Toro Tackles Turbulent Markets with Operational Excellence
The Toro Company has navigated the challenging second quarter of 2025 with a focus on operational excellence, driving results that exceeded earnings per share expectations despite a dynamic macroeconomic environment.
Adjusted earnings per share for the quarter reached $1.42, surpassing the company's forecast, as Toro continued to leverage its diverse portfolio of leading brands and drive efficiency across the organization. Revenue declined 2.3% year-over-year to $1.3 billion, impacted by weak consumer confidence and unfavorable regional weather in some businesses.
However, strength in Toro's Golf and Grounds business segment offset these losses, with demand for innovative products remaining robust. The company also saw positive results from its AMP (Acceleration, Margin, Productivity) program, which has generated $70 million of run rate savings to date and remains on track to deliver $100 million by 2027.
Toro's efforts to mitigate tariffs have paid off, with the company estimating a fiscal 2025 cost impact of approximately 3% of annual cost of goods sold. The majority of its professional products are manufactured in the United States, while residential and irrigation products made in Mexico are U.S. MCA qualified, exempting them from tariffs.
The company's sourcing team has optimized supply chains to remain agile in any environment, and Toro will continue to thoughtfully implement price increases to protect profit margins and fuel investments in its future. This strategic approach enables the company to navigate headwinds while driving customer productivity through innovative products and solutions.
Toro's commitment to operational excellence is reflected in its workforce adjustments, with a 10% reduction in global salaried employees in the current fiscal year. The company also took action to rationalize its residential segment by winding down production in one of its Mexico-based plants and transitioning that production to existing facilities in the United States.
This move will improve fixed cost absorption and efficiency while ensuring Toro delivers exceptional products and service to customers. As a result, the company's supply chain strategies have provided a competitive advantage in navigating the dynamic environment.
Toro's focus on innovation, leadership in technology-driven solutions, and customer-focused strategies reinforce its confidence in the company's future. The company continues to execute on its playbook, introducing new products and solutions that enhance customer productivity at a time when it is needed most.
Through these efforts, Toro has demonstrated its ability to navigate challenging markets while driving operational excellence and delivering strong financial results. As the company looks ahead to the remainder of 2025, its strategic approach will undoubtedly position it for continued success in an ever-changing environment.
