Toro Raises Full-Year Guidance for FY2026, Citing Margin Improvement from AMP Initiative and Projecting 4%-6.5% Sales Growth

The turf and golf equipment manufacturer Toro reported its fiscal second-quarter results on Thursday and raised its full-year outlook.

The company now anticipates adjusted earnings per share for fiscal 2026 to range between $4.50 and $4.62, with net sales growth projected at 4% to 6.5%. Both figures represent an increase from the prior guidance of $4.40 to $4.60 and 3% to 6.5%.

In a statement, Toro's Chairman and CEO, Richard Olson, attributed the upgraded outlook to the company's continued capture of opportunities in underground construction, landscape contractor, and golf markets, coupled with the successful execution of margin enhancement initiatives.

Financial results for the second quarter ended May 1st showed adjusted earnings per share of $1.60. This surpassed the $1.42 reported in the same period last year and exceeded analyst expectations of $1.51.

Total net sales rose by 8.1% year-over-year to $1.42 billion, also coming in above the market consensus of $1.39 billion.

The performance was primarily driven by the ongoing advancement of the AMP productivity plan. Launched at the beginning of fiscal 2024, this program focuses on lean operations, strategic facility closures, and divestitures of non-core assets to achieve cost savings and margin expansion.

The adjusted operating margin for the second quarter reached 14.4%, marking a 70-basis-point improvement from the prior year and representing the highest level in twelve quarters.

Breaking down performance by segment, revenue for the Professional segment grew by 9.1% to $1.11 billion. This was attributed to price increases, incremental contributions from the acquisition of Tornado Infrastructure Equipment, and robust demand for underground construction equipment and zero-turn-radius mowers.

Sales in the Residential segment increased by 4.4% to $310.4 million, though this was partially offset by lower shipments of snow products.

Toro expects the AMP plan to achieve a run-rate cost savings of $125 million by the end of the current fiscal year, with progress already exceeding internal expectations.

The company also noted strong free cash flow generation, having returned $361 million to shareholders during the first half of the year through share repurchases and dividends.

Toro's stock rose approximately 6.5% during Thursday's trading session to $96.86, bringing its year-to-date gain to nearly 17%.