Illinois Tool Works Inc. (NYSE:ITW) Q2 2024 Earnings Conference Call July 30, 2024 10:00 AM ET

Company Participants

Erin Linnihan - VP, IR
Christopher O'Herlihy - President and CEO
Michael Larsen - SVP and CFO

Conference Call Participants

Andy Kaplowitz - Citigroup
Scott Davis - Melius Research
Tami Zakaria - JPMorgan
Joe Ritchie - Goldman Sachs
Julian Mitchell - Barclays
Walt Liptak - Seaport Global

Operator

Good morning. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the ITW Second Quarter Earnings Conference Call. [Operator Instructions] Thank you.

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

Erin Linnihan

Thank you, Audra. Good morning, and welcome to ITW's second quarter 2024 conference call. Today, I'm joined by our President and CEO, Chris O'Herlihy; and Senior Vice President and CFO, 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 2024. Slide 2 is a reminder that this presentation contains forward-looking statements.

We refer you to the company's 2023 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.

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?

Christopher O'Herlihy

Thank you, Erin, and good morning, everyone. As you saw in our press release this morning, during the second quarter, the short cycle demand environment continued to moderate across our portfolio. At the total company level, second quarter revenues came in approximately 1 percentage point, or $50 million below what they would have been had demand held at the level we were seeing exiting the first quarter.

Second quarter organic revenue was down in three segments with declines year-over-year in CapEx-related products such as welding, test and measurement and construction. These declines were offset by revenue growth in four segments resulting in overall flat organic growth year-over-year at the total company level as compared to our end markets which we believe were down in the low single digits.

As usual, as the quarter progressed, the ITW team executed well on all the elements within our control. As evidenced by record second quarter operating margin, which improved by 140 basis points, 26.2%, supported by 140 basis points of benefit from enterprise initiatives.