$ITW · ILLINOIS TOOL WORKS INC
Illinois Tool Works filed its Q3 2026 10-Q, reporting operating revenue of $4.236B (+4.4% YoY), net income of $855M (+4.1% YoY), and diluted EPS of $3.00 versus $2.81 in the prior-year quarter. Operating margin expanded to 27.8% from 27.4%. For the nine months, revenue reached $12.553B (+5.0% YoY) with net income of $2.438B (+7.1% YoY).
- Q3 revenue $4.236B (+4.4% YoY), net income $855M (+4.1% YoY), diluted EPS $3.00 vs $2.81
- Operating margin reached 27.8% (Q3 2025: 27.4%), with operating income of $1.177B (+5.8% YoY)
- Test & Measurement and Electronics segment revenue surged 17.3% YoY to $819M, operating income jumped 32.8% to $235M
- Nine-month share repurchases totaled $1.312B vs $1.125B in prior year; average diluted shares fell to 285.3M from 291.7M
- Automotive OEM segment revenue declined 1.8% YoY to $814M, operating income fell 9.8% to $163M — the only segment with negative organic growth
Extended-hours trading shows essentially flat reaction at $276.07, unchanged from regular close. For a $78.62B market-cap industrial with steady mid-single-digit growth, the in-line quarter and consistent margin profile offer no surprise catalyst for after-hours movement.
ITW's 27.8% operating margin and aggressive $1.312B buyback pace demonstrate capital discipline, but Automotive OEM weakness is a growing divergence worth monitoring.
ITW's 27.8% operating margin remains among the highest in multi-industry peers, driven by its proprietary 80/20 business model. The Test & Measurement and Electronics segment's 17.3% revenue surge contrasts with the Automotive OEM softness, reflecting the uneven industrial demand environment seen across the sector.
Automotive OEM segment showed organic revenue decline of 1.8% and operating income drop of 9.8% YoY, with margin compression of 170 bps to 20.1%. Interest expense rose to $83M from $75M as debt levels increased (long-term debt $7.153B vs $6.683B at year-end 2025).