3M Gives Investors a ‘Beat and Raise.’ The Stock Is Rising.

Coming into Friday trading, 3M stock was up about 52% over the past 12 months. Investors have been encouraged by improving sales growth. (Gabby Jones/Bloomberg)

3M traded higher initially after reporting better-than-expected second-quarter earnings, but gave up gains throughout the day. Still, the maker of Post-it Notes turned in solid results and even managed to increase full-year financial guidance, despite a weakening consumer.

Friday morning, the company announced adjusted earnings per share of $2.16 on sales of $6.2 billion. Wall Street was looking for earnings per share of $2.01 on sales of $6.1 billion, according to FactSet. A year ago, 3M reported adjusted earnings per share of $1.93 on sales of $6 billion.

“We delivered strong results in the second quarter, posting positive organic sales growth and double-digit EPS growth,” said CEO William Brown in a news release. “With execution improving and solid results in the first half, we have confidence in our increased full-year EPS guidance, which now embeds the expected impact of tariffs.”

The midpoint of 2025 earnings-per-share guidance was raised to $7.87 from $7.75. The new number appears to include estimated tariff-related cost increases of 20 cents a share. Tariff impacts were excluded from the old $7.75 figure.

3M shares traded as high as $164.15 in premarket trading, but slipped 3.7% to $153.23 on Friday. The S&P 500 finished flat, and the Dow Jones Industrial Average fell 0.3%. Starting points explain some of the reaction. Coming into earnings, 3M stock had been strong, up about 50% over the past 12 months.

For the quarter, comparable sales grew 1.5% year over year. Growth hasn’t been easy for 3M lately. In the first quarter of 2024, organic sales grew by about 1%, which was the first positive reading in four quarters.

In the first quarter of 2025, comparable sales grew about 1.5% year over year. 3M management expects full-year comparable sales to rise about 2% year over year. That’s at the lower end of Wall Street’s expectations of 2% to 3% growth. Still, the guidance isn’t entirely unexpected.

“3M’s consumer leverage could clip down core sales guidance from [a] current 2% to 3% range, but we see considerable offsets from foreign exchange, cost, and investment spending,” wrote Wolfe Research analyst Nigel Coe in a preview report. He rates 3M stock at Buy, and has a $186 price target.

Consumer spending has been resilient, but growth slowed in May, and Wells Fargo noted that credit-card-spending growth slowed slightly in the second quarter. 3M called consumer discretionary end-markets “soft” in its earnings presentation. That’s a concern for any consumer-facing business, but 3M does a lot of business overseas, and the dollar has been weak lately. That makes foreign sales a little more valuable in U.S. terms.

Foreign exchange is helping offset headwinds. Currency changes added 10 cents to 3M’s updated full-year guidance.

Overall, 3M’s second quarter looks like a solid report in a less-than-ideal operating environment.

Options markets implied the stock would move about 4%, up or down, following earnings. Shares have moved about 9% following the prior four earnings reports, rising three times and falling once over that span, which includes a big 23% gain after the company reported second-quarter 2024 earnings.

Write to Al Root at allen.root@dowjones.com