Financial Data and Key Metrics Changes - Third quarter sales reached $1,190.8 million, up 3.8% from $1,147 million last year, with organic sales increasing by 3% [5][27] - Operating income margin was 23.4%, including a 190 basis point benefit from a legal settlement, while excluding this, it was 21.5%, down 50 basis points year-over-year [6][30] - Earnings per share (EPS) was $5.02, the highest ever for a third quarter, compared to $4.71 excluding the one-time legal benefit [6][31] Business Line Data and Key Metrics Changes - CNI Group sales were $367.7 million, reflecting a slight organic sales decrease of 0.8%, primarily due to reductions in the Asia-Pacific business [12][32] - Tools Group sales increased to $506 million, with a 1% organic gain, driven by new product introductions and higher sales in the U.S. [16][34] - RS&I Group sales rose to $464.8 million, with an organic increase of 8.9%, supported by strong performance in diagnostics and repair information products [22][36] Market Data and Key Metrics Changes - The automotive repair market showed favorable conditions, with increased complexity in vehicle repairs and a growing need for maintenance as vehicles age [7][8] - Spending on repairs increased in double digits, indicating a robust market environment for automotive repair services [8][9] - The industrial sector saw mixed results, with gains in critical industries offset by weakness in Asia-Pacific export activities [27][32] Company Strategy and Development Direction - The company is focusing on leveraging its manufacturing flexibility and short supply chains to capitalize on market opportunities and challenges [9][10] - There is a strategic pivot towards faster payback products, which is gaining traction in the current economic environment [9][22] - The company aims to maintain its competitive advantage through innovation and strong customer connections, particularly in the RS&I segment [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of their markets and the company's ability to navigate through economic uncertainties [4][43] - The outlook for the fourth quarter remains positive, with expectations of continued strong performance driven by strategic initiatives and market demand [42][44] - The company anticipates that its advantages in strategy, structure, and product offerings will lead to stronger performance in 2025 and beyond [45][46] Other Important Information - The company celebrated its 105th anniversary with a successful Franchisee Conference, which saw increased orders and positive feedback from franchisees [17][18] - The legal settlement provided a significant one-time benefit, impacting operating earnings and margins positively [30][31] Q&A Session Summary Question: Consistency in RS&I diagnostics and repair systems growth - Management noted improved product launches and consistent performance across the line, indicating a positive trend in diagnostics [49][50] Question: Stability in undercar sales - Undercar sales appeared to stabilize, contributing less negatively to RS&I's performance compared to previous quarters [51][52] Question: European tools market performance - The European market is showing uncertainty similar to the U.S., with transactional business remaining flat but opportunities in project-based work [53][54] Question: Impact of capacity investments on sequential volume - Capacity increases over the past two years have helped match volume fluctuations, contributing to sequential improvements [56][57] Question: Performance breakdown of tools segment - Diagnostics performed well, while hand tools and tool storage faced challenges, with power tools showing improvement towards the end of the quarter [66]

Financial Data and Key Metrics Changes - Third quarter sales reached $1,190.8 million, an increase of 3.8% from $1,147 million last year, with organic sales up 3% [7][41] - Operating income margin was 23.4%, including a 190 basis point benefit from a legal settlement, while the adjusted margin was 21.5%, down 50 basis points year-over-year [8][40] - Earnings per share (EPS) was $5.02, or $4.71 excluding the one-time legal benefit, marking the highest EPS for a third quarter [8][45] Business Line Data and Key Metrics Changes - **C and I Group**: Sales were $367.7 million, reflecting an organic sales decrease of 0.8%, with operating margin at 15.6%, down 110 basis points year-over-year [17][48] - **Tools Group**: Sales were $506 million, with a 1% organic gain and operating margin of 21.7%, up 10 basis points from last year [22][49] - **RS and I Group**: Sales increased to $464.8 million, with an organic growth of 8.9% and operating margin at 30.4%, including a legal benefit [33][52] Market Data and Key Metrics Changes - The automotive repair market showed continued strength, with spending on repairs up double digits and an aging vehicle fleet averaging nearly 12.8 years [10][11] - The critical industries segment demonstrated growth despite geopolitical uncertainties, with increasing order activity noted [15][16] Company Strategy and Development Direction - The company is focusing on faster payback items and innovative products to adapt to market challenges, leveraging its flexible manufacturing capabilities [5][13] - The strategy includes enhancing customer connections and expanding product offerings to meet the evolving needs of repair shop owners and managers [14][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of markets and the company's ability to navigate challenges, citing strong performance despite economic headwinds [5][61] - The outlook remains positive, with expectations for continued growth driven by strategic advantages and a robust product pipeline [65][66] Other Important Information - The company celebrated its 105th anniversary with a successful franchisee conference, which saw increased orders and positive feedback from franchisees [24][26] - The effective income tax rate for the third quarter was 22.6%, with expectations for a similar rate in the upcoming quarters [45][59] Q&A Session Summary Question: Consistency in RS and I growth - Management noted improved product launches and consistent performance across the line, indicating a positive trend in diagnostics and repair systems [70][71] Question: OEM share accrual and undercar stabilization - OEM business is gaining share, while undercar sales showed signs of stabilization, contributing to overall growth [73][75] Question: Sequential volume strength and capacity investments - Capacity increases over the past years have helped match volume fluctuations, but the sequential improvement was primarily due to effective product pivots rather than SFC orders [81][82] Question: Organic growth in Snap-on Tools - The organic growth of 1% in Snap-on Tools was attributed to a mix of promotions and product performance, with margins remaining stable [86][89] Question: Off-truck sales comparison - Off-truck sales were slightly lower than on-truck sales, but within the normal variability range, indicating no major concerns [90][92]

Consolidated Results - Net sales reached $1,190.8 million, a 3.8% increase from $1,147.0 million in Q3 2024[10] - Organic sales increased by $34.8 million, representing a 3.0% gain[10] - Currency translation favorably impacted net sales by $9.0 million, contributing 0.8%[10] - Operating earnings before financial services increased by 10.3%, reaching $278.5 million compared to $252.4 million in Q3 2024, representing 23.4% of net sales versus 22.0% last year[10] - Diluted EPS increased by 6.8%, from $4.70 to $5.02[10] Segment Performance - Commercial & Industrial segment sales increased by 0.5% to $367.7 million, with organic sales decreasing by 0.8% or $2.8 million[11] - Snap-on Tools segment sales increased by 1.1% to $506.0 million, with organic sales up by 1.0% or $4.9 million[12] - Repair Systems & Information segment sales increased by 10.0% to $464.8 million, with organic sales up by 8.9% or $38.1 million[13] - Financial Services revenue increased by 0.7% to $101.1 million, while operating earnings decreased by 3.9%[14] Financial Position - Gross finance portfolio totaled $2,534.4 million as of Q3 2025[15] - Free cash flow was $256.7 million for the quarter[16]

Core Insights - Snap-On (SNA) reported quarterly earnings of $4.71 per share, exceeding the Zacks Consensus Estimate of $4.59 per share, and showing a slight increase from $4.70 per share a year ago, resulting in an earnings surprise of +2.61% [1] - The company achieved revenues of $1.19 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.49% and up from $1.15 billion year-over-year [2] - Snap-On has outperformed consensus EPS estimates three times in the last four quarters and has also topped revenue estimates three times during the same period [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $4.83 on revenues of $1.22 billion, while the estimate for the current fiscal year is $18.69 on revenues of $4.69 billion [7] - The company's earnings outlook will be influenced by management's commentary during the earnings call, which is crucial for understanding future stock performance [3][4] Stock Performance - Snap-On shares have declined approximately 2% since the beginning of the year, contrasting with the S&P 500's gain of 13.4% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating it is expected to perform in line with the market in the near future [6] Industry Context - The Tools - Handheld industry, to which Snap-On belongs, is currently ranked in the top 39% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Snap-on reported strong Q3 2025 results, with increased sales and EPS, boosted by a legal settlement, and the CEO highlighted strategic advantages and growth opportunities [Third Quarter 2025 Financial Highlights](index=1&type=section&id=Third%20Quarter%202025%20Financial%20Highlights) Snap-on reported increased sales and diluted EPS for Q3 2025, with a significant benefit from a legal settlement contributing to improved operating earnings and net earnings compared to the prior year Key Financial Metrics | Metric | Q3 2025 | Q3 2024 | Change (%) | | :----------------------------------- | :------ | :------ | :--------- | | Net Sales | $1,190.8M | $1,147.0M | +3.8% | | Organic Sales | N/A | N/A | +3.0% | | Gross Margin | 50.9% | N/A | N/A | | Diluted EPS | $5.02 | $4.70 | +6.8% | | Diluted EPS (incl. legal settlement) | $5.02 (+$0.31) | N/A | N/A | | Operating Earnings before Financial Services | $278.5M | $252.4M | +10.3% | | Operating Earnings before Financial Services (% of sales) | 23.4% | 22.0% | +1.4 pp | | Consolidated Operating Earnings | $347.4M | $324.1M | +7.2% | | Consolidated Operating Earnings (% of revenues) | 26.9% | 26.0% | +0.9 pp | | Net Earnings | $265.4M | $251.1M | +5.7% | | Effective Income Tax Rate | 22.6% | 22.9% | -0.3 pp | [CEO Commentary](index=2&type=section&id=CEO%20Commentary) CEO Nick Pinchuk highlighted encouraging Q3 results, attributing success to sales growth, resilient gross margins, strong profitability, and strategic advantages like localized manufacturing and flexible plant structure - The third quarter was encouraging, demonstrating continuing momentum in meeting and overcoming considerable uncertainty and trade turbulence, evidenced by overall sales growth, resilient gross margins, and strong profitability[5](index=5&type=chunk) - Success is enabled by distinct advantages in strategy (making in markets where sold) and structure (utilizing flexibility of **15 U.S. and 36 worldwide plants**)[5](index=5&type=chunk) - The company is maintaining actions to match vehicle technicians' preference for quick payback items and extending profitable penetration of critical industries, alongside robust expansion with OEM dealerships and independent shops, fortified by software portfolio gains[5](index=5&type=chunk) [Segment Results](index=2&type=section&id=Segment%20Results) This section details the financial performance of Snap-on's Commercial & Industrial, Snap-on Tools, Repair Systems & Information, and Financial Services segments [Commercial & Industrial Group](index=2&type=section&id=Commercial%20%26%20Industrial%20Group) The Commercial & Industrial Group saw a slight sales increase due to favorable foreign currency translation, despite an organic sales decline primarily in Asia Pacific, offset by growth in critical industries and specialty torque Commercial & Industrial Group Performance | Metric | Q3 2025 | Q3 2024 | Change | | :---------------- | :------ | :------ | :----- | | Segment Sales | $367.7M | $365.7M | +$2.0M | | Organic Sales | N/A | N/A | -0.8% | | Operating Earnings | $57.5M | $61.0M | -$3.5M | | Operating Margin | 15.6% | 16.7% | -1.1 pp | - Organic sales decline primarily due to reductions in the segment's Asia Pacific business, partially offset by higher activity with customers in critical industries and in the specialty torque operation[6](index=6&type=chunk) [Snap-on Tools Group](index=2&type=section&id=Snap-on%20Tools%20Group) The Snap-on Tools Group reported increased sales driven by organic growth in international operations and slightly higher U.S. sales, along with favorable foreign currency translation Snap-on Tools Group Performance | Metric | Q3 2025 | Q3 2024 | Change | | :---------------- | :------ | :------ | :----- | | Segment Sales | $506.0M | $500.5M | +$5.5M | | Organic Sales | N/A | N/A | +1.0% | | Operating Earnings | $109.9M | $108.3M | +$1.6M | | Operating Margin | 21.7% | 21.6% | +0.1 pp | - Organic sales gain is due to increased activity in the segment's international operations and slightly higher sales in the U.S. business[8](index=8&type=chunk) [Repair Systems & Information Group](index=2&type=section&id=Repair%20Systems%20%26%20Information%20Group) The Repair Systems & Information Group experienced significant sales and operating earnings growth, largely due to an **8.9% organic sales increase** from higher activity with OEM dealerships and diagnostic/repair information products, and a substantial benefit from a legal settlement Repair Systems & Information Group Performance | Metric | Q3 2025 | Q3 2024 | Change | | :---------------- | :------ | :------ | :----- | | Segment Sales | $464.8M | $422.7M | +$42.1M | | Organic Sales | N/A | N/A | +8.9% | | Operating Earnings | $141.2M | $107.3M | +$33.9M | | Operating Margin | 30.4% | 25.4% | +5.0 pp | - Organic gain includes higher activity with OEM dealerships and increased sales of diagnostic and repair information products to independent repair shop owners and managers, partially offset by lower volumes of undercar equipment[9](index=9&type=chunk) - Operating earnings for the period include a benefit of **$22.0 million** from a legal settlement[10](index=10&type=chunk) [Financial Services](index=3&type=section&id=Financial%20Services) Financial Services reported a slight increase in revenue but a decrease in operating earnings, with originations declining by **4.8%** compared to the prior year Financial Services Performance | Metric | Q3 2025 | Q3 2024 | Change | | :---------------- | :------ | :------ | :----- | | Revenue | $101.1M | $100.4M | +$0.7M | | Operating Earnings | $68.9M | $71.7M | -$2.8M | | Originations | $274.1M | $288.0M | -$13.9M (-4.8%) | - Corporate expenses in the third quarter were **$30.1 million**, compared to **$24.2 million** last year[11](index=11&type=chunk) [Company Outlook & Guidance](index=3&type=section&id=Company%20Outlook%20%26%20Guidance) Snap-on anticipates continued progress in its growth strategies, leveraging automotive repair expertise and expanding into adjacent markets and critical industries, projecting capital expenditures of approximately **$100 million** for 2025 and a full-year effective income tax rate of **22% to 23%** - Snap-on expects ongoing progress along its decisive runways for coherent growth, leveraging capabilities in automotive repair and expanding its professional customer base in adjacent markets, additional geographies, and critical industries[12](index=12&type=chunk) - Projected capital expenditures for full-year 2025 will approximate **$100 million**, with **$62.5 million** incurred in the first nine months[12](index=12&type=chunk) - The full-year 2025 effective income tax rate is anticipated to be in the range of **22% to 23%**[13](index=13&type=chunk) [Additional Information](index=3&type=section&id=Additional%20Information) This section provides details on the conference call, non-GAAP measures, company overview, forward-looking statements, and contact information [Conference Call and Webcast](index=3&type=section&id=Conference%20Call%20and%20Webcast) Snap-on scheduled a webcast and conference call for October 16, 2025, at 9:00 a.m. Central Time to discuss the earnings release, with replay and slide presentation access available online - A discussion of this release will be webcast on **Thursday, October 16, 2025**, at **9:00 a.m. Central Time**[14](index=14&type=chunk) - Access to the webcast and accompanying slide presentation is available via the Snap-on investor relations website[14](index=14&type=chunk) [Non-GAAP Measures Definition](index=3&type=section&id=Non-GAAP%20Measures%20Definition) This section defines "organic sales" as a non-GAAP measure, explaining it excludes acquisition-related sales and foreign currency translation impacts to provide insight into underlying business growth from existing operations - Organic sales refer to sales from continuing operations, adjusted to exclude acquisition-related sales and the impact of foreign currency translation[15](index=15&type=chunk) - Management uses organic sales growth to evaluate sales performance, reflecting growth from existing businesses due to increased output, expanded customer base, geographic expansion, new product development, and pricing changes[15](index=15&type=chunk) - This non-GAAP measure is considered meaningful to investors as it aids in identifying underlying growth trends and facilitates comparisons with prior periods[15](index=15&type=chunk) [About Snap-on](index=4&type=section&id=About%20Snap-on) Snap-on Incorporated is a global innovator, manufacturer, and marketer of tools, equipment, diagnostics, and repair solutions for professional users across various critical tasks - Snap-on is a leading global innovator, manufacturer, and marketer of tools, equipment, diagnostics, repair information, and systems solutions for professional users performing critical tasks[16](index=16&type=chunk) - Products and services are sold through franchisee vans, direct, and distributor channels under various brands[16](index=16&type=chunk) - The company generated sales of **$4.7 billion** in 2024 and is headquartered in Kenosha, Wisconsin[16](index=

KENOSHA, Wis.--(BUSINESS WIRE)--Snap-on announces 2025 third quarter results. ...

Core Viewpoint - Analysts project Snap-On (SNA) will report quarterly earnings of $4.59 per share, reflecting a 2.3% decline year over year, with revenues expected to reach $1.15 billion, a 0.3% increase from the same quarter last year [1]. Earnings Estimates - The consensus EPS estimate has been revised upward by 0.3% in the past 30 days, indicating a reassessment by covering analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate revisions and short-term stock performance [3]. Key Metrics Projections - Analysts estimate 'Net Sales- Financial Services Revenue' at $101.14 million, a 0.7% increase year over year [5]. - 'Net Sales- Repair Systems & Information Group' is forecasted to reach $446.71 million, suggesting a 5.7% year-over-year increase [5]. - 'Net Sales- Snap-on Tools Group' is expected to be $492.00 million, indicating a 1.7% decline from the previous year [5]. - 'Net Sales- Commercial & Industrial Group' is projected at $355.43 million, reflecting a 2.8% decrease year over year [6]. Operating Earnings Estimates - The consensus for 'Operating earnings / (losses)- Financial services' is $69.48 million, down from $71.70 million reported in the same quarter last year [6]. - 'Operating earnings / (losses)- Commercial & Industrial Group' is expected to be $55.64 million, compared to $61.00 million in the previous year [7]. - 'Operating earnings / (losses)- Snap-on Tools Group' is projected at $105.52 million, down from $108.30 million reported last year [7]. - 'Operating earnings / (losses)- Repair Systems & Information Group' is estimated at $110.49 million, up from $107.30 million in the same quarter last year [8]. Stock Performance - Snap-On shares have returned -1.9% over the past month, contrasting with the Zacks S&P 500 composite's +0.4% change, and the company holds a Zacks Rank 3 (Hold), indicating expected performance in line with the overall market [8].

Core Insights - Snap-on Incorporated (SNA) is expected to report a decline in earnings for Q3 2025, with a revenue estimate of $1.16 billion, reflecting a 0.8% increase year-over-year, while earnings per share are projected to decline by 2.6% to $4.58 [1][10] Financial Performance - The consensus estimate for quarterly earnings has remained unchanged at $4.58 per share over the past 30 days, indicating a decline from the previous year [1] - Snap-on has a negative trailing four-quarter earnings surprise of 0.2% on average, but achieved a positive earnings surprise of 2.4% in the last reported quarter [2] Business Strategy and Growth Factors - The company is enhancing its business model through initiatives focused on safety, service quality, customer satisfaction, and innovation [3] - Snap-on's strategic growth agenda includes expanding its franchise network, strengthening relationships with repair shop owners, and increasing its presence in emerging markets [3] - The focus on Rapid Continuous Improvement aims to boost efficiency, control costs, and enhance organizational performance [4] Market Dynamics - Management remains optimistic about the auto repair sector, driven by increased household spending on vehicle maintenance, higher repair volumes, and rising technician wages [5] - The Repair Systems & Information Group segment is expected to see a 5% year-over-year revenue growth due to its expanding presence with OEM dealerships and independent garages [6] - The Tools Group segment is showing signs of recovery, with a projected 1% decline in revenues for Q3, supported by improving U.S. demand [7] Challenges and External Factors - Snap-on faces macroeconomic headwinds, including geopolitical tensions and economic disruptions in Europe and Asia, particularly China, which are expected to impact performance [10][11] - The company is dealing with persistent cost inflation from rising raw material and operational expenses, which poses risks to profitability [9][10] Valuation and Market Position - Snap-on's stock is trading at a forward 12-month price-to-earnings ratio of 17.15X, which is below its five-year high and near the industry average, indicating an attractive investment opportunity [13] - Over the past three months, Snap-on shares have gained 4.5%, compared to the industry's 5.9% growth [15]

Group 1 - The plaintiff in the case against Allstate Insurance Company claims insufficient payment for damages from a windstorm at a property in Denver [3] - Colorado Pavement Solutions LLC is seeking $11,641 for work completed on a project in Denver [3] - Adams County School District No. 1 alleges $1 million in costs due to poor construction work by The Neenan Company on its Arts Center [4] Group 2 - Straphanger LLC is pursuing a mechanic's lien foreclosure for $172,693 in unpaid work related to the Buckhead Meat Project in Aurora [4] - Multiple plaintiffs are accusing various insurance companies of inadequate payments for damages caused by hailstorms and other incidents in Aurora and surrounding areas [5][6][10][19] Group 3 - J&F Construction LLC is filing a mechanic's lien foreclosure for $123,327 due to unpaid work in Englewood [8] - MPM CO LLC is also pursuing a mechanic's lien foreclosure for $421,364 in unpaid work at a property in Aurora [8] - HRS Colorado LLC claims $61,558 for restoration work in Aurora [9] Group 4 - The case against State Farm Fire & Casualty Company involves claims of insufficient payment for damages from a burst pipe in Aurora [6] - The plaintiffs in the case against Snap-on Incorporated allege that defective batteries caused property damage in Englewood [11] - The plaintiffs in the case against American Family Mutual Insurance Company claim inadequate payment for damages from a hailstorm in Lone Tree [22]

Company Overview - Snap-on Incorporated (SNA) has a market cap of $17.8 billion and is a global leader in manufacturing and marketing tools, equipment, diagnostics, repair information, and systems solutions for professional users across various industries [1] Upcoming Earnings - Snap-on is expected to announce its fiscal Q3 2025 results on October 16, with analysts predicting an EPS of $4.58, a decrease of 2.6% from $4.70 in the same quarter last year [2] - For fiscal 2025, analysts forecast an EPS of $18.67, down 2.7% from $19.19 in fiscal 2024, but anticipate a growth of 7.7% year-over-year to $20.11 in fiscal 2026 [3] Stock Performance - Over the past 52 weeks, Snap-on shares have returned 18.1%, outperforming the S&P 500 Index's gain of 15.6% and the Industrial Select Sector SPDR Fund's rise of 13.3% [4] Recent Financial Results - On July 17, Snap-on shares rose 7.9% after reporting a stronger-than-expected Q2 2025 EPS of $4.72, with revenue of $1.2 billion, driven by a 2% increase in the Tools Group and a 3% rise in the Repair Systems & Information Group [5] Analyst Ratings - The consensus view on Snap-on stock is moderately optimistic, with a "Moderate Buy" rating overall. Among 11 analysts, three suggest a "Strong Buy," one a "Moderate Buy," six recommend a "Hold," and one has a "Moderate Sell" [6] - The average analyst price target for Snap-on is $353.14, indicating a potential upside of 3.3% from current levels [6]