Did Fastenal's growth come from price or volume?

Both contributed. Pricing added roughly 290 basis points to Q2 2026 net sales growth, compared with 140-170 bps a year earlier, so most of the 14.7% increase reflects price. The rest came from share gains with larger contract customers and a modest improvement in industrial production. Contract customers grew daily sales 17.6%, while non-contract customers grew 7.3%.

Why did operating cash flow decline even though earnings grew?

Operating cash flow fell to $265.7M, or 69.4% of net income, versus 84.4% a year earlier. The main driver was a larger build in accounts receivable, which rose 17.6% year-over-year on strong late-quarter sales and higher exposure to larger customers that have longer payment terms. Accounts payable growth partly offset this. Management characterizes the shortfall as timing, and first-half operating cash flow still grew 19.1%.

Is Fastenal's margin under pressure?

Gross margin is under pressure, down 75 bps to 44.6%, mainly from unfavorable price/cost of about 40 bps, plus customer mix shifting toward larger accounts, higher fuel-driven transportation costs, and timing-related rebates. Operating margin nonetheless held at 21.0% because SG&A fell to 23.5% of sales from 24.4%, with base pay leverage and occupancy fixed-cost leverage. Whether that offset can persist depends on sustaining sales growth against rising costs.

Did Fastenal change its digital or technology targets?

Yes, slightly. The 2026 goal for weighted FASTBin/FASTVend signings was lowered to 27,000-29,000 MEUs from 28,000-30,000 MEUs. Q2 signings were 6,993, up 8.3% YoY, and installations reached 140,789, up 6.5%. FMI sales grew 16.4% in the quarter, and digital channels represented 61.6% of net sales in total Digital Footprint terms.

How is Fastenal allocating capital and what does its balance sheet look like?

Fastenal returned $305.1M to shareholders in Q2, or 79.7% of net income, which is above its five-year average of 73.2%. Dividends were $275.4M and buybacks $29.7M. Total debt fell to $120.0M, or 2.9% of total capital, from $230.0M a year earlier. Capex is guided up to $310-330M for 2026, mainly for facility replacement, distribution capacity, trucking, and IT, which would be a notable step-up from 2025 spending.

FAST 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed July 14, 2026. Cited figures are marked; the original filing is the authoritative source.

Fastenal (FAST) reported Q2 2026 results that show continued top-line momentum with operating margin holding steady.

Net sales rose 14.7% year-over-year to $2,386.9 million^a, and daily sales grew by the same 14.7% (both periods had 64 business days). Growth was driven by share gains with larger contract customers, pricing (about 290 basis points of contribution), and a modest improvement in industrial production. Gross margin contracted 75 basis points to 44.6%, mainly from unfavorable price/cost, but SG&A leverage (SG&A fell to 23.5% of sales from 24.4%) fully offset that pressure, leaving operating margin flat at 21.0%.

Diluted EPS rose 15.9% to $0.33^b and net income rose 15.9% to $382.8 million. Cash generation was the soft spot in the quarter. Operating cash flow fell 4.6% to $265.7 million, only 69.4% of net income versus 84.4% a year earlier, as receivables grew 17.6% year-over-year to $1,557.4 million on strong late-quarter sales and a larger mix of customers with longer payment terms.

Management attributes the gap to timing rather than a deterioration in collections, and first-half operating cash flow still rose 19.1%. The company returned $305.1 million^c (79.7% of net income) to shareholders through $275.4 million in dividends and $29.7 million in buybacks, and total debt fell to $120.0 million. Management also trimmed its 2026 MEU signings goal to 27,000-29,000 from 28,000-30,000, and expects capex of $310-330 million, up from $230.6 million in 2025.

02—Key points

Key Highlights

Net sales of $2,386.9M, up 14.7% YoY; daily sales growth matched at 14.7%, with pricing contributing roughly 290 bps
Operating margin held flat at 21.0%, as SG&A leverage (23.5% of sales vs. 24.4%) offset a 75 bps gross margin decline to 44.6%
Diluted EPS of $0.33, up 15.9% YoY; net income of $382.8M
Operating cash flow of $265.7M, down 4.6% YoY and 69.4% of net income, driven by a 17.6% increase in receivables
Shareholder returns of $305.1M (79.7% of net income), including $275.4M in dividends; total debt reduced to $120.0M from $230.0M a year ago
Digital Footprint sales reached 61.6% of net sales, with FMI sales up 16.4% YoY; FMI signings were up 8.3% but the 2026 signings target was lowered
2026 capex guidance of $310-330M, up from $230.6M in 2025, driven by the Atlanta hub replacement, trucking, and delayed IT projects

03—Questions

Frequently Asked Questions

Did Fastenal's growth come from price or volume?
Both contributed. Pricing added roughly 290 basis points to Q2 2026 net sales growth, compared with 140-170 bps a year earlier, so most of the 14.7% increase reflects price. The rest came from share gains with larger contract customers and a modest improvement in industrial production. Contract customers grew daily sales 17.6%, while non-contract customers grew 7.3%.
Why did operating cash flow decline even though earnings grew?
Operating cash flow fell to $265.7M, or 69.4% of net income, versus 84.4% a year earlier. The main driver was a larger build in accounts receivable, which rose 17.6% year-over-year on strong late-quarter sales and higher exposure to larger customers that have longer payment terms. Accounts payable growth partly offset this. Management characterizes the shortfall as timing, and first-half operating cash flow still grew 19.1%.
Is Fastenal's margin under pressure?
Gross margin is under pressure, down 75 bps to 44.6%, mainly from unfavorable price/cost of about 40 bps, plus customer mix shifting toward larger accounts, higher fuel-driven transportation costs, and timing-related rebates. Operating margin nonetheless held at 21.0% because SG&A fell to 23.5% of sales from 24.4%, with base pay leverage and occupancy fixed-cost leverage. Whether that offset can persist depends on sustaining sales growth against rising costs.
Did Fastenal change its digital or technology targets?
Yes, slightly. The 2026 goal for weighted FASTBin/FASTVend signings was lowered to 27,000-29,000 MEUs from 28,000-30,000 MEUs. Q2 signings were 6,993, up 8.3% YoY, and installations reached 140,789, up 6.5%. FMI sales grew 16.4% in the quarter, and digital channels represented 61.6% of net sales in total Digital Footprint terms.
How is Fastenal allocating capital and what does its balance sheet look like?
Fastenal returned $305.1M to shareholders in Q2, or 79.7% of net income, which is above its five-year average of 73.2%. Dividends were $275.4M and buybacks $29.7M. Total debt fell to $120.0M, or 2.9% of total capital, from $230.0M a year earlier. Capex is guided up to $310-330M for 2026, mainly for facility replacement, distribution capacity, trucking, and IT, which would be a notable step-up from 2025 spending.

04—Continue

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