China GDP grows 5% in Q1, beats expectations on exports, spending strength
Investing.com -- Stanley Black & Decker Inc (NYSE:SWK) reported better-than-expected first quarter earnings on Wednesday, but shares fell 2.35% as the company warned of tariff impacts on its 2025 outlook.
The tools and outdoor equipment maker posted adjusted earnings per share of $0.75, beating analyst estimates of $0.66. Revenue came in at $3.7 billion, slightly below the consensus of $3.71 billion but up 1% organically YoY.
Gross margin expanded 140 basis points to 30.4% on an adjusted basis, driven by supply chain efficiencies and new product launches. However, the company faces headwinds from freight inflation and tariffs.
In response to U.S. tariff policies, Stanley Black & Decker implemented a high single-digit price increase in April and plans another hike for the third quarter. The company estimates 2025 EPS will take a $0.75 hit from tariffs, even after mitigation efforts.
"We are accelerating adjustments to our supply chain and exploring all options as we seek to minimize the impact of tariffs on end users while balancing the need to protect our business," said CEO Donald Allan, Jr.
For 2025, the company projects adjusted EPS of approximately $4.50 and is targeting free cash flow of at least $500 million. Management will provide more details on its outlook and scenario planning during the earnings call.
The stock’s decline suggests investors remain concerned about tariff pressures despite the earnings beat. Stanley Black & Decker aims to leverage its North American manufacturing footprint as a competitive advantage in navigating the challenging trade environment.