MSC Industrial Supply Co. (NYSE:MSM) delivered a stronger-than-expected set of fiscal first-quarter results, posting solid profit growth and higher sales even as operations were weighed down by disruption linked to the U.S. government shutdown.
Despite the earnings beat, the distributor’s shares slipped about 1.11% in pre-market trading after the update.
For the quarter ended November 29, 2025, MSC Industrial reported adjusted earnings per share of $0.99, ahead of the $0.95 analysts had been expecting. Revenue reached $965.7 million, narrowly beating the consensus forecast of $964.59 million and marking a 4% increase from $928.5 million a year earlier.
Operating performance also improved, with adjusted operating margin rising to 8.4%, an increase of 40 basis points compared with the same period last year. The company said it managed to return to profitable growth despite facing roughly 100 basis points of headwinds related to the government shutdown.
Commenting on the quarter, President and Chief Executive Officer Martina McIsaac said: “We began the fiscal year on solid footing by executing on the continued momentum from our recent growth initiatives. This resulted in average daily sales growth at the midpoint of our outlook and approximately 180 basis points above the Industrial Production Index.”
Looking ahead, MSC Industrial said it expects average daily sales growth of between 3.5% and 5.5% year on year in the second quarter of fiscal 2026, alongside an adjusted operating margin in the range of 7.3% to 7.9%. Management noted that the timing of holidays led to a softer start to the quarter, influencing its near-term outlook.
Greg Clark, Vice President and Interim Chief Financial Officer, also highlighted execution during the period, saying: “We successfully capitalized on growth by delivering 10 basis points of operating margin expansion, or 40 basis points on an adjusted basis year over year and towards the higher end of our guidance range.”
The company reiterated its full-year fiscal 2026 guidance, including expectations for free cash flow conversion of around 90% and an effective tax rate between 24.5% and 25.5%.