Industrial Supplies
Fastenal 3Q Sales Climb 15.5% as Profit Growth Accelerates, Pricing Eases
The company's operating profit grew 20.2% as expense leverage offset gross margin pressure. September daily sales growth moderated but extended Fastenal’s double-digit streak to 15 months.
Fastenal’s 1Q growth considerably outpaced that of a year earlier and the last “pre-COVID” quarter of 1Q 2020. Digital is the biggest driver. We examine the numbers here.
Industrial and construction supplies distributor Fastenal reported its 2026 third-quarter and September business results on Oct. 14, posting faster quarterly sales growth and an expansion in operating margin.
Fastenal’s 3Q26 sales totaled $2.46 billion — up 15.5% year-over-year on both a total and daily sales basis. Sequentially, growth accelerated from 2Q26’s 14.7% gain and was the company’s strongest quarterly increase since 3Q22.
The company attributed growth primarily to market share gains with larger customers, pricing actions and broad-based demand across its core end markets. Its investor presentation indicated that improving market conditions in the first half of 2026 strengthened further in the third quarter.
Pricing contributed approximately 240 basis points to quarterly sales growth, easing from about 290 bps in 2Q26 and 350 bps in 1Q26. Foreign exchange rates reduced 3Q26 growth by approximately 10 bps.
Fastenal Quietly Acquired an AI Startup as Distribution Races to Scale
Other key stats from Fastenal’s 3Q26:
- Gross margin of 44.8% declined approximately 40 bps year-over-year, according to the company, but improved from 44.6% in 2Q26. Larger-customer mix and unfavorable price/cost weighed on margin, partially offset by direct sourcing savings, supplier rebates and tariff refunds.
- SG&A expenses of $573.9 million grew 9.4% year-over-year, slowing from 10.9% growth in 2Q26. Expenses declined to 23.3% of sales from 24.6% a year earlier, reflecting productivity gains and fixed-cost leverage.
- Operating profit of $530.8 million jumped 20.2% year-over-year. Operating margin reached 21.5%, an improvement the company reported as approximately 90 bps.
- Net profit of $401.6 million increased 19.7% year-over-year.
In September, Fastenal’s sales of $825.4 million grew 14.4% year-over-year on both a total and daily basis. Daily sales growth moderated from August’s 16.6% and July’s 15.5%, but marked the company’s 15th consecutive month of double-digit growth.
September daily sales increased 20.3% in heavy manufacturing, 12.9% in other manufacturing and 9.6% in non-residential construction. Average daily sales rose 1.6% from August, below the company’s historical August-to-September increase of 4.0%.
