Industrial supplies distributor W.W. Grainger Inc. reported first quarter 2025 sales of $4.31 billion, up 1.7% from $4.24 billion in the same period last year, driven by strong double-digit growth in its Endless Assortment e-commerce business.
However, net income was flat year over year at $479 million, compared to $478 million in Q1 2024, as sluggish demand in North America weighed on overall performance.
Grainger’s Endless Assortment segment — which includes Zoro in the U.S. and MonotaRO in Japan — led performance with reported sales up 10.3%, or 15.3% on a daily, constant currency basis. The High-Touch Solutions – North America segment, which includes Grainger’s core U.S. and Canadian maintenance, repair and operations (MRO) business, posted a 0.2% decline in reported sales, though daily, constant currency growth was 1.9%.
“Our Endless Assortment business continues to perform exceptionally well, showing the strength of our digital strategy,” said chairman and CEO D.G. Macpherson. “Meanwhile, in North America, we’re maintaining share in a soft market and executing on the fundamentals: service, supply chain, and customer experience.”
Grainger reaffirmed its full-year 2025 guidance, projecting sales between $17.6 billion and $18.1 billion, up 2.7% to 5.2% from 2024.
Equity analysts said the results were stable and in line with expectations, though macroeconomic conditions remain a concern.
“Grainger executed well, particularly in expense management and digital growth, but underlying demand remains tepid across industrial end markets,” said Brian Bernard, senior equity analyst at Morningstar. “The flat net income reflects the margin pressure on the North American business despite strength in the Endless Assortment channel.”
Kevin McVeigh, equity analyst at UBS, added: “This is a textbook example of operational discipline. The business is navigating a sluggish environment with sharp execution, and the reaffirmed guidance is a positive signal. But High-Touch Solutions will remain under pressure unless end-market demand improves.”
Baird analyst Dave Manthey highlighted the company’s e-commerce leadership: “MonotaRO and Zoro continue to be the growth engine for Grainger. The investments in digital infrastructure are paying off, and that segment is clearly gaining share globally.”
Grainger generated $646 million in cash from operations in Q1 and reported free cash flow of $521 million after $125 million in capital expenditures.
Macpherson acknowledged that the demand environment remains muted across many MRO customer segments. “We’re not seeing a sharp downturn, but we’re also not seeing a snapback. It’s a low-growth, flat landscape, and we’re adjusting accordingly,” he said on Thursday’s earnings call.
Grainger’s full-year guidance assumes that current tariffs remain in place and that mitigation strategies will help offset further disruptions. “We’ve built agility into the supply chain and pricing to adapt if tariffs expand or get more complex,” Macpherson added.
Grainger serves more than 4.5 million customers globally and generated $17.2 billion in revenue in 2024. The company offers more than 2 million MRO products in North America and 24 million products through MonotaRO in Japan.
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