Illinois Tool Works Inc (ITW) 2025 Q2 法說會逐字稿

Good morning. My name is Janine, and I will be your conference operator for today. At this time, I would like to welcome everyone to the ITW's second-quarter earnings conference call. (Operator Instructions)

早安.我叫 Janine，今天我將擔任您的會議主持人。現在，我歡迎大家參加 ITW 第二季財報電話會議。（操作員指示）

Erin Linnihan, Vice President of Investor Relations, you may begin your conference.

投資者關係副總裁 Erin Linnihan，您可以開始您的會議了。

Thank you, Janine. Good morning, and welcome to ITW's second-quarter 2025 conference call. Today, I'm joined by our President and CEO, Chris O'Herlihy; and Senior Vice President and CFO, Michael Larsen.

謝謝你，珍妮。早安，歡迎參加 ITW 2025 年第二季電話會議。今天，與我一起出席的還有我們的總裁兼執行長 Chris O'Herlihy 和資深副總裁兼財務長 Michael Larsen。

During today's call, we will discuss ITW's second quarter financial results and provide an update on our outlook for full year 2025. Slide 2 is a reminder that this presentation contains forward-looking statements. We refer you to the company's 2024 Form 10-K and subsequent reports filed with the SEC for more detail about important risks that could cause actual results to differ materially from our expectations. This presentation uses certain non-GAAP measures, and a reconciliation of those measures to the most directly comparable GAAP measures is contained in the press release.

在今天的電話會議上，我們將討論 ITW 的第二季財務業績，並提供我們對 2025 年全年的展望。投影片 2 提醒您，本簡報包含前瞻性陳述。我們請您參閱該公司 2024 年 10-K 表格以及隨後向美國證券交易委員會提交的報告，以了解有關可能導致實際結果與我們的預期存在重大差異的重要風險的更多詳細資訊。本簡報使用了某些非 GAAP 指標，新聞稿中包含了這些指標與最直接可比較的 GAAP 指標的對帳。

Please turn to Slide 3, and it's now my pleasure to turn the call over to our President and CEO, Chris O'Herlihy. Chris?

請翻到幻燈片 3，現在我很高興將電話轉給我們的總裁兼執行長 Chris O'Herlihy。克里斯？

Thank you, Erin, and good morning, everyone. As you saw in our press release this morning, the ITW team outpaced underlying end market growth and delivered solid financial performance in the second quarter.

謝謝你，艾琳，大家早安。正如您在我們今天早上的新聞稿中看到的，ITW 團隊在第二季度超越了終端市場的成長，並實現了穩健的財務表現。

Total revenue increased 1% as foreign currency translation increased revenue by 1% and while product line simplification or PLS, accounted for a 1% reduction. We achieved GAAP EPS of $2.58, operating income of $1.1 billion, an operating margin of 26.3%, which are all second quarter records.

總收入增加了 1%，因為外幣折算使收入增加了 1%，而產品線簡化或 PLS 導致收入減少了 1%。我們實現了 GAAP EPS 2.58 美元、營業收入 11 億美元、營業利潤率 26.3%，這些都是第二季度的最高紀錄。

We continue to execute well in controlling the controllables and as evidenced by enterprise initiatives, which contributed 130 basis points to operating margin and pricing actions that more than offset the tariff cost impact in the quarter.

我們在控制可控因素方面繼續表現良好，企業舉措證明了這一點，這些舉措為營業利潤率和定價行動貢獻了 130 個基點，足以抵消本季關稅成本的影響。

Furthermore, I am very encouraged by the meaningful strategic progress we made in the first half of the year diligently advancing our next phase growth priorities to make above-market organic growth powered by customer-back innovation at defining ITW's strength.

此外，我對我們在今年上半年取得的有意義的策略進展感到非常鼓舞，我們努力推進下一階段的成長重點，以客戶支援的創新為動力實現高於市場的有機成長，從而確定 ITW 的優勢。

We remain firmly on track to deliver on our 2030 performance goals, including customer-back innovation yield of 3% plus. These results are a direct testament to the strength of the ITW business model, the quality of our diversified and resilient portfolio and the unwavering dedication of our global ITW colleagues to serving our customers and executing our strategy with excellence.

我們堅定地朝著實現 2030 年績效目標的方向前進，包括實現 3% 以上的客戶支援創新收益。這些結果直接證明了 ITW 商業模式的實力、我們多元化和彈性投資組合的品質以及我們全球 ITW 同事對服務客戶和卓越執行策略的堅定奉獻精神。

Looking ahead, ITW is inherently built to outperform in uncertain and volatile environments. And therefore, we are raising our full year guidance. Confident in our ability to successfully navigate the current environment, and deliver differentiated performance through 2025 and beyond.

展望未來，ITW 的本質特徵是能夠在充滿不確定性和動盪的環境中表現出色。因此，我們提高了全年業績預期。我們相信我們有能力成功駕馭當前環境，並在 2025 年及以後提供差異化的表現。

I will now turn the call over to Michael to discuss our second quarter performance in more detail as well as our updated full year guidance. Michael?

現在我將把電話轉給邁克爾，更詳細地討論我們第二季的業績以及我們更新的全年指引。麥可？

Thank you, Chris, and good morning, everyone. The ITW team achieved solid operational and financial performance in Q2. Our top line saw a 1% increase in total revenue, driven in part by a 1% positive impact from foreign currency translation. Our organic growth rate was essentially flat, marking an improvement of over 1 percentage point from Q1. Geographically, while North America posted a 2% organic revenue decline in Europe was down 3%.

謝謝你，克里斯，大家早安。ITW 團隊在第二季度取得了穩健的營運和財務表現。我們的總收入成長了 1%，部分原因是外幣折算帶來了 1% 的正面影響。我們的有機成長率基本上持平，比第一季提高了 1 個百分點以上。從地理上看，北美有機收入下降 2%，歐洲有機收入下降 3%。

Asia Pacific stood out with a 9% increase with impressive growth of 15% in China. We experienced encouraging sequential revenue growth of 6% from Q1 and along with some positive signs in end markets such as semiconductors, electronics, welding, specialty products, equipment and an improved outlook for auto builds.

亞太地區表現突出，增幅達 9%，其中中國增幅高達 15%。我們的營收較第一季環比成長 6%，令人鼓舞，同時半導體、電子、焊接、特殊產品、設備等終端市場也出現了一些正面跡象，汽車製造前景也有所改善。

On the other hand, more consumer-oriented end markets, notably construction products remained challenging. The ITW team continued to demonstrate strong execution on all controllable factors positively impacting our bottom line. Our enterprise initiatives were particularly effective this quarter, contributing 130 basis points to the operating margin of 26.3%. Although our decisive pricing actions more than cover tariff costs and positively impacted EPS in Q2, the overall price cost dynamic was modestly dilutive to our margin. Finally, we generated $449 million in free cash flow, representing a 59% conversion rate.

另一方面，更以消費者為導向的終端市場，尤其是建築產品市場仍充滿挑戰。ITW 團隊繼續在所有可控因素上表現出強大的執行力，對我們的底線產生了積極影響。本季我們的企業措施特別有效，為 26.3% 的營業利潤率貢獻了 130 個基點。儘管我們果斷的定價行動不僅涵蓋了關稅成本，而且對第二季的每股盈餘產生了積極影響，但整體價格成本動態對我們的利潤率產生了輕微的稀釋作用。最後，我們產生了 4.49 億美元的自由現金流，轉換率為 59%。

Although this was modestly below our historical average, primarily due to the timing of certain onetime items, we're still on track to reach 100% plus conversion for the full year as planned. To summarize the quarter, we continue to significantly outperform our underlying end markets in a tough macro environment. Our solid financial performance includes organic growth of 1%, excluding PLS, incremental margin of 49%, operating margin of 26.3% and GAAP EPS of $2.58.

儘管這略低於我們的歷史平均水平，主要是由於某些一次性項目的時間安排，但我們仍有望按計劃實現全年 100% 以上的轉換率。總結本季度，在嚴峻的宏觀環境下，我們的表現持續顯著超越基礎終端市場。我們穩健的財務表現包括 1% 的有機成長（不包括 PLS）、49% 的增量利潤率、26.3% 的營業利潤率和 2.58 美元的 GAAP EPS。

Let's turn to slide 4 for a closer look at our sequential performance from Q1 to Q2, which was quite encouraging. Revenue grew 6%, operating income improved 12%, and operating margin expanded by 150 basis points.

讓我們翻到投影片 4，仔細看看我們從第一季到第二季的連續表現，這是相當令人鼓舞的。營收成長 6%，營業收入提高 12%，營業利益率擴大 150 個基點。

Notably, every one of our seven segments grew revenue and expanded operating margin sequentially, with 3 segments exceeding 30%. Let's dive into our segment results, beginning with automotive OEM. Revenue here was up 4%, driven by 2% organic growth in the quarter. Strategic PLS reduced revenue by over 1%. The Regionally, while North America was down 7% and Europe up 1%, China was a standout with impressive 22% growth.

值得注意的是，我們的七個部門都實現了收入成長和營業利潤率連續擴大，其中三個部門的營業利潤率超過 30%。讓我們深入了解各部門的業績，從汽車 OEM 開始。受本季 2% 有機成長的推動，該部門營收成長了 4%。策略性 PLS 使收入減少了 1% 以上。從地區來看，北美下降了 7%，歐洲成長了 1%，而中國則表現突出，成長了 22%。

Our local team continues to innovate and gain market share in the rapidly expanding EV market with customer-back innovation efforts driving increased content per vehicle. We anticipate this strong momentum will carry into the second half of 2025 and beyond.

我們的本地團隊不斷創新，在快速擴張的電動車市場中獲得市場份額，並以客戶為導向的創新努力推動每輛車的含量增加。我們預計這一強勁勢頭將持續到 2025 年下半年及以後。

For the full year, we project the Automotive OEM segment will outperform relevant industry builds by 200 to 300 basis points as we continue to consistently grow our content per vehicle. We've updated our guidance to incorporate the latest more positive auto build forecasts, which are as follows: worldwide auto builds are now projected to be about flat, with North American bills down mid-single digits and Europe down low single digits, partially offset by mid-single-digit growth in China builds.

就全年而言，隨著我們繼續穩定增加每輛車的內容，我們預計汽車 OEM 部門的表現將比相關行業表現高出 200 至 300 個基點。我們已更新我們的指引，以納入最新的更為積極的汽車生產預測，具體如下：目前預計全球汽車生產將基本持平，北美汽車產量將下降中等個位數，歐洲汽車產量將下降低個位數，但中國汽車產量將出現中等個位數的增長，從而部分抵消這一影響。

Overall, our relevant markets are expected to be down in the low single digits in 2025, which is an improvement from the down mid-single-digit protection in our prior guide. The bottom line performance was a significant highlight for automotive OEM with operating margin improving 190 basis points to 21.3%. This marks our highest margin since Q1 of 2021 and firmly placing us on track to achieve our long-term goal of low to mid-20s operating margin by next year.

總體而言，我們預計 2025 年相關市場將出現低個位數下降，這比我們先前指南中的中個位數下降保護有所改善。底線業績是汽車 OEM 的一大亮點，營業利潤率提高 190 個基點至 21.3%。這是我們自 2021 年第一季以來的最高利潤率，並使我們預計在明年實現 20% 左右的長期營業利潤率目標。

Turning to Food Equipment on slide 5. Revenue increased 2% with 1% organic growth. Equipment sales were flat, while our service business grew by 3%. Regionally, North America grew a solid 5%, driven by 4% growth in equipment and 6% in service. The growth was notably strong in the institutional end markets. International, however, was down 5%.

前往幻燈片 5 上的食品設備。營收成長 2%，其中有機成長 1%。設備銷售額持平，而我們的服務業務成長了 3%。從地區來看，北美地區穩健成長 5%，其中設備成長 4% 和服務成長 6%。機構終端市場的成長尤為強勁。然而，國際股市下跌了 5%。

For Test & Measurement and Electronics, revenue was up 1% and as organic revenue saw a 1% decline. Demand for our test and measurement capital equipment continues to be challenging. However, we noted encouraging order activity late in the second quarter. Meanwhile, our electronics business grew 4%, fueled by heightened activity in the semiconductor-related businesses that achieved double-digit growth. Despite being impacted by onetime items this quarter, operating margin is projected to recover to the mid- to high 20s in the second half.

測試測量和電子產品的收入增加了 1%，而有機收入下降了 1%。對我們的測試和測量資本設備的需求仍然充滿挑戰。然而，我們注意到第二季末的訂單活動令人鼓舞。同時，我們的電子業務成長了 4%，這得益於半導體相關業務的活躍度提高，實現了兩位數的成長。儘管本季受到一次性專案的影響，但預計下半年營業利潤率將回升至 25% 左右。

Moving to slide 6. Welding was a bright spot, delivering 3% organic growth. Equipment sales increased 4% with strong new product contributions, while consumables grew 1%. These represent the highest growth rates for both businesses in two years. Industrial sales also increased 1% with every region contributing to growth this quarter.

移至幻燈片 6。焊接業務是一個亮點，實現了 3% 的有機成長。受新產品強勁推動，設備銷售額成長 4%，而消耗品銷售額成長 1%。這是兩家公司兩年來的最高成長率。本季度，各地區均對工業銷售額成長做出了貢獻，工業銷售額也成長了 1%。

North America was up 1% and international sales grew 11% and largely driven by 28% growth in China, a direct result of new product introductions targeting the energy sector. Our 33.1% operating margin remained essentially flat year-over-year demonstrating sustained strong profitability. Revenue in Palmers & Fluids declined 3%, which included a percentage point headwind from PLS. Organic revenue was down 5% in polymers and 3% in both fluids and the more consumer-oriented automotive aftermarket.

北美銷售額成長 1%，國際銷售額成長 11%，這主要得益於中國市場 28% 的成長，而這直接得益於針對能源領域的新產品的推出。我們的營業利潤率為 33.1%，與去年同期基本持平，顯示出持續強勁的獲利能力。Palmers & Fluids 的收入下降了 3%，其中包括來自 PLS 的一個百分點的逆風。聚合物的有機收入下降了 5%，流體和更面向消費者的汽車售後市場的有機收入下降了 3%。

Let's look at Construction Products on slide 7. This, our most interest rate sensitive segment continues to contend with global demand challenges on the residential side. Revenue declined 6% in markets we estimate are down even more significantly and were further impacted by a 1% reduction from strategic PLS.

讓我們來看看幻燈片 7 上的建築產品。我們對利率最敏感的這個部門繼續應對住宅方面的全球需求挑戰。我們估計，在下降幅度更大的市場中，收入下降了 6%，並受到策略 PLS 1% 下降的進一步影響。

Regionally, organic revenues saw North America declined 7% and Europe was down 5% and Australia and New Zealand decreased 10%. However, despite these persistent market headwinds, the segment demonstrated remarkable resilience, improving its operating margin by 140 basis points to 30.8%, a testament to strong execution in a difficult environment. For Specialty Products, revenue increased 1% with flat organic revenue this quarter due to a challenging 7% organic growth comparison with last year.

從地區來看，北美有機收入下降 7%，歐洲下降 5%，澳洲和紐西蘭下降 10%。然而，儘管市場持續面臨逆風，該部門仍表現出了顯著的韌性，營業利潤率提高了 140 個基點，達到 30.8%，證明了在困難環境中的強勁執行力。對於特種產品而言，本季營收成長 1%，有機收入持平，因為與去年相比 7% 的有機成長率具有挑戰性。

Revenue also included over 1 percentage point from strategic PLS. On a positive note, equipment sales, which rose 8% were fueled by sustained strength in our packaging and aerospace equipment businesses. Operating margin improved 70 basis points to 32.6%, significantly benefiting from enterprise initiatives.

收入中還包括來自戰略 PLS 的 1% 以上的收入。積極的一面是，設備銷售額成長了 8%，這得益於我們包裝和航太設備業務的持續強勁成長。營業利潤率提高 70 個基點至 32.6%，這在很大程度上受益於企業舉措。

With that, let's move to slide 8 for an update on our full year 2025 guidance. We've often reiterated our high confidence in successfully navigating challenging macro conditions and delivering solid financial performance. Our decision to raise GAAP EPS guidance by $0.10 at the midpoint, narrowing the range to 135 to 155 serves as clear evidence of this capability. We are well positioned to outperform our end markets and continue to project organic growth of 0% to 2%.

接下來，讓我們轉到第 8 張投影片，了解我們 2025 年全年指引的最新情況。我們經常重申，我們對成功應對充滿挑戰的宏觀環境和實現穩健的財務表現充滿信心。我們決定將 GAAP EPS 指引中點上調 0.10 美元，將範圍縮小至 135 至 155，這清楚地證明了這一能力。我們已做好準備，超越我們的終端市場，並將繼續實現 0% 至 2% 的有機成長。

Per our usual process, our projection factors in current demand levels, the incremental pricing related to tariffs, our updated automotive build projections and an easier year-over-year comparison in the second half of the year.

按照我們的常規流程，我們的預測因素包括當前的需求水準、與關稅相關的增量定價、我們更新的汽車產量預測以及下半年更容易的同比比較。

Total revenue is now projected to be up 1% to 3%, reflecting current more favorable foreign exchange rates. As we look at the second half, we fully expect to continue to execute at our usual high level on all the key profitability drivers within our control. This includes already implemented pricing actions, which we project will more than offset tariff costs and favorably impact EPS.

由於當前外匯匯率更為有利，預計總收入將成長 1% 至 3%。展望下半年，我們完全有信心繼續在我們控制範圍內的所有關鍵盈利驅動因素上保持一貫的高水準表現。這包括已經實施的定價行動，我們預計這些行動將足以抵消關稅成本並對每股盈餘產生正面影響。

Additionally, we expect our enterprise initiatives to contribute 100 basis points or more to the operating margin independent of volume. Notably, all seven of our segments are projected to grow revenue and improve margins in the second half relative to the first half.

此外，我們預計我們的企業計劃將為營業利潤率貢獻 100 個基點或更多，無論交易量如何。值得注意的是，我們所有七個部門預計下半年的營收和利潤率都將比上半年有所成長。

Our full year GAAP EPS cadence remains consistent. We expect 47% in the first half and 53% in the second half. This reflects our typical business seasonality along with expected benefits in the second half for stronger pricing and more favorable foreign exchange rates.

我們的全年 GAAP EPS 節奏保持一致。我們預計上半年為47%，下半年為53%。這反映了我們典型的業務季節性以及下半年更強勁的定價和更優惠的外匯匯率的預期收益。

Implied in our guidance is solid second half financial performance with reasonable organic growth, substantial margin improvement and strong free cash flows. To wrap up, we're confident that the enhanced strength and resilience of the ITW business model, coupled with our high-quality diversified business portfolio and crucially, our dedicated people equip us to decisively and effectively manage the current environment, no matter how it evolves and all while steadfastly pursuing our long-term enterprise strategy.

我們的指引暗示下半年財務業績穩健，有機成長合理，利潤率大幅提高，自由現金流強勁。總而言之，我們相信，ITW 業務模式的增強實力和彈性，加上我們高品質的多元化業務組合，以及至關重要的我們敬業的員工，使我們能夠果斷有效地管理當前環境，無論它如何發展，同時堅定不移地追求我們的長期企業戰略。

With that, Erin, I'll turn it back to you.

艾琳，有了這個，我就把它交還給你了。

Thank you, Michael. Janine, will you please open the call for questions and answers.

謝謝你，麥可。Janine，請您開啟問答環節。

(Operator Instructions) Tami Zakaria, JP Morgan.

（操作員指示）摩根大通 (JP Morgan) 的塔米·扎卡里亞 (Tami Zakaria)。

All right, good morning. Thank you so much. I just wanted to ask about the new operating margin outlook. I think you reduced it at the midpoint. I just wanted to get some color on it.

好的，早安。太感謝了。我只是想詢問一下新的營業利潤率前景。我認為你在中間點減少了它。我只是想給它加點顏色。

are price increases causing more than expected volume headwind, which is driving the reduced operating margin outlook? Or is there anything that you didn't anticipate, but now are seeing and are expecting for the back half. So any color on what's driving that outlook versus the last time you spoke?

物價上漲是否會導致銷量逆風超過預期，導致營業利潤率前景下降？或者有什麼事情是你沒有預料到的，但現在看到了，並且期待後半部分發生。那麼，與您上次談話相比，您能解釋一下是什麼導致了這種觀點嗎？

Yes, Tami, it's a pretty straightforward answer. Essentially, while our price actions to offset tariffs have been quite successful, and we are ahead on a dollar-for-dollar basis. As you know, that can be -- can mean that it is still dilutive from a margin standpoint. Which is what I mentioned in the prepared remarks that price/cost was modestly margin dilutive in Q2. And so that's really what's driving it.

是的，塔米，這是一個非常直接的答案。從本質上講，我們為抵消關稅而採取的價格行動相當成功，而且我們在同等條件下處於領先地位。如您所知，這可能意味著從利潤率的角度來看它仍然具有稀釋性。這就是我在準備好的評論中提到的，第二季的價格/成本略微稀釋了利潤率。這就是真正的推動因素。

And I think just taking a step back, if you look at the last time we were together, we said that we expected price cost to be neutral or better. And I think our teams have done a great job putting us in a position where these price actions are EPS positive, but slightly margin dilutive, which is what you're seeing in the updated margin guidance.

我認為，退一步來說，如果你回顧我們上次在一起時，我們說過我們預計價格成本將是中性的或更好的。我認為我們的團隊做得非常出色，使我們處於這樣的位置：這些價格行動對每股收益有利，但會略微稀釋利潤率，這就是您在更新的利潤率指引中看到的情況。

Now that to us is just a timing issue. We will recover that margin just like we did every other cycle that we've been through. And whether that happens by the end of the year or next year, I think is a little uncertain at this point. But as we've talked about before, good companies will offset the cost impact and eventually recuperate the margin impact as well. And so that's what you're seeing in our updated margin guidance.

對我們來說，這只是一個時間問題。我們將恢復這項利潤，就像我們經歷過的每一個週期一樣。至於這是否會在今年年底或明年發生，我認為目前還不太確定。但正如我們之前所討論過的，好的公司將抵消成本影響並最終恢復利潤影響。這就是您在我們更新的保證金指南中看到的內容。

Got it. That's very helpful color. And a follow-up on the auto segment specifically, I think margins came in at least better than what I was modeling. So as I think about the back half, as we think about the back half, should we expect sequential improvement versus 2Q?

知道了。這是非常有用的顏色。具體來說，針對汽車領域，我認為利潤率至少比我所模擬的還要好。因此，當我考慮下半年時，當我們考慮下半年時，我們是否應該期待與第二季度相比連續的改善？

So I think we're very pleased with the progress in our Automotive segment, both on the top line in the quarter and the improved outlook for the back half and also on the margin side. 21.3%, an improvement of 190 basis points. I think as you look forward into the balance of the year, I think we'll be solidly above 20% both for the second half and likely for the full year as well, which puts us in a great position to reach our long-term goal, kind of low to mid-20s sometime next year.

因此，我認為我們對汽車部門的進展感到非常滿意，包括本季的營業收入、下半年前景的改善以及利潤率方面的成長。利潤率為 21.3%，提高了 190 個基點。我認為，當你展望今年的平衡時，我認為我們下半年的成長率將穩固地超過 20%，而且全年的成長率也可能如此，這使我們處於有利地位，可以在明年某個時候實現我們的長期目標，即 20% 左右。

Just to support that, Tami. The other thing I would say on auto is that when we looked at our auto margins back at Investor Day, we forecast that we get ongoing significant contributions from enterprise initiatives and from higher-margin innovation. And that's very much what's playing out here in 2025.

只是為了支持這一點，塔米。關於汽車，我想說的另一件事是，當我們在投資者日回顧汽車利潤率時，我們預測企業計劃和利潤率更高的創新將持續帶來重大貢獻。這正是 2025 年將要發生的事。

Jamie Cook, Truist Securities.

Jamie Cook，Truist Securities。

I guess two questions. It sounds like on CBI, you guys think you're doing you're sort of gaining traction there. So can you help me understand outside of automotive where you're the most success? And is the -- do we still expect CBI to contribute to 2.3% to 2.5% that you initially laid out? And then I guess my second question, just a follow-up.

我想問兩個問題。聽起來，你們認為在 CBI 方面你們正在取得進展。那麼，您能否幫助我了解您在汽車產業之外最成功的領域是什麼？我們是否仍預期 CBI 將貢獻您最初提出的 2.3% 至 2.5%？然後我想我的第二個問題只是一個後續問題。

Michael, just what's implied in the new guide in terms of FX? I know initially, it was I think, a negative $0.30 headwind, it went neutral last quarter. Just trying to understand what's implied in the new updated guidance.

邁克爾，新指南中關於 FX 到底暗示了什麼？我知道，最初，我認為這是一個負 0.30 美元的逆風，但上個季度它變成中性。只是想了解新更新指南中暗示的內容。

Yes. Let me answer the FX question. So basically, what we've incorporated now are current foreign exchange rates. And so we've gone from anticipating a significant headwind going into the year. we now expect some modest favorability based on rates as we sit here today.

是的。讓我來回答 FX 問題。所以基本上，我們現在所採用的是目前的外匯匯率。因此，我們不再預期今年會出現重大逆風，而是預計今天的利率將出現一定程度的溫和上漲。

Now I say modest because on a year-over-year basis, the contribution to EPS in Q2, for example, was about $0.03 a share. So we're not talking about huge tailwind from foreign exchange. So that's kind of the modeling assumption, current foreign exchange rates and assuming that they stay where they are, which obviously can change quickly as we've seen this year. And with that, on the CBI side, Chris.

現在我說適度，是因為與去年同期相比，第二季對每股盈餘的貢獻約為每股 0.03 美元。所以我們談論的並不是外匯帶來的巨大順風。這是一種建模假設，即當前的外匯匯率，並假設它們保持在原位，但正如我們今年所看到的那樣，這顯然會迅速變化。接下來是 CBI 方面的 Chris。

Sure. So Jamie, on CBI, we're certainly encouraged by the progress that we're making across the company, great pipeline of new products. really across all seven segments. It's one of the reasons that we would say we're outperforming our end markets at the enterprise level. several successful product launches this year across the portfolio.

當然。因此，Jamie，關於 CBI，我們當然對整個公司所取得的進展感到鼓舞，新產品的管道非常豐富，實際上涉及所有七個部門。這也是我們可以說我們在企業級終端市場中表現優於其他市場的原因之一。今年我們在整個產品組合中成功推出了幾款產品。

You asked for some segment color. I would say Welding has been a sand. You've seen that in terms of welding growth of 3%. We believe our CBI contribution welding is above 3% right now. But also say food equipment, where we continue to have product launches across all product categories, all real tangible areas like energy and water savings and then automotive, where we see it particularly in China, where we're certainly growing market share through CBI.

您要求一些片段顏色。我想說焊接已經是沙子了。您已經看到焊接量增加了 3%。我們相信我們的 CBI 貢獻焊接目前已超過 3%。但也說到食品設備，我們將繼續推出涵蓋所有產品類別、所有實際有形領域的產品，例如節能節水，然後是汽車，我們在中國尤其看到這一點，我們透過 CBI 在中國的市場份額肯定在不斷增長。

So off to a solid start here in 2025, to your question, well on track to deliver on our CBI yield goal of 2.3 to 2.5 this year.

因此，對於您的問題，2025 年我們將有一個良好的開端，預計將實現今年 2.3 至 2.5 的 CBI 收益率目標。

Andy Kaplowitz, Citigroup.

花旗集團的安迪‧卡普洛維茲 (Andy Kaplowitz)。

Chris or Michael, you mentioned encouraging sequential growth of 6%. I think usually, you get a couple of percentage points of growth sequentially in Q1 to Q2. I think you had one extra selling day, if I remember correctly for Q2. But would you say you're seeing incremental continued improvement in short-cycle businesses such as semicon that you saw last quarter? And how are your longer-cycle customers?

克里斯或邁克爾，你們提到了令人鼓舞的 6% 的連續成長。我認為通常情況下，第一季和第二季會連續實現幾個百分點的成長。如果我沒記錯的話，我認為第二季你們的銷售時間多了一天。但是您是否認為您看到上個季度半導體等短週期業務正在逐步持續改善？您的長週期客戶狀況如何？

What are the conversations like? You mentioned welding a little bit better you mentioned test and measurement getting better at the end of Q2. Maybe you can give a little more color on that.

對話是什麼樣的？您提到焊接效果稍微好一點，您提到測試和測量在第二季末變得更好了。也許您可以對此進行更詳細的說明。

Yes. I think, Andy, those are fair points on the sequential. I think really the point of putting that slide in there was that this is certainly not a company that's slowing down. We were really encouraged. If you look back to where we were on the last earnings call, we were talking about the slowdown and some real concerns around tariffs.

是的。安迪，我認為這些都是關於順序的合理觀點。我認為放這張投影片的真正目的是表明這絕對不是一家正在放緩的公司。我們確實受到了鼓舞。如果你回顧一下我們上次財報電話會議的情況，我們討論的是經濟放緩以及有關關稅的一些真正擔憂。

I think at this point, we're talking about some really encouraging positive momentum. And you can see what happens when you get just a little bit of growth, 6% growth equated to 12% income growth on a sequential basis, incremental margins sequentially are above 50% and year over year 49%. So that was really the point that we were trying to make here.

我認為此時此刻，我們正在談論一些真正令人鼓舞的積極勢頭。你可以看到，當你獲得一點點增長時會發生什麼，6% 的增長相當於連續 12% 的收入增長，增量利潤率連續超過 50%，同比增長 49%。這就是我們在此想要表達的真實觀點。

I think we still see some challenges, as you heard, as we went through the segments on the consumer-oriented side. Construction product is the obvious one, which I think is not going to be a surprise to anybody at this point. A little bit of softness maybe in automotive aftermarket, which in Polymers & Fluids, which also tends to be more consumer oriented, but also some positive signs as we went through the quarter in the kind of the more general industrial CapEx space.

正如您所聽到的，當我們討論面向消費者的各個部分時，我認為我們仍然面臨一些挑戰。建築產品是顯而易見的，我認為這對任何人來說都不會感到驚訝。汽車售後市場、聚合物和流體市場可能略顯疲軟，這些市場也更傾向於以消費者為導向，但隨著我們在本季度經歷更普遍的工業資本支出領域，也出現了一些積極的信號。

We saw order activity really pick up in Test & Measurement towards the end of the quarter. We saw a significant increase in the number of big orders that were taken relative to last quarter. We saw some good progress also in Welding. We talked about the growth rates there. Semi which is a fairly small percentage of our total revenues, about 3%. I think it is last time we looked at it, growing double digits.

我們看到，在本季末，測試與測量領域的訂單活動確實有所回升。與上一季相比，我們收到的大額訂單數量顯著增加。我們在焊接方面也看到了一些很好的進展。我們討論了那裡的成長率。Semi 在我們的總收入中所佔比例相當小，約為 3%。我認為這是我們上次看到的那樣，增長了兩位數。

And so that's really what we want to try to highlight that there are some positive things going on here. The automotive build forecast improved. And I think all those things are obviously not just market tailwind, but it's all the work that we're doing around customer-backed innovation and new products to gain market share. And if you were an optimist, I would say we're seeing the first encouraging signs that this is really working.

因此，我們確實想強調的是，這裡正在發生一些正面的事情。汽車生產預測有所改善。我認為所有這些顯然不僅僅是市場順風，也是我們圍繞客戶支持的創新和新產品為贏得市場份額所做的所有工作。如果你是一個樂觀主義者，我會說我們看到了第一個令人鼓舞的跡象，表明這確實有效。

And it gives us a lot of confidence not only going into the back half of the year, but also going into next year and the commitments we've made kind of in terms of our long-term performance goals that even when macro conditions are maybe not very supportive of the growth that we're trying to achieve. We're still delivering solid performance and in a position we're halfway through the year, we can raise our guidance.

這不僅讓我們對今年下半年充滿信心，也讓我們對明年充滿信心，並且相信我們已就長期業績目標做出承諾，即使宏觀條件可能不太支持我們試圖實現的成長。我們仍然保持著穩健的表現，並且在今年已經過去一半的情況下，我們可以提高我們的預期。

So that's how I would characterize it, Andy.

這就是我對它的描述，安迪。

Michael, to that point, you've always been good in China, but it seems like you're getting better, particularly in [Chad Automotive]. Chris talked about CVI if I look by region, China just such a standout versus your other regions, especially versus other industrial peers. So is it really just CBI or maybe it's just China EV. Is there anything that you can do for the other geographies to really sort of support or improve that growth and maybe the durability? I think you just answered it, Michael, durability in China it seems there.

邁克爾，到目前為止，你在中國的表現一直很好，但似乎你正在變得更好，特別是在[乍得汽車]。克里斯談到了 CVI，如果我按地區來看，中國與其他地區相比非常突出，尤其是與其他工業同行相比。那麼它真的只是 CBI 嗎，或者只是中國電動車嗎？您能為其他地區做些什麼來真正支持或改善這種成長和持久性？邁克爾，我想你剛剛回答了這個問題，中國的耐用性似乎就在那裡。

Yes, Andy, and I would just add to that, that we would certainly see -- you saw a 15% growth in China, '22 in automotive. But the growth is really sustainable for a number of reasons and not just automotive. Our business in China across all segments are highly differentiated.

是的，安迪，我只想補充一點，我們肯定會看到——你看到中國 22 年汽車業成長了 15%。但這種成長確實是可持續的，原因有很多，不僅僅是汽車產業。我們在中國各領域的業務都具有高度的差異化。

The proof point that I would offer here is that our margins in China are at the same level as North America or Western Europe, which really speaks to the whole kind of focus on differentiation. We have very strong customer-back innovation efforts in China. China actually generates a disproportion of our patents protecting customer solutions.

我在這裡要提供的證據是，我們在中國的利潤率與北美或西歐處於同一水平，這確實說明了我們對差異化的關注。我們在中國擁有非常強大的客戶支援創新力量。中國實際上產生了不成比例的保護客戶解決方案的專利。

We have these very long and very strong, long-lasting customer partnerships in China. As an example, our auto business in China has been there of close to 30 years. A reminder, again, we produce in China for the China market. But last and I'd say by no means least, we have a very highly tenured, highly talented and experienced leadership team who are ITW business model experts and who execute for the company every day. So we really feel well positioned across all seven segments in China.

我們在中國擁有非常悠久、非常牢固、持久的客戶合作夥伴關係。例如，我們在中國的汽車業務已經存在近30年了。再次提醒一下，我們在中國生產，供應中國市場。但最後我想說的是，我們擁有一支任職時間很長、才華洋溢、經驗豐富的領導團隊，他們都是 ITW 商業模式專家，每天都在為公司執行任務。因此，我們確實感覺自己在中國所有七個細分市場都處於有利地位。

Innovation is certainly a part of it. But I think across the relationships, the quality of our team and most importantly, our focus on sustainable differentiation is really what underpins our future growth prospects in China.

創新當然是其中的一部分。但我認為，透過各種關係、我們團隊的素質以及最重要的，我們對永續差異化的關注才是我們未來在中國成長前景的真正基礎。

Julian Mitchell, Barclays.

巴克萊銀行的朱利安·米切爾。

Maybe just my first question, trying to understand the sort of FX dynamics in the EPS guide. So I think maybe sort of versus the beginning of the year, there's about a $0.30, $0.40 tailwind to EPS from the FX change what are sort of the offsets in that sort of blunting that because the drop-through to the overall EPS guide is much smaller, and I think price cost is dollar positive.

也許這只是我的第一個問題，試圖了解 EPS 指南中的外匯動態類型。因此，我認為與年初相比，外匯變化對 EPS 的影響約為 0.30 美元、0.40 美元，這種影響可以抵消什麼呢？因為對整體 EPS 指南的跌幅要小得多，我認為價格成本對美元有利。

Yes. I think, Julian, we're still taking a fairly cautious approach here. I think as we said in Chris' opening remarks, I mean we remain in a really uncertain and a pretty volatile environment where things can change quickly, whether it be the tariff environment or foreign exchange rates. And so I think the reason why you're not seeing us take guidance up by $0.30 is exactly that, that we are maintaining an appropriately conservative approach here given the current macro conditions that we're dealing with.

是的。朱利安，我認為我們在這裡仍然採取相當謹慎的態度。我想正如我們在克里斯的開場白中所說的那樣，我們仍然處於一個非常不確定且相當不穩定的環境中，無論是關稅環境還是外匯匯率，情況都可能迅速變化。因此，我認為您沒有看到我們將指導價上調 0.30 美元的原因正是因為考慮到我們當前面臨的宏觀條件，我們在這裡保持了適當保守的態度。

And I would say given, again, the conditions that we're dealing with, we feel pretty good about the type of performance that we're putting up. And the confidence that we're trying to convey in the second half, which, based on our -- everything I talked about, we're going to be putting up some reasonable organic growth implied in our guidance is kind of 2% to 3% organic growth, 100 basis points plus of margin improvement year-over-year in the back half, really strong incremental margins. and also really strong free cash flows.

我想說，考慮到我們所面臨的情況，我們對於我們所取得的表現感到相當滿意。我們試圖傳達的信心是，基於我所談論的一切，我們將在下半年實現一些合理的有機增長，這在我們的指導中有所暗示，即下半年有機增長率為 2% 到 3%，利潤率同比提高 100 個基點以上，利潤增量非常強勁，自由現金流也非常強勁。

So given the conditions we're dealing with, we feel like we're in a pretty good position here going into the back half of the year.

因此，考慮到我們所面臨的情況，我們感覺我們在進入下半年時處於一個相當有利的地位。

That's helpful. And then maybe just a second one kind of trying to follow up on sort of within the back half, third versus fourth quarter? I know there was a little bit of conversation of that already. But any sort of shift in terms of demand patterns, let's say, in recent weeks into Q3? And when you're thinking about that price cost margin headwind, how are we thinking about that in sort of the third versus the fourth quarter, maybe just sort of flesh out anything?

這很有幫助。然後也許只是嘗試跟進後半段、第三節和第四節的情況？我知道已經有人就此進行了一些討論。但是，就需求模式而言，比如說最近幾週進入第三季度，有什麼改變嗎？當您考慮價格成本利潤率逆風時，我們如何看待第三季和第四季的情況，也許可以充實一下？

I think, Julian, I mean, from Q3 to Q4, it's kind of our typical sequential. Typically, revenues go up a little bit from Q2 to Q3 and into Q4. The kind of the traditional run rates are not as accurate as usual because of all the price that we're getting. So if you think about these price-related -- tariff-related price increases, those are really only starting to flow through here in Q3 and Q4. And so -- that's why we're effectively guiding to something that's a little above our typical run rate.

我認為，朱利安，我的意思是，從第三季度到第四季度，這是我們典型的連續過程。通常，收入從第二季到第三季再到第四季會略有上升。由於我們獲得的價格不同，傳統的運行率並不像平常那麼準確。因此，如果你考慮這些與價格相關的——與關稅相關的價格上漲，這些實際上只是在第三季和第四季才開始出現。所以——這就是為什麼我們有效地引導某個略高於我們典型運行率的事物。

But again, we should expect, like we talked about on the last call, good sequential improvement from Q2 into Q3, Q3 into Q4. Both really on all the key elements here, the top line margin improvement. I think we talked about every segment improving margins and revenue in the second half relative to the first half. And that's not assuming a pickup in demand.

但是，正如我們在上次電話會議上談到的那樣，我們應該預期從第二季到第三季、從第三季到第四季會出現連續的良好改善。兩者確實都涉及所有關鍵要素，即頂線利潤率的提高。我認為我們討論過每個部門下半年相對於上半年的利潤率和收入都有所提高。這並不是假設需求會回升。

That's basically, like I said, current run rates, it's the price current FX rates, which I think you asked about. And then an updated outlook for automotive and then a more -- about 0.5 point of easier comps in the back half of the year. So you put all that together, that's how we end up with a pretty solid second half. Just to wrap up your question around what did you see in Q2? Nothing really unusual going through the quarter other than in June, June was our strongest month, it typically is.

基本上，就像我說的，這就是當前的運行率，也就是當前的外匯匯率，我想您問的是這個。然後是汽車產業的更新前景，然後是下半年更容易比較的約 0.5 個百分點。所以，把所有這些綜合起來，我們就能得到一個相當穩固的下半場。總結一下您的問題，您在第二季看到了什麼？除了 6 月以外，本季沒有什麼特別不尋常的情況，6 月是我們最強勁的月份，通常都是如此。

And then some of these more positive signs that we talked about around some of the order activity and the CapEx equipment businesses became more became more encouraging as we went through towards the end of the quarter.

然後，隨著我們接近本季末，我們談到的一些訂單活動和資本支出設備業務的一些更積極的跡象變得越來越令人鼓舞。

Stephen Volkmann, Jefferies.

傑富瑞的史蒂芬·福爾克曼。

I guess I'm trying to say -- I know you don't like to talk in too much detail about this, but I'm assuming in your 0% to 2% organic, your volumes must be down like low to mid-single digits or something. And the reason I'm curious about that is because, obviously, you're putting up pretty good incrementals on lower volumes, I guess, so I'm trying to think about when volumes do come back, did the enterprise initiatives mean we'll have higher incremental margins? Or how should I think about that? Sorry, it's a little complicated.

我想說的是——我知道你不喜歡談論太多細節，但我假設在 0% 到 2% 的有機率中，你的銷量一定會下降到低到中等個位數左右。我對此感到好奇的原因是，顯然你們在較低的銷量上實現了相當不錯的增量，所以我想，當銷量回升時，企業計劃是否意味著我們將獲得更高的增量利潤率？或者我應該如何考慮這個問題？抱歉，有點複雜。

No, that's okay. We just how we're saying that your volume assumptions are not entirely correct, even though we don't guide volume versus price. And then your second point, we brought up incremental margins of 49% year-over-year in Q2. And that is some of these price cost actions related to tariffs are basically coming through at a fairly low incremental.

不，沒關係。我們只是想說，儘管我們不指導交易量與價格的關係，但您的交易量假設並不完全正確。然後您的第二點是，我們在第二季度實現了 49% 的同比增量利潤率。與關稅相關的一些價格成本行動基本上是以相當低的增量實現的。

So if that's the case, you have to believe that the core incrementals are significantly higher at this point in time relative to our kind of historical 35% to 40%. And I think you can see in a couple of places here.

因此，如果情況確實如此，那麼你必須相信，目前的核心增量相對於我們歷史上的 35% 到 40% 而言要高得多。我想您可以在這裡的幾個地方看到。

Automotive is maybe the better example this quarter. What happens when we get just a little bit of growth. I mean automotive with 2% organic margins are up 190 basis points. And so you look at the sequential growth and the incrementals from Q1 to Q2.

汽車產業也許是本季更好的例子。當我們獲得一點點成長時會發生什麼。我的意思是，有機利潤率為 2% 的汽車產業上漲了 190 個基點。因此，您可以查看從第一季到第二季的連續成長和增量。

So to answer your question, it's reasonable to assume that incrementals are above historical and you'll see some of that in the second half. We expect reasonable kind of 2% to 3% organic growth with some very strong incrementals.

因此，回答您的問題，可以合理地假設增量高於歷史水平，並且您會在下半年看到其中的一些。我們預計有機成長率將達到合理的 2% 至 3%，且增量非常強勁。

And Steve, over the long term, the incremental is strong incremental is predominantly driven by the quality of the portfolio and continuous improvement in the quality of the portfolio and execution of the business model against that portfolio is ultimately what drives the incremental higher.

史蒂夫，從長期來看，增量是強勁的，增量主要由投資組合的品質驅動，投資組合品質的持續改進和針對該投資組合的業務模式的執行最終推動了增量的提高。

Got it. Okay. And then maybe specifically on construction, sort of amazing to see 140 bps of growth on 6% decline in revenue. And it doesn't look like it was a geographic mix issue there. Was that all just kind of enterprise or CBI? Or is there some sort of mix there? Any detail there would be great.

知道了。好的。或許具體到建築業，收入下降 6% 的情況下卻實現了 140 個基點的成長，這真是令人驚訝。這看起來不像是個地理混合問題。這些都是企業還是 CBI 的產物？或者那裡有某種混合？任何細節都很棒。

Yes. I mean the biggest driver is as usual are the enterprise initiatives were well above company average at about 160 basis points. So that's really the key driver. I think that we agree with you that the fact that we have a construction business that for over a year, has been putting up margins in that 29%, 30% range in some of the most challenging end markets that we've seen in a long time is pretty remarkable. And I think the team frankly gets a lot of credit for trying to find a way to make the best of a tough macro.

是的。我的意思是，最大的驅動力一如既往，企業措施遠高於公司平均水平，約為 160 個基點。所以這確實是關鍵驅動因素。我想我們同意你的觀點，我們的建築業務在一年多的時間裡，在一些我們長期以來見過的最具挑戰性的終端市場中，利潤率一直保持在 29% 到 30% 左右，這是非常了不起的。而且我認為團隊在嘗試找到一種方法來充分利用艱難的宏觀優勢方面確實獲得了很大的讚譽。

Yes, and all underpinned with great brands and technology, very focused on the most attractive parts of the construction market.

是的，所有這些都以優秀的品牌和技術為基礎，高度專注於建築市場最具吸引力的部分。

Mirc Dobre, Baird.

米爾克·多布雷，貝爾德。

Q2 was just such a strange quarter, not so much in your reporting, but just the broader backdrop, right? I mean we started in April with Liberation Day and a lot of volatility, I guess, in the national markets, and then we exited feeling very different. And I'm kind of curious how your business experienced all of this? Have you -- at any point in time through the quarter, maybe actually felt an economic effect from this tariff uncertainty and obviously, the quarter all-in on a surface looked fine.

第二季度真是個奇怪的季度，不是因為你們的報告，而是因為更廣泛的背景，對嗎？我的意思是，我們從四月的解放日開始，國內市場波動很大，然後我們退出時的感覺就大不相同了。我有點好奇您的企業是如何經歷這一切的？在本季度的任何時候，您是否可能實際上感受到了關稅不確定性帶來的經濟影響，而且顯然，本季度的整體表面上看起來不錯。

So I'm wondering about the cadence. And the reason why I'm asking the question is because if we end up with another wave of disruption related to these tariffs, based on your learnings from Q2, how disruptive do you think that could end up being or maybe not at all to your business going forward?

所以我對節奏感到好奇。我之所以問這個問題，是因為如果我們最終面臨與這些關稅相關的另一波混亂，根據您從第二季度了解到的情況，您認為這會對您未來的業務造成多大的混亂，或者根本不會造成混亂？

Yes. So I think I would say just -- I suppose as a reminder, and you coat Q2 very accurately in terms of how it played out. But from our standpoint, and particularly relating to the tariffs, we go back to the point that we're over 90% produced what we sell. So the direct impact of tariffs is largely mitigated. And to the extent that we need to get price, we are able to get price due to the high levels of differentiation across the business, both in 2018 and in this past round tariffs were manageable for us.

是的。所以我想我會說只是——我想作為提醒，你對第二季度的進展的描述非常準確。但從我們的角度來看，特別是與關稅有關，我們回到了這一點：我們所銷售的產品 90% 以上都是自產的。因此關稅的直接影響在很大程度上已減輕。在我們需要獲得價格的範圍內，我們能夠獲得價格，因為整個業務的差異化程度很高，無論是在 2018 年還是在上一輪，關稅對我們來說都是可控的。

And based on what we know today and even if tariffs were increased, we'd expect the tariff cost to be manageable going forward. Certainly, we would hold to our EPS neutral or better, I say no matter what happens to (inaudible)

根據我們目前所了解的情況，即使關稅增加，我們預期未來關稅成本仍然是可控的。當然，我們會保持每股收益中性或更好，我說無論發生什麼（聽不清楚）

Okay. But you didn't experience that whole customer freezing up or anything of the sort, as they were seeking for more clarity that was just not a factor in your business you're seeing.

好的。但是您並沒有遇到整個客戶都僵住或類似情況的情況，因為他們正在尋求更清晰的答案，而這並不是您所看到的業務中的一個因素。

Yes, there was a little bit of that in one segment. We have one segment where we have some shipments to China from the US, particularly relating to customer requests for us to do it that way. And thirdly, with the enormous China tariffs at the beginning of the quarter, there certainly was a freeze in that. That has no freed up since then.

是的，在某個片段中確實有一點這樣的內容。我們有一個部門，負責從美國向中國運送一些貨物，特別是應客戶要求我們這樣做。第三，由於本季初對中國徵收了巨額關稅，這一數字肯定有所凍結。從那時起，這一點就再也沒有得到釋放。

And also, we've had several through our we react capabilities in our businesses, we've been able to read and react very successfully to that. So for was to happen again, we'd have mitigation plans in place where it wouldn't be as much of an issue.

此外，透過我們在業務中做出反應的能力，我們已經能夠非常成功地讀取並做出反應。因此，如果再次發生這種情況，我們會制定緩解計劃，以免問題變得更嚴重。

Got it. And my follow-up, if I may, just kind of a bigger picture capital allocation question. I'd love to hear as to how you're thinking about your M&A pipeline and in terms of returning capital to shareholders, if M&A is not available for whatever reason, is there an argument to be made for taking a more aggressive approach at this point in a cycle where maybe you're dealing with lower growth knowing that, obviously, as growth accelerates eventually, you'll be able to hopefully create some value with more aggressive buybacks in the lower part of the cycle?

知道了。如果可以的話，我的後續問題只是一個更大的資本配置問題。我很想聽聽您對於併購管道的看法，在向股東返還資本方面，如果出於某種原因無法進行併購，那麼在周期的這個階段，您是否應該採取更積極的方式？也許您正面臨較低的成長，但顯然，隨著成長最終加速，您將能夠透過在週期的低迷時期更積極的回購來創造一些價值？

Yes. So with respect to M&A, Mig, what I would say is that, first and foremost, we're very confident in our -- the ability of our current portfolio to grow at 4% plus over time. And so we are comfortable in really sticking to our disciplined portfolio management strategy around M&A. We've got a very clear and well-defined view of what we think fits our strategy.

是的。因此，關於併購，米格，我想說的是，首先，我們對我們的當前投資組合隨著時間的推移以 4% 以上的速度增長的能力非常有信心。因此，我們很樂意堅持圍繞併購的嚴謹的投資組合管理策略。我們對符合我們策略的理念有著非常清晰和明確的看法。

So it's just a matter of spending the right opportunities, focused on those high-quality acquisitions that could extend our long-term growth potential to grow at a minimum at 4% plus at high quality. While being able to leverage the business model to improve margins. That's typically how we think about these things.

因此，這只是一個抓住正確機會的問題，專注於那些可以延長我們長期成長潛力的高品質收購，以實現至少 4% 以上的高品質成長。同時能夠利用商業模式來提高利潤率。這通常是我們對這些事情的看法。

Now we do review opportunities for this on an ongoing basis, but we continue to be very selective and very selective being mindful of the fact that we've got all this organic growth potential that we're working on. We're very active in terms of reviewing M&A opportunities.

現在我們確實在持續審查這方面的機會，但我們會繼續非常謹慎地選擇，因為我們意識到我們正在努力實現所有這些有機成長潛力。我們在審查併購機會方面非常積極。

And to the extent that we find the right opportunities, then we will certainly be appropriately aggressive in pursuing them, I would say. And obviously, MTS was one that we did -- we -- that's the criteria we use to evaluate and to acquire MTS, and it's proved to be a really great acquisition for us on that basis. And that's the lens at which we look at acquisitions remaining selected, but appropriately aggressive when we see the right ones.

我想說，只要我們找到正確的機會，我們一定會積極地去追求它們。顯然，MTS 是我們用來評估和收購 MTS 的標準之一，事實證明，從這個角度來看，這是一次非常棒的收購。這是我們審視剩餘收購的視角，但當我們看到合適的收購時，我們會採取適當的積極態度。

And I'll just add on the other elements of our capital allocation strategy. Mirc, we obviously constantly review, debate, discuss our strategy and we are still coming in conclusion that it's pretty optimal and pretty well aligned with our enterprise strategy with number one priority being the internal investments to support all the organic growth initiatives that are going on inside the company and maintain core profitability in these highly differentiated core businesses. We have an attractive dividend.

我只想補充一下我們的資本配置策略的其他要素。Mirc，我們顯然不斷地審查、辯論和討論我們的戰略，我們仍然得出結論，它是相當理想的，並且與我們的企業戰略非常一致，首要任務是內部投資，以支持公司內部正在進行的所有有機增長計劃，並在這些高度差異化的核心業務中保持核心盈利能力。我們的股息很誘人。

If you look at our payout ratio, we're probably and rightfully so towards the higher end of the peer group just given our margins and our best-in-class balance sheet and highest credit rating in the peer group. We'll continue to grow that dividend in line with long-term earnings.

如果你看一下我們的派息率，你會發現，考慮到我們的利潤率、一流的資產負債表和同行中最高的信用評級，我們很可能而且理所當然地處於同行的高端。我們將根據長期收益繼續增加股利。

And then we allocate surplus cash to the buybacks, which is about $1.5 billion this year, about 2% of our outstanding shares. And so as we sit here today, we feel like we've optimized this. And as Chris said, we'd love to do M&A given the criteria that Chris outlined. And as you know, this is -- it's not an easy market given the valuation are what's making this pretty challenging.

然後我們將剩餘現金分配給回購，今年約 15 億美元，約占我們流通股的 2%。所以今天我們坐在這裡，我們感覺我們已經優化了這一點。正如克里斯所說，我們很樂意根據克里斯概述的標準進行併購。如你所知，這不是一個容易的市場，因為估值使得這個市場相當具有挑戰性。

Sabrina Abrams, Bank of America.

美國銀行的薩布麗娜‧艾布拉姆斯 (Sabrina Abrams)。

I think my understanding was that there would be some more restructuring in the first half. So I think there were comments about 80% of the full year to $0.15 to $0.20 headwind in the first half. So I guess just looking at the components of the margin bridge, it doesn't seem like we had -- I think restructuring year-over-year was this quarter, and there wasn't a ton in 1Q. So just any color you could provide on restructuring this year, how it's changed? Is that still the right full year number? And how has the cadence evolved relative to your expectations?

我認為我的理解是上半年會進行更多的重組。因此，我認為有評論稱，全年 80% 的不利因素是上半年的 0.15 美元至 0.20 美元。因此，我想，僅從保證金橋樑的組成部分來看，我們似乎沒有——我認為同比重組是本季度進行的，而第一季的重組並不多。那麼，您能否介紹一下今年的重組情況以及它發生了哪些變化？這仍然是正確的全年數字嗎？相對於您的預期，節奏是如何演變的？

Yes. Sabrina. So I think restructuring with everything going on in the quarter, a couple of things did move around. At the end of the day, we ended up spending $20 million in the first half this year, which is the same as what we spent in the first half of last year. These are all projects tied to kind of our 80/20 front-to-back process all projects with less than a one-year payback.

是的。薩布麗娜。因此，我認為隨著本季發生的所有事情進行重組，有些事情確實發生了變化。最終，我們今年上半年的支出為 2,000 萬美元，與去年上半年的支出相同。這些項目都與我們 80/20 的前後端流程相關，所有項目的回報期均不到一年。

We had a few projects that just from a timing standpoint, moved into July. Those have been approved and are well underway. We expect that we'll spend about another $20 million here or $0.05 a share, so it's pretty small relative to our overall earnings. We'll spend about $20 million here in the second half. And on a year-over-year basis, that will be about flat year over year.

從時間角度來看，我們有幾個項目已經進入 7 月。這些均已獲得批准並正在順利進行中。我們預計我們將在這裡再花費約 2000 萬美元或每股 0.05 美元，因此相對於我們的整體收益而言，這筆錢相當少。下半年我們將在這裡花費約 2000 萬美元。與去年同期相比，這一數字基本持平。

Okay. And then just how much PLS is in the guide this year? I think there was 100 bps this quarter. I think there was 50 bps in 1Q I think you started the year with 100 bps of PLS in the guide. Just how are we thinking about that now?

好的。那麼今年的指南中 PLS 到底有多少呢？我認為本季有 100 個基點。我認為第一季的 PLS 為 50 個基點，我認為年初指南中的 PLS 為 100 個基點。我們現在是怎麼看待這個問題的？

Yes. That's unchanged. We still have a fair bit of activity. And as you saw this quarter in automotive, specialty as well as construction. And so we're still at about a percentage point of headwind to the organic growth rate from strategic PLS.

是的。這一點沒有改變。我們仍有相當多的活動。正如您本季在汽車、專業以及建築領域所看到的。因此，我們仍然面臨戰略 PLS 對有機成長率約一個百分點的阻力。

But obviously, a huge tailwind in terms of positioning the portfolio for future growth as well as -- if you look at the margin improvement in the segment that I just talked about, you can see kind of the benefits associated with these PLS efforts.

但顯然，就未來成長的投資組合定位而言，這是一個巨大的順風——如果你看看我剛才談到的細分市場的利潤率提高，你就能看到與這些 PLS 努力相關的好處。

Joe O'Dea, Wells Fargo.

富國銀行的喬·奧迪亞。

First just on margins in the second half of the year. And when we look at sort of the walk from Q2 into the back half, about 100 bps improvement. Can you just outline cadence of that? Is that sort of 50 bps sequentially over the back half of the year in each quarter is kind of reasonable. And then the segments that are going to be contributing that the programs are going to be driving that, presumably, test and measurement the ones where we should see the biggest contribution.

首先，我們來看看下半年的利潤率。當我們觀察從第二季到下半年的走勢時，我們發現了大約 100 個基點的改善。能簡單概括一下這個節奏嗎？下半年每季連續升息 50 個基點是否合理？然後，這些程序將推動那些將做出貢獻的部分，大概就是測試和測量部分，我們應該看到最大的貢獻。

That's exactly right. That -- the Test & Measurement is the biggest step up sequentially from the first half into the second half. I'd rather -- the segments that are above 30% already kind of in the -- we got 3 at 33%, 31%, 33%, you may not see the same type of step up in those -- but other there pretty broad-based, and we expect some sequential improvement from, like I said, from Q2 into Q3 with some -- also some improvement on a year-over-year basis.

完全正確。測試與測量是上半場到下半場連續最大的進步。我寧願 - 那些已經處於 30% 以上的細分市場 - 我們有 3 個，分別為 33%、31%、33%，您可能不會看到相同類型的增長 - 但其他部分相當廣泛，我們預計從第二季度到第三季度會有一些連續的改善，就像我說的，與去年同期相比也會有一些改善。

And then, frankly, a slightly bigger step-up in Q4 on the margin front on a year-over-year basis. So you take all of that. And this is implied in our guidance, so I'm not telling you something you couldn't figure out yourself is that external operating margins of about 27% in the back half of the year. And that's with some reasonable improvement year-over-year. These are improvement on already best-in-class operating margins with not a whole lot of help from macro conditions.

坦白說，第四季的利潤率年增幅略有擴大。所以你把這些都拿走了。這在我們的指導中有所隱含，所以我不會告訴您一些您自己無法弄清楚的事情，那就是今年下半年的外部營業利潤率約為 27%。與去年同期相比，這有了一些合理的改善。這些都是在宏觀條件沒有太多幫助的情況下，對已經最好的營業利潤率進行的改進。

And that's why we talk about these being such differentiated results. There are without dragging there are not many companies that could put up this type of margin performance given the top line and the macro that we're dealing with and just look at the incremental margins this quarter and implied for the full year.

這就是我們談論這些差異化結果的原因。毫無疑問，考慮到我們所面對的營收和宏觀形勢，能夠實現這種利潤率表現的公司並不多，只需看看本季度的增量利潤率和全年的隱含利潤率。

Got it. That's helpful. And then I wanted to come back to some of the more kind of CapEx order activity that you're talking about and maybe specifically on welding and just trying to parse kind of DBI and share versus underlying end market. I think a lot of what we hear out there is MRO trends are stable. Bigger spend projects, elongation between quote to order.

知道了。這很有幫助。然後我想回到您正在談論的一些更多的資本支出訂單活動，也許特別是關於焊接，只是試圖解析 DBI 和份額與底層終端市場的關係。我認為我們聽到的很多消息是 MRO 趨勢是穩定的。項目支出越大，報價與訂單之間的時間間隔就越長。

So it doesn't really sound like in broad strokes, we're hearing much of a sequential acceleration. It sounds like you're seeing it a little bit more early days but the degree to which you can talk through some of the end markets within welding, what you're hearing from those customers versus kind of CBI and that's really the answer to the better growth?

因此，從整體來看，我們聽到的並不是連續加速的聲音。聽起來您對此還處於早期階段，但是您可以談論焊接領域的一些終端市場，您從這些客戶那裡聽到了什麼，與 CBI 相比，這真的是更好增長的答案嗎？

Yes. In short, Joe, I would say CBI is a better answer to the growth. And we see some pickup in activity on the industrial side. But in general, the big driver of our growth in building right now on CBI.

是的。簡而言之，喬，我認為 CBI 是應對成長的更好答案。我們看到工業方面的活動有所回升。但總體而言，我們目前成長的最大動力在於 CBI 建設。

Yes. And I'll just go back to what we talked about earlier. I think the more consumer-oriented businesses certainly are dealing with some more challenging end market conditions. The general industrial more CapEx set aside some of the delays that Chris talked about early in the quarter when there was kind of peak tariffs angst. Positive signs in general industrial in the semi space as well as in automotive. But these are short-cycle businesses. Things can change very quickly. We're dealing with a pretty challenging underlying market demand.

是的。我將回顧我們之前討論過的內容。我認為，以消費者為導向的企業肯定會面臨一些更具挑戰性的終端市場條件。一般工業的更多資本支出消除了克里斯在本季初談到的、因關稅高峰而產生的一些延遲。半導體領域一般工業和汽車產業都出現了正面訊號。但這些都是短週期業務。事情可能很快就會發生變化。我們正在應對一個相當具有挑戰性的潛在市場需求。

We estimate our end markets on average are down 3 to 4. And we're holding organic flat. We improved the organic growth rate sequentially from Q1 to Q2. So that's kind of the environment that we're dealing with. And so that's why it's so important that we continue to do what we said we were going to do from an execution standpoint and continue to make progress on the enterprise initiatives and the things we can control, including CBI, price costs and so forth.

我們估計我們的終端市場平均下降了 3 到 4。我們保持有機平穩。我們從第一季到第二季連續提高了有機成長率。這就是我們所面臨的環境。因此，從執行的角度繼續履行我們的承諾並繼續在企業計劃和我們可以控制的事情上取得進展（包括 CBI、價格成本等）是如此重要。

Okay. Great color there. One last quick one, just China. Really strong growth in auto. Can you just talk a little bit about other parts of China exposure?

好的。那裡的色彩很棒。最後一個問題，關於中國。汽車產業確實成長強勁。能否簡單談談在中國其他地區的曝光？

Yes. I think China was up 15%, as I said in the prepared remarks. I mean, the -- the biggest driver by far is the automotive business, but there's also some solid double-digit growth in Test & Measurement, polymers and Fluids & Welding. And where we're seeing this are -- is in the businesses that had the highest contribution from new products. So there's a real correlation here in terms of being able to outperform end markets is really a result of great progress on CBI.

是的。我認為中國經濟成長了 15%，正如我在準備好的演講中所說的那樣。我的意思是，迄今為止最大的驅動力是汽車業務，但測試與測量、聚合物和流體與焊接也實現了穩定的兩位數成長。我們看到的是新產品貢獻最大的企業。因此，就能夠超越終端市場而言，這其中存在著真正的關聯，這實際上是 CBI 取得巨大進步的結果。

And I think maybe that explains -- there was a question earlier in terms of our performance in China and not seeing the same results in other -- with some of our peers and maybe that's part of the explanation.

我想這也許可以解釋——之前有人質疑我們在中國的表現，而在其他一些同行中卻沒有看到同樣的結果，也許這是部分原因。

Steven Fisher, UBS.

瑞銀的史蒂文·費雪。

Just to follow up on one of those last questions there. In terms of the pickup maybe at the end of the quarter in some of the capital-oriented equipment, I guess, just to achieve the 2% to 3% organic growth that you have in the second half, are you guys assuming that you -- there will be a continuation of some of that strong order levels that you saw at the end of the quarter? Or is it really just sort of -- that was kind of a onetime thing? Or I'm guessing if it's really CDI, as you said, I think it would be maybe a continuation, but just curious how you'd frame that.

我只是想繼續回答最後一個問題。就本季末一些資本導向設備的回升而言，我猜，只是為了實現下半年 2% 到 3% 的有機增長，你們是否認為——本季度末看到的強勁訂單水平將會延續？或者這真的只是某種一次性的事情？或者我猜如果它真的是 CDI，正如你所說，我認為它可能是一種延續，但只是好奇你會如何建構它。

Yes. I'd go back, Steve, to kind of our usual process for giving guidance, which is based on current levels of demand in our businesses. We have more price than usual coming through in the back half associated with these tariffs. We have some easier comps in the second half than we did in the first half by about 0.5 point. But we're not factoring in any further acceleration from kind of current levels of demand.

是的。史蒂夫，我想回到我們通常的指導流程，它是基於我們業務的當前需求水準。與這些關稅相關的後半部分價格比平時高。與上半場相比，下半場我們的比賽更加輕鬆，大約低 0.5 分。但我們並沒有考慮到當前需求水準的進一步加速。

And so if that were to happen, that would be great news. That would suggest that our guidance is conservative. If we have another round of tariffs, as somebody suggested and things slow down, then that would be bad news. But overall, I think as we sit here today, we are confidently raising our guidance, and we're well positioned for a solid second half, as I think we said earlier.

如果這種情況真的發生，那將是一個好消息。這顯示我們的指導是保守的。如果像某些人所說的那樣，我們又要徵收一輪關稅，而事情又會放緩，那麼這將是一個壞消息。但總的來說，我認為，正如我們之前所說的那樣，我們今天坐在這裡，有信心提高我們的指導，並且我們為穩固的下半年做好了準備。

Okay. Terrific. And then just to follow up on the CB&I. I think maybe Chris mentioned 3%-plus in the long term, 2030. Do you still think of CBI and net market penetration as two separate growth buckets? And if so, can you sort of help us differentiate between these two things? I think you had a 1% to 2% target on net market penetration and 2% to 3% on CBI and the longer-term targets?

好的。了不起。然後只是跟進 CB&I。我認為克里斯提到的長期成長率可能是 3% 以上，也就是 2030 年。您是否仍認為 CBI 和淨市場滲透率是兩個獨立的成長領域？如果是這樣，您能幫助我們區分這兩者嗎？我認為您的淨市場滲透率目標是 1% 到 2%，CBI 目標是 2% 到 3%，還有長期目標嗎？

Yes, we look at them differently, CBI and net market penetration. And the way we think about it is that CBI is revenue -- new product revenue in the next three years. after that, it's market penetration. And so the way to think about it is that the CBI revenues are today turn into the market penetration revenues in the future. It's kind of how we think about it.

是的，我們對 CBI 和淨市場滲透率有不同的看法。我們的想法是，CBI 是收入——未來三年的新產品收入。之後，就是市場滲透率。所以，我們可以這樣想：今天的 CBI 收入將轉化為未來的市場滲透收入。這就是我們對此的看法。

Thank you for participating in today's conference call. All lines may disconnect at this time.

感謝您參加今天的電話會議。此時所有線路可能會斷開。