Stanley Black & Decker, Inc. (NYSE:SWK) reported fourth-quarter 2025 financial results on Wednesday.

Net sales in the quarter were $3.684 billion, below analyst estimates of $3.780 billion, representing a 3% organic decline.

Gross margin rose to 33.2% in the fourth quarter, an increase of 240 basis points. Adjusted EPS was $1.41, exceeding the $1.28 estimate, while GAAP EPS was $1.04.

These results reflect effective cost management, pricing strategies, and successful supply chain mitigation.

The Tools & Outdoor segment saw a 2% sales decline, primarily due to weaker North American retail demand. However, adjusted gross margin expanded by 340 basis points to 13.6%, mainly due to tariff mitigation and supply chain cost reductions.

The Engineered Fastening segment reported a 6% sales increase, driven by strong aerospace and automotive demand, along with a 140 basis-point margin improvement.

Cash generation remained strong, with the quarter’s operating cash flow at $956 million and free cash flow at $883 million.

The company agreed to divest its Consolidated Aerospace Manufacturing (CAM) business for $1.8 billion in cash. Net proceeds of $1.525 billion to $1.6 billion, after taxes and fees, will be used to reduce debt and strengthen the balance sheet.

Stanley Black & Decker’s Global Cost Reduction Program has generated $2.1 billion in pre-tax run-rate savings since inception, supporting operational efficiency and margin expansion.

Outlook

Stanley Black & Decker expects 2026 adjusted EPS to range from $4.90 to $5.70, compared to the $5.66 estimate.

GAAP EPS for 2026 is projected at $3.15 to $4.35, below the $5.58 estimate.

SWK Price Action: Stanley Black & Decker shares were up 0.05% at $81.00 at the time of publication on Wednesday, according to Benzinga Pro data.

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