What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-23 compared with 2026-04-23 · 234 added, 90 removed, 307 unchanged (51% of the section changed)

40 unchanged sentences

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.

SNAP-ON INCORPORATED

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RESULTS OF OPERATIONS

Results of operations for the three months ended April 4, 2026, and March 29, 2025, are as follows:

Results of operations for the three months ended July 4, 2026, and June 28, 2025, are as follows:

Three Months Ended

(Amounts in millions) April 4, 2026 March 29, 2025 Change

(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 %

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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 $1,207.2 million in the first quarter of 2026 represented an increase of $66.1 million, or 5.8%, from 2025 levels, reflecting a $39.2 million, or 3.4%, organic gain and $26.9 million of favorable foreign currency translation.

Gross profit of $608.3 million in the first quarter of 2026 compared to $578.5 million last year.

Gross margin (gross profit as a percentage of net sales) in the quarter decreased 30 basis points (100 basis points (“bps”) equals 1.0 percent) from the first quarter of 2025 primarily reflecting 40 bps of unfavorable foreign currency effects.

The benefit of increased volume and savings from the company’s “Rapid Continuous Improvement” or “RCI” initiatives in the first quarter were largely offset by higher tariffs and other material costs.

While the company is relatively advantaged in the tariff environment, principally manufacturing in the markets where it sells, overall costs, however, can be somewhat impacted by trade policies.

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.

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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 $357.5 million in the first quarter of 2026 compared to $335.4 million in 2025.

Operating expenses as a percentage of net sales rose 20 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 $250.8 million in the first quarter of 2026 compared to $243.1 million in 2025.

As a percentage of net sales, operating earnings before financial services were 20.8% including 40 bps of unfavorable foreign currency effects and compared to 21.3% last year.

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.

SNAP-ON INCORPORATED

1 unchanged sentence

OF OPERATIONS

Financial services revenue of $101.1 million in the first quarter of 2026 compared to $102.1 million last year.

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.

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

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 $318.8 million in the first quarter of 2026 compared to $313.4 million in 2025.

As a percentage of revenues (net sales plus financial services revenue), operating earnings in the quarter were 24.4% including 40 bps of unfavorable foreign currency effects and compared to 25.2% last year.

Interest expense in the first quarter of 2026 of $12.4 million was unchanged from last year.

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.

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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 quarter was 22.0% in 2026 and 22.2% in 2025.

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 $247.0 million, or $4.69 per diluted share, in the first quarter of 2026 compared to $240.5 million, or $4.51 per diluted share, in the first quarter of 2025.

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

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Three Months Ended

(Amounts in millions) April 4, 2026 March 29, 2025 Change

(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 %

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Segment operating earnings $ 66.5 16.8 % $ 46.9 13.5 % $ 19.6 41.8 %

Segment net sales of $381.0 million in the first quarter of 2026 represented an increase of $37.1 million, or 10.8%, from 2025 levels, reflecting a $25.2 million, or 7.1%, organic gain and $11.9 million of favorable foreign currency translation.

The organic increase reflects gains in each of the segment’s operations, including a high single-digit improvement with customers in critical industries and a double-digit rise in the specialty torque business.

Segment gross margin in the first quarter decreased 230 bps from last year primarily due to higher tariffs and material costs, and 50 bps of unfavorable foreign currency effects, partially offset by benefits from the increased sales.

Segment operating expenses as a percentage of net sales in the first quarter improved 120 bps as compared to 2025 primarily reflecting the higher sales volumes.

As a result of these factors, segment operating earnings in the first quarter of 2026 of $54.9 million compared to $53.2 million in 2025.

Operating margin (segment operating earnings as a percentage of segment net sales) for the Commercial & Industrial Group in the first quarter of 2026 of 14.4%, including 50 bps of unfavorable foreign currency effects, compared to 15.5% last year.

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.

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

Snap-on Tools Group

Three Months Ended

(Amounts in millions) April 4, 2026 March 29, 2025 Change

(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 %

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Segment operating earnings $ 115.1 22.6 % $ 116.7 23.8 % $ (1.6) (1.4) %

Segment net sales of $486.0 million in the first quarter of 2026 represented an increase of $23.1 million, or 5.0%, from 2025 levels, reflecting a $15.9 million, or 3.4%, organic sales gain and $7.2 million of favorable foreign currency translation.

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 first quarter improved 140 bps from last year primarily due to the increased sales and savings from the segment’s RCI initiatives, partially offset by higher material and other costs.

Segment operating expenses as a percentage of net sales in the first quarter improved 20 bps as compared to 2025 primarily reflecting the higher sales volumes.

As a result of these factors, segment operating earnings of $105.0 million in the first quarter of 2026 compared to $92.4 million in 2025.

Operating margin for the Snap-on Tools Group of 21.6% in the first quarter of 2026 compared to 20.0% last year.

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.

SNAP-ON INCORPORATED

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Three Months Ended

(Amounts in millions) April 4, 2026 March 29, 2025 Change

(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 %

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Segment operating earnings $ 115.1 24.0 % $ 119.8 25.6 % $ (4.7) (3.9) %

Segment net sales of $485.3 million in the first quarter of 2026 represented an increase of $9.4 million, or 2.0%, from 2025 levels, primarily reflecting $9.1 million of favorable foreign currency translation.

On an organic basis, a low single-digit increase in sales of diagnostic and repair information products to independent repair shop owners and managers was offset by lower activity with OEM dealerships, while sales of undercar equipment were essentially flat.

Segment gross margin in the first quarter improved 30 bps from last year primarily reflecting favorable business mix and savings from the segment’s RCI initiatives, partially offset by higher tariffs and material costs, and 40 bps of unfavorable foreign currency effects.

Segment operating expenses as a percentage of net sales in the first quarter increased 140 bps from 2025 primarily due to expanded technology investments and higher personnel costs, as well as 20 bps of unfavorable foreign currency effects.

As a result of these factors, segment operating earnings in the first quarter of 2026 of $119.5 million compared to $122.1 million in 2025.

Operating margin for the Repair Systems & Information Group in the first quarter of 2026 of 24.6%, including 60 bps of unfavorable foreign currency effects, compared to 25.7% last year .

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.

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

Financial Services

Three Months Ended

(Amounts in millions) April 4, 2026 March 29, 2025 Change

(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) %

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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 $101.1 million in the first quarter of 2026 represented a decrease of $1.0 million, or 1.0%, from last year, primarily due to the lower year-over-year average portfolio.

In the first quarters 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 $264.6 million in the first quarter of 2026 represented a decrease of $4.1 million, or 1.5%, from 2025 levels.

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.

As a percentage of the average financial services portfolio, expenses were 1.3% in the first quarters of both 2026 and 2025.

As a result of these factors, segment operating earnings of $68.0 million in the first quarter of 2026 compared to $70.3 million in 2025.

Snap-on’s first quarter 2026 general corporate expenses of $28.6 million compared to $24.6 million last year.

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.

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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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 April 4, 2026, and March 29, 2025, is as follows:

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) April 4,

2026 March 29,

2025 April 4,

2026 March 29,

(Amounts in millions) July 4,

2026 June 28,

Net sales $ 1,235.1 $ 1,179.4 $ — $ —

21 unchanged sentences

OF OPERATIONS

Non-GAAP Supplemental Consolidating Data – Supplemental Condensed Balance Sheets information as of April 4, 2026, and January 3, 2026, is as follows:

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) April 4,

2026 January 3, 2026 April 4,

(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.

SNAP-ON INCORPORATED

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS

OF OPERATIONS

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

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Operations* Financial Services

(Amounts in millions) April 4,

2026 January 3, 2026 April 4,

(Amounts in millions) July 4,

2026 January 3, 2026 July 4,

2026 January 3, 2026

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Due to Snap-on’s credit rating over the years, external funds have been available at an acceptable cost.

As of April 17, 2026, Snap-on’s long-term debt and commercial paper were rated, respectively, A2 and P-1 by Moody’s Investors Service;

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;

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The following discussion focuses on information included in the accompanying Condensed Consolidated Balance Sheets.

Working capital (current assets less current liabilities) of $3,258.6 million as of April 4, 2026, represented a decrease of $225.7 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 April 4, 2026, and January 3, 2026:

(Amounts in millions) April 4,

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

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Working capital $ 3,205.8 $ 3,484.3

Cash and cash equivalents of $1,753.3 million as of April 4, 2026, represented an increase of $128.8 million from 2025 year-end levels primarily due to:

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;

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(iii) the repurcha se of 508,000 sha res of the company’s common stock for $191.3 million;

and (iv) the funding of $21.2 million of capital expenditures.

Of the $1,753.3 million of cash and cash equivalents as of April 4, 2026, $583.3 million was held outside of the United States.

(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.

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OF OPERATIONS

Trade and other accounts receivable – net of $890.7 million as of April 4, 2026, represented an increase of $9.3 million from 2025 year-end levels.

The increase is primarily due to higher sales, partially offset by $2.8 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 67 days for both April 4, 2026, and January 3, 2026.

The current portions of net finance and contract receivables of $725.6 million as of April 4, 2026, compared to $720.2 million at 2025 year end.

The long-term portions of net finance and contract receivables of $1,690.9 million as of April 4, 2026, compared to $1,721.9 million at 2025 year end.

Inventories – net of $1,020.5 million as of April 4, 2026, represented a decrease of $4.7 million from January 3, 2026, primaril y due to $5.6 million of foreign currency translation.

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 April 4, 2026, and January 3, 2026.

Inventories accounted for using the first-in, first-out (“FIFO”) method approximated 61% of total inventories as of April 4, 2026, and 62% of total inventories as of January 3, 2026.

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, primaril y due to $17.6 million from acquisitions.

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 $127.7 million and $126.7 million as of April 4, 2026, and January 3, 2026, respectively.

Notes payable and current maturities of long-term debt of $316.2 million as of April 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 $16.5 million, compared to $16.2 million of other notes as of 2025 year end.

Accounts payable of $253.6 million as of April 4, 2026, represented an increase of $24.5 million from January 3, 2026, primarily due to the timing of payments, partially offset by $2.3 million of foreign currency translation.

Other accrued liabilities of $519.0 million as of April 4, 2026, represented an increase of $53.9 million from 2025 year-end levels primarily due to an increase in accrued income taxes, partially offset by $1.9 million of foreign currency translation.

Long-term debt of $886.9 million as of April 4, 2026, consisted of $400 million of unsecured 4.10% notes that mature on March 1, 2048, and $500 million of 3.10% notes that mature on May 1, 2050, partially offset by $13.1 million of unamortized debt issuance costs and issuance discounts.

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 three months ended and as of April 4, 2026.

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:

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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 April 4, 2026, the company’s consolidated cash balance, net of certain adjustments, exceeded consolidated debt resulting in actual ratios of (0.07) and (0.28), respectively.

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 generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances.

There was no commercial paper issued or outstanding during the three months ended and as of April 4, 2026 .

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 .

SNAP-ON INCORPORATED

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Operating Activities

Net cash provided by operating activities was $368.7 million and $298.5 million in the respective first three months of 2026 and 2025.

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 $28.6 million in the first three months of 2026 included additions to finance receivables of $218.4 million, partially offset by collections of $215.9 million.

Net cash used by investing activities of $32.0 million in the first three months of 2025 included additions to finance receivables of $218.9 million, partially offset by collections of $210.7 million.

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.

Capital expenditures were $21.2 million and $22.9 million in the respective first three months of 2026 and 2025.

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 $211.1 million in the first three months of 2026 and $193.6 million in the first three months of 2025.

Proceeds from stock purchase plans and stock option exercises totaled $30.6 million and $18.3 million in the respective first three months of 2026 and 2025.

In the first three months of 2026, Snap-on repurchased 267,000 shares of its common stock for $99.9 million under its previously announced share repurchase programs.

In the first three months of 2025, Snap-on repurchased 260,000 shares of its common stock for $87.2 million under its previously announced share repurchase programs.

As of April 4, 2026, Snap-on had remaining availability to repurchase up to an additional $234.1 million in common stock pursuant to its Board’s authorizations.

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.

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Snap-on has paid consecutive quarterly cash dividends, without interruption or reduction, since 1939.

Cash dividends totaled $126.8 million and $112.2 million in the respective first three months of 2026 and 2025.

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).

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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 $21.2 million was incurred in the first three months of the year.

Snap-on currently anticipates that its full-year 2026 effective income tax rate will be in the range of 22% to 23%.

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%.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis