“This scenario could result in full year 2025 sales and revenues to be only down slightly versus 2024.”

In context

“ons. Demand signals were stronger than we had expected in the quarter, including backlog growth across our three primary segments and stronger-than-expected sales to users, particularly in Construction Industries. These indicators boost our confidence in the resilience of the top line this year. As Joe mentioned, our sales expectations would be about flat for the full year in a pre-tariff scenario, which excludes any impact from tariffs. As a reminder, this compares to our prior expectations for slightly lower full year sales than we communicated to you a quarter ago. Also, as Joe noted, we have run a number of scenarios to estimate the full potential impact of tariffs for the remainder of the year. Our alternative scenario also assumes negative economic growth in the second half of 2025. This scenario could result in full year 2025 sales and revenues to be only down slightly versus 2024. This result highlights the resilience of our top line, which is supported by the strength of our backlog and the diversity of our end markets. Now, onto margins. In a pre-tariff scenario, which assumes no impact from tariffs, we would have expected full year margins to remain in the top half of the adjusted operating profit margin range at the expected levels of sales and revenue. We have also assessed potential cost impacts from the current tariffs for the remainder of the year before any additional mitigation actions. Given the uncertainty of what tariff rates could be and the timing of any additional mitigation actions that we may take once the situation becomes clearer, it is not possible to derive an accurate estimate of the net full year impact of tariffs. However, in our alternativ”