3M (MMM) on Tuesday warned that escalating trade tensions between the U.S. and Europe could pressure earnings in 2026, as the company assesses potential tariff exposure linked to a White House dispute involving Greenland.
The diversified industrial manufacturer ships roughly $700 million of products to Europe each year and imports about $250 million back into the U.S., according to Chairman and Chief Executive William Brown. Based on proposed tariff levels, Brown said the financial impact could become material. “If you just run the numbers at 10% and then expand up to 25%, you can get to something in the order of $60 to $70 million,” he said.
Shares of 3M (MMM) fell 8% to about $154.35 in midday trading on Tuesday.
The company said it expects revenue growth to accelerate in 2026 following a modest sales improvement in the fourth quarter, though its current outlook does not assume additional tariffs. Under the proposed policy, duties of 10% could be imposed early in the year and potentially rise to 25% by midyear. Brown said that scenario could translate into a $30 million to $40 million earnings impact in 2026.
3M (MMM) forecast adjusted sales growth of about 4% in 2026, up from $24.3 billion in 2025. The company projected adjusted earnings a share of $8.50 to $8.70, compared with $8.06 last year.
In the fourth quarter, net income fell to $577 million, or $1.07 a share, from $728 million, or $1.33 a share, a year earlier. Results were weighed down by litigation-related costs that reduced earnings by 56 cents a share. On an adjusted basis, earnings of $1.83 a share beat Wall Street expectations by three cents.
Quarterly revenue rose 2.1% to $6.1 billion, topping consensus estimates. However, margins emerged as a key concern.
Analyst Christopher Snyder of Morgan Stanley said margins were the primary downside surprise, citing a 360-basis-point sequential decline that exceeded typical seasonal patterns. He pointed to weakness in the consumer segment, where operating income came in 12% below expectations and margins slipped to 18%, a trend he said could pose near-term risk heading into the first quarter.