3M | Q2 2025: Adjusted earnings growth and improved outlook despite legal expenses

3M entered the second quarter of 2025 with the goal of building on its improving results from the start of the year - and it succeeded in most key metrics. Organic revenue growth continued for the third consecutive quarter, earnings per share adjusted for extraordinary costs grew at a double-digit pace, and operating margins improved across major divisions. These results come at a time when the company continues to face significant litigation-related expenses, primarily around PFAS-containing products and historical military shipments, which continue to weigh on GAAP results.

Despite these complications, however, the company raised its full-year earnings guidance and reaffirmed its ability to generate strong free cash flow. The internal transformation model, "3M eXcellence," is also beginning to show positive signs of delivering long-term efficiencies and operational discipline. While some short-term hurdles remain, investors are getting an important signal: the core business is…