The Toro Company (TTC) posted third‑quarter fiscal 2026 results that topped Wall Street expectations. Adjusted earnings per share came in at $1.33, modestly above the $1.30 consensus, while net sales reached $1.23 billion, exceeding the $1.19 billion forecast by roughly $40 million.
Revenue growth was driven by both the professional and residential segments. Professional sales rose 8.8% year‑over‑year, with an adjusted operating margin of 20.9%, a 40‑basis‑point decline from the prior period. Residential sales increased 8.6%, and its margin improved to 5.9%, up four percentage points. Overall adjusted operating margin expanded to 13.9%, a 30‑basis‑point gain.
The company generated $425 million of free cash flow, representing a 128% conversion rate, and repurchased $358 million of its own shares during the quarter. Working capital improved by $217 million year‑over‑year, while inventory fell $153 million. A non‑cash impairment charge of $43 million was recorded for network optimization and product‑portfolio rationalisation under the AMP productivity program.
Toro’s stock slipped 6.78% in pre‑market trading, settling at $92.43, down from $99.15 at the prior close. The shares are trading about 12% below the 52‑week high of $105.19, with analyst price targets ranging between $100 and $120.
Management raised its full‑year fiscal 2026 outlook. Net‑sales growth is now projected at 6.3%‑6.6%, up from the earlier 4%‑6.5% range, and adjusted EPS is expected to fall between $4.60 and $4.65, moving the midpoint to $4.63. For the fourth quarter, Toro forecasts sales growth of 3.9%‑5.1% and adjusted EPS of $0.93‑$0.98. The company also revised its anticipated IEEPA refunds for Q4 to $7 million, down from $12 million.
Chief Executive Rick Olson highlighted the 8% sales increase and the $1.33 EPS result, calling the quarter “strong.” CFO Angie Drake credited the AMP productivity program for durable earnings and margin improvements, noting that its timing helped offset tariff and inflation pressures while supporting the raised guidance.
