Financial Data and Key Metrics Changes - Average daily sales declined 4.7% year over year, with a sequential decline of 5.5% despite January and February outperforming historical trends [6][20] - Fiscal second quarter sales were $892 million, down 4.7% year over year [20] - Gross margin was 41%, a decline of 50 basis points year over year, while adjusted operating margin was 7.1%, down 340 basis points year over year [22][24] - GAAP earnings per share were $0.70 compared to $1.10 in the prior year quarter, and adjusted earnings per share were $0.72 compared to $1.18 in the prior year [25] Business Line Data and Key Metrics Changes - Public sector sales grew 13.2% year over year, while national accounts declined 5.4% and core and other customers declined 6.8% [20] - Average daily sales through vending programs were up 1% year over year, representing 18% of total company net sales [21] - Sales through implant programs also grew 1% year over year, accounting for approximately 18% of total company net sales [21] Market Data and Key Metrics Changes - The industrial production (IP) readings across most top manufacturing end markets continued to contract, impacting performance [12] - Customer sentiment and future outlook have shown improvement, with recent MBI readings hovering around 50 [12] Company Strategy and Development Direction - The company is focused on improving execution and returning to growth despite a soft demand environment [6] - Key initiatives include enhancing the website for better customer experience, expanding the OEM product line, and maintaining momentum in high-touch solutions [8][11] - The company is navigating the tariff landscape with a playbook covering purchasing, pricing, assortment management, and productivity tools for customers [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about future prospects, citing a solid long-term manufacturing outlook and improving execution [12][13] - The company is well-positioned to navigate uncertainties due to tariff impacts and inflation concerns [12][14] Other Important Information - The company repurchased approximately 158,000 shares during the quarter, returning approximately $60 million to shareholders [26] - Expectations for the fiscal third quarter include average daily sales down 2% to flat compared to the prior year [27] Q&A Session Summary Question: Thoughts on the back half of the fiscal year - Management indicated cautious optimism, not assuming significant further erosion in end markets, and focusing on share gain initiatives [32][33] Question: Details on price increases announced in March - The price increase was small, primarily covering items where the company is the importer of record, with an estimated half a point of price benefit [44][45] Question: Update on web enhancements and marketing initiatives - Progress is on track, with improvements in customer acquisition and website traffic noted [56][58] Question: Insights on individual end markets, particularly automotive and aerospace - Management noted continued improvement in heavy manufacturing end markets, with automotive remaining soft but aerospace showing a robust outlook [70][71] Question: Pricing dynamics and expectations for the third quarter - Management explained that pricing was affected by customer sector mix, with expectations for flat pricing in the third quarter due to various factors [75][76] Question: Digital KPIs and future sales expectations - Management reported improvements in conversion rates and average order value, indicating positive momentum for future sales [86][87] Question: Impact of export customers on demand - Management acknowledged the difficulty in sizing export exposure but noted that a decline in export demand would impact domestic performance [90][91]