Maintenance and repair supplier W.W. Grainger (NYSE: GWW) reported Q2 CY2026 results exceeding the market’s revenue expectations, with sales up 10.3% year on year to $5.02 billion. The company expects the full year’s revenue to be around $19.55 billion, close to analysts’ estimates. Its GAAP profit of $12.01 per share was 7.7% above analysts’ consensus estimates.

Is now the time to buy W.W. Grainger? Find out by accessing our full research report, it’s free.

"Despite ongoing geopolitical uncertainty, we executed well during the second quarter and delivered exceptional service to customers. Sales remained strong and core operating profitability was in line with expectations," said D.G. Macpherson, Chairman and CEO.

Company Overview

Founded as a supplier of motors, W.W. Grainger (NYSE: GWW) provides maintenance, repair, and operating (MRO) supplies and services to businesses and institutions.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Thankfully, W.W. Grainger’s 9% annualized revenue growth over the last five years was decent. Its growth was slightly above the average industrials company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. W.W. Grainger’s recent performance shows its demand has slowed as its annualized revenue growth of 6.1% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs.

We can dig further into the company’s sales dynamics by analyzing its organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, W.W. Grainger’s organic revenue averaged 6.8% year-on-year growth. Because this number aligns with its two-year revenue growth, we can see the company’s core operations (not acquisitions and divestitures) drove most of its results.

This quarter, W.W. Grainger reported year-on-year revenue growth of 10.3%, and its $5.02 billion of revenue exceeded Wall Street’s estimates by 1.2%.

Looking ahead, sell-side analysts expect revenue to grow 7% over the next 12 months, similar to its two-year rate. This projection doesn’t excite us and suggests its newer products and services will not catalyze better top-line performance yet.

ONE MORE THING: The $21 AI Application Stock Wall Street Forgot. While Wall Street obsesses over who’s building AI, one company is already using it to print money. And nobody’s paying attention.

AI chip stocks trade at ridiculous valuations. This company processes a trillion consumer signals monthly using AI and trades at a third of the price. The gap won’t last. The institutions will figure it out. You need to see this first. Read the FREE Report Before They Notice.

Operating Margin

Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.

W.W. Grainger has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 14.8%. This result isn’t surprising as its high gross margin gives it a favorable starting point.

Analyzing the trend in its profitability, W.W. Grainger’s operating margin rose by 1 percentage points over the last five years, as its sales growth gave it operating leverage. Its expansion shows it’s one of the better Maintenance and Repair Distributors companies as most peers saw their margins plummet.

This quarter, W.W. Grainger generated an operating margin profit margin of 16.1%, up 1.2 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

W.W. Grainger’s EPS grew at 19.2% compounded annual growth rate over the last five years, higher than its 9% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into W.W. Grainger’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, W.W. Grainger’s operating margin expanded by 1 percentage points over the last five years. On top of that, its share count shrank by 10.1%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For W.W. Grainger, its two-year annual EPS growth of 3.7% was lower than its five-year trend. We hope its growth can accelerate in the future.

In Q2, W.W. Grainger reported EPS of $12.01, up from $9.97 in the same quarter last year. This print beat analysts’ estimates by 7.7%. Over the next 12 months, Wall Street expects W.W. Grainger’s full-year EPS to grow 21.7% from $39.22 to $47.72.

Key Takeaways from W.W. Grainger’s Q2 Results

We enjoyed seeing W.W. Grainger beat analysts’ organic revenue expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. Overall, we think this was a decent quarter with some key metrics above expectations. Investors were likely hoping for more, and shares traded down 5.6% to $1,295 immediately after reporting.

Big picture, is W.W. Grainger a buy here and now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).