NYSE:FTV
Fortive Corp
Fortive Corp is a global leader in industrial technology solutions, delivering high-value automation, materials, and environmental services to diverse sectors worldwide.
Key Metrics
Investment Thesis
Bull Case
Fortive offers a compelling growth story backed by a proven track record of acquiring innovative companies and integrating them into a high-margin global platform. The company's ability to generate robust free cash flow provides flexibility for aggressive share buybacks, which can significantly elevate earnings per share over time. With a diversified portfolio across automation and materials sectors, Fortive is well-positioned to capture value from long-term industrial digitization and sustainability trends.
Bear Case
Recent revenue contraction in 2025 raises concerns about the durability of demand in the industrial sector and the company's ability to offset slower growth with acquisitions. High levels of debt, including $2.31B in long-term debt, combined with a large retained earnings deficit, suggest potential financial leverage risks if cash flow generation weakens further. Investors should monitor whether operating expenses can be controlled effectively as revenue declines, given the historical trend of high administrative costs.
About Fortive Corp
Fortive Corp (NYSE: FTV) is a diversified industrial solutions provider serving global markets with specialized businesses in automation, advanced materials, and environmental technologies. The company generates revenue primarily through its three main segments: Automation Solutions, Advanced Materials, and Environmental Services, offering engineered products that enable clients to improve efficiency and sustainability. Operating globally with significant exposure to the industrial manufacturing sector, Fortive leverages its acquisition strategy and strong cash flow generation to drive long-term shareholder value.
Analysis
Management Discussion
While 2025 revenue of $4.16B represents a decline from the prior year's trajectory, the company maintained profitability with net income of $579.2M, demonstrating resilience despite market headwinds. Strong operating cash flow of $1.08B and significant capital return via share repurchases of $1.61B highlight management's commitment to capital efficiency even during periods of revenue contraction. The substantial goodwill balance of $7.30B underscores the value embedded in past acquisitions, which must continue to generate returns above cost of capital to justify the investment.
Industry Overview
Fortive operates within the broader industrial automation and advanced manufacturing sector, which is essential for modernizing production processes in life sciences, energy, and consumer goods. The industry is characterized by steady but cyclical demand tied to global capital expenditure cycles, with increasing pressure from customers to adopt sustainable and efficient technologies. Consolidation is a key theme as larger players seek scale advantages while smaller innovators look for acquisition partners to accelerate growth.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $5.83B | $6.07B | $6.23B | $4.16B |
| Cost of Revenue | $2.46B | $2.47B | $2.50B | $1.52B |
| Gross Profit | $3.36B | $3.59B | $3.73B | $2.64B |
| Operating Expenses | $2.38B | $2.46B | $-2.59B | $-1.92B |
| Operating Income | $987.4M | $1.13B | $1.21B | $720.2M |
| R&D | $401.5M | $397.8M | $414.0M | $259.2M |
| G&A | $1.96B | $2.06B | $2.17B | $1.66B |
| Stock-Based Comp | $93.8M | $113.3M | $109.2M | $116.8M |
| D&A | $465.6M | $456.8M | $543.9M | $437.6M |
| Depreciation | $83.5M | $86.4M | $90.6M | $70.1M |
| Amortization | $382.0M | $370.0M | $453.0M | $368.0M |
| Other OpEx | $17.9M | $0 | $-5.17B | $-3.84B |
| Non-Operating Income | $-113.9M | $-142.9M | $-237.0M | $-118.0M |
| Interest Expense | $98.3M | $123.5M | $-152.8M | $-120.5M |
| Pre-Tax Income | $873.5M | $990.8M | $969.6M | $602.2M |
| Income Tax | $118.3M | $125.0M | $136.7M | $69.5M |
| Continuing Ops | $755.2M | $865.8M | $832.9M | $532.7M |
| Discontinued Ops | $0 | $0 | $0 | $46.5M |
| Net Income | $755.2M | $865.8M | $832.9M | $579.2M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $755.2M | $865.8M | $832.9M | $579.2M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $2.48B | $3.67B | $2.59B | $1.61B |
| Cash & Equivalents | $709.2M | $1.89B | $813.3M | $375.5M |
| Accounts Receivable | $958.5M | $960.8M | $945.4M | $683.6M |
| Inventory | $536.7M | $536.9M | $544.8M | $291.8M |
| Prepaid Expenses | $272.6M | $285.1M | $288.8M | $234.0M |
| Other Current Assets | $0 | $0 | $0 | $20.8M |
| Long-Term Assets | $13.41B | $13.24B | $14.42B | $10.13B |
| PP&E (Net) | $421.9M | $439.8M | $433.1M | $269.8M |
| Intangibles | $3.49B | $3.16B | $3.34B | $2.19B |
| Goodwill | $9.05B | $9.12B | $10.16B | $7.30B |
| Operating Leases | $162.0M | $155.0M | $164.0M | $96.1M |
| Other LT Assets | $293.8M | $363.9M | $330.7M | $279.4M |
| Total Assets | $15.89B | $16.91B | $17.02B | $11.74B |
| Current Liabilities | $2.73B | $1.79B | $2.24B | $2.25B |
| Current Debt | $999.7M | $0 | $376.2M | $899.5M |
| Current Leases | $38.4M | $37.6M | $36.8M | $27.0M |
| Deferred Revenue | $509.6M | $544.6M | $553.2M | $440.3M |
| Taxes Payable | $132.5M | $129.8M | $145.8M | $120.4M |
| Other Current Liab | $-57.5M | $-103.4M | $-58.4M | $-151.3M |
| Long-Term Liabilities | $3.47B | $4.80B | $4.58B | $3.03B |
| Long-Term Debt | $2.25B | $3.65B | $3.33B | $2.31B |
| LT Operating Leases | $131.0M | $126.3M | $132.8M | $73.6M |
| Other LT Liab | $160.8M | $167.9M | $164.9M | $80.7M |
| Total Liabilities | $6.20B | $6.59B | $6.82B | $5.28B |
| Shareholders' Equity | $9.69B | $10.33B | $10.20B | $6.46B |
| Paid-In Capital | $3.71B | $3.85B | $4.04B | $4.21B |
| Retained Earnings | $6.74B | $7.51B | $8.23B | $5.43B |
| AOCI | $-325.7M | $-326.1M | $-465.4M | $41.0M |
| Treasury Stock | $442.9M | $715.8M | — | — |
| Total L&E | $15.89B | $16.91B | $17.02B | $11.74B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $755.2M | $865.8M | $832.9M | $579.2M |
| Non-Cash Adjustments | $281.0M | $240.1M | $550.6M | $401.8M |
| Working Capital Changes | $267.0M | $247.7M | $143.3M | $102.2M |
| Cash from Operations | $1.30B | $1.35B | $1.53B | $1.08B |
| Capital Expenditures | $95.8M | $107.8M | $120.4M | $105.1M |
| Cash from Investing | $-102.5M | $-195.4M | $-1.80B | $-135.4M |
| Share Buybacks | $442.9M | $272.9M | $889.6M | $1.61B |
| Dividends Paid | $99.5M | $102.0M | $111.2M | $92.2M |
| Cash from Financing | $-1.27B | $32.3M | $-792.7M | $-1.39B |
| FX Effect | $-37.8M | $-10.9M | $-13.6M | $1.0M |
| Net Change in Cash | $-110.1M | $1.18B | $-1.08B | $-437.8M |
| Beginning Cash | $819.3M | $709.2M | $1.89B | $813.3M |
| Ending Cash | $709.2M | $1.89B | $813.3M | $375.5M |
Frequently Asked Questions
How does Fortive Corp make money?
The company operates through three primary segments: Automation Solutions, which provides manufacturing control systems and software; Advanced Materials, supplying engineered materials for industrial applications; and Environmental Services, offering filtration and separation technologies. Revenue streams are driven by the sale of proprietary equipment, consumables, and lifecycle services across industries such as life sciences, energy, and food & beverage.
What are the main risks for FTV?
The company faces significant exposure to global macroeconomic downturns that could reduce industrial capex spending from its key end-market customers. Supply chain disruptions or raw material cost inflation could erode gross margins, particularly in the materials and equipment manufacturing segments. Foreign exchange volatility poses a risk given Fortive's substantial international operations, as fluctuations in currency rates can impact reported revenues and earnings. Integration risks remain present following acquisitions, where failure to realize synergies or cultural clashes could impair investment returns.
What is FTV's competitive advantage?
Fortive possesses a robust competitive moat built on its disciplined acquisition strategy that acquires innovative niche players and integrates them rapidly into its global supply chain. The company benefits from high switching costs for customers reliant on its specialized automation software and proprietary material formulations, creating sticky revenue relationships. Additionally, Fortive's decentralized management structure allows regional business units to operate with agility while maintaining centralized financial discipline and capital allocation expertise.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.