[Executive Summary: Second Quarter Highlights](index=1&type=section&id=Executive%20Summary%3A%20Second%20Quarter%20Highlights) Grainger delivered solid Q2 2025 financial performance with increased sales and adjusted diluted EPS, generating strong operating cash flow and shareholder returns, despite tariff-related headwinds [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) Grainger reported solid results for the second quarter of 2025, with sales increasing by 5.6% to $4.6 billion and adjusted diluted EPS growing by 2.2% to $9.97, while generating $377 million in operating cash flow and returning $336 million to shareholders Q2 2025 Key Financial Metrics | Metric | Q2 2025 | YoY Change (Reported) | YoY Change (Adjusted) | | :-------------------------------- | :------ | :-------------------- | :-------------------- | | Sales ($ billion) | $4.6 | 5.6% | 5.1% (daily, constant currency) | | Operating Margin (%) | 14.9% | -20 bps | -50 bps | | Diluted EPS ($) | $9.97 | 4.8% | 2.2% | | Operating Cash Flow ($ million) | $377 | N/A | N/A | | Shareholder Returns ($ million) | $336 | N/A | N/A | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) Chairman and CEO D.G. Macpherson noted that Q2 results were largely in-line with expectations, despite impacts from tariff-related factors, emphasizing the company's focus on customers, service, and innovation to create value amidst macroeconomic uncertainty - Performance was largely **in-line with communicated expectations**, though impacted by **tariff-related factors**[4](index=4&type=chunk) - The company remains **focused on customers, fostering relationships, providing exceptional service, and driving innovation** through differentiated capabilities[4](index=4&type=chunk) [Second Quarter 2025 Financial Results](index=2&type=section&id=Second%20Quarter%202025%20Financial%20Results) Grainger's Q2 2025 financial results detail net sales growth, changes in gross profit and operating margins, earnings performance, tax rates, and cash flow generation [Overall Financial Summary](index=2&type=section&id=Overall%20Financial%20Summary) Grainger's second quarter 2025 financial summary shows an increase in net sales and operating earnings, but a decrease in gross profit margin and operating margin compared to Q2 2024 Q2 2025 vs. Q2 2024 Financial Summary (Reported and Adjusted) | ($ in millions, except per share amounts) | Q2 2025 Reported | Q2 2025 Adjusted | Q2 2024 Reported | Q2 2024 Adjusted | Q2'25 vs. Q2'24 Reported Fav. / (Unfav.) | Q2'25 vs. Q2'24 Adjusted Fav. / (Unfav.) | | :---------------------------------------- | :--------------- | :--------------- | :--------------- | :--------------- | :-------------------------------------- | :------------------------------------- | | Net Sales | $4,554 | $4,554 | $4,312 | $4,312 | 5.6% | 5.6% | | Gross Profit | $1,755 | $1,755 | $1,694 | $1,694 | 3.6% | 3.6% | | Operating Earnings | $678 | $678 | $649 | $665 | 4.5% | 2.0% | | Net Earnings Attributable to W.W. Grainger, Inc. | $482 | $482 | $470 | $482 | 2.6% | —% | | Diluted Earnings Per Share | $9.97 | $9.97 | $9.51 | $9.76 | 4.8% | 2.2% | | Gross Profit Margin (%) | 38.5% | 38.5% | 39.3% | 39.3% | (80) bps | (80) bps | | Operating Margin (%) | 14.9% | 14.9% | 15.1% | 15.4% | (20) bps | (50) bps | | Effective Tax Rate (%) | 23.2% | 23.2% | 22.9% | 22.9% | (30) bps | (30) bps | [Revenue Performance](index=2&type=section&id=Revenue%20Performance) Total company sales increased by 5.6% (5.1% on a daily, constant currency basis) in Q2 2025, with the Endless Assortment segment showing strong growth that significantly outpaced the High-Touch Solutions - N.A. segment - Total sales increased **5.6%** compared to Q2 2024, or **5.1%** on a daily, constant currency basis[7](index=7&type=chunk) Q2 2025 Sales Growth by Segment | Segment | Q2 2025 Sales Growth (Reported) | Q2 2025 Sales Growth (Daily, Constant Currency) | | :-------------------------- | :------------------------------ | :---------------------------------------------- | | High-Touch Solutions - N.A. | 2.5% | 2.8% | | Endless Assortment | 19.7% | 16.3% | - Endless Assortment segment growth was driven by strong performance at both **MonotaRO** and **Zoro**[8](index=8&type=chunk) [Gross Profit Margin](index=2&type=section&id=Gross%20Profit%20Margin) The company's gross profit margin decreased by 80 basis points to 38.5% in Q2 2025, primarily due to headwinds in the High-Touch Solutions - N.A. segment, partially offset by improvements in the Endless Assortment segment - Gross profit margin was **38.5%** in Q2 2025, an **80 basis point decrease** from Q2 2024[9](index=9&type=chunk) - High-Touch Solutions - N.A. segment gross profit margin decreased by **70 basis points** due to tariff-related inflation causing unfavorable price/cost timing and LIFO inventory valuation headwinds[10](index=10&type=chunk) - Endless Assortment segment gross profit margin increased by **30 basis points**, primarily due to margin improvement at **Zoro**[10](index=10&type=chunk) [Earnings Performance](index=3&type=section&id=Earnings%20Performance) Operating earnings increased by 4.5% on a reported basis, but operating margin declined, while diluted EPS also saw an increase, primarily driven by fewer shares outstanding Q2 2025 Earnings Performance | Metric | Q2 2025 | YoY Change (Reported) | YoY Change (Adjusted) | | :-------------------- | :------ | :-------------------- | :-------------------- | | Operating Earnings ($ million) | $678 | 4.5% | 2.0% | | Operating Margin (%) | 14.9% | -20 bps | -50 bps | | Diluted EPS ($) | $9.97 | 4.8% | 2.2% | - Unfavorable gross margin in High-Touch Solutions - N.A. was partially offset by **strong expense leverage** in Endless Assortment[11](index=11&type=chunk) - The increase in diluted EPS was primarily driven by **fewer shares outstanding**[12](index=12&type=chunk) [Tax Rate](index=3&type=section&id=Tax%20Rate) The effective tax rate for Q2 2025 was 23.2%, a slight increase compared to 22.9% in the prior year quarter, remaining consistent on both reported and adjusted bases Effective Tax Rate Comparison | Metric | Q2 2025 | Q2 2024 | | :---------------- | :------ | :------ | | Effective Tax Rate (%) | 23.2% | 22.9% | [Cash Flow](index=3&type=section&id=Cash%20Flow) Grainger generated $377 million in operating cash flow and $202 million in free cash flow during Q2 2025, investing $175 million in capital expenditures and returning $336 million to shareholders through dividends and share repurchases Q2 2025 Cash Flow Summary | Metric | Q2 2025 | | :-------------------------- | :------ | | Operating Cash Flow ($ million) | $377 | | Capital Expenditures ($ million) | $175 | | Free Cash Flow ($ million) | $202 | | Shareholder Returns ($ million) | $336 | - Net earnings were partially offset by **unfavorable working capital** in operating activities[14](index=14&type=chunk) [Full Year 2025 Guidance Update](index=4&type=section&id=Full%20Year%202025%20Guidance%20Update) Grainger updated its full-year 2025 guidance, reflecting tariff impacts with a revised net sales range, lower adjusted diluted EPS, and adjustments to margins, CapEx, and share buyback [Revised Guidance Overview](index=4&type=section&id=Revised%20Guidance%20Overview) Grainger updated its full-year 2025 guidance to reflect anticipated headwinds from certain known tariff impacts, including a higher net sales range but a lower adjusted diluted EPS range, along with adjustments to gross profit margin, operating margin, CapEx, and share buyback - Guidance ranges were updated to reflect anticipated headwinds from **certain known tariff impacts**[15](index=15&type=chunk) Full Year 2025 Guidance Comparison | Metric | Previous 2025 Guidance Range (as of May 1, 2025) | Updated 2025 Guidance Range (as of August 1, 2025) | | :-------------------------------- | :----------------------------------------------- | :--------------------------------------------- | | Net Sales ($ billion) | $17.6 - $18.1 | $17.9 - $18.2 | | Sales growth (%) | 2.7% - 5.2% | 4.4% - 5.9% | | Daily, constant currency sales growth (%) | 4.0% - 6.5% | 4.5% - 6.0% | | Gross Profit Margin (%) | 39.1% - 39.4% | 38.6% - 38.9% | | Operating Margin (%) | 15.1% - 15.5% | 14.7% - 15.1% | | Diluted Earnings per Share ($) | $39.00 - $41.50 | $38.50 - $40.25 | | Operating Cash Flow ($ billion) | $2.05 - $2.25 | $2.05 - $2.25 | | CapEx (cash basis) ($ billion) | $0.45 - $0.55 | $0.55 - $0.65 | | Share Buyback ($ billion) | $1.15 - $1.25 | $1.05 - $1.15 | | Effective Tax Rate (%) | ~23.8% | ~23.8% | | Segment Operating Margin (High-Touch Solutions - N.A.) (%) | 17.0% - 17.4% | 16.5% - 16.9% | | Segment Operating Margin (Endless Assortment) (%) | 8.5% - 9.0% | 9.2% - 9.6% | [Company Information](index=4&type=section&id=Company%20Information) This section provides an overview of Grainger's business, details for the Q2 results webcast, a safe harbor statement regarding forward-looking information, and contact details [About Grainger](index=4&type=section&id=About%20Grainger) W.W. Grainger, Inc. is a leading broad line distributor primarily operating in North America, Japan, and the United Kingdom, serving over 4.5 million customers with MRO products and solutions, and reported $17.2 billion in revenue for 2024 - Grainger is a leading broad line distributor with operations primarily in **North America, Japan, and the United Kingdom**[18](index=18&type=chunk) - The company serves over **4.5 million customers** worldwide with maintenance, repair, and operating (MRO) products and value-added solutions[18](index=18&type=chunk) - Grainger reported **$17.2 billion in revenue** for 2024[18](index=18&type=chunk) [Webcast Information](index=4&type=section&id=Webcast%20Information) Grainger will host a live conference call and webcast on August 1, 2025, at 11:00 a.m. ET to discuss the second quarter results, with a replay available for 90 days - A live conference call and webcast for Q2 results will be held on **Friday, August 1, 2025, at 11:00 a.m. ET**, accessible at invest.grainger.com[17](index=17&type=chunk) - A webcast replay will be available for **90 days**[17](index=17&type=chunk) [Safe Harbor Statement](index=5&type=section&id=Safe%20Harbor%20Statement) The document includes a safe harbor statement, indicating that all forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, and Grainger disclaims any obligation to update these statements - All statements other than historical facts are **forward-looking** and subject to **risks and uncertainties** beyond Grainger's control[19](index=19&type=chunk) - Important factors that could cause actual results to differ include **inflation, customer loss, supply disruptions, competitive pressures, technological failures, and changes in economic or regulatory conditions**[19](index=19&type=chunk) - Grainger disclaims any obligation to update or revise any forward-looking statement, except as required by law[19](index=19&type=chunk) [Contacts](index=6&type=section&id=Contacts) Contact information for media and investor relations is provided for inquiries regarding the company - Media inquiries can be directed to **Erin Ptacek or Robb Kristopher** at Media_Inquiries@grainger.com[21](index=21&type=chunk) - Investor relations inquiries can be directed to **Kyle Bland or Kevin Byrne** at InvestorRelations@grainger.com[21](index=21&type=chunk) [Condensed Consolidated Financial Statements](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Grainger's condensed consolidated statements of earnings, balance sheets, and cash flows for the specified periods, detailing financial performance and position [Condensed Consolidated Statements of Earnings](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Earnings) The condensed consolidated statements of earnings show Grainger's financial performance for the three and six months ended June 30, 2025, detailing net sales, gross profit, operating earnings, and net earnings Condensed Consolidated Statements of Earnings | (In millions of dollars, except for share and per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net sales | $4,554 | $4,312 | $8,860 | $8,547 | | Cost of goods sold | 2,799 | 2,618 | 5,395 | 5,185 | | Gross profit | 1,755 | 1,694 | 3,465 | 3,362 | | Selling, general and administrative expenses | 1,077 | 1,045 | 2,115 | 2,044 | | Operating earnings | 678 | 649 | 1,350 | 1,318 | | Earnings before income taxes | 661 | 636 | 1,318 | 1,291 | | Income tax provision | 153 | 146 | 310 | 304 | | Net earnings | 508 | 490 | 1,008 | 987 | | Net earnings attributable to W.W. Grainger, Inc. | $482 | $470 | $961 | $948 | | Diluted Earnings per share | $9.97 | $9.51 | $19.83 | $19.13 | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets present Grainger's financial position as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets | (In millions of dollars) | As of June 30, 2025 | As of December 31, 2024 | | :------------------------------------ | :------------------ | :---------------------- | | **Assets** | | | | Cash and cash equivalents | $597 | $1,036 | | Total current assets | 5,650 | 5,737 | | Property, buildings and equipment – net | 2,107 | 1,927 | | Total assets | $8,937 | $8,829 | | **Liabilities and Shareholders' Equity** | | | | Total current liabilities | $2,002 | $2,305 | | Long-term debt | 2,341 | 2,279 | | Shareholders' equity | 4,083 | 3,703 | | Total liabilities and shareholders' equity | $8,937 | $8,829 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The condensed consolidated statements of cash flows outline Grainger's cash movements for the three and six months ended June 30, 2025, across operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows | (In millions of dollars) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $377 | $411 | $1,023 | $1,072 | | Net cash used in investing activities | (158) | (59) | (283) | (177) | | Net cash used in financing activities | (303) | (372) | (1,201) | (763) | | Net change in cash and cash equivalents | (69) | (35) | (439) | 109 | | Cash and cash equivalents at end of period | $597 | $769 | $597 | $769 | [Supplemental Information: GAAP to Non-GAAP Reconciliations](index=10&type=section&id=Supplemental%20Information%3A%20GAAP%20to%20Non-GAAP%20Reconciliations) This section provides definitions for non-GAAP financial measures and reconciliations for sales growth, free cash flow, and income statement adjustments [Non-GAAP Financial Measures Definitions](index=10&type=section&id=Non-GAAP%20Financial%20Measures%20Definitions) This section defines various non-GAAP financial measures used by Grainger, such as adjusted gross profit, operating earnings, diluted EPS, free cash flow, and different sales growth metrics, explaining their purpose in providing a clearer view of core operating results - Non-GAAP measures provide meaningful information to investors by excluding **non-recurring items** like restructuring charges, asset impairments, and business divestiture gains/losses[28](index=28&type=chunk)[30](index=30&type=chunk) - Free cash flow (FCF) is calculated as total cash provided by operating activities less **capital expenditures**[31](index=31&type=chunk) - Daily sales, daily constant currency sales, and daily organic constant currency sales are defined to adjust for **selling days, foreign currency exchange rates, and divested businesses**, respectively[32](index=32&type=chunk)[33](index=33&type=chunk)[34](index=34&type=chunk) [Sales Growth Reconciliation](index=12&type=section&id=Sales%20Growth%20Reconciliation) The sales growth reconciliation details the impact of foreign currency exchange on reported sales growth for the total company and its segments, showing the conversion to daily, constant currency sales growth Sales Growth Reconciliation by Segment (Q2 2025) | | Total Company | High-Touch Solutions - N.A. | Endless Assortment | | :-------------------------- | :------------ | :-------------------------- | :----------------- | | Reported sales (%) | 5.6% | 2.5% | 19.7% | | Daily impact (%) | —% | —% | —% | | Daily sales (%) | 5.6% | 2.5% | 19.7% | | Foreign currency exchange (%) | (0.5)% | 0.3% | (3.4)% | | Daily, constant currency sales (%) | 5.1% | 2.8% | 16.3% | - There were **64 selling days** in both Q2 2025 and Q2 2024[37](index=37&type=chunk) [Free Cash Flow Reconciliation](index=12&type=section&id=Free%20Cash%20Flow%20Reconciliation) This reconciliation shows the calculation of free cash flow for Q2 2025, starting from net cash flows provided by operating activities and subtracting capital expenditures Free Cash Flow Reconciliation (Q2 2025) | (in millions of dollars) | Q2 2025 | | :------------------------------------ | :------ | | Net cash flows provided by operating activities | $377 | | Capital expenditures | (175) | | Free cash flow | $202 | [Income Statement Adjustments Reconciliation](index=13&type=section&id=Income%20Statement%20Adjustments%20Reconciliation) This section provides a detailed reconciliation of GAAP to adjusted non-GAAP income statement figures for Q2 2025 and Q2 2024, highlighting adjustments primarily related to restructuring costs incurred in the prior year Q2 2025 Income Statement Adjustments Reconciliation **Q2 2025 (in millions of dollars):** | Metric | Reported | Adjustment | Adjusted | % of Net sales (Reported) | % of Net sales (Adjusted) | Y/Y (Reported) | Y/Y (Adjusted) | | :-------------------------------- | :------- | :--------- | :------- | :------------------------ | :------------------------ | :------------- | :------------- | | SG&A | $1,077 | — | $1,077 | 23.6 % | 23.6 % | 3.1 % | 4.7 % | | Operating earnings | 678 | — | 678 | 14.9 | 14.9 | 4.5 | 2.0 | | Net earnings attributable to W.W. Grainger, Inc. | $482 | — | $482 | 10.6 % | 10.6 % | 2.6 % | — % | | Diluted earnings per share | $9.97 | — | $9.97 | | | 4.8 % | 2.2 % | **Q2 2024 (in millions of dollars):** | Metric | Reported | Adjustment | Adjusted | % of Net sales (Reported) | % of Net sales (Adjusted) | Y/Y (Reported) | Y/Y (Adjusted) | | :-------------------------------- | :------- | :--------- | :------- | :------------------------ | :------------------------ | :------------- | :------------- | | SG&A | $1,045 | $(16) | $1,029 | 24.2 % | 23.9 % | 6.3 % | 4.7 % | | Operating earnings | 649 | 16 | 665 | 15.1 | 15.4 | (1.8) | 0.6 | | Net earnings attributable to W.W. Grainger, Inc. | $470 | 12 | $482 | 10.9 % | 11.2 % | — % | 2.6 % | | Diluted earnings per share | $9.51 | 0.25 | $9.76 | | | 2.5 % | 5.2 % | - Adjustments for Q2 2024 reflect **restructuring costs of $15 million** in Grainger's HTS-N.A. segment and **$1 million** in Other businesses; no non-GAAP adjustments were made for Q2 2025[40](index=40&type=chunk) - The reported and adjusted effective tax rates were **23.2% for Q2 2025** and **22.9% for Q2 2024**, with a tax benefit related to 2024 restructuring costs[40](index=40&type=chunk)

Core Insights - Grainger reported second quarter 2025 sales of $4.6 billion, reflecting a 5.6% increase year-over-year, or 5.1% on a daily, constant currency basis [2][5] - The company updated its full year 2025 guidance, adjusting the diluted EPS range to $38.50 to $40.25, down from the previous range of $39.00 to $41.50 [10][15] Financial Performance - Net sales for Q2 2025 were $4,554 million, up 5.6% from $4,312 million in Q2 2024 [4] - Gross profit was $1,755 million, a 3.6% increase from $1,694 million in the prior year [4] - Operating earnings reached $678 million, up 4.5% from $649 million in Q2 2024, with an operating margin of 14.9% [9][10] - Diluted earnings per share were $9.97, representing a 4.8% increase from $9.51 in Q2 2024 [11] Segment Performance - In the High-Touch Solutions - N.A. segment, sales increased by 2.5%, while the Endless Assortment segment saw a significant growth of 19.7% [6][31] - The gross profit margin for the High-Touch Solutions - N.A. segment was 41.0%, down 70 basis points year-over-year, while the Endless Assortment segment's margin improved by 30 basis points [7][8] Cash Flow and Shareholder Returns - The company generated $377 million in operating cash flow and returned $336 million to shareholders through dividends and share repurchases [10][13] - Free cash flow for Q2 2025 was $202 million, calculated as operating cash flow minus capital expenditures of $175 million [26][31] Guidance Update - The updated guidance for 2025 includes net sales projected between $17.9 billion and $18.2 billion, with sales growth revised to 4.4% to 5.9% [15] - The effective tax rate is expected to remain around 23.8% [15]

Core Insights - W.W. Grainger, Inc. (GWW) is set to report its second-quarter 2025 results on August 1, with sales expected to reach $4.52 billion, reflecting a 4.8% year-over-year growth, and earnings per share (EPS) estimated at $10.00, indicating a 2.5% increase from the previous year [2][5] Financial Performance - The consensus estimate for GWW's sales is $4.52 billion, which represents a 4.8% growth compared to the same quarter last year [2][5] - The earnings estimate of $10.00 per share shows a 2.5% year-over-year increase, with a slight upward revision of 0.1% in the past 60 days [2][5] - GWW's earnings surprise history indicates that the company has beaten the Zacks Consensus Estimates in two of the last four quarters, with an average surprise of 1.2% [3][4] Segment Performance - High-Touch sales are projected to rise by 2.2% to $3.53 billion, driven by strength in commercial, transportation, and heavy manufacturing sectors [5][9] - The Endless Assortment segment is expected to see an 11% increase in sales to $862 million, attributed to robust customer acquisition and repeat business [5][10] Growth Drivers - GWW's growth is anticipated to be supported by digital investments, supply-chain improvements, and overall sales momentum, with organic daily sales growth expected at 3.8% [5][7] - The High-Touch Solutions North America segment is benefiting from an expanding customer base and strong revenue growth across North America [8][9] Cost Considerations - The company has been facing elevated material and freight costs, along with higher operating expenses and increased selling, general, and administrative (SG&A) costs due to technology investments, which may negatively impact margins [11] Stock Performance - GWW's stock has increased by 9.4% over the past year, compared to a 13.7% rise in the industry [12]

Core Viewpoint - Analysts project that W.W. Grainger (GWW) will report quarterly earnings of $10.00 per share, reflecting a 2.5% year-over-year increase, with revenues expected to reach $4.52 billion, a 4.8% increase from the same quarter last year [1]. Earnings Estimates - Over the last 30 days, the consensus EPS estimate has been revised downward by 0.3%, indicating a collective reassessment by covering analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical studies show a strong correlation between earnings estimate revisions and short-term stock price performance [3]. Key Metrics Projections - Analysts forecast 'Net Sales- High-Touch Solutions N.A.' to reach $3.55 billion, a 2.7% increase from the prior year [5]. - The estimate for 'Net Sales- Endless Assortment' is projected at $887.37 million, indicating a 14.4% increase from the previous year [5]. - 'Net Sales- Other' is expected to be $81.42 million, reflecting a 4.4% increase from the prior year [5]. - The consensus estimate for 'Total Reported Growth' is 4.8%, compared to 3.1% from the previous year [6]. - Analysts predict 'Operating earnings (losses)- High-Touch Solutions N.A.' at $609.17 million, up from $591.00 million year-over-year [6]. - For 'Operating earnings (losses)- Endless Assortment', the estimate is $76.73 million, compared to $61.00 million from the previous year [6]. Stock Performance - Over the past month, W.W. Grainger shares have returned +0.8%, while the Zacks S&P 500 composite has changed by +3.6% [7]. - Based on its Zacks Rank 3 (Hold), GWW is expected to perform in line with the overall market in the upcoming period [7].

FY 2017 Results - Full year 2017 sales were $10425 million, a 3% increase compared to the prior year[6] - Full year 2017 adjusted operating earnings were $1160 million, a decrease of 8% compared to the prior year[6] - Full year 2017 adjusted EPS was $1146, a decrease of 1% compared to the prior year[6] Q4 2017 Adjusted Results - Q4 2017 sales increased by 7% to $2632 million compared to $2471 million in Q4 2016[7] - Q4 2017 EPS increased by 20% to $294 compared to $245 in Q4 2016[7] - Q4 2017 gross profit margin was 392%, a decrease of 90 basis points compared to Q4 2016[7] - Q4 2017 operating margin was 108%, a decrease of 30 basis points compared to Q4 2016[7] - Sales in Other Businesses increased by 16% to $559 million compared to $484 million in Q4 2016[9] - Sales in Canada increased by 5% to $189 million compared to $181 million in Q4 2016[13] - Sales in the United States increased by 5% to $1992 million compared to $1897 million in Q4 2016[16] Guidance - The company expects 5% sales growth in 2018, reaching $109 billion[27] - The company expects EPS of $1355 in 2018, an increase of 18%[27]

Company Overview - W W Grainger, Inc is a leading distributor of MRO products for businesses[4] - The company was founded in 1927 and has over 90 years of service[4] - In 2018, the company's revenues reached $112 billion[4] - The company has more than 3 million active customers, with an average customer invoice of approximately $300[4] eCommerce Leadership - Grainger is ranked as the 11th largest eCommerce retailer in North America by Internet Retailer[4] - The company launched the first commerce-enabled website in the industry in 1996[4] - 69% of orders originated through digital channels in the U S [4] Business Models - High-Touch Solutions Model includes U S , Canada, Mexico, Cromwell, and Fabory[5] - Endless Assortment Model includes Zoro and MonotaRO[5]

Group 1 - W.W. Grainger, Inc. has good growth potential over the coming years due to its initial pricing increase in response to Trump Tariffs, which is expected to boost sales in the upcoming quarters [1] - The company is positioned to benefit from the economic environment and has strategies in place to unlock value and drive upside [1] Group 2 - The analyst has experience in investing and has provided research services to mid-sized hedge funds, focusing on medium-term investing strategies [1] - The analyst's strategy includes investing in growth stories available at reasonable prices, particularly in the industrial, consumer, and technology sectors [1]

Core Insights - W.W. Grainger, Inc. (GWW) is experiencing growth driven by volume increases in the High Touch Solutions segment and customer growth in the Endless Assortment segment [1][4] - The company anticipates continued top-line growth due to volume improvements and pricing actions, alongside effective inventory management and investments in e-commerce [2][8] Segment Performance - The High-Touch Solutions segment is benefiting from volume growth across all geographies and strong price realization, with an improved product mix contributing to gross margin [3][6] - The Endless Assortment segment is supported by customer acquisition and repeat customer growth at MonotaRO, as well as solid performance at Zoro [4] Financial Guidance - GWW expects earnings per share for 2025 to be between $39.00 and $41.50, indicating a 3% growth from 2024 figures, with net sales projected between $17.6 billion and $18.1 billion, reflecting a sales growth of 2.7-5.2% [5] Strategic Initiatives - The company is focused on enhancing customer experience through investments in e-commerce and digital capabilities, aiming for a personalized and efficient customer journey [9] - Strategic actions include improving product mix, reducing freight costs, and navigating supply-chain challenges to enhance margins [8] Market Position - Grainger's shares have increased by 20.6% over the past year, contrasting with a 1% decline in the industry [12]

Core Insights - W.W. Grainger reported $4.31 billion in revenue for Q1 2025, a year-over-year increase of 1.7%, with an EPS of $9.86 compared to $9.62 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $4.32 billion, resulting in a surprise of -0.29%, while the EPS exceeded expectations by +4.23% [1] Financial Performance - Total reported growth was 1.7%, compared to an estimated growth of 2.4% by five analysts [4] - Net Sales for High-Touch Solutions N.A. were $3.40 billion, slightly below the $3.43 billion average estimate, representing a year-over-year change of -0.2% [4] - Net Sales for Endless Assortment reached $828 million, exceeding the $810.60 million average estimate, with a year-over-year increase of +10.3% [4] - Net Sales for Other segments were $81 million, slightly above the $80.64 million estimate, reflecting a +2.5% change year-over-year [4] - Operating earnings for Endless Assortment were $72 million, surpassing the average estimate of $68.63 million [4] - Operating earnings for High-Touch Solutions N.A. were $600 million, exceeding the estimated $587.01 million [4] Stock Performance - W.W. Grainger's shares returned +8.2% over the past month, contrasting with a -0.5% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Group 1 - Grainger appointed Melanie Tinto as Senior Vice President and Chief Human Resources Officer, effective April 28, 2025, to oversee HR strategy and operations [1][2] - Tinto's previous experience includes serving as CHRO at WEX, where she transformed HR into a strategic business partner, and held leadership roles at Medtronic, Hewlett-Packard, Walmart, and Bank of America [2][3] - Grainger reported 2024 revenue of $17.2 billion, serving over 4.5 million customers worldwide with a broad range of MRO products and solutions [4] Group 2 - The company emphasizes the importance of supporting and engaging team members through strong leadership and a commitment to its principles [2] - Grainger operates primarily in North America, Japan, and the United Kingdom, offering approximately 2 million MRO products in its High-Touch Solutions segment and over 14 million products through Zoro.com and 24 million through MonotaRO.com [4]