Key Highlights

  • The board raised the quarterly Dividend to $1.72 per share, the 63rd consecutive annual increase, payable October 9, 2026.
  • Second-quarter Revenue was $4.30 billion, up 6.1%, with organic growth of 4.5% and Operating Margin of 26.7%.
  • GAAP diluted EPS was $2.84, up 10.1%, and free Cash Flow was $631 million, up 41% from the prior year.
  • The company raised its 2026 GAAP EPS guidance to $11.35-$11.55 per share, with a midpoint of $11.45.

Overview

Illinois Tool Works Inc. (NYSE:ITW) raised its quarterly dividend 7% to $1.72 per share from $1.61, declared August 7, 2026 and payable October 9 to holders of record on September 30. The dividend yields 2.51%. The company describes the increase as its 63rd consecutive annual dividend increase and announced a new $6 billion share repurchase authorization alongside it.

Dividend Program and Shareholder Returns

The board declared the $1.72 quarterly dividend on August 7, 2026, payable October 9 to shareholders of record on September 30. It trades ex-dividend on September 30. The new rate compares with $1.61 per share previously, and the company stated the increase is 7%.

The company stated that the 63rd consecutive annual dividend increase and the new $6 billion share repurchase authorization reflect the strength of its Business model and its confidence in Long-term Growth and free cash flow generation. Cash dividends paid in the second quarter were $1.61 per share, compared with $1.50 in the prior-year quarter.

About the Company

Illinois Tool Works Inc. is a diversified industrial manufacturer that reports results by segment, including Welding, Test and Measurement and Electronics, and Polymers and Fluids. It reports GAAP Earnings Per Share and issues full-year GAAP EPS and organic growth guidance. Its operating margin reporting includes the contribution of what it calls enterprise initiatives.

Second-Quarter Revenue, Margin and Guidance

Revenue was $4.30 billion, up 6.1%, including a 1.4% contribution from foreign currency translation. Organic growth accelerated to 4.5%. Operating Income was $1.15 billion, up 7.4%, and operating margin was 26.7%, a 40 basis point improvement.

GAAP diluted EPS was $2.84, up 10.1%. The company raised its full-year 2026 GAAP EPS guidance to a range of $11.35 to $11.55, a midpoint of $11.45, up $0.15 from the previous midpoint of $11.30. Organic revenue growth guidance is 3 to 4 percent, with a midpoint of 3.5%.

Segment Growth, Enterprise Initiatives and Cash Flow

Management said results reflected a meaningful acceleration in its capex-related segments, led by double-digit organic growth in Welding and in Test and Measurement and Electronics, alongside strong performance in Polymers and Fluids. Second-quarter organic growth was 13.9% in Welding, 10.0% in Test and Measurement and Electronics, and 7.3% in Polymers and Fluids.

The company stated that enterprise initiatives contributed 120 basis points to operating margin. Operating Cash Flow was $723 million and free cash flow was $631 million, an increase of 41% from the prior year and 77% conversion of net income, according to the company.

Outlook

Organic growth by segment, operating margin, free cash flow, GAAP EPS relative to the $11.35-$11.55 guidance range, share repurchases under the new $6 billion authorization, and the board's annual dividend decisions are the relevant considerations.