ILLINOIS TOOL WORKS INC 8-K

What Happened

• Illinois Tool Works Inc. announced its first-quarter 2026 results in a press release furnished as Exhibit 99.1 on April 30, 2026. The filing explains the Company’s use of two non‑GAAP measures — free cash flow and after‑tax return on average invested capital (After‑tax ROIC) — and provides reconciliations in the press release.
• Free cash flow is defined as net cash provided by operating activities less additions to plant and equipment. After‑tax ROIC is defined as operating income after taxes divided by average invested capital (annualized for interim periods); operating income after taxes excludes interest expense and other income (expense). For comparability, the Company excluded discrete tax benefits of $34 million in Q1 2026, $21 million in Q1 2025, and a net $27 million in Q3 2025 from net income and the effective tax rate.

Key Details

• Filing date / press release: April 30, 2026 (Exhibit 99.1).
• Free cash flow = operating cash flow − capital expenditures; reconciliation to GAAP cash flow from operations is included in the press release.
• After‑tax ROIC uses operating income after taxes ÷ average invested capital; invested capital excludes cash & equivalents and outstanding debt.
• Discrete tax benefits excluded for comparability: $34M (Q1 2026), $21M (Q1 2025), $27M net (Q3 2025).

Why It Matters

• These non‑GAAP measures show how much cash ITW generates that could be used for dividends, share repurchases, acquisitions or debt repayment (free cash flow) and how efficiently the Company is earning returns on capital invested in operations (After‑tax ROIC).
• The filing provides reconciliations and explains adjustments (notably discrete tax items) so investors can compare these metrics to GAAP figures and prior periods on a consistent basis when assessing ITW’s quarterly performance and capital‑allocation capacity.