The Toro 2025 Q3 Earnings Misses Targets as Net Income Plummets 55.2%

The Toro (TTC) reported its fiscal 2025 Q3 earnings on September 4, 2025. The company’s results fell below expectations, with total revenue declining and profitability contracting sharply. The earnings report underscored a mixed operating environment and downward guidance for the full year.

The Toro (TTC) reported its fiscal 2025 Q3 earnings on September 4, 2025. The company’s results fell below expectations, with total revenue declining and profitability contracting sharply. The earnings report underscored a mixed operating environment and downward guidance for the full year.

Revenue
The Toro’s total revenue declined by 2.2% to $1.13 billion in fiscal 2025 Q3, compared to $1.16 billion in the same period the prior year. The professional segment remained the company’s largest revenue contributor, generating $930.80 million, driven by strong demand in underground construction and golf and grounds solutions. In contrast, the residential segment saw a notable decline, posting revenue of $192.80 million, reflecting ongoing consumer caution and market pressures. The “Other” category contributed a modest $7.70 million, rounding out the company’s total revenue.

Earnings/Net Income
The company’s net income dropped to $53.50 million in Q3 2025, representing a 55.2% decline compared to $119.30 million in Q3 2024. Similarly, earnings per share (EPS) fell 53.0% to $0.54, down from $1.15 a year ago. The sharp drop in profitability highlights the continued challenges in the residential segment and the broader market environment. The performance indicates a difficult operating period and a significant deterioration in earnings.

Price Action
Shares of The Toro experienced mixed price action in the immediate aftermath of the earnings report. On the latest trading day, the stock rose 3.55%, but it declined by 2.34% over the most recent full trading week. Month-to-date, the stock has rebounded with an 8.35% gain.

Post Earnings Price Action Review
Richard Olson, CEO & Chairman of The Toro, acknowledged the company’s mixed performance, emphasizing robust demand and margin expansion in the professional segment, especially in underground construction and golf and grounds solutions. At the same time, he noted ongoing challenges in the residential segment, which continues to be impacted by consumer caution and market pressures. The company is working to clear excess channel inventory, which management believes will position the business for a stronger 2026 selling season. Strategic priorities include innovation in alternative power and automation, along with operational excellence and cost control, to drive long-term profitability. The CEO expressed cautious optimism about the company’s long-term prospects, citing the secular growth trends in golf participation and infrastructure investment. However, he remained mindful of the near-term uncertainties that continue to weigh on performance.

Guidance
For fiscal 2025, The Toro expects total company net sales to be at the low end of its guidance range, with total revenue down flat to down 3%. The professional segment is anticipated to see slight growth, while the residential segment is expected to decline by mid-teens. Adjusted diluted EPS is forecast to be approximately $4.15, at the low end of its previous guidance range. The company also expects interest expense of about $60 million, capital expenditures of about $90 million, and a free cash flow conversion rate of approximately 110%. The outlook reflects continued strong demand in underground construction and golf and grounds, while residential margins remain under pressure.

Additional News
There were no major earnings-related announcements, M&A activity, or C-Level changes reported within the three weeks surrounding The Toro’s Q3 2025 earnings release. The company has not issued any dividend or buyback news in this period.