Earnings Preview: Fastenal poised for another positive quarter, despite tariff woes

Industrial supplies distributor Fastenal Company (NASDAQ: FAST) has a strong track record of effectively navigating market disruptions — from the pandemic to the recent tariff war. In response to rising import costs, the company has raised prices and signaled further adjustments if supply chain pressures persist. Fastenal has consistently grown sales and profitability over the long term, supported by its differentiated business model and effective use of technology.

Q3 Report Due

The Winona-headquartered fastener maker is scheduled to publish its third-quarter financial results on October 13 at 6:50 am ET. On average, analysts following the company predict Q3 earnings of $0.30 per share, which represents an improvement from the prior-year period when it earned $0.26 per share. It is estimated that revenues increased 11.6% YoY to $2.13 billion in the September quarter.

In August, Fastenal’s stock set a new record after growing consistently since the beginning of 2025. Over the long term, the shares have maintained a steady uptrend, with their value more than doubling in the past three years. The stock has regularly outperformed the broader market in the recent past, underscoring investor confidence and operational resilience.

Results Beat

Fastenal reported positive results for the second quarter, with sales growing 8.6% from last year to $2.08 billion amid strong customer contract signings and favorable foreign exchange rates. That marks the company’s strongest daily sales rate since the first quarter of 2023, and its first-ever quarter with sales exceeding $2 billion. As a result, Q2 profit increased 13% year-over-year to $330.3 million or $0.29 per share. Earnings and sales exceeded the market’s expectations. For 2025, the company expects investments in property and equipment — net of sales proceeds — to be between $250 million and $270 million, up from $214 million in 2024.

From Fastenal’s Q2 2025 earnings call:

“Trade policy continues to create some caution. Notwithstanding this uncertainty, we did not detect any meaningful pre-buying ahead of tariffs. In the absence of much external help, the improvement in our sales reflects 2 other variables. First, even as the market has stabilized, our comparisons have gotten easier, particularly in the cyclical parts of our business. This factor helped produce our second quarter of growth for fasteners since the first quarter of 2023 and an acceleration in manufacturing end markets. Second, contributions from our strong contract signings over the past 6 quarters continue to build.”

Sales Strategy

Fastenal’s resilient performance is driven mainly by its unique digital platform, which is an integrated ecosystem of services and technologies that help optimize inventory management and supply chain for customers. Meanwhile, since a significant portion of the company’s products is imported, the ongoing tariff war is weighing on its profitability due to higher supply chain costs. To mitigate the impact of US tariffs, it has begun shipping products directly from facilities in Canada and Mexico, though the approach entails higher logistics costs.

Fastenal’s stock has grown about one-third so far in 2025, ranking among the best-performing Wall Street stocks. The shares traded slightly higher on Thursday afternoon.