SWK · 10-Q · 2026Q4 · Full report

Income Tax Rate Changes

STANLEY BLACK & DECKER, INC. · 2026-11-04 · Importance 71 · Surprise 82

For the first nine months of 2026, income tax expense was $259.0 million and the effective tax rate was 27.5%, compared with a $53.8 million tax benefit and a negative 28.3% rate in the first nine months of 2025. The 2026 year-to-date rate exceeded the 21% U.S. statutory rate primarily because of tax effects from CAM-divestiture basis differences for which no corresponding tax benefit was recognized, as well as other items affecting the quarter. Excluding non-GAAP adjustments, the 2026 nine-month tax rate was 21.3%, compared with 5.1% in 2025. Third-quarter 2026 tax expense was $86.1 million at a 24.0% rate, while third-quarter 2025 had a $15.8 million tax benefit and a negative 44.4% rate.

Key facts

• The Company's Pillar Two tax impact was expected to be immaterial to its 2026 estimated annual tax rate. source
• For the three and nine months ended October 3, 2026, income tax expense was $86.1 million and $259.0 million, with effective tax rates of 24.0% and 27.5%, respectively. source
• The Company concluded the OBBBA had no material impact on its 2025 consolidated financial statements and did not expect a material impact to future income tax provisions. source
• The effective tax rate for the nine months ended October 3, 2026 was affected by tax effects of basis differences associated with the CAM divestiture for which no corresponding tax benefit was recognized. source