Fortive Corporation

Second-quarter revenue was nearly $1.1 billion, up almost 8% reported and 6.7% core year over year. Adjusted gross margin was 63%, down about 100 basis points year over year; adjusted EBITDA was $323 million, up 12%, with margin at 29.5%, and adjusted EPS was $0.74, up over 28%. Free cash flow was roughly $270 million, and trailing 12-month free cash flow topped $1 billion. Segment results included Intelligent Operating Solutions revenue up 9% reported and 7.4% core with adjusted EBITDA of $264 million, and Advanced Healthcare Solutions revenue of nearly $340 million, up 6% reported and 5.3% core with adjusted EBITDA of $88 million. For 2026, Fortive raised adjusted EPS guidance to $2.95 to $3.05, expects full-year reported revenue of approximately $4.35 billion, and now expects full-year core growth of about 4% versus a prior 2% to 3% view. Management also said Q3 adjusted EBITDA margin should be slightly below Q2, Q3 adjusted EPS should be up very slightly year over year, and Q4 will face a smaller reported-revenue contribution because of four fewer selling days, creating a $15 million to $20 million reported-revenue headwind and a 150-basis-point core-growth headwind.

Olumide Soroye struck an upbeat, confident tone and framed the quarter as evidence that Fortive Accelerated is working. He emphasized faster profitable organic growth, citing innovation, commercial investment, and recurring customer value across all 10 brands, with examples including Fluke’s CertiFiber Max, Gordian’s Flash AI, ServiceChannel’s AI-enabled tools, and ASP’s FDA clearance for expanded robotic-surgery applications. He also stressed capital discipline, noting roughly $200 million in buybacks in the quarter, nearly $2 billion deployed to repurchases since the spin-off, and the UV Smart bolt-on, while reiterating confidence in the company’s 2026-2027 framework and growth runway.

Mark Okerstrom focused on the financial mechanics behind the quarter. He highlighted nearly $1.1 billion of revenue, 63% adjusted gross margin, $323 million of adjusted EBITDA, 29.5% EBITDA margin, $0.74 adjusted EPS, and roughly $270 million of free cash flow, along with a 2.7x gross debt-to-adjusted EBITDA leverage ratio and about 307 million diluted shares outstanding. He said mix hurt margins in both segments, tariffs had minimal impact this quarter, and the company recognized a $4.5 million IEEPA tariff refund benefit in GAAP earnings, with another $20 million to $25 million expected in coming quarters; he also guided to full-year net interest expense of about $140 million and a Q3 tax rate in the mid-teens with Q4 in the low double-digit range.

Analysts focused on whether new products are materially driving growth, and management said yes, pointing to a deeper innovation funnel, especially at Fluke and ServiceChannel, with internal tracking showing measurable returns. Questions on bolt-on M&A and portfolio priorities drew the response that Fortive will skew toward its strongest platforms, especially Fluke and ASP, and that software deals are possible but must be highly differentiated and financially attractive. Analysts also pressed on margins, data-center exposure at Fluke, and healthcare capital spending; management said mix and tactical investments are weighing on near-term margins, Fluke is benefiting from data-center-related products like CertiFiber Max, and ASP’s capital business is recovering as hospital budget pressure eases.