Distributor Executives See Industrial Upswing Keeping Pace

Demand growth appears to be broadening out, leaders of Fastenal and MSC recently told analysts and investors. “We are starting to see changes in behavior,” MSC CEO Martina McIsaac said.
July 16, 2026
3 min read
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Key Highlights

  • MSC and Fastenal see demand broadening across sectors, with Fastenal's daily sales increasing nearly 15% year over year.
  • Construction, utility, infrastructure, and data-center projects are fueling growth, especially for Fastenal, which reports a 17% rise in construction-related business.
  • Executives note that trade and tariff uncertainties are impacting pricing and cost planning more than demand, maintaining healthy activity levels.
  • Both companies are witnessing a shift in industry behavior, with canceled summer shutdowns indicating a potential acceleration in industrial recovery.
Fastenal Co.
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The leaders of MSC Industrial Direct Supply Co. and Fastenal Co., two distributors of manufacturing and construction supplies with deep views into the goods economy, have recently told investors they see the growth that surfaced early this year as holding its own—and apparently broadening out.

Speaking on recent conference calls discussing their results from the spring quarter, both teams of executives said demand from customers remains solid and that their strategic plans are helping them outpace the market. MSC President and EO Martina McIsaac said average daily sales topped expectations by growing nearly 8% year over year, which helped MSC’s adjusted operating margin climb to 10.6%. At Fastenal, daily sales rose even more quickly, climbing nearly 15% year over year, as the company’s teams were able to couple demand growth with share gains among some larger customers and raise prices.

Notable from both companies’ conference calls were executives’ points that a broad range of sectors are contributing to improving demand and their calling out of industries that seem to have turned a corner. Fastenal CFO Max Tunnicliff said overall demand conditions during the second quarter were “stable to modestly positive” but called out construction’s growth of 17% year over year (the same rate as early this year) as showing “a meaningful improvement from weaker trends we saw in prior periods.”

Driving Fastenal’s construction-related business are the strong tailwinds from work on electrical, utility, infrastructure and, yep, data-center projects. And while not every sector is flying high like this, Tunnicliff said many customers are keeping their cool this summer as they look to 2027.

“While trade and tariff uncertainty stayed in the picture, its impact this quarter showed up through cost planning and pricing discussions rather than demand,” Tunnicliff said. “Activity levels remain healthy and our teams continue to see strong customer engagement.”

Striking a similar note, MSC Head of Investor Relations Ryan Mills told analysts earlier this month that four of the company’s five largest end markets produced strong growth last quarter. The fifth, which is automotive, turned positive in June.

Where to from here? McIsaac was asked, about just how far along the industrial recovery is. She responded optimistically using a popular baseball-game analogy, and with what could be an important potential break from trend.

“We’re probably in sort of the third inning," she responded. “That might be conservative but we are starting to see changes in behavior. The most notable now—that we haven’t sized yet but we’re watching closely—is [that] summer shutdown patterns are changing significantly. So whereas we would have had preplanned shutdowns, particularly in automotive, those are being canceled. Those are not—or they’re not being announced as they would have been.

“So it’s still spotty, but it’s real," McIsaac rounded out. “I think that’s probably the best indicator that we have.”

About the Author

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Geert De Lombaerde

Senior Editor

A native of Belgium, Geert De Lombaerde has been in business journalism since the mid-1990s and writes about public companies, markets and economic trends for Endeavor Business Media publications, focusing on IndustryWeek, FleetOwner, Oil & Gas Journal, T&D World and Healthcare Innovation. He also curates the twice-monthly Market Moves Strategy newsletter that showcases Endeavor stories on strategy, leadership and investment and contributes to other Market Moves newsletters.

With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati in 1997, initially covering retail and the courts before shifting to banking, insurance and investing. He later was managing editor and editor of the Nashville Business Journal before being named editor of the Nashville Post in early 2008. He led a team that helped grow the Post's online traffic more than fivefold before joining Endeavor in September 2021.

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