01—Abstract
Summary
Summary of the 10-Q filed May 7, 2026. Cited figures are marked; the original filing is the authoritative source.
W.W.
Grainger, Inc. reported a strong first quarter for fiscal year 2026, with net sales increasing by 10.1% to $4.74 billiona compared to the same period in 2025. This growth was driven by both the High-Touch Solutions N.A. and Endless Assortment segments, with daily, organic constant currency net sales up 12.2%. Net earnings attributable to W.W.
Grainger, Inc. rose 15.9% to $555 millionb, resulting in a diluted earnings per share of $11.65, an 18.2% increase year-over-year. The company demonstrated improved operating leverage, with operating earnings increasing by 18.0%. Despite macroeconomic volatility and uncertainty, Grainger's business model, characterized by a diverse customer base and the generally non-discretionary nature of its MRO products, has shown resilience.
The company maintained a healthy liquidity position, with cash and cash equivalents of $695 millionc and available liquidity of approximately $1.9 billion. Management expects these resources, along with cash generated from operations, to be sufficient for the next twelve months, supporting continued investment in the business and returns to shareholders through dividends and share repurchases.
02—Key points
Key Highlights
- Net sales grew 10.1% to $4.74 billion in Q1 2026 compared to Q1 2025.
- Diluted Earnings Per Share (EPS) increased by 18.2% to $11.65.
- Operating earnings saw a significant increase of 18.0%, indicating improved operational efficiency.
- Both High-Touch Solutions N.A. and Endless Assortment segments contributed to sales growth.
- The company maintained strong liquidity with $695 million in cash and cash equivalents and $1.9 billion in available liquidity.
- Capital expenditures increased to $178 million, primarily for supply chain investments in MonotaRO.
- Shareholders received $108 million in cash dividends, reflecting a commitment to returning capital.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, W.W. Grainger kept $0.12.
- Revenue$4.74B100.0%
- Cost of revenue−$2.85B60.0%
- Gross profit$1.90B40.0%
- Operating costs−$1.10B23.3%
- Operating income$793.0M16.7%
- Interest, other & tax−$238.0M5.0%
- Net income$555.0M11.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed May 7, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $4.74B$4.31B | +10.1% |
| Cost of Revenue | $2.85B$2.60B | +9.6% |
| Gross Profit | $1.90B$1.71B | +10.9% |
| SG&A Expenses | $1.10B$1.04B | +6.3% |
| Operating Income | $793.00M$672.00M | +18.0% |
| Net Income | $555.00M$479.00M | +15.9% |
| EPS (Basic) | $11.67$9.88 | +18.1% |
| EPS (Diluted) | $11.65$9.86 | +18.2% |
| Shares Outstanding (Basic) | 47.30M48.20M | −1.9% |
| Shares Outstanding (Diluted) | 47.40M48.30M | −1.9% |
05—Questions
Frequently Asked Questions
What drove the significant increase in net sales?
Net sales increased by 10.1% to $4.74 billion, driven by growth in both the High-Touch Solutions N.A. and Endless Assortment segments. On a daily, organic constant currency basis, net sales increased by 12.2%, indicating strong underlying business performance and favorable pricing.
How did the company's profitability perform in the quarter?
Profitability improved significantly. Gross profit increased by 10.9% to $1.90 billion, and operating earnings grew by 18.0% to $793 million. This strong operating leverage led to a 15.9% increase in net earnings attributable to W.W. Grainger, Inc., reaching $555 million, with diluted EPS rising 18.2% to $11.65.
What is the company's liquidity and cash flow situation?
Grainger maintained a strong liquidity position with $695 million in cash and cash equivalents and approximately $1.9 billion in available liquidity as of March 31, 2026. Net cash provided by operating activities increased to $739 million, up from $646 million in the prior year, reflecting higher net earnings. The company anticipates sufficient resources for the next twelve months and plans to continue investing in its business and returning cash to shareholders.
Are there any significant risks or headwinds mentioned in the report?
The report acknowledges elevated global economic volatility and uncertainty, including challenges in commodity, labor, and transportation markets, as well as geopolitical developments and potential impacts from changing tariff and trade policies. However, management believes Grainger's strategy and the non-discretionary nature of its MRO products provide resilience.
06—Continue