Grainger Raises 2026 Sales Outlook After Growth Accelerates

The Tip Desk · November 4, 2026 · 4 min read

Third-quarter sales reached $5.181 billion, up 11.3%, as the MRO distributor lifted full-year net sales to $19.8 billion to $20.0 billion.

W.W. Grainger (GWW), a broad-line distributor of maintenance, repair and operating products, reported third-quarter sales of $5.181 billion, up 11.3% from a year earlier, and raised its full-year 2026 sales outlook after growth accelerated for a second straight quarter.

Daily, organic constant currency sales rose 14.9%, faster than the 13.7% pace in the second quarter and 12.2% in the first. The company lifted 2026 net sales guidance to $19.8 billion to $20.0 billion from $19.4 billion to $19.7 billion, sales growth to 10.1% to 11.6% from 8.4% to 10.0%, and daily, organic constant currency growth to 13.0% to 14.5% from 11.5% to 13.0%. Diluted adjusted EPS guidance moved to $47.00 to $48.00 from $45.50 to $47.25.

Chairman and Chief Executive Officer D.G. Macpherson said the quarter reflected consistent execution and an improving demand environment, and that both High-Touch Solutions and Endless Assortment delivered growth. The company said it remains on track for an exceptional year.

High-Touch Solutions - N.A. sales rose 13.8% on both a reported and daily, constant currency basis, faster than 11.9% in the second quarter and 10.5% in the first. The company said results were driven by double-digit volume growth and continued price inflation as cost increases were passed.

Endless Assortment reported sales rose 11.9%, or 19.3% on a daily, organic constant currency basis, slower than 13.5% and 20.6% in the second quarter and 19.6% and 21.9% in the first. The company attributed growth to strong performance at both MonotaRO and Zoro.

Gross profit margin was 38.8%, up 20 basis points from the year-ago quarter, a narrower year-over-year expansion than 100 basis points in the second quarter and 30 basis points in the first. The company said the 20-basis-point increase was driven by expansion across Endless Assortment and a benefit related to the exit from the U.K. market. High-Touch Solutions - N.A. gross profit margin was 40.8%, down 30 basis points from the prior-year quarter on unfavorable freight expense and mix. Endless Assortment gross profit margin increased 90 basis points, matching the second-quarter expansion after a 40-basis-point increase in the first.

Reported operating earnings were $828 million, up 62.0%, and reported operating margin was 16.0%, up 500 basis points. Adjusted operating earnings were $836 million, up 18.2%, and adjusted operating margin was 16.1%, up 90 basis points. The company said the adjusted increase was driven by sales leverage in both segments and a benefit related to the U.K. exit. Adjusted results exclude $8 million of transaction costs tied to the acquisition of technology assets from Adroit Worldwide Media in the current quarter and the prior-year loss from the U.K. exit, including the sale of the Cromwell business and closure of Zoro U.K.

Diluted EPS was $12.42 on a reported basis, up 102.9%, and $12.54 on an adjusted basis, up 22.8%, faster than 20.5% growth in the second quarter and 18.2% in the first. The company said the increase was due primarily to strong operating performance, fewer shares outstanding, and a lower effective tax rate of 24.3% versus 34.7% a year earlier. On an adjusted basis the tax rate was 24.3% versus 24.8%, with the variance primarily from additional tax credit benefits.

Operating cash flow was $661 million. After $115 million of capital expenditures, free cash flow was $546 million. The company returned $396 million to shareholders through dividends and share repurchases and paid $215 million for the Adroit technology-asset acquisition.

For 2026, the company now guides operating cash flow to $2.35 billion to $2.45 billion, capital expenditures to $0.575 billion to $0.625 billion, and share buybacks to $0.975 billion to $1.025 billion. Endless Assortment operating-margin guidance was raised to 10.9% to 11.1% from 10.4% to 10.8%; High-Touch Solutions - N.A. operating-margin guidance was narrowed to 17.3% to 17.5% from 17.2% to 17.6%.