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Caution Regarding Forward-Looking Statements:
Statements in this document that are not historical facts, including statements that (i) are in the future tense, (ii) include the words “expects,” “plans,” “targets,” “estimates,” “believes,” “anticipates,” or similar words that reference Snap-on Incorporated (“Snap-on” or “the company”) or its management, (iii) are specifically identified as forward-looking, or (iv) describe Snap‑on’s or management’s future outlook, plans, estimates, objectives or goals, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Snap-on cautions the reader that any forward-looking statements included in this document that are based upon assumptions and estimates were developed by management in good faith and are subject to risks, uncertainties or other factors that could cause (and in some cases have caused) actual results to differ materially from those described in any such statement. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results or regarded as a representation by the company or its management that the projected results will be achieved. For those forward-looking statements, Snap-on cautions the reader that numerous important factors, such as those listed below, as well as those factors discussed in its Annual Report on Form 10-K for the fiscal year ended January 3, 2026 (“2025 year end”), particularly those in Part I, Item 1A: Risk Factors, and those discussed in this document, could affect the company’s actual results and could cause its actual consolidated results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, Snap-on.
Risks and uncertainties include, without limitation:
•Uncertainties related to estimates, assumptions and projections generally;
•The timing and progress with which Snap-on can attain value through its Snap-on Value Creation Processes, including its ability to (i) realize efficiencies and savings from its rapid continuous improvement and other cost reduction initiatives, (ii) improve workforce productivity, (iii) achieve improvements in the company’s manufacturing footprint and greater efficiencies in its supply chain, and (iv) enhance machine maintenance, plant productivity and manufacturing line set-up and change-over practices, any or all of which could result in production inefficiencies, higher costs and/or lost revenues;
•Snap-on’s capability to successfully implement future strategies with respect to its existing businesses, including increasing or optimizing selling, designing, or manufacturing capacity;
•Snap-on’s ability to refine its brand and franchise strategies, retain and attract franchisees, and further enhance service and value to franchisees in order to help improve the sales and profitability of franchisees;
•The company’s ability to introduce successful new products;
•Inflation, interest rate changes and other monetary and market fluctuations;
•Price and supply fluctuations related to raw materials, components and certain purchased finished goods, such as steel, plastics, and electronics;
•The effects of external economic factors, including adverse developments in world financial markets, disruptions related to tariffs and other trade or sanction issues, and global supply chain inefficiencies;
•Significant changes in the current competitive environment;
•Risks related to pursuing, completing and integrating acquisitions;
•Snap-on’s ability to successfully manage changes in prices and the availability of energy;
•The company’s ability to withstand disruption arising from natural disasters, including climate-related events or other unusual occurrences;
•Risks associated with data security and technological systems and protections, including the effects of cyber incidents and from new legislation, regulations or government-related developments;
•Snap-on’s ability to effectively manage human capital resources;
•The impact of production and sourcing challenges, including labor interruptions and supply chain disruptions, to both Snap-on and relevant third parties;
•Weakness in certain geographic areas, including as a result of localized recessions;
•Changes in tax rates, laws and regulations as well as uncertainty surrounding potential changes;
•The amount, rate and growth of health care and postretirement costs, including continuing and potentially increasing required contributions to pension and postretirement plans;
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•The effects of new or changing requirements, legislation, regulations or government-related developments or issues, as well as third party actions, including those addressing climate change;
•Potential reputational damages and costs related to litigation; and
•Other world or local events outside Snap-on’s control, including terrorist disruptions, armed conflicts and civil unrest.
Snap-on disclaims any responsibility to update any forward-looking statement provided in this document, except as required by law.
In addition, investors should be aware that generally accepted accounting principles in the United States of America (“GAAP”) prescribe when a company should reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when a reserve is established for a major contingency. Reported results, therefore, may appear to be volatile in certain accounting periods.
Non-GAAP Measures
References in Management’s Discussion and Analysis of Financial Condition and Results of Operations to “organic sales” refer to sales from continuing operations calculated in accordance with GAAP, adjusted to exclude acquisition-related sales and the impact of foreign currency translation. Management evaluates the company’s sales performance based on organic sales growth, which primarily reflects growth from the company’s existing businesses as a result of increased output, expanded customer base, geographic expansion, new product development and pricing changes, and excludes sales contributions from acquired operations the company did not own as of the comparable prior-year reporting period. Organic sales also exclude the effects of foreign currency translation as foreign currency translation is subject to volatility that can obscure underlying business trends. Management believes that the non-GAAP financial measure of organic sales is meaningful to investors as it provides them with useful information to aid in identifying underlying growth trends in the company’s businesses and facilitates comparisons of its sales performance with prior periods.
Recent Acquisitions
On June 8, 2026, Snap-on acquired Diesel Laptops, LLC (“Diesel Laptops”) for a preliminary cash purchase price of $99.7 million (or $99.1 million, net of cash acquired). Diesel Laptops, based in Irmo, South Carolina, specializes in diagnostics, repair information, and digital solutions for commercial trucks and off-highway vehicles serving heavy-duty repair shops, fleets, and other equipment customers such as those in mining, agriculture, and infrastructure. The acquisition expands Snap-on’s capabilities in these growing markets and further strengthens the company’s library of proprietary experienced-based data, as well as its product offerings to support the diagnosis and repair of increasingly complex vehicles and equipment. The operating results and assets of Diesel Laptops have been included in the Repair Systems & Information Group segment since the acquisition date.
On April 30, 2026, Snap-on acquired Hi-Force Group Holdings Ltd. (“Hi-Force”) for a preliminary cash purchase price of $58.0 million (or $54.9 million, net of cash acquired). Hi-Force, based in Daventry, United Kingdom, designs and manufactures high-pressure hydraulic tools, heavy lifting systems, as well as torque and tensioning equipment. The acquisition of Hi-Force complements and expands Snap-on’s offerings in the growing torque arena across a variety of industries including oil & gas, power generation, railways, mining, and heavy engineering. The operating results and assets of Hi-Force have been included in the Commercial & Industrial Group segment since the acquisition date.
Pro forma financial information has not been presented for these acquisitions as the net effects were not significant to Snap-on’s results of operations or financial position.
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RESULTS OF OPERATIONS
Results of operations for the three months ended July 4, 2026, and June 28, 2025, are as follows:
Three Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Net sales $ 1,235.1 100.0 % $ 1,179.4 100.0 % $ 55.7 4.7 %
Cost of goods sold (599.9) (48.6) % (583.9) (49.5) % (16.0) (2.7) %
Gross profit 635.2 51.4 % 595.5 50.5 % 39.7 6.7 %
Operating expenses (366.3) (29.6) % (336.4) (28.5) % (29.9) (8.9) %
Operating earnings before financial services 268.9 21.8 % 259.1 22.0 % 9.8 3.8 %
Financial services revenue 99.7 100.0 % 101.7 100.0 % (2.0) (2.0) %
Financial services expenses (32.2) (32.3) % (33.5) (32.9) % 1.3 3.9 %
Operating earnings from financial services 67.5 67.7 % 68.2 67.1 % (0.7) (1.0) %
Operating earnings 336.4 25.2 % 327.3 25.5 % 9.1 2.8 %
Interest expense (12.3) (0.9) % (12.3) (1.0) % — — %
Other income (expense) – net 15.1 1.1 % 14.3 1.2 % 0.8 5.6 %
Earnings before income taxes 339.2 25.4 % 329.3 25.7 % 9.9 3.0 %
Income tax expense (73.0) (5.5) % (72.5) (5.7) % (0.5) (0.7) %
Net earnings 266.2 19.9 % 256.8 20.0 % 9.4 3.7 %
Net earnings attributable to noncontrolling interests (5.6) (0.4) % (6.5) (0.5) % 0.9 13.8 %
Net earnings attributable to Snap-on Incorporated $ 260.6 19.5 % $ 250.3 19.5 % $ 10.3 4.1 %
Percentage Disclosure: All income statement line item percentages below “Operating earnings from financial services” are calculated as a percentage of the sum of Net sales and Financial services revenue.
Net sales of $1,235.1 million in the second quarter of 2026 represented an increase of $55.7 million, or 4.7%, from 2025 levels, reflecting a $35.5 million, or 3.0%, organic gain, $11.5 million of acquisition-related sales, and $8.7 million of favorable foreign currency translation.
Gross profit of $635.2 million in the second quarter of 2026 compared to $595.5 million last year. Gross margin (gross profit as a percentage of net sales) in the quarter improved 90 basis points (100 basis points (“bps”) equals 1.0 percent) from the second quarter of 2025 primarily reflecting the increased sales volumes and benefits from the company’s “Rapid Continuous Improvement” or “RCI” initiatives.
Snap-on’s RCI initiatives employ a structured set of tools and processes across multiple businesses and geographies intended to eliminate waste and improve operations. Savings from Snap-on’s RCI initiatives reflect benefits from a wide variety of ongoing efficiency, productivity and process improvements, including savings generated from product design cost reductions, improved manufacturing line set-up and change-over practices, lower-cost sourcing initiatives, and facility consolidations. Unless individually significant, it is not practicable to disclose each RCI activity that generated savings and/or segregate RCI savings embedded in sales volume increases.
Operating expenses of $366.3 million in the second quarter of 2026 compared to $336.4 million in 2025. Operating expenses as a percentage of net sales rose 110 bps from last year primarily due to increased personnel and other costs.
Operating earnings before financial services of $268.9 million in the second quarter of 2026 compared to $259.1 million in 2025. As a percentage of net sales, operating earnings before financial services were 21.8% compared to 22.0% last year.
Financial services revenue of $99.7 million in the second quarter of 2026 compared to $101.7 million last year. Financial services operating earnings of $67.5 million compared to $68.2 million in 2025.
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Operating earnings of $336.4 million in the second quarter of 2026 compared to $327.3 million in 2025. As a percentage of revenues (net sales plus financial services revenue), operating earnings in the quarter were 25.2% compared to 25.5% last year.
Interest expense in the second quarter of 2026 of $12.3 million was unchanged from last year. See Note 8 to the Condensed Consolidated Financial Statements for additional information on debt and credit facilities.
Other income (expense) – net primarily includes interest income, non-service components of net periodic benefit costs, and net gains and losses associated with hedging and currency exchange rate transactions. See Note 16 to the Condensed Consolidated Financial Statements for additional information on Other income (expense) – net.
The effective income tax rate on earnings attributable to Snap-on in the second quarter was 21.9% in 2026 and 22.5% in 2025. See Note 7 to the Condensed Consolidated Financial Statements for additional information on income taxes.
Net earnings attributable to Snap-on of $260.6 million, or $4.96 per diluted share, in the second quarter of 2026 compared to $250.3 million, or $4.72 per diluted share, in the second quarter of 2025.
Results of operations for the six months ended July 4, 2026, and June 28, 2025 are as follows:
Six Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Net sales $ 2,442.3 100.0 % $ 2,320.5 100.0 % $ 121.8 5.2 %
Cost of goods sold (1,198.8) (49.1) % (1,146.5) (49.4) % (52.3) (4.6) %
Gross profit 1,243.5 50.9 % 1,174.0 50.6 % 69.5 5.9 %
Operating expenses (723.8) (29.6) % (671.8) (29.0) % (52.0) (7.7) %
Operating earnings before financial services 519.7 21.3 % 502.2 21.6 % 17.5 3.5 %
Financial services revenue 200.8 100.0 % 203.8 100.0 % (3.0) (1.5) %
Financial services expenses (65.3) (32.5) % (65.3) (32.0) % — — %
Operating earnings from financial services 135.5 67.5 % 138.5 68.0 % (3.0) (2.2) %
Operating earnings 655.2 24.8 % 640.7 25.4 % 14.5 2.3 %
Interest expense (24.7) (0.9) % (24.7) (1.0) % — — %
Other income (expense) – net 31.9 1.2 % 28.7 1.1 % 3.2 11.1 %
Earnings before income taxes 662.4 25.1 % 644.7 25.5 % 17.7 2.7 %
Income tax expense (142.7) (5.4) % (141.2) (5.6) % (1.5) (1.1) %
Net earnings 519.7 19.7 % 503.5 19.9 % 16.2 3.2 %
Net earnings attributable to noncontrolling interests (12.1) (0.5) % (12.7) (0.5) % 0.6 4.7 %
Net earnings attributable to Snap-on Incorporated $ 507.6 19.2 % $ 490.8 19.4 % $ 16.8 3.4 %
Percentage Disclosure: All income statement line item percentages below “Operating earnings from financial services” are calculated as a percentage of the sum of Net sales and Financial services revenue.
Net sales of $2,442.3 million in the first six months of 2026 represented an increase of $121.8, or 5.2%, from 2025 levels, reflecting a $74.7 million, or 3.2%, organic gain, $35.6 million of favorable foreign currency translation, and $11.5 million of acquisition-related sales.
Gross profit of $1,243.5 million in the first six months 2026 compared to $1,174.0 million last year. Gross margin in the first six months improved 30 basis points from 2025 primarily reflecting the benefit of increased volume and savings from the company’s RCI initiatives, partially offset by higher material and other costs, as well as 20 bps of unfavorable foreign currency effects.
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Operating expenses of $723.8 million in the first six months of 2026 compared to $671.8 million in 2025. Operating expenses as a percentage of net sales rose 60 bps from last year primarily reflecting increased personnel costs and expanded technology investments, partially offset by the favorable effects of sales volume.
Operating earnings before financial services of $519.7 million in the first six months of 2026 compared to $502.2 million in 2025. As a percentage of net sales, operating earnings before financial services were 21.3% including 20 bps of unfavorable foreign currency effects and compared to 21.6% last year.
Financial services revenue of $200.8 million in the first six months of 2026 compared to $203.8 million last year. Financial services operating earnings of $135.5 million compared to $138.5 million in 2025.
Operating earnings of $655.2 million in the first six months of 2026 compared to $640.7 million in 2025. As a percentage of revenues, operating earnings in the first six months were 24.8% including 20 bps of unfavorable foreign currency effects and compared to 25.4% last year.
Interest expense in the first six months of 2026 of $24.7 million was unchanged from last year. See Note 8 to the Condensed Consolidated Financial Statements for additional information on debt and credit facilities.
Other income (expense) – net primarily includes interest income, non-service components of net periodic benefit costs, and net gains and losses associated with hedging and currency exchange rate transactions. See Note 16 to the Condensed Consolidated Financial Statements for additional information on Other income (expense) – net.
The effective income tax rate on earnings attributable to Snap-on in the first six months was 21.9% in 2026 and 22.3% in 2025. See Note 7 to the Condensed Consolidated Financial Statements for additional information on income taxes.
Net earnings attributable to Snap-on of $507.6 million, or $9.65 per diluted share, in the first six months of 2026 compared to $490.8 million, or $9.24 per diluted share, in the first six months of 2025.
Segment Results
Snap-on’s operating segments, which represent Snap-on’s reportable segments, are based on the organizational structure used by the Chief Executive Officer, its CODM, to make operating and investment determinations and to assess performance. Snap‑on’s reportable operating segments are: (i) the Commercial & Industrial Group; (ii) the Snap-on Tools Group; (iii) the Repair Systems & Information Group; and (iv) Financial Services. The Commercial & Industrial Group consists of business operations serving a broad range of industrial and commercial customers worldwide, including customers in the aerospace, natural resources, government and military, power generation, transportation and technical education market segments, primarily through direct and distributor channels. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians through the company’s multinational mobile tool distribution channel. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers worldwide, primarily owners and managers of independent repair shops and OEM dealerships, through direct and distributor channels. Financial Services consists of the business operations of Snap-on’s finance subsidiaries.
The CODM evaluates the performance of the Commercial & Industrial Group, the Snap-on Tools Group and the Repair Systems & Information Group operating segments based on segment net sales and segment operating earnings. The segment net sales of the Snap-on Tools Group reflect external net sales, while the segment net sales of the Commercial & Industrial Group and the Repair Systems & Information Group include both external and intersegment net sales. Snap-on accounts for intersegment net sales and transfers based primarily on standard costs with reasonable mark-ups established between the segments. The Financial Services operating segment is evaluated based on financial services revenue and segment operating earnings. Corporate expenses primarily reflect stock-based compensation and other costs not attributable to an operating segment. Intersegment amounts are eliminated to arrive at Snap-on’s consolidated financial results.
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Commercial & Industrial Group
Three Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
External net sales $ 325.5 82.2 % $ 289.2 83.2 % $ 36.3 12.6 %
Intersegment net sales 70.3 17.8 % 58.6 16.8 % 11.7 20.0 %
Segment net sales 395.8 100.0 % 347.8 100.0 % 48.0 13.8 %
Segment cost of goods sold (227.0) (57.4) % (208.6) (60.0) % (18.4) (8.8) %
Segment gross profit 168.8 42.6 % 139.2 40.0 % 29.6 21.3 %
Segment operating expenses (102.3) (25.8) % (92.3) (26.5) % (10.0) (10.8) %
Segment operating earnings $ 66.5 16.8 % $ 46.9 13.5 % $ 19.6 41.8 %
Segment net sales of $395.8 million in the second quarter of 2026 represented an increase of $48.0 million, or 13.8%, from 2025 levels, reflecting a $38.7 million, or 11.0%, organic gain, $6.8 million of acquisition-related sales, and $2.5 million of favorable foreign currency translation. The organic improvement reflects increases in each of the segment’s businesses, including double-digit gains in the Asia Pacific, European-based hand tools, specialty torque and power tools operations, as well as a mid single-digit rise in activity with customers in critical industries.
Segment gross margin in the second quarter increased 260 bps from last year primarily due to increased sales and savings from the segment’s RCI initiatives.
Segment operating expenses as a percentage of net sales in the second quarter improved 70 bps as compared to 2025 primarily reflecting the higher sales volumes.
As a result of these factors, segment operating earnings of $66.5 million in the second quarter of 2026 compared to $46.9 million in 2025. Operating margin (segment operating earnings as a percentage of segment net sales) for the Commercial & Industrial Group of 16.8% in the second quarter of 2026 compared to 13.5% last year.
Six Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
External net sales $ 634.3 81.7 % $ 565.9 81.8 % $ 68.4 12.1 %
Intersegment net sales 142.5 18.3 % 125.8 18.2 % 16.7 13.3 %
Segment net sales 776.8 100.0 % 691.7 100.0 % 85.1 12.3 %
Cost of goods sold (454.4) (58.5) % (406.0) (58.7) % (48.4) (11.9) %
Gross profit 322.4 41.5 % 285.7 41.3 % 36.7 12.8 %
Operating expenses (201.0) (25.9) % (185.6) (26.8) % (15.4) (8.3) %
Segment operating earnings $ 121.4 15.6 % $ 100.1 14.5 % $ 21.3 21.3 %
Segment net sales of $776.8 million in the first six months of 2026 represented an increase of $85.1 million, or 12.3%, from 2025 levels, reflecting a $63.9 million, or 9.0%, organic gain, $14.4 million of favorable foreign currency translation, and $6.8 million of acquisition-related sales. The organic rise reflects double-digit gains in the segment’s Asia Pacific and specialty torque operations, a high single-digit improvement in the European-based hand tools business, and mid single-digit increases with customers in critical industries and in the power tools operation.
Segment gross margin in the first six months improved 20 bps from last year primarily due to increased sales and savings from the segment’s RCI initiatives, partially offset by higher material and other costs, as well as 30 bps of unfavorable foreign currency effects.
Segment operating expenses as a percentage of net sales in the first six months improved 90 bps as compared to 2025 primarily reflecting the higher sales volumes.
As a result of these factors, segment operating earnings of $121.4 million in the first six months of 2026 compared to $100.1 million in 2025. Operating margin for the Commercial & Industrial Group of 15.6% in the first six months of 2026 included 30 bps of unfavorable foreign currency effects and compared to 14.5% last year.
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Snap-on Tools Group
Three Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Segment net sales $ 508.8 100.0 % $ 491.0 100.0 % $ 17.8 3.6 %
Segment cost of goods sold (264.6) (52.0) % (253.8) (51.7) % (10.8) (4.3) %
Segment gross profit 244.2 48.0 % 237.2 48.3 % 7.0 3.0 %
Segment operating expenses (129.1) (25.4) % (120.5) (24.5) % (8.6) (7.1) %
Segment operating earnings $ 115.1 22.6 % $ 116.7 23.8 % $ (1.6) (1.4) %
Segment net sales of $508.8 million in the second quarter of 2026 represented an increase of $17.8 million, or 3.6%, from 2025 levels, reflecting a $14.9 million, or 3.0%, organic sales gain and $2.9 million of favorable foreign currency translation. The organic rise was due to low single-digit gains both in the U.S. and in the segment’s international operations.
Segment gross margin in the second quarter decreased 30 bps from last year primarily reflecting a year-over-year shift in product mix, partially offset by savings from the segment’s RCI initiatives.
Segment operating expenses as a percentage of net sales in the second quarter rose 90 bps as compared to 2025 due to increased personnel, freight and other costs.
As a result of these factors, segment operating earnings of $115.1 million in the second quarter of 2026 compared to $116.7 million in 2025. Operating margin for the Snap-on Tools Group of 22.6% in the second quarter of 2026 compared to 23.8% last year.
Six Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Segment net sales $ 994.8 100.0 % $ 953.9 100.0 % $ 40.9 4.3 %
Cost of goods sold (519.0) (52.2) % (502.2) (52.6) % (16.8) (3.3) %
Gross profit 475.8 47.8 % 451.7 47.4 % 24.1 5.3 %
Operating expenses (255.7) (25.7) % (242.6) (25.5) % (13.1) (5.4) %
Segment operating earnings $ 220.1 22.1 % $ 209.1 21.9 % $ 11.0 5.3 %
Segment net sales of $994.8 million in the first six months of 2026 represented an increase of $40.9 million, or 4.3%, from 2025 levels, reflecting a $30.8 million, or 3.2%, organic sales gain and $10.1 million of favorable foreign currency translation. The organic improvement was due to low single-digit increases both in the U.S. and in the segment’s international operations.
Segment gross margin in the first six months improved 40 bps from last year primarily due to savings from the segment’s RCI initiatives.
Segment operating expenses as a percentage of net sales in the first six months increased 20 bps as compared to 2025 reflecting increased personnel and other costs.
As a result of these factors, segment operating earnings of $220.1 million in the first six months of 2026 compared to $209.1 million in 2025. Operating margin for the Snap-on Tools Group of 22.1% in the first six months of 2026 compared to 21.9% last year.
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Repair Systems & Information Group
Three Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
External net sales $ 400.8 83.4 % $ 399.2 85.2 % $ 1.6 0.4 %
Intersegment net sales 79.5 16.6 % 69.4 14.8 % 10.1 14.6 %
Segment net sales 480.3 100.0 % 468.6 100.0 % 11.7 2.5 %
Segment cost of goods sold (258.1) (53.7) % (249.5) (53.2) % (8.6) (3.4) %
Segment gross profit 222.2 46.3 % 219.1 46.8 % 3.1 1.4 %
Segment operating expenses (107.1) (22.3) % (99.3) (21.2) % (7.8) (7.9) %
Segment operating earnings $ 115.1 24.0 % $ 119.8 25.6 % $ (4.7) (3.9) %
Segment net sales of $480.3 million in the second quarter of 2026 represented an increase of $11.7 million, or 2.5%, from 2025 levels, reflecting a $3.2 million, or 0.7%, organic gain, $4.7 million of acquisition-related sales, and $3.8 million of favorable foreign currency translation. On an organic basis, low single-digit gains in undercar equipment and sales of diagnostic and repair information products to independent repair shop owners and managers were partially offset by a low single-digit decline in activity with OEM dealerships.
Segment gross margin in the second quarter decreased 50 bps from last year primarily reflecting higher sales of lower gross margin products.
Segment operating expenses as a percentage of net sales in the second quarter increased 110 bps from 2025 primarily due to higher personnel and other costs, as well as expanded technology investments.
As a result of these factors, segment operating earnings of $115.1 million in the second quarter of 2026 compared to $119.8 million in 2025. Operating margin for the Repair Systems & Information Group of 24.0% in the second quarter of 2026 compared to 25.6% last year.
Six Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
External net sales $ 813.2 84.2 % $ 800.7 84.8 % $ 12.5 1.6 %
Intersegment net sales 152.4 15.8 % 143.8 15.2 % 8.6 6.0 %
Segment net sales 965.6 100.0 % 944.5 100.0 % 21.1 2.2 %
Cost of goods sold (520.3) (53.9) % (507.9) (53.8) % (12.4) (2.4) %
Gross profit 445.3 46.1 % 436.6 46.2 % 8.7 2.0 %
Operating expenses (210.7) (21.8) % (194.7) (20.6) % (16.0) (8.2) %
Segment operating earnings $ 234.6 24.3 % $ 241.9 25.6 % $ (7.3) (3.0) %
Segment net sales of $965.6 million in the first six months of 2026 represented an increase of $21.1 million, or 2.2%, from 2025 levels, reflecting a $3.5 million, or 0.4%, organic gain, $12.9 million of favorable foreign currency translation, and $4.7 million of acquisition-related sales. On an organic basis, low single-digit gains in undercar equipment and sales of diagnostic and repair information products to independent repair shop owners and managers were offset by a low single-digit decrease in activity with OEM dealerships.
Segment gross margin in the first six months decreased 10 bps from last year primarily reflecting higher material costs and 30 bps of unfavorable foreign currency effects, mostly offset by favorable business mix and savings from the segment’s RCI initiatives.
Segment operating expenses as a percentage of net sales in the first six months increased 120 bps from 2025 primarily due to higher personnel and other costs, as well as expanded technology investments.
As a result of these factors, segment operating earnings of $234.6 million in the first six months of 2026 compared to $241.9 million in 2025. Operating margin for the Repair Systems & Information Group of 24.3% in the first six months of 2026 included 40 bps of unfavorable foreign currency effects and compared to 25.6% last year.
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Financial Services
Three Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Financial services revenue $ 99.7 100.0 % $ 101.7 100.0 % $ (2.0) (2.0) %
Financial services expenses (32.2) (32.3) % (33.5) (32.9) % 1.3 3.9 %
Segment operating earnings $ 67.5 67.7 % $ 68.2 67.1 % $ (0.7) (1.0) %
Financial services revenue is generally dependent on the size of the average financial services portfolio during the period, as well as on the average yield on receivables. Financial services revenue of $99.7 million in the second quarter of 2026 represented a decrease of $2.0 million, or 2.0%, from last year, primarily due to the lower year-over-year average portfolio. In the second quarters of 2026 and 2025, the respective average yields on finance receivables were 17.6% and 17.5%. In the second quarters of 2026 and 2025, the average yields on contract receivables were 9.0% and 9.1%, respectively. Originations of $281.0 million in the second quarter of 2026 represented a decrease of $12.0 million, or 4.1%, from 2025 levels.
Financial services expenses primarily include personnel-related and other general and administrative costs, as well as provisions for credit losses. These expenses are generally more dependent on changes in the size of the financial services portfolio than they are on the revenue of the segment. Financial services expenses in the second quarter of 2026 decreased $1.3 million from last year primarily due to lower provisions for credit losses. As a percentage of the average financial services portfolio, expenses were 1.3% in the second quarters of both 2026 and 2025.
As a result of these factors, segment operating earnings of $67.5 million in the second quarter of 2026 compared to $68.2 million in 2025.
Six Months Ended
(Amounts in millions) July 4, 2026 June 28, 2025 Change
Financial services revenue $ 200.8 100.0 % $ 203.8 100.0 % $ (3.0) (1.5) %
Financial services expenses (65.3) (32.5) % (65.3) (32.0) % — — %
Segment operating earnings $ 135.5 67.5 % $ 138.5 68.0 % $ (3.0) (2.2) %
Financial services revenue of $200.8 million in the first six months of 2026 represented a decrease of $3.0 million, or 1.5%, from last year, primarily reflecting the lower year-over-year average portfolio. In the first six months of both 2026 and 2025, the average yield on finance receivables was 17.6% and the average yield on contract receivables was 9.1%. Originations of $545.6 million in the first six months of 2026 represented a decrease of $16.1 million, or 2.9%, from 2025 levels.
Financial services expenses in the first six months of 2026 were unchanged from last year. As a percentage of the average financial services portfolio, expenses were 2.6% in the first six months of both 2026 and 2025.
As a result of these factors, segment operating earnings of $135.5 million in the first six months of 2026 compared to $138.5 million in 2025.
Corporate
Snap-on’s second quarter 2026 general corporate expenses of $27.8 million compared to $24.3 million last year. The year-over-year increase in general corporate expenses primarily reflects higher stock-based and performance-based compensation costs. For the first six months of 2026, general corporate expenses of $56.4 million compared to $48.9 million in 2025. The year-over-year increase in general corporate expenses primarily reflects higher stock-based compensation and other costs.
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Non-GAAP Supplemental Data
The following non-GAAP supplemental data is presented for informational purposes to provide readers with insight into the information used by management for assessing the operating performance of Snap-on’s non-financial services (“Operations”) and Financial Services businesses.
The supplemental Operations data reflects the results of operations and financial position of Snap-on’s tools, diagnostics, equipment products, software, and other non-financial services operations with Financial Services presented on the equity method. The supplemental Financial Services data reflects the results of operations and financial position of Snap-on’s U.S. and international financial services operations. The financing needs of Financial Services are met through intersegment borrowings and cash generated from Operations; Financial Services is charged interest expense on intersegment borrowings at market rates. Income taxes are charged to Financial Services on the basis of the specific tax attributes generated by the U.S. and international financial services businesses. Transactions between the Operations and Financial Services businesses are eliminated to arrive at the Condensed Consolidated Financial Statements.
Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Statements of Earnings information for the three months ended July 4, 2026, and June 28, 2025, is as follows:
Operations* Financial Services
(Amounts in millions) July 4, 2026 June 28, 2025 July 4, 2026 June 28, 2025
Net sales $ 1,235.1 $ 1,179.4 $ — $ —
Cost of goods sold (599.9) (583.9) — —
Gross profit 635.2 595.5 — —
Operating expenses (366.3) (336.4) — —
Operating earnings before financial services 268.9 259.1 — —
Financial services revenue — — 99.7 101.7
Financial services expenses — — (32.2) (33.5)
Operating earnings from financial services — — 67.5 68.2
Operating earnings 268.9 259.1 67.5 68.2
Interest expense (12.3) (12.3) — —
Intersegment interest income (expense) – net 17.1 17.4 (17.1) (17.4)
Other income (expense) – net 15.0 14.2 0.1 0.1
Earnings before income taxes and equity earnings 288.7 278.4 50.5 50.9
Income tax expense (60.3) (59.7) (12.7) (12.8)
Earnings before equity earnings 228.4 218.7 37.8 38.1
Financial services – net earnings attributable to Snap-on Incorporated 37.8 38.1 — —
Net earnings 266.2 256.8 37.8 38.1
Net earnings attributable to noncontrolling interests (5.6) (6.5) — —
Net earnings attributable to Snap-on Incorporated $ 260.6 $ 250.3 $ 37.8 $ 38.1
* Snap-on with Financial Services presented on the equity method.
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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Statements of Earnings information for the six months ended July 4, 2026, and June 28, 2025, is as follows:
Operations* Financial Services
(Amounts in millions) July 4, 2026 June 28, 2025 July 4, 2026 June 28, 2025
Net sales $ 2,442.3 $ 2,320.5 $ — $ —
Cost of goods sold (1,198.8) (1,146.5) — —
Gross profit 1,243.5 1,174.0 — —
Operating expenses (723.8) (671.8) — —
Operating earnings before financial services 519.7 502.2 — —
Financial services revenue — — 200.8 203.8
Financial services expenses — — (65.3) (65.3)
Operating earnings from financial services — — 135.5 138.5
Operating earnings 519.7 502.2 135.5 138.5
Interest expense (24.7) (24.7) — —
Intersegment interest income (expense) – net 34.1 34.4 (34.1) (34.4)
Other income (expense) – net 31.8 28.6 0.1 0.1
Earnings before income taxes and equity earnings 560.9 540.5 101.5 104.2
Income tax expense (117.3) (115.1) (25.4) (26.1)
Earnings before equity earnings 443.6 425.4 76.1 78.1
Financial services – net earnings attributable to Snap-on Incorporated 76.1 78.1 — —
Net earnings 519.7 503.5 76.1 78.1
Net earnings attributable to noncontrolling interests (12.1) (12.7) — —
Net earnings attributable to Snap-on Incorporated $ 507.6 $ 490.8 $ 76.1 $ 78.1
* Snap-on with Financial Services presented on the equity method.
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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Balance Sheets information as of July 4, 2026, and January 3, 2026, is as follows:
Operations* Financial Services
(Amounts in millions) July 4, 2026 January 3, 2026 July 4, 2026 January 3, 2026
ASSETS
Current assets:
Cash and cash equivalents $ 1,644.2 $ 1,624.1 $ 0.5 $ 0.4
Intersegment receivables 13.0 20.3 — —
Trade and other accounts receivable – net 940.7 880.2 1.5 1.2
Finance receivables – net — — 597.6 590.2
Contract receivables – net 4.8 4.9 116.3 125.1
Inventories – net 1,045.3 1,025.2 — —
Prepaid expenses and other current assets 174.4 154.7 12.9 11.2
Total current assets 3,822.4 3,709.4 728.8 728.1
Property and equipment – net 557.6 549.8 2.8 2.5
Operating lease right-of-use assets 93.7 78.4 5.0 5.3
Investment in Financial Services 395.3 400.3 — —
Deferred income tax assets 47.4 45.4 27.4 27.1
Intersegment long-term notes receivable 789.5 815.0 — —
Long-term finance receivables – net — — 1,274.0 1,298.8
Long-term contract receivables – net 6.0 8.0 404.6 415.1
Goodwill 1,231.5 1,109.5 — —
Other intangible assets – net 267.8 270.7 — —
Pension assets 173.6 173.8 — —
Other long-term assets 45.0 44.1 0.3 0.3
Total assets $ 7,429.8 $ 7,204.4 $ 2,442.9 $ 2,477.2
* Snap-on with Financial Services presented on the equity method.
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Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Balance Sheets Information (continued):
Operations* Financial Services
(Amounts in millions) July 4, 2026 January 3, 2026 July 4, 2026 January 3, 2026
LIABILITIES AND EQUITY
Current liabilities:
Notes payable and current maturities of long-term debt $ 17.2 $ 16.2 $ 299.8 $ —
Accounts payable 267.0 227.6 0.4 1.5
Intersegment payables — — 13.0 20.3
Accrued benefits 53.1 64.6 0.1 0.1
Accrued compensation 75.6 74.2 2.4 3.0
Franchisee deposits 66.8 66.2 — —
Other accrued liabilities 521.0 455.1 29.0 24.4
Total current liabilities 1,000.7 903.9 344.7 49.3
Long-term debt and intersegment long-term debt — — 1,676.5 2,001.4
Deferred income tax liabilities 98.1 87.0 — —
Retiree health care benefits 16.6 17.7 — —
Pension liabilities 77.8 85.7 — —
Operating lease liabilities 69.9 56.3 5.4 5.5
Other long-term liabilities 100.4 97.0 21.0 20.7
Total liabilities 1,363.5 1,247.6 2,047.6 2,076.9
Total shareholders’ equity attributable to Snap-on Incorporated 6,041.3 5,931.8 395.3 400.3
Noncontrolling interests 25.0 25.0 — —
Total equity 6,066.3 5,956.8 395.3 400.3
Total liabilities and equity $ 7,429.8 $ 7,204.4 $ 2,442.9 $ 2,477.2
* Snap-on with Financial Services presented on the equity method.
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Liquidity and Capital Resources
Snap-on’s growth has historically been funded by a combination of cash provided by operating activities and debt financing. Snap-on believes that its cash from operations and collections of finance receivables, coupled with its sources of borrowings and available cash on hand, are sufficient to fund its currently anticipated requirements for scheduled debt repayments, payments of interest and dividends, new receivables originated by our financial services businesses, capital expenditures, working capital, funding of pension plans, and share repurchases and acquisitions, if and as they arise.
Due to Snap-on’s credit rating over the years, external funds have been available at an acceptable cost. As of July 17, 2026, Snap-on’s long-term debt and commercial paper were rated, respectively, A2 and P-1 by Moody’s Investors Service; A- and A-2 by Standard & Poor’s; and A and F1 by Fitch Ratings. Snap-on believes that its current credit arrangements are sound and that the strength of its balance sheet affords the company the financial flexibility, including through access to financial markets for potential new financing, to respond to both internal growth opportunities and those available through acquisitions. However, Snap-on cannot provide any assurance that financing will be available in the future on acceptable terms, or that its debt ratings will not decrease.
The following discussion focuses on information included in the accompanying Condensed Consolidated Balance Sheets.
Working capital (current assets less current liabilities) of $3,205.8 million as of July 4, 2026, represented a decrease of $278.5 million from $3,484.3 million as of January 3, 2026 (fiscal 2025 year end), primarily as a result of the net changes discussed below.
The following represents the company’s working capital position as of July 4, 2026, and January 3, 2026:
(Amounts in millions) July 4, 2026 January 3, 2026
Cash and cash equivalents $ 1,644.7 $ 1,624.5
Trade and other accounts receivable – net 942.2 881.4
Finance receivables – net 597.6 590.2
Contract receivables – net 121.1 130.0
Inventories – net 1,045.3 1,025.2
Prepaid expenses and other current assets 172.8 151.5
Total current assets 4,523.7 4,402.8
Notes payable and current maturities of long-term debt (317.0) (16.2)
Accounts payable (267.4) (229.1)
Other current liabilities (733.5) (673.2)
Total current liabilities (1,317.9) (918.5)
Working capital $ 3,205.8 $ 3,484.3
Cash and cash equivalents of $1,644.7 million as of July 4, 2026, represented an increase of $20.2 million from 2025 year-end levels primarily due to: (i) $640.2 million of cash generated from operations; (ii) $435.1 million of cash from collections of finance receivables; and (iii) $67.1 million of cash proceeds from stock purchase plans and stock option exercises. These increases in cash and cash equivalents were partially offset by: (i) the funding of $456.0 million of new finance receivables; (ii) dividend payments to shareholders of $253.2 million; (iii) the repurchase of 508,000 shares of the company’s common stock for $191.3 million; (iv) $159.1 million of net cash paid for acquisitions; and (v) the funding of $44.3 million of capital expenditures.
Of the $1,644.7 million of cash and cash equivalents as of July 4, 2026, $580.2 million was held outside of the United States. Snap-on maintains non-U.S. funds in its foreign operations to: (i) provide adequate working capital; (ii) satisfy various regulatory requirements; and/or (iii) take advantage of business expansion opportunities as they arise. Although the Tax Cuts and Jobs Act generally eliminated U.S. federal taxation of dividends from foreign subsidiaries, such dividends may still be subject to state income taxation and foreign withholding taxes. Snap-on periodically evaluates its cash held outside the United States and may pursue opportunities to repatriate certain foreign cash amounts to the extent that it can be accomplished in a tax efficient manner.
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Trade and other accounts receivable – net of $942.2 million as of July 4, 2026, represented an increase of $60.8 million from 2025 year-end levels. The increase is primarily due to higher sales and $12.2 million from acquisitions, partially offset by $4.7 million of foreign currency translation. Days sales outstanding (trade and other accounts receivable – net as of the respective period end, divided by the respective trailing 12 months of sales, times 360 days) was 70 days for July 4, 2026, and 67 days for January 3, 2026.
The current portions of net finance and contract receivables of $718.7 million as of July 4, 2026, compared to $720.2 million at 2025 year end. The long-term portions of net finance and contract receivables of $1,684.6 million as of July 4, 2026, compared to $1,721.9 million at 2025 year end.
Inventories – net of $1,045.3 million as of July 4, 2026, represented an increase of $20.1 million from January 3, 2026, primarily due to $17.6 million from acquisitions. Inventory turns (trailing 12 months of cost of goods sold, divided by the average of the beginning and ending inventory balances for the trailing 12 months) were 2.4 turns as of both July 4, 2026, and January 3, 2026. Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 62% of total inventories as of both July 4, 2026, and January 3, 2026. All other inventories are accounted for using the last-in, first-out (“LIFO”) method. The company’s LIFO reserve was $128.5 million and $126.7 million as of July 4, 2026, and January 3, 2026, respectively.
Notes payable and current maturities of long-term debt of $317.0 million as of July 4, 2026, reflected the $300 million unsecured 3.25% notes that Snap-on currently intends to repay with available cash on hand at maturity on March 1, 2027, and other notes of $17.2 million. As of 2025 year end, notes payable and current maturities of long-term debt were $16.2 million.
Accounts payable of $267.4 million as of July 4, 2026, represented an increase of $38.3 million from January 3, 2026, primarily due to the timing of payments and $11.3 million from acquisitions, partially offset by $3.5 million of foreign currency translation.
Other accrued liabilities of $535.5 million as of July 4, 2026, represented an increase of $70.4 million from 2025 year-end levels primarily due to an increase in accrued income taxes and $13.0 million from acquisitions, partially offset by $2.6 million of foreign currency translation.
Long-term debt of $887.0 million as of July 4, 2026, consisted of $400 million of unsecured 4.1% notes that mature on March 1, 2048, and $500 million of unsecured 3.1% notes that mature on May 1, 2050, partially offset by $13.0 million of unamortized debt issuance costs and issuance discounts.
Snap-on has a $900 million multicurrency revolving credit facility that terminates on September 12, 2028 (the “Credit Facility”). The Credit Facility contains an accordion feature that, subject to certain customary conditions, may allow the maximum commitment to be increased by up to $450 million with the approval of the lenders providing additional commitments. No amounts were borrowed or outstanding under the Credit Facility during the six months ended and as of July 4, 2026.
Borrowings under the Credit Facility bear interest at varying rates based on either: (i) Snap-on’s then-current, long-term debt ratings; or (ii) Snap-on’s then-current ratio of consolidated debt net of certain cash adjustments (“Consolidated Net Debt”) to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended (the “Consolidated Net Debt to EBITDA Ratio”). The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of Consolidated Net Debt to the sum of Consolidated Net Debt plus total equity and less accumulated other comprehensive income or loss (the “Leverage Ratio”); or (ii) a Consolidated Net Debt to EBITDA Ratio not greater than 3.50 to 1.00. Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement). As of July 4, 2026, the company’s consolidated cash balance, net of certain adjustments, exceeded consolidated debt resulting in actual ratios of (0.05) and (0.21), respectively. Both ratios are within the permitted ranges set forth in this financial covenant.
Snap-on may issue commercial paper to fund future financing needs on a short-term basis, with the Credit Facility as back-up liquidity to support such commercial paper issuances. There was no commercial paper issued or outstanding during the six months ended and as of July 4, 2026.
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Snap-on believes it has sufficient available cash and access to both committed and uncommitted credit facilities to cover its expected funding needs on both a short-term and long-term basis. Snap-on manages its aggregate short-term borrowings so as not to exceed its availability under the Credit Facility. Snap-on believes that it can access short-term debt markets, predominantly through commercial paper issuances and existing lines of credit, to fund its short-term requirements and to ensure near-term liquidity. Snap-on regularly monitors the credit and financial markets and, if it believes conditions are favorable, it may take advantage of such conditions to issue long-term debt to further improve its liquidity and capital resources. Near-term liquidity requirements for Snap-on include payments of interest and dividends, scheduled debt payments, funding to support new receivables originated by our financial services businesses, capital expenditures, working capital, the funding of pension plans, and funding for share repurchases and acquisitions, if and as they arise. Snap-on intends to make contributions of $4.5 million to its foreign pension plans and $3.7 million to its domestic pension plans in 2026, as required by law. Depending on market and other conditions, Snap-on may make discretionary cash contributions to its pension plans in 2026.
Snap-on’s long-term financing strategy is to maintain continuous access to the debt markets to accommodate its liquidity needs, including the potential use of commercial paper, additional fixed-term debt and/or securitizations.
The following discussion focuses on information included in the accompanying Condensed Consolidated Statements of Cash Flows.
Operating Activities
Net cash provided by operating activities was $640.2 million and $535.7 million in the respective first six months of 2026 and 2025. The $104.5 million year-over-year increase in net cash provided by operating activities primarily reflects a $73.6 million change in net operating assets and liabilities and a $16.2 million increase in net earnings.
Investing Activities
Net cash used by investing activities of $223.7 million in the first six months of 2026 included additions to finance receivables of $456.0 million, partially offset by collections of $435.1 million. Net cash used by investing activities of $78.0 million in the first six months of 2025 included additions to finance receivables of $462.4 million, partially offset by collections of $427.8 million. Finance receivables are comprised of extended-term installment payment contracts to both technicians and independent shop owners (i.e., franchisees’ customers) to enable them to purchase tools, diagnostics, and equipment products on an extended-term payment plan, with average payment terms of approximately four years.
Net cash used for acquisitions in the first six months of 2026 totaled $159.1 million. Capital expenditures were $44.3 million and $42.6 million in the respective first six months of 2026 and 2025. Capital expenditures in both years included continued investments related to the company’s execution of its strategic growth initiatives and Value Creation Processes around safety, quality, customer connection, innovation and RCI.
Financing Activities
Net cash used by financing activities was $396.9 million in the first six months of 2026 and $364.5 million in the first six months of 2025. Proceeds from stock purchase plans and stock option exercises totaled $67.1 million and $45.2 million in the respective first six months of 2026 and 2025. In the first six months of 2026, Snap-on repurchased 508,000 shares of its common stock for $191.3 million under its previously announced share repurchase programs. In the first six months of 2025, Snap-on repurchased 510,000 shares of its common stock for $166.2 million under its previously announced share repurchase programs. As of July 4, 2026, Snap-on had remaining availability to repurchase up to an additional $485.5 million in common stock pursuant to its Board’s authorizations. The repurchase of Snap-on common stock to offset dilution related to equity plan issuances or for other corporate purposes is at the company’s discretion, subject to prevailing financial and market conditions. Snap‑on believes that its cash generated from operations, available cash on hand, and funds available from its credit facilities, will be sufficient to fund the company’s additional share repurchases, if any.
Snap-on has paid consecutive quarterly cash dividends, without interruption or reduction, since 1939. Cash dividends totaled $253.2 million and $224.0 million in the respective first six months of 2026 and 2025. On November 6, 2025, the Board increased the quarterly cash dividend by 14.0% to $2.44 per share ($9.76 per share annualized). Snap-on believes that its cash generated from operations, available cash on hand, and funds available from its credit facilities, will be sufficient to pay dividends.
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Critical Accounting Policies and Estimates
Snap-on’s critical accounting policies and estimates, which are discussed in its Annual Report on Form 10-K for the fiscal year ended January 3, 2026, have not materially changed since the report was filed.
Outlook
We believe that our markets and our operations possess and have demonstrated continuing and considerable resilience against the uncertainties of the current environment. Snap-on expects to make ongoing progress along its decisive runways for coherent growth, leveraging capabilities already proven in the automotive repair arena, developing and expanding its professional customer base, not only in automotive repair, but in adjacent markets, additional geographies and other areas, including extending in critical industries, where the cost and penalties for failure are high. In pursuit of these initiatives, we project that capital expenditures in 2026 will approximate $100 million, of which $44.3 million was incurred in the first six months of the year.
Snap-on currently anticipates that its full-year 2026 effective income tax rate will approximate 22%.
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