How does Illinois Tool Works (ITW) make money?

Illinois Tool Works (ITW) generates revenue primarily from Automotive OEM Segment, which accounted for 20.3% of total revenue in TTM through Q2 2026. The company reported $16.5B in revenue and converted 19.4% of it into net profit, equivalent to roughly $3.19B in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of Illinois Tool Works (ITW)?

Illinois Tool Works (ITW) reported a gross profit margin of 44.2% in TTM through Q2 2026, equivalent to $7.27B in gross profit on $16.5B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of Illinois Tool Works (ITW)?

Illinois Tool Works (ITW) reported an operating profit margin of 26.5% in TTM through Q2 2026, equivalent to $4.36B in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of Illinois Tool Works (ITW)?

Illinois Tool Works (ITW) reported a net profit margin of 19.4% in TTM through Q2 2026, equivalent to $3.19B in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is Illinois Tool Works (ITW) profitable?

Yes. Illinois Tool Works (ITW) reported $3.19B in net income for TTM through Q2 2026, with a net profit margin of 19.4%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does Illinois Tool Works (ITW) invest in research and development?

Illinois Tool Works (ITW) invested $676M in research and development during TTM through Q2 2026, roughly 4.1% of total revenue. R&D spending funds the company's future product pipeline and is expensed in full on the income statement rather than capitalised, which makes the operating margin sensitive to how aggressively management chooses to reinvest in innovation.

How much does Illinois Tool Works (ITW) spend on capital expenditures?

Illinois Tool Works (ITW) spent $317M on capital expenditures (CapEx) during TTM through Q2 2026, roughly 1.9% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does Illinois Tool Works (ITW) generate?

Illinois Tool Works (ITW) generated $2.29B in free cash flow during TTM through Q2 2026, a free-cash-flow margin of 13.9%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What is the effective tax rate of Illinois Tool Works (ITW)?

Illinois Tool Works (ITW) had an effective tax rate of 22.5% in TTM through Q2 2026. The effective rate is the actual share of pre-tax income paid as income taxes and can differ materially from the statutory rate due to foreign earnings mix, tax credits (such as R&D), share-based compensation deductions, and one-off discrete items.

What are the main business segments of Illinois Tool Works (ITW)?

Illinois Tool Works (ITW) reports revenue across 7 reportable product segments, led by Automotive OEM Segment at 20.3% of total revenue in TTM through Q2 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

How Illinois Tool Works Makes Money: 2026 Visual Revenue Map

Illinois Tool Works (ITW) Income Statement Flow — TTM through Q2 2026

Calculated from the four most recent reported quarters, ending June 30, 2026 (reported July 28, 2026).

Illinois Tool Works discloses geographic revenue only in annual filings. to view the full breakdown.

Illinois Tool Works (ITW) Revenue by Product Segment — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for Illinois Tool Works (ITW), TTM through Q2 2026.
Segment	Revenue (USD)	% of total
Automotive OEM Segment	$3.35B	20.3%
Test and Measurement and Electronics Segment	$2.98B	18.1%
Food Equipment Segment	$2.74B	16.7%
Welding Segment	$1.95B	11.9%
Construction Products Segment	$1.84B	11.2%
Polymers and Fluids Segment	$1.83B	11.1%
Specialty Products Segment	$1.78B	10.8%
Total	$16.5B	100%

Automotive OEM Segment$3.35B
Test and Measurement and Electronics Segment$2.98B
Food Equipment Segment$2.74B
Welding Segment$1.95B
Construction Products Segment$1.84B
Polymers and Fluids Segment$1.83B
Specialty Products Segment$1.78B
Total$16.5B

Revenue Breakdown — TTM through Q2 2026

In TTM through Q2 2026, Illinois Tool Works (ITW) reports revenue across 7 reportable product segments; the largest segment was Automotive OEM Segment at 20.3%, followed by Test and Measurement and Electronics Segment (18.1%) and Food Equipment Segment (16.7%).

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