Stanley Black Decker 2025 Q2 Earnings Strong Turnaround as Net Income Surges Over 1000%

Stanley Black & Decker (SWK) reported its fiscal 2025 Q2 earnings on Jul 29th, 2025. Stanley Black & Decker surpassed expectations with an adjusted EPS of $1.08, significantly beating analyst estimates. The company’s guidance for full-year 2025 EPS stands at $3.45 on a GAAP basis, and approximately $4.65 on an adjusted basis, showcasing improved earnings forecasts. The company also anticipates annual free cash flow to approximate $600 million, indicating a solid financial strategy moving forward.

Revenue

In 2025 Q2, Stanley Black & Decker's revenue declined by 2% to $3.95 billion from $4.02 billion in the same quarter of 2024. The Tools & Outdoor segment contributed $3.46 billion, while Engineered Fastening generated $483.80 million in revenue. Overall, the total revenue was $3.95 billion, reflecting the challenges faced in this period.

Earnings/Net Income

Stanley Black & Decker returned to profitability with an EPS of $0.67 in 2025 Q2, reversing a loss of $0.07 per share in 2024 Q2, marking a 1057.1% positive change. The net income was $101.90 million, a significant turnaround from the net loss of $11.20 million in 2024 Q2, representing a 1009.8% positive swing. This EPS reflects a strong recovery from the previous year's performance.

Price Action

The stock price of Stanley Black & Decker has edged up 0.57% during the latest trading day, has dropped 5.76% during the most recent full trading week, and has edged up 1.51% month-to-date.

Post-Earnings Price Action Review

The strategy of investing in the Schwab U.S. Broad Market ETF (SWK) following an earnings beat and selling after 30 days led to substantial losses. The strategy's compound annual growth rate (CAGR) was -14.21%, with a total return of -53.32% and an excess return of -140.67%. Although the maximum drawdown was 0.00%, the Sharpe ratio of -0.41 highlights the high risk and negative return relative to the benchmark. Overall, the strategy's performance indicates a lack of effectiveness in navigating post-earnings volatility.

CEO Commentary

Donald Allan, CEO, expressed gratitude for the support received during his tenure, highlighting significant advancements since 2022 in stabilizing and simplifying the organization. He emphasized improvements in cost structures and focus on core strengths in the Tools & Outdoor and Engineered Fastening segments. Allan highlighted the resilience of the DEWALT brand amidst challenging conditions, particularly in managing tariff impacts and maintaining profitability. He conveyed confidence in future growth under Chris Nelson’s leadership, reinforcing a commitment to operational excellence and innovation.

Guidance

For 2025, Stanley Black & Decker anticipates slight revenue retraction compared to 2024, with adjusted EPS forecasted at approximately $4.65. The Tools & Outdoor segment is expected to see a 1% decline in organic revenue, while Engineered Fastening anticipates 1% organic growth. The company targets $500 million in cost savings from supply chain transformation and aims for adjusted gross margins to expand year-over-year in both the third and fourth quarters.

Additional News

Stanley Black & Decker announced a leadership transition plan with Christopher Nelson becoming President and CEO effective October 1, 2025. Donald Allan, Jr. will transition to Executive Chair of the Board, marking a significant change in the leadership structure. Additionally, Maria Ford, President of U.S. Commercial & Industrial Sales at DEWALT, was appointed to the Forbes Business Development Council, showcasing her industry expertise. The company also announced a quarterly dividend increase of $0.01, bringing the new dividend to $0.83 per common share, reflecting its commitment to shareholder value.