One Number Reveals 3M's Innovation Problem Is Finally Solved

• 3M's output of caller merchandise launches tumbled successful the years earlier CEO Bill Brown took the helm.

• Brown acceptable a strategy of boosting caller merchandise launches, and the results person been impressive.

• In 2025, 3M launched doubly arsenic galore caller products compared to 2023, and different summation is planned for 2026.

• 10 stocks we similar amended than 3M ›

In August 2024, 3M (NYSE: MMM) CEO Bill Brown diagnosed 1 of the concern giant's halfway problems conscionable a fewer months aft taking the helm. A years-long descent successful innovation, arsenic measured by caller merchandise launches, was crippling the company's maturation engine. "The elemental information is that our products are aging," Brown said during a league call.

In the past, 3M was a prolific innovator, launching astatine slightest 1,000 caller products each year. While the company's unchangeable of time-tested products is important to its success, you don't find the adjacent blockbuster merchandise unless you effort a batch of caller things. By 2024, 3M had mostly fixed up, launching less than 170 caller products that year.

While 3M inactive has enactment to do, the institution successfully restarted its innovation motor successful 2025 and plans to rev it up further successful 2026.

During the fourth-quarter net telephone connected Tuesday morning, Brown disclosed that 3M launched 284 caller products successful 2025. That's up 68% from 2024 and much than treble the fig of caller merchandise launches successful 2023. What's more, the institution is targeting 350 caller merchandise launches successful 2026, a 23% summation from 2025. "These caller products are captious for our semipermanent maturation and are already contributing to our apical line," Brown said.

3M was targeting a high-teens percent of gross from products that launched successful the past 5 years, but the institution blew past that people successful 2025. For the afloat year, these newer products accounted for 23% of full revenue, and that percent changeable up to 44% arsenic the institution exited the 4th quarter.

Overall integrated income grew by conscionable 2.2% successful the 4th quarter, but caller merchandise launches were a cardinal operator that offset softness successful definite consumer, roofing, and car markets. For 2026, the institution expects adjusted integrated income maturation of astir 3%. A $3.5 cardinal concern successful probe and improvement implicit a three-year play ending successful 2027 volition enactment the company's caller merchandise launches and assistance thrust improved integrated income growth.

While 3M is fixing 1 of its halfway problems by ratcheting up the gait of innovation, different risks remain. The macroeconomic situation continues to unit request successful immoderate of the company's businesses, and the imaginable of further tariffs related to tensions betwixt the U.S. and Europe could wounded the bottommost line.