The Toro Company’s second quarter results outperformed Wall Street’s expectations, but the market reaction was negative. Management attributed the solid revenue growth to robust demand in both the professional and residential segments, highlighting especially strong performance in underground and specialty construction. CEO Richard Olson emphasized that “demand was broad based across our portfolio,” with professional segment growth fueled by the popularity of products like the JT21 horizontal directional drill and technology adoption in fleet management. The company’s productivity program, AMP, also improved margins, although inflation and supply chain costs remained headwinds.
Is now the time to buy TTC? Find out in our full research report (it’s free for active Edge members).
The Toro Company (TTC) Q1 CY2026 Highlights:
- Revenue: $1.42 billion vs analyst estimates of $1.39 billion (8.1% year-on-year growth, 2.1% beat)
- Adjusted EPS: $1.60 vs analyst estimates of $1.50 (6.7% beat)
- Management raised its full-year Adjusted EPS guidance to $4.56 at the midpoint, a 1.3% increase
- Operating Margin: 13.7%, in line with the same quarter last year
- Market Capitalization: $8.69 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From The Toro Company’s Q1 Earnings Call
- David MacGregor (Longbow Research) asked how leaner channel inventories impacted unit growth, with CEO Richard Olson noting sales returned to “a more normal situation” and demand exceeded expectations with healthy flow from all facilities.
- Bobby Shultz (Baird) pressed for detail on tariff impacts; COO Edric Funk and CFO Angela Drake explained that while gross tariffs rose, anticipated refunds and U.S.-based manufacturing limited the net financial impact for the year.
- Samuel Darkatsh (RJF) questioned the sustainability of profitability amid rising tariffs, to which Olson credited the AMP program and portfolio restructuring for offsetting cost headwinds and maintaining high free cash flow conversion.
- Mike Shlisky (DA Davidson & Co.) inquired about the outlook for residential demand and autonomous product adoption; Olson described residential as “back to a normal longer term growth rate” and Funk noted growing enthusiasm but tempered near-term expectations for autonomous sales.
- Ted Jackson (Northland) sought insight on acquisition strategy and inventory levels, with Olson reiterating a disciplined M&A approach focused on familiar markets like Tornado and confirming snow equipment inventory is now normalized.
Catalysts in Upcoming Quarters
Looking forward, the StockStory team is monitoring (1) the pace of adoption and margin contribution from new professional products, (2) execution of the AMP productivity program and its ability to offset inflation and tariff pressures, and (3) successful integration and growth from recent acquisitions, especially Tornado. Progress in electrification and autonomous solutions will also be important signposts for sustained competitive differentiation.
The Toro Company currently trades at $91.27, in line with $90.95 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
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