3M Co.’s profit outlook fell narrowly short of Wall Street’s expectations for this year, a sign of the challenges the company faces as it tries to revamp operations and grow in an uneven economy.
William Brown
Adjusted earnings will be $8.50 to $8.70 a share in 2026, the manufacturer said Tuesday in a statement. The midpoint was slightly below the $8.64 average of analyst estimates compiled by Bloomberg. Adjusted sales will climb about 4%, the company said.
The outlook suggests momentum is slowing for Chief Executive Officer Bill Brown’s plan to turn around the Maplewood-based company, in part by reviving its pipeline of new products and increasing efficiencies across its sprawling industrial base. Those efforts helped 3M top Wall Street expectations throughout 2025.
The maker of Post-it notes, roofing granules and electronics materials said adjusted earnings were $1.83 a share in the fourth quarter. Analysts had forecast $1.80. Its adjusted operating income margin, a key profitability metric for investors was 21.1%, while analysts had predicted 21.3%.
“While far from a messy quarter, we believe the optics of a slight operating miss and modestly weak 2026 margin guidance could pressure shares,” Deane Dray, an analyst with RBC Capital Markets, said in a note.
3M’s shares were down 7.6% in midday trading Tueday. The stock had gained more than 20% in the last 12 months, beating a roughly 17% advance by the S&P 500 Index.
Data Centers
The CEO has sought to re-orientate the company’s products toward sectors with strong cyclical growth trends globally. Its electrical business has been targeting clients in the data center space, particularly cables and accessories, as demand for such infrastructure rises alongside artificial intelligence use. Data center activity accounts for about 3% of 3M’s total revenue, according to Bank of America analyst Andrew Obin.
Meanwhile, its nuclear facilities, which have uses ranging from fuel control to isotope separation, are being positioned by the company to help build new reactors, as the industry experiences a renaissance amid rising power demand, according to its website.
The economy is proving to be the “main swing factor” for the company’s financial results, Mustafa Okur, an analyst with Bloomberg Intelligence, said in a note.
The forecast shows the company is making progress on medium-term targets, “yet there’s no sign of a major acceleration or portfolio changes.”
Brown has been actively looking at options for the conglomerate in recent months, including holding talks with advisers about selling billions of dollars of assets from its industrial operations as he looks to shift away from low-growth businesses, Bloomberg reported in October.
“We’ve got to structurally adjust the portfolio, which means some pieces coming out,” Brown said Tuesday on a conference call. That could mean divesting more “commodity-like” businesses, he said.
The company has also been looking to increase its use of digital products, developing an AI-powered assistant with the aim of reducing prototyping costs and bringing products to market faster, the company has said.
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