Applied Industrial Technologies, Inc (NYSE: AIT) closed at $281.58, up modestly on Tuesday trading, reflecting an intraday increase of about 0.5% at the market close. The industrial distributor’s shares moved higher following the release of its fiscal second-quarter results for 2026. (Stock price data as of January 27, 2026 close)
Capital Allocation Priorities & Strategy
Applied Industrial Technologies, a Cleveland-based industrial products and services distributor, outlined capital allocation actions tied to its fiscal second quarter results.
According to the company’s Q2 FY26 recap presentation and earnings release, priorities included share repurchases, dividend increases, and acquisitions.
During the first half of fiscal 2026, the company repurchased approximately $143 million of its common stock and announced an 11% increase in its quarterly dividend per share.
In addition, Applied Industrial completed the acquisition of Thompson Industrial Supply Inc during the quarter, aligning with its strategy of selective, bolt-on acquisitions to expand service capabilities and geographic reach while balancing organic growth opportunities.
Latest Quarterly Results
For the quarter ended December 31, 2025, Applied Industrial Technologies reported net sales of $1.20 billion, representing an 8.4% increase year-over-year. On an organic basis (excluding the effects of acquisitions and currency translation), sales grew 2.2% compared with the prior year period.
The company posted net income of $95.3 million, or $2.51 per diluted share, up 4.6% from net income in the same quarter of the previous fiscal year.
EBITDA for the quarter was $140.4 million, an increase of 3.9% year-over-year. Operating income was $123.2 million. The reported figures included LIFO expense impacts.
Gross margin for the period was approximately 30.4%. Free cash flow for the quarter was $93.4 million. There were no forward-looking or interpretative assertions in these reported results.
Operating Performance
The following chart illustrates the company’s quarterly revenue trend over the past four reporting periods, reflecting the impact of recent acquisitions and fluctuating industrial demand.
Full-Year Results Context
Applied Industrial Technologies’ most recent annual results for the fiscal year ended June 30, 2025 showed total net sales of $4.56 billion, up roughly 1.9% from the prior fiscal year. The company’s net income for fiscal 2025 was approximately $392.99 million, slightly higher year-over-year. These figures indicate overall revenue and profit expansion in the prior fiscal year.
Segment Results
In the fiscal second quarter of 2026, Applied Industrial Technologies reported growth across its two principal business segments. The Service Center segment experienced sales increases of about 3.2%, driven largely by price contributions and modest volume growth, with U.S. organic sales up more than 4% year-over-year. The Engineered Solutions segment reported sales increases of approximately 19.1%, reflecting significant contributions from acquisitions; organic sales in this segment were modestly positive.
Segment EBITDA in the Service Center and Engineered Solutions businesses rose year-over-year, with both segments contributing to overall EBITDA growth. Orders in the Engineered Solutions segment trended higher, with order growth exceeding 10% on a year-over-year basis during the quarter, according to company disclosures.
Applied Industrial Technologies operates through a global network of technical specialists and service centers, distributing bearings, power transmission components, fluid power solutions, flow control products, and related industrial supplies across key end markets.