Fortive Corporation reported 6.7% core revenue growth in Q2 2026, driven by its 'Fortive Accelerated' strategy, according to company materials. The strategy focuses on innovation velocity and recurring customer value.
Fluke, a Fortive operating company, is expanding its innovation funnel to target high-growth verticals including data centers, defense, and early-in-career technicians. The company also launched the CertiFiber Max. Fluke is pivoting toward data center commissioning and maintenance, which is seeing demand 'way above plan,' management said.
The Gordian Flash AI solution, which reduces construction cost estimating time from days to minutes, has moved into production across strategic accounts. Meanwhile, the US Food and Drug Administration (FDA) granted clearance to ASP for a 50-pound expanded load capacity, enhancing its positioning in robotic-assisted surgery.
Recurring revenue growth remained strong across two segments, supported by AI-enabled predictive maintenance tools and software-as-a-service offerings. ServiceChannel saw success in AI-enabled work order detection.
Gross margin was 63% in Q2 2026, reflecting a 100-basis-point year-over-year decline due to product mix dynamics from growth in lower-margin products.
Geographically, North America was the strongest region, while the EMEA region faced modest declines due to macroeconomic uncertainty and geopolitical tensions.
Fortive raised its full-year 2026 adjusted EPS guidance to a range of $2.95 to $3.05 and increased full-year core growth expectations to approximately 4%, up from the previous range of 2% to 3%. The company noted that Q4 reported revenue faces a $15 million to $20 million headwind due to four fewer selling days compared to the prior year.
Fortive's medium-term financial framework targets 50 to 100 basis points of annual EBITDA margin expansion. The company executed approximately $200 million in share repurchases during Q2 2026, totaling 11% of shares retired since the launch of 'New Fortive' one year ago.
Fortive acquired a majority stake in UV Smart to expand ASP's portfolio into UVC high-level disinfection for specialized medical instruments. It also recognized a $4.5 million IEEPA tariff refund in GAAP earnings, with an additional $20 million to $25 million expected in coming quarters.
The company's M&A strategy is shifting to prioritize differentiated hardware businesses over software. Management confirmed that New Product Introductions (NPIs) are a primary driver of the 6.7% core growth.
