S&P 500 slips, but losses kept in check as Nvidia climbs ahead of results
Investing.com -- WW Grainger Inc (NYSE:GWW) posted better-than-expected first quarter earnings and reaffirmed its full-year guidance, sending shares up 1.9% despite ongoing concerns over tariffs and muted macro signals. The company reported adjusted earnings of $9.86 per share, beating the $9.54 analyst consensus.
Revenue totaled $4.3 billion, slightly below the $4.31 billion estimate, but rose 1.7% year-over-year, or 4.4% on a daily, constant currency basis. Growth in the Endless Assortment segment helped offset a slower start in its High-Touch Solutions business.
“Across both segments, our team kicked off 2025 by excelling at what we do best: delivering exceptional service,” said CEO Donald Macpherson. He added that the company is focused on helping customers navigate supply chain disruption while adapting to emerging tariff risks.
Gross margin improved 30 basis points to 39.7%, due to better product mix and pricing discipline. Operating margin declined modestly by 20 basis points to 15.6%, yet exceeded both internal and analyst forecasts.
CFO Deidra Merriweather said the team is targeting “price-cost neutrality over time” as Grainger gradually passes on tariff-related increases. The company enacted targeted pricing adjustments in May, primarily affecting direct imports.
Keybanc analyst Ken Newman viewed the results positively, noting the upside in gross margin and modest SG&A leverage. He credited strategic pricing in Endless Assortment and favorable product mix in High-Touch Solutions for helping protect profitability.
Grainger maintained full-year guidance of $39.00–$41.50 in earnings per share and revenue between $17.6 billion and $18.1 billion. The company expects Q2 revenue just over $4.5 billion, and operating margin of approximately 15%.
Operating cash flow reached $646 million while $380 million was returned to shareholders through dividends and buybacks. A 10% dividend increase marked the company’s 54th consecutive year of planned growth in payout to investors.