Stanley Black & Decker’s first quarter results exceeded Wall Street’s revenue and adjusted earnings expectations, yet the market responded negatively, reflecting ongoing concerns about profitability and margin trends. Management highlighted that a well-executed outdoor products preseason and strong performance in Engineered Fastening drove the quarter’s top-line results, while persistent volume pressure in North America and cost inflation impacted operating margins. CEO Chris Nelson called out “lower retail activity in North America” as a key headwind, alongside disciplined promotional strategies and early success in professional channels.
Is now the time to buy SWK? Find out in our full research report (it’s free for active Edge members).
Stanley Black & Decker (SWK) Q1 CY2026 Highlights:
- Revenue: $3.85 billion vs analyst estimates of $3.75 billion (2.7% year-on-year growth, 2.7% beat)
- Adjusted EPS: $0.80 vs analyst estimates of $0.59 (34.6% beat)
- Adjusted EBITDA: $354.7 million vs analyst estimates of $334.1 million (9.2% margin, 6.2% beat)
- Management reiterated its full-year Adjusted EPS guidance of $5.30 at the midpoint
- Operating Margin: 7.1%, in line with the same quarter last year
- Organic Revenue was flat year on year (beat)
- Market Capitalization: $12.04 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Stanley Black & Decker’s Q1 Earnings Call
- Nigel Coe (Wolfe Research) asked about the drivers of gross margin improvement between the first and second halves of the year. CFO Patrick Hallinan explained that productivity initiatives, fixed cost adjustments, and tariff mitigation are the primary levers, with gross margin already visible in the balance sheet barring major inflation surprises.
- Julian Mitchell (Barclays) pressed for more detail on Tools & Outdoor volume trends and pricing dynamics. CEO Chris Nelson noted that underlying demand remains stable and that promotional adjustments are expected to drive an inflection in volume in the second and third quarters.
- Timothy Wojs (Baird) questioned the impact of competitor price actions on Stanley Black & Decker’s pricing strategy. Nelson said the competitive landscape now reflects a more “even playing field,” and that the company’s SKU-level tracking of promotions is performing as planned.
- Richard Reid (Wells Fargo) inquired about progress on USMCA and China tariff mitigation. Nelson indicated the company is ahead of schedule on USMCA qualification and on track to reduce China-sourced U.S. sales below 5% by year-end.
- Brett Linzey (Mizuho) asked about the replacement cycle for battery-powered tools and new product innovation. Nelson clarified that replacement cycles are shorter for professionals due to higher usage, and highlighted ongoing investment in DEWALT’s battery platforms and product ecosystem.
Catalysts in Upcoming Quarters
Going forward, the StockStory team will be watching (1) the pace and sustainability of margin expansion as tariff mitigation and cost control initiatives take effect, (2) the impact of new product launches and brand refreshes on organic growth in the Tools & Outdoor segment, and (3) the company’s ability to offset input cost inflation while maintaining competitive pricing and market share. Progress on the CRAFTSMAN relaunch and execution in international markets will also be key indicators.
Stanley Black & Decker currently trades at $77.44, down from $78.33 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
Our Favorite Stocks Right Now
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week - FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
