Fastenal Company Reports 2026 Third Quarter Earnings
primarily driven by share gains with larger customers, pricing actions, and broad-based demand across core end markets.
, as selling, general, and administrative expense leverage more than offset customer mix-related gross margin pressure.
Operating cash flow was $422 million, representing 105% of net income , reflecting the timing of working capital changes associated with strong sales growth.
, including increased sales effectiveness through key account wins, expansion of digital technologies, and deeper penetration through new customer site growth.
WINONA, Minn., October 14, 2026 (BUSINESS WIRE) -- Fastenal Company (Nasdaq:FAST) ('Fastenal,' 'we,' 'our,' or 'us'), a global leader in supply chain services, today reported results for the third quarter ended September 30, 2026. Results reflected strong daily sales growth, operating expense leverage, and continued growth with larger customers supported by our Onsite, digital, and supply chain solutions. Except for share and per share information, or as otherwise noted, amounts are stated in millions. Percentage and dollar calculations, which are based on non-rounded dollar values, may not be recalculated or footed using the dollar values included in this document due to the rounding of those dollar values.
Net sales increased $330.0, or 15.5%, in the third quarter of 2026 when compared to the third quarter of 2025 (both periods had the same number of business days). Sales performance reflects the contribution from improved customer contract signings since the first quarter of 2024 , product pricing, and a modest improvement in industrial production in the first nine months of 2026. Foreign exchange rates negatively impact ed sales growth by approximately 10 basis points in the third quarter of 2026 as compared to the third quarter of 2025 when foreign exchange rates contributed approximately 10 basis points to sales growth. The impact of product pricing on net sales in the third quarter of 2026 wa s an increase of approximately 240 basis points, compared to an increase of 240 to 270 basis points in the third quarter of 2025.
From a product portfolio standpoint, we classify our offerings into four primary categories: fasteners, safety supplies, cutting tools, and other product lines. 'Other product lines' encompasses seven smaller product segments, including tools and janitorial supplies. 1 Beginning in the fourth quarter of 2025, we expanded our reporting to provide a more comprehensive view of direct (original equipment manufacturing/production) and indirect (maintenance, repair, and operations/facilities maintenance) business across product categories. Direct materials generally include products incorporated into finished goods or that directly support customers' production processes, while indirect materials support customers' facility operations, maintenance, and safety needs . During the third quarter of 2026, direct materials outpaced indirect materials, reflecting greater contribution from fastener sales and continued strength with manufacturing customers.
The DS R change when compared to the same period in the prior year and the percent of sales in the period were as follows:
From an end market standpoint, we have four categories: heavy manufacturing, other manufacturing, non-residential construction, and other, the latter of which includes reseller, government/education, transportation, warehousing and storage, and data centers. Our manufacturing end market growth was mainly due to the relative strength we are experiencing with key account customers with significant managed spend, where our service model and technology are particularly impactful. The non-residential construction end market experienced growth for the sixth quarter in a row. Other end market sales were favorably impacted by growth with transportation and reseller customers.
The D SR change when compared to the same period in the prior year and the percent of sales in the period were as follows:
From a customer standpoint, we have two categories: 1) contracts, which include national multi-site, local and regional, and government customers with significant revenue potential, and 2) non-contracts. Sales with our contract customers continue to outperform as we realize incremental sales from implementing customer signings that we have achieved since the first quarter of 2024. Non-contract customers tend to be smaller and utilize fewer of our tool s and capabilities, providing fewer avenues for share gains and therefore more closely reflect overall business trends.
The DSR change when compared to the same period in the prior year and the percent of sales in the period were as follows:
We engage customers in the local market by delivering services and solutions within or near the customer's business (Sites). Sites represent distinct customer locations where we maintain inventory tailored to local demand, supported by our regional distribution networks. Our strategy prioritizes customer Sites with monthly sales potential of $50,000 or more. Segmentation by spend level provides insight into the scale and potential of customer relationships served through our network. The following table summarizes average customer Site counts by monthly spend band and related sales metrics.
(3) Monthly sales per Site totals are not rounded to the millions and represent the exact dollar amount.
(4) $50k+ Sites are disclosed as a representation of Onsite-like customers and are also a subset of $10k+ and $5k+ Sites.
(5) Other sales represent sales to Sites under $5k per month and sales that are not tied to a specific Site. This includes certain service fees, cash sales, direct ship sales, etc.
Fastenal Managed Inventory (FMI ® ) Technology comprises our FASTStock℠ (scanned stocking locations), FASTBin ® (infrared, RFID, scaled bins, and FASTBin ® - Click), and FASTVend ® (vending devices) offerings. FASTStock's fulfillment processing technology is not embedded, is relatively less expensive to deploy and highly flexible in application, and is delivered using our proprietary mobility technology. FASTBin and FASTVend incorporate highly efficient and powerful embedded data tracking and fulfillment processing technologies. The first statistic below is a weighted FMI measure, which combines the signings and installations of FASTBin and FASTVend in a standardized machine equivalent unit (MEU) based on the expected output of each type of device. We do not include FASTStock in this measurement because scanned stocking locations can take many forms, such as bins, shelves, cabinets, pallets, etc., that cannot be converted into a standardized MEU.
We signed 7,484 weighted FASTBin and FASTVend devices in the third quarter of 2026 . Our goal for weighted FASTBin and FASTVend device signings in 2026 is between 27,000 and 29,000 MEUs (our previous goal was between 28,000 and 30,000 MEUs). 3 The second statistic is sales through FMI Technology, which combines the sales through FASTStock, FASTBin, and FASTVend. A portion of the growth in sales experienced by FMI, particularly FASTStock and FASTBin, reflects the migration of products from less efficient non-digital stocking locations to more efficient, digital stocking locations.
The table below summarizes signings and installations of our FMI devices and sales through our FMI devices, eBusiness (1) tools, and Digital Footprint (2) .
(1) Our eBusiness includes eProcurement activities, which are integrated transactions, including electronic data interchange (EDI), and eCommerce (transactional website sales).
(2) Digital Footprint is a combination of our sales through FMI (FASTStock, FASTBin, and FASTVend) plus that portion of our eBusiness sales that does not represent billings of FMI services.
(3) Weighted FASTBin/FASTVend signings and installations reflect the percent change compared to the same period in the prior year.
Gross prof it, as a percentage of net sales, decreased approximately 40 basis points to 44.8% in the third quarter of 2026 from 45.3% in the third quarter of 2025. A continued shift in customer mix toward larger customers reduced gross margin by approximately 50 basis points. While these relationships typically carry lower gross margins, they generate higher absolute profit dollars and are accretive to operating margin through fixed-cost leverage, higher volumes, and operating efficiencies. Price/cost reduced gross margin by approximately 30 basis points, an improvement of approximately 10 basis points from the second quarter of 2026. Gross margin benefited from several factors, including direct sourcing savings, supplier rebates, and tariff refunds. Approximately 20 basis points of the benefit reflected favorable timing.
Our gross margin decreased approximately 75 basis points in the second quarter of 2026 to 44.6% of net sales, from 45.3% in the second quarter of 2025. Gross margin improved from the second quarter of 2026 to the third quarter of 2026.
SG&A expenses, as a percentage of net sales, were 23.3% in the third quarter of 2026 versus 24.6% in the third quarter of 2025, an improvement of 130 basis points.
Employee-related expenses, which typically represent 70% to 75% of total SG&A expenses, improved 90 basis points as a percentage of net sales in the third quarter of 2026 compared to the third quarter of 2025. Base pay leveraged through increased labor productivity, while bonuses and commissions grew faster than sales as a result of improved business activity and financial performance versus the same period in the prior year. 4 Occupancy-related expenses, which typically represent 14% to 19% of total SG&A expenses, improved 50 basis points as a percentage of net sales in the third quarter of 2026 compared to the third quarter of 2025 , driven mainly by fixed cost leverage.
Combined, all other SG&A expenses, which typically represent 10% to 15% of total SG&A expenses, increased 10 basis points as a percentage of net sales when compared to the third quarter of 2025. This slight increase was driven mainly by higher fuel and general insurance expense, partially offset by increased joint marketing efforts with our suppliers.
Operating income as a percentage of net sales increased to 21.5% in the third quarter of 2026, compared to 20.7% in the third quarter of 2025.
Net interest income was $0.4 in the third quarter of 2026, compared to net interest expense of $0.9 in the third quarter of 2025, primarily from lower debt balances.
We recorded income tax expense of $129.6 in the third quarter of 2026, or 24.4% of in com e before income taxes. Income tax expense was $105.1 in the third quarter of 2025, or 23.9% of income before income tax es. We believe our ongoing tax rate, absent any discrete tax items or broader changes to tax law, will be approximately 24.6%.
Net income was $401.6 in the third quarter of 2026, an increase of 19.7% compared to the third quarter of 2025. Diluted net income per share was $0.35 compared to $0.29 in the third quarter of 2025.
Net cash provided by operating activities was $421.6 in the third quarter of 2026, an increase of 9.0% from the third quarter of 2025. Cash flow from operations represented 105.0% of net income, compared to 115.3% in the third quarter of 2025 and our five-year third quarter average of 101.1% . The decline as a percentage of net income compared to last year was primarily driven by a larger use of cash for accounts receivable and inventory, reflecting strong sales growth. This is a common dynamic for a distribution business. This was partially offset by higher accounts payable balances mainly attributable to an increase in inventory spending and an increase in accrued expenses related to incentive compensation and customer rebates from improved business performance.
Net cash provided by operating activities was $1,065.7 in the first nine months of 2026, an increase of 14.9% from the first nine months of 2025, representing 94.8% of net income versus 96.2% in the first nine months of 2025 and the most recent five-year average of 96.4%. The decrease in operating cash flow, as a percent of net income, primarily reflects increased working capital associated with accounts receivable, which was partially offset by inventory efficiencies and higher payable balances due to increased purchasing activity.
The dollar and percentage change in accounts receivable, net, inventories, and accounts payable as of September 30, 2026 when compared to September 30, 2025 were as follows:
The increase in our accounts receivable balance in the third quarter of 2026 was mainly attributable to sales growth, including relative growth with larger customers that tend to carry longer payment terms.
The slight increase in our inventory balance in the third quarter of 2026, despite double-digit sales growth, reflects disciplined inventory management.
The increase in our accounts payable balance in the third quarter of 2026 was mainly attributable to an increase in inventory spending to support growth. 5 During the third quarter of 2026, our investment in property and equipment, net of proce eds from sales, was $71.8 (2.9% of net sales), which wa s an increase from $54.7 (2.6% of net sales) in the third quarter of 2025. The investment was directed toward facility construction and upgrades, industrial vending equipment, and information technology (IT) spend. Our five- a nd ten-year annual average as a percent of net sales was 2.5% and 3.1%, respectively.
For 2026, we continue to expect our investment in property and equipment, net of proceeds from sales, to be between $310.0 and $330.0, an increase from $230.6 in 2025. The expected growth on a year-over-year basis reflects three items. First, we expect increased spending to replace our Atlanta hub facility and improve our picking capacity and efficiency across our hub network. Second, we expect elevated IT spending as projects that were expected in 2025 experienced delays and are expected to continue throughout 2026. Third, we expect increased trucking spend.
During the third quarter of 2026, we retu rned $328.4, or 81.8% of net income, to our shareholders in the form of dividends ($298.2) and share repurchases ($30.2), compared to the third quarter of 2025 when we returned $252.5, or 75.3% of net income, in the form of dividends. Over the past five years, we have returned an average of 76.0% of net income to shareholders in the third quarter.
Total debt on our balance sheet was $100.0 at the end of the third quarter of 2026, or 2.4% of total capital (the sum of stockholders' equity and total debt), compared to $195.0, or 4.8% of total capital, at the end of the third quarter of 2025.
During the last twelve months, we increased our total full-time equivalent (FTE; based on 40 hours per week) employee headcount by 181. Our total FTE selling personnel decreased by 82, primarily driven by a drop in hours worked by part- time selling personnel. We increased our distribution and transportation FTE personnel by 105 to support increased product throughput at our distribution facilities. We increased our remaining FTE personnel by 158, which related primarily to personnel investments in supply chain support.
The table below summarizes our absolute and FTE employee headcount at the end of the periods presented and the percentage change compared to the end of the prior periods.
As we previously disclosed, we will host a conference call today to review the quarterly results, as well as current operations. This conference call will be broadcast live over the Internet at 9:00 a.m., central time. To access the webcast, please go to our Investor Relations website at https://investor.fastenal.com/events.cfm .
We publish on the 'Investor Relations' page of our website at www.fastenal.com both our monthly consolidated net sales information and the presentation for our quarterly conference call (which includes information, supplemental to that contained in our earnings announcement, regarding results for the quarter). We expect to publish the consolidated net sales information for each month, other than the third month of a quarter, at 6:00 a.m., central time, on the fourth business day of the following month. We expect to publish the consolidated net sales information for the third month of each quarter and the conference call presentation for each quarter at 6:00 a.m., central time, on the date our earnings announcement for such quarter is publicly released.
Certain statements contained in this document do not relate strictly to historical or current facts. As such, they are considered 'forward-looking statements' that provide current expectations or forecasts of future events. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of terminology such as anticipate, believe, should, estimate, expect, intend, may, will, plan, goal, project, hope, trend, target, opportunity, continue, outlook, potential, would, could, and similar words or expressions, or by references to typical outcomes. Any statement that is not a historical fact, including estimates, projections, future trends, and the outcome of events that have not yet occurred, is a forward-looking statement. Our forward-looking statements generally relate to our expectations and beliefs regarding the business environment in which we operate, our projections of future performance, our perceived marketplace opportunities, our strategies, goals, mission, and vision, and our expectations about future capital expenditures, future investment in property and equipment, future tax rates, future inventory levels, the declaration and payment of dividends, pricing, weighted FMI device signings, the impact of inflation on our cost of goods sold or SG&A expenses, the impact of price increases on overall sales growth or margin performance, and our ability to grow our business through the enhancement of sales through our Digital Footprint. Readers should understand that forward- looking statements involve a variety of risks and uncertainties, known and unknown (including risks disclosed in our most recent annual and quarterly reports), and may be affected by inaccurate assumptions. Consequently, no forward-looking statement can be guaranteed and actual results may vary materially. Factors that could cause our actual results to differ from those discussed in the forward-looking statements include, but are not limited to, those detailed in our most recent annual and quarterly reports. Each forward- looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any such statement to reflect events or circumstances arising after such date. FAST-E 7
FASTENAL COMPANY Condensed Consolidated Balance Sheets (Amounts in millions except share and per share information) (Unaudited) Assets September 30, December 31, Current assets: 2026 2025 ────────────────────────────────────────────────────────────────────────────── Cash and cash equivalents $ 211.9 276.8 Trade accounts receivable, net of allowance for credit 1,615.2 1,245.3 losses of $6.2 and $5.3, respectively Inventories 1,776.6 1,748.0 Prepaid income taxes 9.3 20.1 Other current assets 215.8 181.9 Total current assets 3,828.8 3,472.1 Property and equipment, 1,188.2 1,131.6 net Operating lease 343.4 309.0 right-of-use assets Other assets 134.1 140.2 Total assets $ 5,494.4 5,052.9 Liabilities and Stockholders' Equity Current liabilities: Current portion of debt $ 50.0 25.0 Accounts payable 445.8 316.8 Accrued expenses 335.5 264.7 Current portion of operating lease 113.5 106.1 liabilities Income taxes payable 29.4 3.0 Total current liabilities 974.2 715.6 Long-term debt 50.0 100.0 Operating lease 238.2 210.8 liabilities Deferred income taxes 65.9 67.4 Other long-term 16.9 15.5 liabilities Stockholders' equity: Preferred stock: $0.01 par value, 5,000,000 shares — — authorized, no shares issued or outstanding Common stock: $0.01 par value, 1,600,000,000 shares authorized, 1,147,264,610 11.5 11.5 and 1,148,057,473 shares issued and outstanding, respectively Additional paid-in 60.0 115.5 capital Retained earnings 4,142.8 3,867.7 Accumulated other -65.0 -51.1 comprehensive loss Total stockholders' 4,149.2 3,943.6 equity Total liabilities and stockholders' $ 5,494.4 5,052.9 equity
Full text with the tables
EXHIBIT 99.1
Fastenal Company Reports 2026 Third Quarter Earnings
•
Daily sales increased 15.5% year-over-year,
primarily driven by share gains with larger customers, pricing actions, and
broad-based demand across core end markets.
•
Operating margin was 21.5%, a 90 basis point improvement y
ear-over-year
, as selling, general, and administrative expense leverage more than offset
customer mix-related gross margin pressure.
•
Operating cash flow was $422 million, representing 105% of net income ,
reflecting the timing of working capital changes associated with strong sales
growth.
•
Returned $328 million to shareholders
through dividends and share repurchases, representing 82% of net income.
•
Continued progress on strategic initiatives
, including increased sales effectiveness through key account wins, expansion of
digital technologies, and deeper penetration through new customer site growth.
WINONA, Minn., October 14, 2026 (BUSINESS WIRE) -- Fastenal Company
(Nasdaq:FAST) ('Fastenal,' 'we,' 'our,' or 'us'), a global leader in supply
chain services, today reported results for the third quarter ended September 30,
2026. Results reflected strong daily sales growth, operating expense leverage,
and continued growth with larger customers supported by our Onsite, digital, and
supply chain solutions. Except for share and per share information, or as
otherwise noted, amounts are stated in millions. Percentage and dollar
calculations, which are based on non-rounded dollar values, may not be
recalculated or footed using the dollar values included in this document due to
the rounding of those dollar values.
PERFORMANCE SUMMARY
N… T…
P… 20… 2… Ch… P… 20… 2… Ch…
──────────────────────────────────────────────────────────────────────────────
N… $ 7,… 6… 14… % $ 2,… 2… 15… %
s…
B… 191 1… 64 64
d…
D… $ 36… 3… 14… % $ 38… 3… 15… %
s…
G… $ 3,… 2… 12… % $ 1,… 9… 14… %
p…
%
of 44… % 4… % 44… % 4… %
n…
s…
S…
g…
a… $ 1,… 1… 9.9 % $ 57… 5… 9.4 %
a…
(…
e…
%
of 23… % 2… % 23… % 2… %
n…
s…
O… $ 1,… 1… 16… % $ 53… 4… 20… %
i…
%
of 21… % 2… % 21… % 2… %
n…
s…
I…
b… $ 1,… 1… 16… % $ 53… 4… 20… %
i…
t…
%
of 21… % 2… % 21… % 2… %
n…
s…
N… $ 1,… 9… 16… % $ 40… 3… 19… %
i…
D…
n…
i… $ 0.… 0… 16… % $ 0.… 0… 19… %
p…
s…
N…
–
D…
s…
r…
(…
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d…
as
t…
t…
n…
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by
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of
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QUARTERLY RESULTS OF OPERATIONS
Sales
Net sales increased $330.0, or 15.5%, in the third quarter of 2026 when compared
to the third quarter of 2025 (both periods had the same number of business
days). Sales performance reflects the contribution from improved customer
contract signings since the first quarter of 2024 , product pricing, and a
modest improvement in industrial production in the first nine months of 2026.
Foreign exchange rates negatively impact ed sales growth by approximately 10
basis points in the third quarter of 2026 as compared to the third quarter of
2025 when foreign exchange rates contributed approximately 10 basis points to
sales growth. The impact of product pricing on net sales in the third quarter of
2026 wa s an increase of approximately 240 basis points, compared to an increase
of 240 to 270 basis points in the third quarter of 2025.
From a product portfolio standpoint, we classify our offerings into four primary
categories: fasteners, safety supplies, cutting tools, and other product lines.
'Other product lines' encompasses seven smaller product segments, including
tools and janitorial supplies.
1
Beginning in the fourth quarter of 2025, we expanded our reporting to provide a
more comprehensive view of direct (original equipment manufacturing/production)
and indirect (maintenance, repair, and operations/facilities maintenance)
business across product categories. Direct materials generally include products
incorporated into finished goods or that directly support customers' production
processes, while indirect materials support customers' facility operations,
maintenance, and safety needs . During the third quarter of 2026, direct
materials outpaced indirect materials, reflecting greater contribution from
fastener sales and continued strength with manufacturing customers.
The DS R change when compared to the same period in the prior year and the
percent of sales in the period were as follows:
% of
DSR Change Sales
Three-mon… Three-mo…
Period 2026 2025 Period 2026 2025
──────────────────────────────────────────────────────────────────────────────
Direct 16.8 % 15.3 % 21.0 % 20.9 %
fastener…
Direct
cutting 19.5 % 13.4 % 5.4 % 5.2 %
tools and
abrasives
Direct 21.2 % 12.9 % 13.3 % 12.8 %
non-fast…
Total
direct 18.6 % 14.2 % 39.8 % 38.9 %
materials
Indirect 7.6 % 15.3 % 9.3 % 10.0 %
fastener…
Indirect 13.0 % 10.6 % 20.8 % 21.4 %
safety
Indirect
non-fast… 17.5 % 8.7 % 30.1 % 29.7 %
and
non-safe…
Total
indirect 14.3 % 10.4 % 60.2 % 61.1 %
materials
From an end market standpoint, we have four categories: heavy manufacturing,
other manufacturing, non-residential construction, and other, the latter of
which includes reseller, government/education, transportation, warehousing and
storage, and data centers. Our manufacturing end market growth was mainly due to
the relative strength we are experiencing with key account customers with
significant managed spend, where our service model and technology are
particularly impactful. The non-residential construction end market experienced
growth for the sixth quarter in a row. Other end market sales were favorably
impacted by growth with transportation and reseller customers.
The D SR change when compared to the same period in the prior year and the
percent of sales in the period were as follows:
% of
DSR Change Sales
Three-mon… Three-mo…
Period 2026 2025 Period 2026 2025
──────────────────────────────────────────────────────────────────────────────
Heavy 20.2 % 12.4 % 44.6 % 43.1 %
manufact…
Other 13.2 % 12.9 % 32.0 % 32.8 %
manufact…
Total 17.2 % 12.7 % 76.6 % 75.9 %
manufact…
Non-resi… 12.0 % 7.5 % 8.0 % 8.3 %
construc…
Other end 12.4 % 8.9 % 15.4 % 15.8 %
markets
Total 12.3 % 8.4 % 23.4 % 24.1 %
non-manu…
From a customer standpoint, we have two categories: 1) contracts, which include
national multi-site, local and regional, and government customers with
significant revenue potential, and 2) non-contracts. Sales with our contract
customers continue to outperform as we realize incremental sales from
implementing customer signings that we have achieved since the first quarter of
2024. Non-contract customers tend to be smaller and utilize fewer of our tool s
and capabilities, providing fewer avenues for share gains and therefore more
closely reflect overall business trends.
The DSR change when compared to the same period in the prior year and the
percent of sales in the period were as follows:
% of
DSR Change Sales
Three-mon… Three-mo…
Period 2026 2025 Period 2026 2025
──────────────────────────────────────────────────────────────────────────────
Contract 18.8 % 13.2 % 76.5 % 73.8 %
sales
Non-cont… 7.8 % 7.2 % 23.5 % 26.2 %
sales
2
Customer Sites and Sales Segmentation
We engage customers in the local market by delivering services and solutions
within or near the customer's business (Sites). Sites represent distinct
customer locations where we maintain inventory tailored to local demand,
supported by our regional distribution networks. Our strategy prioritizes
customer Sites with monthly sales potential of $50,000 or more. Segmentation by
spend level provides insight into the scale and potential of customer
relationships served through our network. The following table summarizes average
customer Site counts by monthly spend band and related sales metrics.
Th… Th…
Pe… Pe…
20… 20…
──────────────────────────────────────────────────────────────────────────────
Si… Mo. Si… Mo.
(#… Sa… Sa… (#… Sa… Sa…
(2) per (2) per
Si… Si…
M…
$… 2,… $ 1,… $ 15… 2,… $ 971… $ 140…
$… 9,… 1,… 59… 8,… 1,4… 52,…
$… 14… 1,… 42… 13… 1,5… 37,…
O… 26… 95… 1,… 28… 103… 1,1…
s…
T… 40… $ 1,… $ 15… 42… $ 1,6… $ 12,…
m…
N…
$… 558 $ 21… $ 12… 467 $ 170… $ 121…
$… 3,… 40… 37… 3,… 340… 34,…
$… 6,… 46… 23… 6,… 400… 21,…
O… 43… 11… 863 50… 121… 806
s…
T… 50… $ 57… $ 3,… 56… $ 522… $ 3,0…
n…
T…
$… 3,… $ 1,… $ 14… 2,… $ 1,1… $ 137…
$… 13… 2,… 53… 12… 1,7… 47,…
$… 20… 2,… 36… 19… 1,9… 32,…
O… 70… 20… 989 79… 224… 945
s…
G… 90… $ 2,… $ 9,… 98… $ 2,1… $ 7,1…
t…
(1) Sites represent the number of customer locations served by our network.
Individual customers with multiple locations will have multiple customer Sites.
(2) Sites numbers reflect the monthly average of active Site counts.
(3) Monthly sales per Site totals are not rounded to the millions and represent
the exact dollar amount.
(4) $50k+ Sites are disclosed as a representation of Onsite-like customers and
are also a subset of $10k+ and $5k+ Sites.
(5) Other sales represent sales to Sites under $5k per month and sales that are
not tied to a specific Site. This includes certain service fees, cash sales,
direct ship sales, etc.
Digital Technology
Fastenal Managed Inventory (FMI ® ) Technology comprises our FASTStock℠ (scanned
stocking locations), FASTBin ® (infrared, RFID, scaled bins, and FASTBin ® -
Click), and FASTVend ® (vending devices) offerings. FASTStock's fulfillment
processing technology is not embedded, is relatively less expensive to deploy
and highly flexible in application, and is delivered using our proprietary
mobility technology. FASTBin and FASTVend incorporate highly efficient and
powerful embedded data tracking and fulfillment processing technologies. The
first statistic below is a weighted FMI measure, which combines the signings and
installations of FASTBin and FASTVend in a standardized machine equivalent unit
(MEU) based on the expected output of each type of device. We do not include
FASTStock in this measurement because scanned stocking locations can take many
forms, such as bins, shelves, cabinets, pallets, etc., that cannot be converted
into a standardized MEU.
We signed 7,484 weighted FASTBin and FASTVend devices in the third quarter of
2026 . Our goal for weighted FASTBin and FASTVend device signings in 2026 is
between 27,000 and 29,000 MEUs (our previous goal was between 28,000 and 30,000
MEUs).
3
The second statistic is sales through FMI Technology, which combines the sales
through FASTStock, FASTBin, and FASTVend. A portion of the growth in sales
experienced by FMI, particularly FASTStock and FASTBin, reflects the migration
of products from less efficient non-digital stocking locations to more
efficient, digital stocking locations.
The table below summarizes signings and installations of our FMI devices and
sales through our FMI devices, eBusiness (1) tools, and Digital Footprint (2) .
Ni… D… Th… D…
Pe… 2… 20… C… Pe… 2… 20… C…
──────────────────────────────────────────────────────────────────────────────
W…
F… 2… 19… 7… % 7… 7,… 6… %
s…
(…
S…
p… 1… 104 1… 110
d…
W…
F…
i…
(… 1… 13… 7… %
e…
of
p…
F… $ 8… 77… 1… % $ 2… 27… 7… %
s…
%
of 1… % 12… % 1… % 12… %
s…
F… $ 2… 1,… 1… % $ 8… 70… 1… %
s…
%
of 3… % 31… % 3… % 32… %
s…
F… $ 3… 2,… 1… % $ 1… 97… 1… %
s…
F…
d… $ 1… 14… $ 1… 15…
s…
%
of 4… % 44… % 4… % 45… %
s…
e… $ 2… 1,… 1… % $ 7… 62… 1… %
s…
%
of 2… % 29… % 2… % 29… %
s…
L…
e…
a… $ 8… 81… 8… % $ 3… 28… 8… %
F…
s…
o…
%
of 1… % 13… % 1… % 13… %
s…
D…
F… $ 4… 3,… 1… % $ 1… 1,… 1… %
s…
%
of 6… % 61… % 6… % 61… %
s…
(1) Our eBusiness includes eProcurement activities, which are integrated
transactions, including electronic data interchange (EDI), and eCommerce
(transactional website sales).
(2) Digital Footprint is a combination of our sales through FMI (FASTStock,
FASTBin, and FASTVend) plus that portion of our eBusiness sales that does not
represent billings of FMI services.
(3) Weighted FASTBin/FASTVend signings and installations reflect the percent
change compared to the same period in the prior year.
Gross Profit
Gross prof it, as a percentage of net sales, decreased approximately 40 basis
points to 44.8% in the third quarter of 2026 from 45.3% in the third quarter of
2025. A continued shift in customer mix toward larger customers reduced gross
margin by approximately 50 basis points. While these relationships typically
carry lower gross margins, they generate higher absolute profit dollars and are
accretive to operating margin through fixed-cost leverage, higher volumes, and
operating efficiencies. Price/cost reduced gross margin by approximately 30
basis points, an improvement of approximately 10 basis points from the second
quarter of 2026. Gross margin benefited from several factors, including direct
sourcing savings, supplier rebates, and tariff refunds. Approximately 20 basis
points of the benefit reflected favorable timing.
Our gross margin decreased approximately 75 basis points in the second quarter
of 2026 to 44.6% of net sales, from 45.3% in the second quarter of 2025. Gross
margin improved from the second quarter of 2026 to the third quarter of 2026.
SG&A Expenses
SG&A expenses, as a percentage of net sales, were 23.3% in the third quarter of
2026 versus 24.6% in the third quarter of 2025, an improvement of 130 basis
points.
Employee-related expenses, which typically represent 70% to 75% of total SG&A
expenses, improved 90 basis points as a percentage of net sales in the third
quarter of 2026 compared to the third quarter of 2025. Base pay leveraged
through increased labor productivity, while bonuses and commissions grew faster
than sales as a result of improved business activity and financial performance
versus the same period in the prior year.
4
Occupancy-related expenses, which typically represent 14% to 19% of total SG&A
expenses, improved 50 basis points as a percentage of net sales in the third
quarter of 2026 compared to the third quarter of 2025 , driven mainly by fixed
cost leverage.
Combined, all other SG&A expenses, which typically represent 10% to 15% of total
SG&A expenses, increased 10 basis points as a percentage of net sales when
compared to the third quarter of 2025. This slight increase was driven mainly by
higher fuel and general insurance expense, partially offset by increased joint
marketing efforts with our suppliers.
Operating Income
Operating income as a percentage of net sales increased to 21.5% in the third
quarter of 2026, compared to 20.7% in the third quarter of 2025.
Net Interest
Net interest income was $0.4 in the third quarter of 2026, compared to net
interest expense of $0.9 in the third quarter of 2025, primarily from lower debt
balances.
Income Taxes
We recorded income tax expense of $129.6 in the third quarter of 2026, or 24.4%
of in com e before income taxes. Income tax expense was $105.1 in the third
quarter of 2025, or 23.9% of income before income tax es. We believe our ongoing
tax rate, absent any discrete tax items or broader changes to tax law, will be
approximately 24.6%.
Net Income
Net income was $401.6 in the third quarter of 2026, an increase of 19.7%
compared to the third quarter of 2025. Diluted net income per share was $0.35
compared to $0.29 in the third quarter of 2025.
CASH FLOW AND BALANCE SHEET
Net cash provided by operating activities was $421.6 in the third quarter of
2026, an increase of 9.0% from the third quarter of 2025. Cash flow from
operations represented 105.0% of net income, compared to 115.3% in the third
quarter of 2025 and our five-year third quarter average of 101.1% . The decline
as a percentage of net income compared to last year was primarily driven by a
larger use of cash for accounts receivable and inventory, reflecting strong
sales growth. This is a common dynamic for a distribution business. This was
partially offset by higher accounts payable balances mainly attributable to an
increase in inventory spending and an increase in accrued expenses related to
incentive compensation and customer rebates from improved business performance.
Net cash provided by operating activities was $1,065.7 in the first nine months
of 2026, an increase of 14.9% from the first nine months of 2025, representing
94.8% of net income versus 96.2% in the first nine months of 2025 and the most
recent five-year average of 96.4%. The decrease in operating cash flow, as a
percent of net income, primarily reflects increased working capital associated
with accounts receivable, which was partially offset by inventory efficiencies
and higher payable balances due to increased purchasing activity.
The dollar and percentage change in accounts receivable, net, inventories, and
accounts payable as of September 30, 2026 when compared to September 30, 2025
were as follows:
Twelve… Twelv…
Septem… Dollar Perce…
30 2026 2025 Change 2026 Change 2026
──────────────────────────────────────────────────────────────────────────────
Accou…
recei… $ 1,615.2 1,347.3 $ 267.9 19.9 %
net
Inven… 1,776.6 1,722.8 53.8 3.1 %
Accou… 445.8 344.8 101.0 29.3 %
payab…
Trade
worki… $ 2,946.0 2,725.3 $ 220.8 8.1 %
capit…
net
Net
sales
in $ 2,463.3 2,133.3 $ 330.0 15.5 %
last
three
months
The increase in our accounts receivable balance in the third quarter of 2026 was
mainly attributable to sales growth, including relative growth with larger
customers that tend to carry longer payment terms.
The slight increase in our inventory balance in the third quarter of 2026,
despite double-digit sales growth, reflects disciplined inventory management.
The increase in our accounts payable balance in the third quarter of 2026 was
mainly attributable to an increase in inventory spending to support growth.
5
During the third quarter of 2026, our investment in property and equipment, net
of proce eds from sales, was $71.8 (2.9% of net sales), which wa s an increase
from $54.7 (2.6% of net sales) in the third quarter of 2025. The investment was
directed toward facility construction and upgrades, industrial vending
equipment, and information technology (IT) spend. Our five- a nd ten-year annual
average as a percent of net sales was 2.5% and 3.1%, respectively.
For 2026, we continue to expect our investment in property and equipment, net of
proceeds from sales, to be between $310.0 and $330.0, an increase from $230.6 in
2025. The expected growth on a year-over-year basis reflects three items. First,
we expect increased spending to replace our Atlanta hub facility and improve our
picking capacity and efficiency across our hub network. Second, we expect
elevated IT spending as projects that were expected in 2025 experienced delays
and are expected to continue throughout 2026. Third, we expect increased
trucking spend.
During the third quarter of 2026, we retu rned $328.4, or 81.8% of net income,
to our shareholders in the form of dividends ($298.2) and share repurchases
($30.2), compared to the third quarter of 2025 when we returned $252.5, or 75.3%
of net income, in the form of dividends. Over the past five years, we have
returned an average of 76.0% of net income to shareholders in the third quarter.
Total debt on our balance sheet was $100.0 at the end of the third quarter of
2026, or 2.4% of total capital (the sum of stockholders' equity and total debt),
compared to $195.0, or 4.8% of total capital, at the end of the third quarter of
2025.
ADDITIONAL INFORMATION
During the last twelve months, we increased our total full-time equivalent (FTE;
based on 40 hours per week) employee headcount by 181. Our total FTE selling
personnel decreased by 82, primarily driven by a drop in hours worked by part-
time selling personnel. We increased our distribution and transportation FTE
personnel by 105 to support increased product throughput at our distribution
facilities. We increased our remaining FTE personnel by 158, which related
primarily to personnel investments in supply chain support.
The table below summarizes our absolute and FTE employee headcount at the end of
the periods presented and the percentage change compared to the end of the prior
periods.
C… C… C…
S… S… S…
Q3 Q2 Q2 Q4 Q4 Q3 Q3
2… 2… 2… 2… 2… 2… 2…
…
…
- 1… 1… -… % … … % … … %
…
…
…
…
…
- 1… 1… -… % … … % … … %
…
…
…
…
…
- 2… 2… -… % … … % … … %
…
…
…
…
…
- 2… 2… -… % … … % … … %
…
…
…
6
CONFERENCE CALL TO DISCUSS QUARTERLY RESULTS
As we previously disclosed, we will host a conference call today to review the
quarterly results, as well as current operations. This conference call will be
broadcast live over the Internet at 9:00 a.m., central time. To access the
webcast, please go to our Investor Relations website at
https://investor.fastenal.com/events.cfm .
ADDITIONAL MONTHLY AND QUARTERLY INFORMATION
We publish on the 'Investor Relations' page of our website at www.fastenal.com
both our monthly consolidated net sales information and the presentation for our
quarterly conference call (which includes information, supplemental to that
contained in our earnings announcement, regarding results for the quarter). We
expect to publish the consolidated net sales information for each month, other
than the third month of a quarter, at 6:00 a.m., central time, on the fourth
business day of the following month. We expect to publish the consolidated net
sales information for the third month of each quarter and the conference call
presentation for each quarter at 6:00 a.m., central time, on the date our
earnings announcement for such quarter is publicly released.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this document do not relate strictly to
historical or current facts. As such, they are considered 'forward-looking
statements' that provide current expectations or forecasts of future events.
These forward-looking statements are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. Such statements can be
identified by the use of terminology such as anticipate, believe, should,
estimate, expect, intend, may, will, plan, goal, project, hope, trend, target,
opportunity, continue, outlook, potential, would, could, and similar words or
expressions, or by references to typical outcomes. Any statement that is not a
historical fact, including estimates, projections, future trends, and the
outcome of events that have not yet occurred, is a forward-looking statement.
Our forward-looking statements generally relate to our expectations and beliefs
regarding the business environment in which we operate, our projections of
future performance, our perceived marketplace opportunities, our strategies,
goals, mission, and vision, and our expectations about future capital
expenditures, future investment in property and equipment, future tax rates,
future inventory levels, the declaration and payment of dividends, pricing,
weighted FMI device signings, the impact of inflation on our cost of goods sold
or SG&A expenses, the impact of price increases on overall sales growth or
margin performance, and our ability to grow our business through the enhancement
of sales through our Digital Footprint. Readers should understand that forward-
looking statements involve a variety of risks and uncertainties, known and
unknown (including risks disclosed in our most recent annual and quarterly
reports), and may be affected by inaccurate assumptions. Consequently, no
forward-looking statement can be guaranteed and actual results may vary
materially. Factors that could cause our actual results to differ from those
discussed in the forward-looking statements include, but are not limited to,
those detailed in our most recent annual and quarterly reports. Each forward-
looking statement speaks only as of the date on which such statement is made,
and we undertake no obligation to update any such statement to reflect events or
circumstances arising after such date. FAST-E
7
FASTENAL COMPANY
Condensed Consolidated
Balance Sheets
(Amounts in millions
except share and per
share information)
(Unaudited)
Assets September 30, December 31,
Current assets: 2026 2025
──────────────────────────────────────────────────────────────────────────────
Cash and cash equivalents $ 211.9 276.8
Trade accounts
receivable, net of
allowance for credit 1,615.2 1,245.3
losses of $6.2 and
$5.3, respectively
Inventories 1,776.6 1,748.0
Prepaid income taxes 9.3 20.1
Other current assets 215.8 181.9
Total current assets 3,828.8 3,472.1
Property and equipment, 1,188.2 1,131.6
net
Operating lease 343.4 309.0
right-of-use assets
Other assets 134.1 140.2
Total assets $ 5,494.4 5,052.9
Liabilities and
Stockholders' Equity
Current liabilities:
Current portion of debt $ 50.0 25.0
Accounts payable 445.8 316.8
Accrued expenses 335.5 264.7
Current portion of
operating lease 113.5 106.1
liabilities
Income taxes payable 29.4 3.0
Total current liabilities 974.2 715.6
Long-term debt 50.0 100.0
Operating lease 238.2 210.8
liabilities
Deferred income taxes 65.9 67.4
Other long-term 16.9 15.5
liabilities
Stockholders' equity:
Preferred stock:
$0.01 par value,
5,000,000 shares — —
authorized, no shares
issued or
outstanding
Common stock:
$0.01 par value,
1,600,000,000 shares
authorized, 1,147,264,610 11.5 11.5
and
1,148,057,473 shares
issued and
outstanding, respectively
Additional paid-in 60.0 115.5
capital
Retained earnings 4,142.8 3,867.7
Accumulated other -65.0 -51.1
comprehensive loss
Total stockholders' 4,149.2 3,943.6
equity
Total liabilities and
stockholders' $ 5,494.4 5,052.9
equity
8
FAST…
COMP…
Cond…
Cons…
Stat…
of
Inco…
(Amo…
in
mill…
exce…
inco…
per
shar…
(Una…
Nine Three
Months Months
Ended Ended
Septem… Septe…
30, 30,
2026 2025 2026 2025
Net $ 7,051… 6,173.1 $ 2,463.3 2,133…
sales
Cost
of 3,900… 3,380.6 1,358.6 1,167…
sales
Gross 3,151… 2,792.5 1,104.7 965.8
prof…
Sell…
gene…
and 1,671… 1,521.1 573.9 524.3
admi…
expe…
Oper… 1,480… 1,271.4 530.8 441.5
inco…
Inte… 4.3 4.3 1.2 0.7
inco…
Inte… -2.9 -5.3 -0.8 -1.6
expe…
Inco…
befo… 1,481… 1,270.4 531.2 440.6
inco…
taxes
Inco…
tax 357.4 306.0 129.6 105.1
expe…
Net $ 1,124… 964.4 $ 401.6 335.5
inco…
Basic
net
inco… $ 0.98 0.84 $ 0.35 0.29
per
share
Dilu…
net
inco… $ 0.98 0.84 $ 0.35 0.29
per
share
Basic
weig…
aver… 1,147… 1,147.4 1,147.2 1,147…
shar…
outs…
Dilu…
weig…
aver… 1,150… 1,150.3 1,150.1 1,151…
shar…
outs…
9
FASTE…
COMPA…
Conde…
Conso…
State…
of
Cash
Flows
(Amou…
in
milli…
(Unau… Nine Three
Cash Months Months
flows Ended Ended
from Septem… Septe…
opera… 30, 30,
activ… 2026 2025 2026 2025
──────────────────────────────────────────────────────────────────────────────
Net $ 1,124… 964.4 $ 401.6 335.5
income
Adjus…
to
recon…
net
income
to
net
cash
provi…
by
opera…
activ…
Depre…
of
prope… 126.9 126.7 42.1 42.3
and
equip…
Loss
(gain)
on
sale 0.1 -2.6 -0.1 -1.0
of
prope…
and
equip…
Bad
debt 4.2 3.5 0.9 1.6
expen…
Defer…
income -1.4 -6.1 0.2 -7.4
taxes
Stock… 7.8 6.2 2.6 2.1
compe…
Amort…
of 8.2 8.0 2.8 2.7
intan…
assets
Chang…
in
opera…
assets
and
liabi…
Trade
accou… -379.1 -233.2 -58.9 -26.8
recei…
net
Inven… -34.2 -66.3 -41.9 1.4
Other
curre… -34.4 5.9 -36.8 -19.8
assets
Accou… 127.5 50.3 43.4 25.6
payab…
Accru… 77.4 35.4 48.7 5.4
expen…
Income 37.2 34.8 13.0 22.3
taxes
Other 1.4 0.8 3.9 3.0
Net
cash
provi… 1,065… 927.8 421.6 386.9
by
opera…
activ…
Cash
flows
from
inves…
activ…
Purch…
of
prope… -197.0 -185.3 -74.0 -60.3
and
equip…
Proce…
from
sale
of 7.0 12.5 2.2 5.6
prope…
and
equip…
Other -2.1 -0.3 -0.2 -0.1
Net
cash
used -192.1 -173.1 -72.0 -54.8
in
inves…
activ…
Cash
flows
from
finan…
activ…
Proce…
from 722.0 1,040.0 315.0 365.0
debt
oblig…
Payme…
again… -747.0 -1,045… -335.0 -400.0
debt
oblig…
Proce…
from
exerc… 17.5 23.9 7.2 6.6
of
stock
optio…
Purch…
of -80.8 — -30.5 —
common
stock
Cash
divid… -849.1 -751.6 -298.2 -252.5
paid
Net
cash
used -937.4 -732.7 -341.5 -280.9
in
finan…
activ…
Effect
of
excha…
rate
chang… -1.1 10.3 -1.0 -0.9
on
cash
and
cash
equiv…
Net
(decr…
incre…
in -64.9 32.3 7.1 50.3
cash
and
cash
equiv…
Cash
and
cash
equiv… 276.8 255.8 204.7 237.8
at
begin…
of
period
Cash
and
cash
equiv… $ 211.9 288.1 $ 211.9 288.1
at end
of
period
Suppl…
infor…
Cash
paid $ 2.9 5.7 $ 0.9 1.5
for
inter…
Net
cash
paid $ 317.4 274.4 $ 114.4 89.1
for
income
taxes
Leased
assets
obtai…
in
excha… $ 122.0 109.5 $ 58.9 36.4
for
new
opera…
lease
liabi…
10
CONTACT: Dray Schreiber
Accounting Manager
507.313.7324
11