Fortive Stock Earnings Reports

Key points for investors: Fortive reported its first quarter as the standalone Fortive following the Ralliance spin-off. Q3 revenue was just over $1.0B, core growth ~2%, adjusted EBITDA $309M (up 10% YoY) and adjusted EPS $0.68 (up 15% YoY). Adjusted EBITDA margin expanded ~200 bps to ~30%; adjusted gross margin was modestly pressured by tariffs (net ~ $0.01 EPS headwind). Trailing twelve-month free cash flow was $922M and Q3 free cash flow was $266M. Management raised full‑year adjusted EPS guidance to $2.63–$2.67, citing Q3 outperformance and incremental share buybacks. Capital allocation: Fortive repurchased ~$1.0B in Q3 (≈21M shares, ~6% of fully diluted share count) and will prioritize organic growth investment, accretive bolt‑on M&A, buybacks, and a modest dividend. Strategy: “Fortive Accelerated” focuses on innovation acceleration, commercial acceleration, recurring customer value, all powered by an amplified Fortive Business System (FBS). Management expects to redeploy some of the cost benefits realized in Q3 back into growth initiatives in Q4 and into 2026; they reiterated a medium‑term framework (3–4% organic growth target, 50–100 bps EBITDA margin expansion and high single‑digit plus EPS growth in the 2026–27 window). Regional demand: North America showing strength and sequential improvement, Western Europe weak, rest‑of‑world mixed (India and South Asia improving). AHS saw sequential improvement in hospital equipment and consumables, with software remaining a strong performer. Tariff pressures remain a modest near‑term headwind but are being offset by pricing and supply‑chain actions. Management emphasized disciplined cost control, flattened leadership, a sharper commercial focus and giving operating brands more “growth oxygen.”