in power

Stanley, Black & Decker (SWK) reported, on July 29, its Q2 2026 financial results, showing net sales of $4.0 billion. One year ago, the company reported its Q2 2025 revenues of $3.9 billion, which was down 2% versus the prior year. The majority of the Q2 2026 sales volume, roughly $3,654,000 or about 90%, comes from the Tools & Outdoor division, including outdoor power equipment under the Dewalt and Craftsman brands along with power tools and hand tools under the same brands plus Stanley tools. The remaining 10% belongs to the company Engineered Fastening division.

The company attributed a 3% growth in sales volume to a strong U.S. retail market as well as strength in the commercial and industrial channel. Two factors offset the manufacturer’s sales gains. The company divested an aerospace manufacturing company. And, as previously reported, Stanley’s transition to a licensing model for the gas walk-behind outdoor products cost the company about 1% compared to previous year.

NOTE: In Power will report further on this licensing arrangement for gas walk-behind mowers branded as Craftsman, but we believe these are now manufactured by MTD, which Stanley acquired in 2021. Licensing the manufacturing to yourself is a financial business play that we don’t immediately understand.

Tools & Outdoor

Stanley reported its North America sales were up 3% while Europe was flat and the Rest of World was up 8%. The Tools & Outdoor segment margin was 10.9%, up 400 basis points year over year, which the company said reflected net productivity gains and favorable product mix. Outdoor organic revenue decreased 7%, pressured by fewer replenishment orders as a result of weather-related demand softness.

Net tariff refunds raised segment margin by approximately 150 basis points. On the earnings call, Patrick Hallinan, EVP, CFO, and chief administrative officer, said, “The bottom line is this: tariff refunds provide us with the flexibility to accelerate investment in our strategic growth priorities, and we have already started making such investments in the Q2.

These tariff refunds are not the end of that story. The Trump administration implemented new Section 301 tariffs recently and the company expects its tariff costs to return back to the prior IEEPA levels within a few months. Stanley also mentioned the impact of inflationary pressures from battery metals, tungsten, oil, and oil derivatives which is likely to require price increases in 2027.

Also from the call, President and CEO Chris Nelson said, “Our ambition for Dewalt is to be the partner of choice for the professional end user. This means serving the full cycle of design, construction, and operations for large-scale commercial projects. This is more than a statement or an aspiration. It is the direction that has been guiding our investments to drive demand with the professional, including strong penetration within the U.S. commercial and industrial channel.”

This “commercial and industrial channel” is more power tool than power equipment and reflects the strong construction market in North America. Companies such as United Rental and Caterpillar are also benefitting from a construction boom, often attributed to infrastructure spending as well as building of data centers.

Looking ahead, Hallinan said, “Tools and Outdoor is still expected to deliver low single-digit organic growth in 2026, led by market share gains in what we anticipate will be a roughly flat to down market. Through the remainder of 2026, we expect our demand generation initiatives, new product launches, and strategic investments in the brands will position us to grow the top line with a focus on outperforming the market.”