Snap-On Tools Segment Drives Growth While Margins Tighten In Q2 Beat

Snap-On Inc. (NYSE:SNA) reported better-than-expected second-quarter 2025 results, surpassing both revenue and earnings consensus estimates.

Here's a breakdown of the report:

• Quarterly net sales reached $1.179 billion flat year-over-year increase and above the consensus estimate of $1.16 billion.
• Sales reflected a $8.6 million, or 0.7%, organic decline, which was counterbalanced by an $8.6 million gain from favorable foreign currency translation.
• The gross margin contracted by 15 bps to 50.5%, and gross profit fell 0.30% year over year to $595.5 million.
• Financial services revenue rose to $101.7 million (+1.2% YoY), with operating earnings at $68.2 million, up from $70.2 million, respectively, in 2024.
• Consolidated operating earnings for the quarter were $327.3 million, or 25.5% of revenues, down from $350.5 million, or 27.4%, in 2024.
• EPS for the quarter was $4.72, down from $5.07 YoY, above the consensus of $4.67.
• Operating cash flow for the quarter totaled $ 237.2 million, compared to $ 301.1 million a year ago, with $1.458 billion in cash and equivalents at the quarter's end.

Snap-on CEO Nick Pinchuk noted that the sales growth in the U.S. Tools Group, along with “solid operating earnings performance,” was achieved despite the headwinds of “general uncertainty and trade turbulence.”

Also Read: Chart Industries And Flowserve Announce $19 Billion Merger, Eyes $300 Million In Synergies

Sales by segments:

• Commercial & Industrial $347.8 million (-7.6% YoY), Operating earnings were $46.9 million, with a margin of 13.5%, down from 16.7% last year.
• Snap-on Tools $491 million (+1.6% YoY), driven by U.S. sales growth. Operating earnings were $116.7 million, with a stable margin of 23.8%.
• Repair Systems & Information $468.6 million (+2.3% YoY), driven by higher OEM dealership activity and increased sales of diagnostic products. Operating earnings were $119.8 million, with a margin of 25.6%, up from 25.0% last year.

Outlook 2025: Snap-on expects continued growth in 2025, expanding its professional customer base in automotive repair and adjacent markets, with projected capital expenditures of $100 million.

The company anticipates a full-year 2025 effective income tax rate between 22% and 23%.

Price Action: Snap-on shares are trading higher by 2.87% at $322 premarket at the last check on Thursday.

Read Next:

• Delta Air Lines To Pay $8.1 Million To Settle DOJ Probe Over Alleged Misuse Of Pandemic Relief Funds

Image: Shutterstock