| Metric [USD Million] | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|
| United States        | **$1,558.7**  **[0000815556-23-000021_fast-20230331.htm:3]**  | **$1,571.7**  **[0000815556-23-000041_fast-20230630.htm:4]**  | **$1,544.6**  **[0000815556-23-000049_fast-20230930.htm:4]**  | N/A     | **$1,578.9**  **[0000815556-24-000019_fast-20240331.htm:4]**  | **$1,594.1**  **[0000815556-24-000031_fast-20240630.htm:5]**  | **$1,587.2**  **[0000815556-24-000037_fast-20240930.htm:5]**  |
| Canada and Mexico    | **$243.9**  **[0000815556-23-000021_fast-20230331.htm:3]**    | **$254.9**  **[0000815556-23-000041_fast-20230630.htm:4]**    | **$245.7**  **[0000815556-23-000049_fast-20230930.htm:4]**    | N/A     | **$255.6**  **[0000815556-24-000019_fast-20240331.htm:4]**    | **$263.9**  **[0000815556-24-000031_fast-20240630.htm:5]**    | **$264.1**  **[0000815556-24-000037_fast-20240930.htm:5]**    |
| All other countries  | **$56.5**  **[0000815556-23-000021_fast-20230331.htm:3]**     | **$56.5**  **[0000815556-23-000041_fast-20230630.htm:4]**     | **$55.6**  **[0000815556-23-000049_fast-20230930.htm:4]**     | N/A     | **$60.6**  **[0000815556-24-000019_fast-20240331.htm:4]**     | **$58.2**  **[0000815556-24-000031_fast-20240630.htm:5]**     | **$58.9**  **[0000815556-24-000037_fast-20240930.htm:5]**     |
| Total Revenue        | **$1,859.1**  **[0000815556-23-000021_fast-20230331.htm:3]**  | **$1,883.1**  **[0000815556-23-000041_fast-20230630.htm:4]**  | **$1,845.9**  **[0000815556-23-000049_fast-20230930.htm:4]**  | N/A     | **$1,895.1**  **[0000815556-24-000019_fast-20240331.htm:4]**  | **$1,916.2**  **[0000815556-24-000031_fast-20240630.htm:5]**  | **$1,910.2**  **[0000815556-24-000037_fast-20240930.htm:5]**  |

5a6258885dbf251a73f8bd7786962e2dc1eda37194b731fca2bb5c461f99f23d

Fastenal Company is a leader in the wholesale distribution of industrial and construction supplies, operating through a network of over 3,400 in-market locations primarily in North America, with additional presence in Europe and Asia **[0000815556-24-000009_fast-20231231.htm:6]** **[0000815556-24-000009_fast-20231231.htm:93]**. The company offers a broad range of products across three main categories: fasteners, safety supplies, and other product lines. Fastenal's business model emphasizes proximity to customers through its extensive branch network and Onsite locations, which support both original equipment manufacturing (OEM) and maintenance, repair, and operations (MRO) needs **[0000815556-24-000009_fast-20231231.htm:57]** **[0000815556-24-000009_fast-20231231.htm:24]**.

1. **Other Product Lines** - Encompasses a variety of products including tools, janitorial supplies, and cutting tools, catering to diverse industrial needs.
2. **Fasteners** - Includes items like bolts, nuts, and screws, serving as essential components in construction and manufacturing.
3. **Safety Supplies** - Offers a range of products designed to ensure workplace safety, benefiting from cross-selling and industrial vending initiatives.

baba7a30df483e5d96f185cc6ee57392e028ff8d7b72a0f1cab0ed56448af116

0628e3516962ddd85730dfebd604421bdcf7953100ebbc330c927658657f80f0

| Product Segment | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-----------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Fasteners (% of sales) | 34.0%  **[0000815556-23-000009_fast-20221231.htm:98]**  | 33.6%  **[0000815556-23-000021_fast-20230331.htm:4]**  | 32.6%  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]**  | 32.1%  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | 31.1%  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | 31.5%  **[0000815556-24-000019_fast-20240331.htm:4]**  | 31.0%  **[0000815556-24-000028_ex_99106302024earningsrele.htm:1]**  | 30.2%  **[0000815556-24-000035_ex_99109302024earningsrele.htm:1]**  |
| Safety Supplies (% of sales) | 20.8%  **[0000815556-23-000009_fast-20221231.htm:98]**  | 20.4%  **[0000815556-23-000021_fast-20230331.htm:4]**  | 20.7%  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]**  | 21.4%  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | 22.5%  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | 21.6%  **[0000815556-24-000019_fast-20240331.htm:4]**  | 21.8%  **[0000815556-24-000028_ex_99106302024earningsrele.htm:1]**  | 22.5%  **[0000815556-24-000035_ex_99109302024earningsrele.htm:1]**  |
| Other Products (% of sales) | N/A | 46.0%  **[0000815556-23-000021_fast-20230331.htm:4]**  | 46.7%  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]**  | 46.5%  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | 46.4%  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | 46.9%  **[0000815556-24-000019_fast-20240331.htm:4]**  | 47.2%  **[0000815556-24-000028_ex_99106302024earningsrele.htm:1]**  | 47.3%  **[0000815556-24-000035_ex_99109302024earningsrele.htm:1]**  |

36628082d15c74d52f65f2f1208127f0cde149701756014ce314806af7490460

| Metric / Quarter | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Weighted FASTBin/FASTVend signings (MEUs) | **4,730**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]**  | **5,902**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]** **[0000815556-23-000021_fast-20230331.htm:13]**  | **6,794**  **[0000815556-23-000041_fast-20230630.htm:13]**  | **5,969**  **[0000815556-23-000049_fast-20230930.htm:14]** **[0000815556-23-000043_ex_99109302023earningsrele.htm:3]**  | **5,462**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:3]**  | **6,726**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:3]**  | **7,188**  **[0000815556-24-000031_fast-20240630.htm:15]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:3]**  | **7,281**  **[0000815556-24-000037_fast-20240930.htm:15]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:3]**  |
| Weighted FASTBin/FASTVend installations (MEUs) | **102,151**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]** **[0000815556-23-000009_fast-20221231.htm:15]**  | **104,673**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]** **[0000815556-23-000021_fast-20230331.htm:13]**  | **107,115**  **[0000815556-23-000041_fast-20230630.htm:13]** **[0000815556-23-000041_fast-20230630.htm:24]**  | **110,191**  **[0000815556-23-000049_fast-20230930.htm:14]** **[0000815556-23-000043_ex_99109302023earningsrele.htm:3]** **[0000815556-23-000049_fast-20230930.htm:25]**  | **113,138**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:3]** **[0000815556-24-000009_fast-20231231.htm:15]**  | **115,653**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:3]**  | **119,306**  **[0000815556-24-000031_fast-20240630.htm:15]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:3]** **[0000815556-24-000031_fast-20240630.htm:27]**  | **123,193**  **[0000815556-24-000037_fast-20240930.htm:15]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:3]** **[0000815556-24-000037_fast-20240930.htm:27]**  |
| Digital Footprint sales (%) | **52.6%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:5]** **[FAST_3013791_2]** **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]**  | **54.1%**  **[0000815556-23-000021_fast-20230331.htm:14]** **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]** **[FAST_3246655_1]**  | **55.3%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:3]** **[0000815556-23-000041_fast-20230630.htm:14]**  | **57.1%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:4]** **[0000815556-23-000049_fast-20230930.htm:15]**  | **58.1%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:4]**  | **59.2%**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:3]**  | **59.4%**  **[0000815556-24-000028_ex_99106302024earningsrele.htm:4]** **[0000815556-24-000031_fast-20240630.htm:16]** **[FAST_3393052_6]**  | **61.1%**  **[0000815556-24-000035_ex_99109302024earningsrele.htm:4]** **[0000815556-24-000037_fast-20240930.htm:16]**  |
| eBusiness growth (%) | **48.2%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]**  | **48.7%**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]**  | **44.7%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:2]** **[0000815556-23-000041_fast-20230630.htm:13]**  | **41.3%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:3]**  | **28.3%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:3]**  | **33.6%**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:3]**  | **25.5%**  **[0000815556-24-000031_fast-20240630.htm:15]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:3]**  | **25.6%**  **[0000815556-24-000037_fast-20240930.htm:15]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:3]**  |
| eBusiness as % of total sales | **20.1%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]**  | **21.9%**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]**  | **23.3%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:2]** **[0000815556-23-000041_fast-20230630.htm:13]**  | **24.5%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:3]**  | **24.8%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:3]**  | **28.6%**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:3]**  | **28.7%**  **[0000815556-24-000031_fast-20240630.htm:15]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:3]**  | **30.1%**  **[0000815556-24-000037_fast-20240930.htm:15]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:3]**  |
| DSR Change for Heavy Manufacturing (%) | **9.0%**  **[0000815556-23-000049_fast-20230930.htm:12]**  | **5.8%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | **2.7%**  **[0000815556-24-000019_fast-20240331.htm:12]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:2]**  | **1.8%**  **[0000815556-24-000031_fast-20240630.htm:14]**  | **0.7%**  **[0000815556-24-000037_fast-20240930.htm:14]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:2]**  |
| DSR Change for Other Manufacturing (%) | **2.5%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | **3.3%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | **2.5%**  **[0000815556-24-000019_fast-20240331.htm:12]**  | **4.0%**  **[0000815556-24-000031_fast-20240630.htm:14]**  | **6.2%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| DSR Change for Non-residential Construction (%) | **-0.6%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:1]**  | **-2.4%**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:1]** **[0000815556-23-000021_fast-20230331.htm:11]**  | **-8.8%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]** **[0000815556-23-000041_fast-20230630.htm:12]**  | **-7.2%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]** **[0000815556-23-000049_fast-20230930.htm:12]**  | **-7.4%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | **-6.6%**  **[0000815556-24-000019_fast-20240331.htm:12]**  | **-5.5%**  **[0000815556-24-000031_fast-20240630.htm:14]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:1]**  | **-3.6%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| DSR Change for Reseller (%) | **-6.9%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | **-7.9%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | **-2.5%**  **[0000815556-24-000019_fast-20240331.htm:12]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:2]**  | **-6.4%**  **[0000815556-24-000031_fast-20240630.htm:14]**  | **-11.3%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| DSR Change for Other End Markets (%) | **-4.4%**  **[0000815556-23-000021_fast-20230331.htm:11]**  | **-3.2%**  **[0000815556-23-000041_fast-20230630.htm:12]**  | **8.1%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:1]**  | **13.5%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:1]**  | **7.7%**  **[0000815556-24-000019_fast-20240331.htm:12]**  | **6.0%**  **[0000815556-24-000031_fast-20240630.htm:14]**  | **5.6%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| DSR Change for National Accounts (%) | **15.0%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:1]**  | **13.6%**  **[0000815556-23-000021_fast-20230331.htm:12]** **[0000815556-23-000019_ex_99103312023earningsrele.htm:1]**  | **10.3%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]**  | **8.6%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:2]** **[0000815556-23-000049_fast-20230930.htm:13]**  | **8.5%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:2]**  | **6.3%**  **[0000815556-24-000019_fast-20240331.htm:12]**  | **5.8%**  **[0000815556-24-000031_fast-20240630.htm:14]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:2]**  | **5.6%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| DSR Change for Non-national Accounts (%) | **5.6%**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:1]**  | **3.4%**  **[0000815556-23-000021_fast-20230331.htm:12]** **[0000815556-23-000019_ex_99103312023earningsrele.htm:1]**  | **0.2%**  **[0000815556-23-000039_ex_99106302023earningsrele.htm:1]**  | **-1.9%**  **[0000815556-23-000043_ex_99109302023earningsrele.htm:2]** **[0000815556-23-000049_fast-20230930.htm:13]**  | **-3.2%**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:2]**  | **-4.5%**  **[0000815556-24-000019_fast-20240331.htm:12]** **[0000815556-24-000017_ex_99103312024earningsrele.htm:2]**  | **-4.3%**  **[0000815556-24-000031_fast-20240630.htm:14]**  | **-4.1%**  **[0000815556-24-000037_fast-20240930.htm:14]**  |
| Number of active Onsite locations | **1,623**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:4]** **[0000815556-23-000002_ex_99112312022earningsrele.htm:8]** **[0000815556-23-000009_fast-20221231.htm:58]**  | **1,674**  **[0000815556-23-000019_ex_99103312023earningsrele.htm:4]** **[0000815556-23-000021_fast-20230331.htm:13]** **[0000815556-23-000021_fast-20230331.htm:9]** **[0000815556-23-000019_ex_99103312023earningsrele.htm:6]**  | **1,728**  **[0000815556-23-000041_fast-20230630.htm:10]**  | **1,778**  **[0000815556-23-000049_fast-20230930.htm:14]** **[0000815556-23-000043_ex_99109302023earningsrele.htm:3]** **[0000815556-23-000049_fast-20230930.htm:10]** **[0000815556-23-000043_ex_99109302023earningsrele.htm:8]**  | **1,822**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:8]** **[0000815556-24-000009_fast-20231231.htm:59]**  | **1,872**  **[0000815556-24-000019_fast-20240331.htm:13]** **[0000815556-24-000019_fast-20240331.htm:9]**  | **1,934**  **[0000815556-24-000031_fast-20240630.htm:15]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:3]** **[0000815556-24-000031_fast-20240630.htm:11]** **[0000815556-24-000028_ex_99106302024earningsrele.htm:8]**  | **1,986**  **[0000815556-24-000037_fast-20240930.htm:15]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:3]** **[0000815556-24-000037_fast-20240930.htm:11]** **[0000815556-24-000035_ex_99109302024earningsrele.htm:8]**  |
| Weighted FMI devices (MEUs) | **102,151**  **[0000815556-23-000002_ex_99112312022earningsrele.htm:8]** **[0000815556-23-000009_fast-20221231.htm:58]**  | **104,673**  **[0000815556-23-000021_fast-20230331.htm:9]**  | **107,115**  **[0000815556-23-000041_fast-20230630.htm:10]**  | **110,191**  **[0000815556-23-000049_fast-20230930.htm:10]** **[0000815556-23-000043_ex_99109302023earningsrele.htm:8]**  | **113,138**  **[0000815556-24-000002_ex_99112312023earningsrele.htm:8]** **[0000815556-24-000009_fast-20231231.htm:59]**  | **115,653**  **[0000815556-24-000017_ex_99103312024earningsrele.htm:7]** **[0000815556-24-000019_fast-20240331.htm:9]**  | **119,306**  **[0000815556-24-000028_ex_99106302024earningsrele.htm:8]** **[0000815556-24-000031_fast-20240630.htm:11]**  | **123,193**  **[0000815556-24-000035_ex_99109302024earningsrele.htm:8]** **[0000815556-24-000037_fast-20240930.htm:11]**  |

8ba0cfdacbac64bc7457acccbae592d07c814661a11c8ef49818857a02bced1b

Total Revenue [USD, Millions]

Cost of Goods Sold (COGS) [USD, Millions]

Selling, General, and Administrative Expenses (SG&A) [USD, Millions]

Research and Development (R&D) [USD, Millions]

Depreciation and Amortization (D&A) [USD, Millions]

Interest Expense [USD, Millions]

Operating Income (EBIT) [USD, Millions]

Net Income [USD, Millions]

Earnings Per Share (EPS) - Basic [USD, Units]

Earnings Per Share (EPS) - Diluted [USD, Units]

8c1abcca66668baabab41877498ea251f251a874f067d8876230b8e4826ba830

| Program Details          | Program 1       |
|--------------------------|-----------------|
| Approval Date            | July 12, 2022  **[0000815556-24-000037_fast-20240930.htm:40]**  |
| End Date/Duration        | No expiration date  **[0000815556-24-000037_fast-20240930.htm:40]**  |
| Total additional amount  | N/A             |
| Remaining authorization amount | 6,200,000 shares  **[0000815556-24-000037_fast-20240930.htm:40]**  |
| Details                  | The authorization does not have an expiration date  **[0000815556-24-000037_fast-20240930.htm:40]**  |

1d3c0cd8f250896f59bbb4eba907b094df30fc43f2a6f82abc2deaea768fc142

1. Given the increased duties in Mexico and Canada that have negatively impacted your gross margin, how do you plan to mitigate these costs going forward, and what strategies are in place to address the risk of further trade barriers?
2. With Onsite signings expected at the lower end of your 375 to 400 target range and a potential strategic shift toward customer acquisition, how will this impact your growth trajectory and the way you measure success moving forward?
3. Branch performance in the Western U.S. has been slightly negative while the Eastern U.S. shows growth; what specific actions are you taking to address these regional disparities, and how confident are you in achieving branch growth in 2025?
4. You've added inventory into your distribution network to improve availability and anticipate cost benefits starting next year; what risks do higher inventory levels pose if demand doesn't meet expectations, and how are you managing these risks?
5. Capital expenditures are projected to decrease in 2025 after significant investments this year, particularly in your Utah hub; how are you prioritizing CapEx investments in an uncertain economic environment, and what returns do you expect from these investments in the near term?

5dab37a0443c5db61fe380bbc6d80cd68f8f133c52d6ddb3b06367282f7620e1

8dd195153c2666d2d6a68edf72e332c2677266ac8dd425845850c435344d5e32

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: N/A
- **Guidance**: The Q3 2024 earnings call did not provide specific guidance metrics or a specific future period for guidance. The discussion focused on past performance, strategic initiatives, and market conditions without explicit future guidance figures.

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Digital Footprint**: Expected to reach about **63%** by the end of the year, down from an earlier expectation of 66%  **[FAST_3393052_6]** .
  2. **Net Capital Spending**: Increased to a range of **$235 million to $255 million** for the full year  **[FAST_3393052_8]** .
  3. **Operating Margin**: Second quarter margin was **20.2%**, with some impact expected to carry into July  **[FAST_3393052_7]** .
  4. **Gross Margin**: Second quarter margin was **45.1%**  **[FAST_3393052_7]** .
  5. **SG&A Expenses**: **24.9%** of sales in the second quarter, up from 24.6% year-over-year  **[FAST_3393052_8]** .
  6. **Customer Acquisition and Growth**: Aiming for a 5% to 6% outgrowth over industrial production  **[FAST_3393052_18]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: Q2 2024
- **Guidance**:
  1. **Operating Margins**: Expected impact of **30 basis points** in Q2 2024 due to near-term investments  **[FAST_3379777_4]** .
  2. **Capital Spending**: Anticipated range of **$225 million to $245 million** for the full year  **[FAST_3379777_4]** .
  3. **Sales Growth**: Total and daily sales up **1.9%** in Q1 2024  **[FAST_3379777_3]** .
  4. **Gross Margin**: **45.5%** in Q1 2024, expected to be down in 2024  **[FAST_3379777_3]** **[FAST_3379777_9]** .
  5. **SG&A Expenses**: **24.9%** of sales in Q1 2024, up from 24.6% year-over-year  **[FAST_3379777_3]** .

### Q4 2023 Earnings Call
- **Issued Period**: Q4 2023
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Net Capital Spending**: Expected range of **$225 million to $245 million**  **[FAST_3370405_7]** .
  2. **Onsite Signings**: Anticipated **375 to 400 Onsite signings**  **[FAST_3370405_2]** .
  3. **FMI Device Signings**: Target of **26,000 to 28,000 FMI devices**  **[FAST_3370405_3]** .
  4. **Market Share and Sales Growth**: Expected improvement in market share gains  **[FAST_3370405_7]** .
  5. **Digital Footprint**: Focus on increasing digital footprint, though specific targets were not detailed  **[FAST_3370405_3]** .

4fed6b4559e1c5d5b9ae9ed1bd9900b3a7da0320a3c833bc624b1fbcda3b01ee

United States

Canada and Mexico

Canada

Other foreign countries

North America Total

All other foreign countries

Total Revenue

f72b2fd7f19a888172889f0f2cedfb9482bffc9c064f81f91a9ae64b489dd95d

Weighted FASTBin/FASTVend signings (MEUs)

Weighted FASTBin/FASTVend installations (MEUs)

Digital Footprint sales (%)

eBusiness growth (%)

DSR Change for Heavy Manufacturing (%)

DSR Change for Other Manufacturing (%)

DSR Change for Non-residential Construction (%)

DSR Change for Reseller (%)

DSR Change for Other End Markets (%)

DSR Change for National Accounts (%)

DSR Change for Non-national Accounts (%)

Number of active Onsite locations

Weighted FMI devices (MEUs)

33e5d4a61168669d2842632f136eedd1f7e640da5fc5b02e6daa1bc3f6937a64

FAST expects margin expansion with incremental margins at 20–25%, supported by cost controls and rising customer optimism. However, 1% of sites drive 48% of sales, creating concentration risk. ECommerce investments aim to fuel broader growth in 2025.

8e5e1e8e612d6e987d648d9dbac07cadb0c9e81d59f273f277964c2fdb556c56

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from Debt [USD, Millions]

Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

c9169bb80a777bcb6fa3e3920f1c867fbba821d31070c0dda143bc7451707887

| Name                  | Position                                           | Start Date         | Short Bio                                                                                                                                                                                                 |
|-----------------------|----------------------------------------------------|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Daniel L. Florness    | President, Chief Executive Officer, and Director   | January 2016       | Daniel L. Florness has been with Fastenal since 1996. He served as CFO from June 1996 to December 2002, and as Executive Vice President and CFO from December 2002 to December 2015  **[0000815556-24-000015_fast-20240306.htm:9]** **[0000815556-24-000009_fast-20231231.htm:111]** **[0000815556-23-000017_fast-20230223.htm:7]** .                                                |
| Anthony P. Broersma   | Executive Vice President – Operations              | October 2023       | Anthony P. Broersma joined Fastenal in 2003. He has held various roles, including Senior Vice President – Operations and Vice President of Procurement and Supply Chain  **[0000815556-24-000009_fast-20231231.htm:111]** .                                                                    |
| William J. Drazkowski | Executive Vice President – Sales                   | October 2019       | William J. Drazkowski has been with Fastenal since 1995. He previously served as Executive Vice President – National Accounts Sales from December 2016 to September 2019  **[0000815556-24-000009_fast-20231231.htm:111]** **[0000815556-23-000009_fast-20221231.htm:114]** .                                                               |
| James C. Jansen       | Executive Vice President – Manufacturing           | January 2016       | James C. Jansen joined Fastenal in 1992. He has held various executive positions, including Executive Vice President - Operations and Executive Vice President – Internal Operations  **[0000815556-24-000009_fast-20231231.htm:112]** **[0000815556-24-000009_fast-20231231.htm:111]** .                                                   |
| Holden Lewis          | Senior Executive Vice President and Chief Financial Officer | December 2022     | Holden Lewis joined Fastenal after a career as a senior equity analyst. He served as Executive Vice President and CFO from August 2016 to December 2022  **[0000815556-24-000009_fast-20231231.htm:112]** **[0000815556-23-000009_fast-20221231.htm:114]** .                                                                                 |
| Sheryl A. Lisowski    | Executive Vice President – Chief Accounting Officer and Treasurer | December 2020 | Sheryl A. Lisowski has been with Fastenal since 1994. She served as controller, chief accounting officer, and treasurer from August 2016 to November 2020  **[0000815556-24-000009_fast-20231231.htm:112]** **[0000815556-23-000009_fast-20221231.htm:115]** .                                                                               |
| Charles S. Miller     | Senior Executive Vice President – Sales            | January 2020       | Charles S. Miller has been with Fastenal since 1999. He was Executive Vice President – Sales from November 2015 to December 2019  **[0000815556-24-000009_fast-20231231.htm:111]** **[0000815556-24-000009_fast-20231231.htm:112]** .                                                                                                        |
| Noelle J. Oas         | Executive Vice President – Human Resources         | February 2023      | Noelle J. Oas joined Fastenal in 2015 as Director of Compliance – Human Resources. She practiced employment law before joining Fastenal  **[0000815556-24-000009_fast-20231231.htm:112]** .                                                                                                    |
| John L. Soderberg     | Senior Executive Vice President – Information Technology | December 2020 | John L. Soderberg has been with Fastenal since 1993. He served as Executive Vice President – Information Technology from May 2016 to November 2020  **[0000815556-24-000009_fast-20231231.htm:112]** **[0000815556-23-000009_fast-20221231.htm:115]** .                                                                                      |
| Jeffery M. Watts      | Chief Sales Officer                                | May 2023           | Jeffery M. Watts has been with Fastenal since 1996. He served as Executive Vice President of International Sales from December 2016 to April 2023  **[0000815556-24-000009_fast-20231231.htm:111]** **[0000815556-24-000009_fast-20231231.htm:113]** **[0000815556-23-000009_fast-20221231.htm:115]** .                                                                                    |
| Jeffery M. Watts      | President                                          | July 2024 (expected) | Jeffery M. Watts was elevated to the position of President of Fastenal in July 2024  **[0000815556-24-000009_fast-20231231.htm:113]** **[0000815556-24-000009_fast-20231231.htm:111]** **[0000815556-24-000013_fast-20240216.htm:34]** **[FAST_3393052_10]** .                                                                                                        |

a0d8d81a77bb089a99c832437acb0cec0fcf674f9ebf6c8af85a962a2fb5ad9b

**Annual guidance for FY 2025:**
- **Net Capital Spending**: $265 million to $285 million  **[FAST_3412793_7]** **[FAST_3412793_4]**  (no prior guidance)  
- **CapEx as a Percentage of Sales**: 3% to 3.5%  **[FAST_3412793_7]** **[FAST_3412793_4]**  (no prior guidance)  
- **FMI Technology Goals**: 28,000 to 30,000 FMI devices  **[FAST_3412793_7]** **[FAST_3412793_4]**  (no prior guidance)  
- **Digital Sales Penetration**: 66% to 68%  **[FAST_3412793_7]** **[FAST_3412793_4]**  (no prior guidance)  

a1a53b2087593c0ac63201b4a6655c6d0b1c67636e680da412d4cc2d39b99742

1. **Price Deflation and Pricing Strategy**  
   **Q:** What's driving price deflation in safety products and how are you addressing it?  
   **A:** We're seeing price deflation in safety products due to a challenging market.  **[FAST_3393052_11]** **[FAST_3393052_16]**  While fastener prices are down, so are costs, and we've managed that well.  **[FAST_3393052_11]**  In safety, we weren't as disciplined with pricing as we should have been, and we're taking steps to improve.  **[FAST_3393052_11]** **[FAST_3393052_16]**  We're raising awareness and utilizing tools to provide better pricing insights to our field personnel.  **[FAST_3393052_11]** 

2. **Gross Margin Outlook**  
   **Q:** How will gross margins progress from Q2 to Q3, and are there any notable impacts?  
   **A:** Typically, our gross margins from Q2 to Q3 remain fairly similar.  **[FAST_3393052_13]**  The impact from warehousing customers that affected Q2 margins will largely not remain in Q3, so we expect margins to reflect normal seasonality or perhaps be slightly better due to the absence of those expenses.  **[FAST_3393052_12]** **[FAST_3393052_13]** 

3. **SG&A Leverage and Expense Control**  
   **Q:** How are you managing SG&A expenses in the second half?  
   **A:** Since **70%–75%** of our SG&A is labor with significant variable costs, SG&A growth tends to track revenue growth.  **[FAST_3393052_14]**  We anticipate being tighter on costs in Q3 than in Q2, which might mitigate SG&A growth to some extent.  **[FAST_3393052_14]** 

4. **Onsite Performance and Sales Outlook**  
   **Q:** What's impacting mature onsite sales, and how will you improve performance?  
   **A:** Mature onsite sales are down due to challenges in the manufacturing environment.  **[FAST_3393052_17]**  Our onsites, heavily oriented toward production, feel macroeconomic pressures more acutely.  **[FAST_3393052_17]**  By combining our East and West U.S. business units, we aim to learn from each other and enhance customer acquisition and relationship management.  **[FAST_3393052_17]** 

5. **Revenue Trends and Macro Outlook**  
   **Q:** Should we read into better monthly sales trends, and what's the macro outlook?  
   **A:** While our ability to gain traction has improved, the macro environment remains challenging with few positive signs.  **[FAST_3393052_15]** **[FAST_3393052_19]**  We're encouraged by our self-help efforts like contract and onsite signings, which will contribute to revenue over time.  **[FAST_3393052_15]** 

6. **Outgrowth vs. Industrial Production**  
   **Q:** How do you view outgrowth versus industrial production and margin expectations long term?  
   **A:** Historically, we've outgrown industrial production by **5%–6%**.  **[FAST_3393052_18]**  Recently, we slipped to **3%–4%**, but changes we've made should return us to **5%–6%** or better.  **[FAST_3393052_18]**  We aim to maintain operating margins around **21%–22%** while gaining market share.  **[FAST_3393052_18]** 

7. **Impact of Upcoming Election**  
   **Q:** Do you expect the industrial economy to stay weak until after the election?  
   **A:** Customers are adjusting costs, anticipating a prolonged downturn.  **[FAST_3393052_19]** **[FAST_3393052_20]**  There's feedback that some are holding back until after the election, but we can't predict the election's impact.  **[FAST_3393052_19]** **[FAST_3393052_20]** 

58be536472957329c7cf8d53e187aafee0ca2cb9b4823e7b1de582d7c96b89a1

| Name                     | Start Date         | End Date         | Reason for Change                                                                 |
|--------------------------|--------------------|------------------|----------------------------------------------------------------------------------|
| PricewaterhouseCoopers LLP (PwC) | March 31, 2025  **[0000815556-24-000033_ex_16107242024letterfromkp.htm:0] [0000815556-24-000033_fast-20240719.htm:1]**  | Present       | Current auditor.                                                             |
| KPMG LLP                 | N/A               | December 31, 2024  **[0000815556-24-000033_ex_16107242024letterfromkp.htm:0] [0000815556-24-000033_fast-20240719.htm:1]**  | The Audit Committee conducted a competitive selection process.  **[0000815556-24-000033_fast-20240719.htm:1]**  |

54cbf5c4aba65a96be8487e047cf869fe6d41b3327272a22c01d4c65ba7fc793

- Total Revenue: $1,824.5 million (+4% YoY)  **[0000815556-24-000009_fast-20231231.htm:89]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:0]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:11]**   
- SG&A: $473.4 million (+6% YoY)  **[0000815556-24-000009_fast-20231231.htm:89]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:11]**   
- Operating Income (EBIT): $344.8 million (−3% YoY)  **[0000815556-24-000009_fast-20231231.htm:89]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:11]**   
- Net Income: $262.1 million (−2% YoY)  **[0000815556-24-000009_fast-20231231.htm:89]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:6]**   
- Capital Expenditures: **$60.2 million** vs. −$309.3 million in prior year  **[0000815556-24-000009_fast-20231231.htm:92]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:12]**   
- Net Change in Cash: −$36.4 million vs. −$76.2 million in prior year (+52% YoY)  **[0000815556-24-000009_fast-20231231.htm:92]** **[0000815556-25-000048_ex_99112312024earningsrele.htm:12]**   

6c0caf269e566576d07452dcc7a306e5018cd4e2ca3ccd7654d81c18785351af

d40b98cedbbf4f5951f72903511f98db2ae510334920efa10ef2d2254e4502e2

Selling personnel - absolute employee headcount (employees)

Selling personnel - FTE employee headcount (employees)

Total personnel - absolute employee headcount (employees)

Total personnel - FTE employee headcount (employees)

Number of branch locations (locations)

Number of active Onsite locations (locations)

Number of in-market locations (locations)

Branch openings (locations)

Branch closures, net of conversions (locations)

Onsite activations (locations)

Onsite closures, net of conversions (locations)

Signings per day (signings per day)

b94cbb67fc82a75197293aebf688ce492492a18c0e97f9f6196bc6c01c6edc54

3924c68e8885c59cdb7645d9784bcd366d72f9be42cc7c7905704f10174d5ce8

1. **Gross Margin Outlook**  
   **Q:** What's the expectation for gross margins from Q4 to Q1?  
   **A:** Management expects gross margins to improve from Q4 to Q1, with a possible flattish gross margin year-over-year in 2025. Factors such as a narrowing gap between weak fasteners and strong safety sales may moderate pressures on gross margins. Additionally, warehousing costs impacting previous quarters are expected to ease, contributing to stable margins.  **[FAST_3412793_12]** 

2. **Operating Expenses Outlook**  
   **Q:** How should we view operating expenses for next year?  
   **A:** Operating expenses are expected to be influenced primarily by labor costs, which constitute about **70%** of OpEx. Management anticipates that with mid-single-digit growth, they can achieve operating leverage, maintaining incremental margins at the high end of the **20% to 25%** range. Bonuses, which were low this year due to weaker performance, may increase if business improves, affecting overall expenses.  **[FAST_3412793_14]** 

3. **2025 Trends and Customer Sentiment**  
   **Q:** Do you expect trends to improve in 2025 and why?  
   **A:** Management observes that customer sentiment is becoming more optimistic heading into 2025. Despite intense shutdowns at the end of the year, customers appear to be clearing the decks to start fresh. The recent election outcomes may have reduced uncertainty, improving outlooks. Management believes there's potential for business growth in the coming year.  **[FAST_3412793_9]** 

4. **Tariffs Impact and Pass-through**  
   **Q:** How will tariffs affect your contracts and plans?  
   **A:** Management is experienced in managing tariffs and has developed tools to handle them effectively. They are prepared to communicate and react to any changes, providing visibility to customers and minimizing supply chain risks. They believe they are well-positioned to manage potential tariff impacts starting January 20th and beyond.  **[FAST_3412793_11]** 

5. **Customer Concentration and Growth Opportunities**  
   **Q:** Is the sales concentration in few customer sites an opportunity?  
   **A:** Management views the concentration as a significant opportunity. They have around **2,500** large customer locations representing about **48%** of sales. They see potential to expand their Onsite programs further, tapping into the estimated **58** potential Onsites per district manager. They are excited about the growth prospects over the next ten years by deepening relationships with both large and smaller customers.  **[FAST_3412793_10]** **[FAST_3412793_11]** 

6. **eCommerce and Unplanned Spend Opportunities**  
   **Q:** What's being done to improve eCommerce and unplanned spend?  
   **A:** Management is enhancing inventory availability in distribution centers and improving the online customer experience. By increasing stocking levels and providing better visibility to product availability and tracking, they aim to make it easier for customers to order products online, even for unplanned purchases. This is expected to benefit smaller customers and maintenance areas of larger customers, contributing to growth.  **[FAST_3412793_12]** 

7. **Sales Concentration in Onsite Customers**  
   **Q:** Does 1% of sites account for 50% of sales?  
   **A:** Management clarified that approximately **2,500** locations doing more than **$50,000** a month represent about **48%** of sales. These include around **2,000 Onsites**, which contribute over **40%** of revenue. The concentration reflects success with larger customers, and management is focused on providing value through supply chain partnerships, which they believe will drive further growth.  **[FAST_3412793_10]** 

67abb724bf326b33a68d68472efa28735b2bc0a27b4a51bf2d4b6d7f1b787d9e

1. **Onsite Sales Growth Slowdown**  
   **Q:** Why did Onsite sales growth slow this quarter?  
   **A:** The slowdown is due to lower signings this year, which were not at the expected level. This has resulted in reduced growth from Onsite implementations. Additionally, weakness in machinery and fabricated metals has disproportionately impacted Onsite sales, as these sectors are significant for Onsite operations.  **[FAST_3370405_14]** 

2. **Impact of Mix on Gross Margin**  
   **Q:** How will sales mix affect gross margin in 2024?  
   **A:** The impact of sales mix on gross margin is expected to be less negative than the usual **50 to 70 basis points**. Factors contributing to this include fewer branch closures leading to slower attrition of smaller customers, slower Onsite signings reducing pressure on channel mix, and a narrowing gap between fastener and non-fastener growth. While mix will still be negative, it may be narrower than usual.  **[FAST_3370405_15]** 

3. **Leadership Changes and Market Share**  
   **Q:** What leadership changes were made, and how will they accelerate share gains?  
   **A:** Several changes were made within the National Accounts team and regional leadership, including consolidating the U.S. under one leader. This aims to unify approaches across regions and stimulate market share growth. The company is confident these changes will help "kick that market share machine back up in 2024."  **[FAST_3370405_20]** 

4. **Competition in Onsite Services**  
   **Q:** Are you seeing increased competition in Onsite, and can you return to higher growth in 2024?  
   **A:** While there is always competition, there's no indication of intensifying competition affecting Onsite growth. The company believes it has a natural advantage due to its branch network, providing redundancy and support for Onsite operations. They expect to achieve higher outgrowth in 2024, returning to previous levels.  **[FAST_3370405_19]** 

5. **Structural Factors Affecting Onsite**  
   **Q:** Are structural headwinds like e-Commerce impacting Onsite growth?  
   **A:** The slowdown in Onsite growth is viewed more as a cyclical issue rather than structural. Onsite and e-Commerce solutions do not compete; instead, they complement each other. Onsite services involve operating within customers' facilities, often supported by digital channels like **EDI**, and are not impacted by e-Commerce cannibalization.  **[FAST_3370405_18]** 

6. **Increase in Shipping Costs**  
   **Q:** How are increased shipping container costs affecting you?  
   **A:** There has been a meaningful uptick in container costs in recent weeks. While the exact impact by route is unclear, the increase is being monitored closely as it could stress the global network and impact overall costs.  **[FAST_3370405_12]** 

7. **Growth in Warehousing Demand**  
   **Q:** What drove the increase in warehousing demand, and what is its future potential?  
   **A:** The company has made concerted efforts over the last **5–6 years** to grow in the warehousing sector, which was less than **1%** of sales before the pandemic. The increase is due to deeper penetration with existing customers and stepping up when other suppliers couldn't meet needs. While it's a small part of the business, it has become an increasingly important segment.  **[FAST_3370405_16]** 

8. **Supplier Consolidation Trends**  
   **Q:** Have suppliers reduced the number of distributors they work with?  
   **A:** While not aware of any recent active consolidation by suppliers, it wouldn't be surprising. Over time, there has been gradual consolidation in terms of spending and engagement as relationships evolve.  **[FAST_3370405_13]** 

9. **Sales Trends and Seasonality**  
   **Q:** Will sales trends in 2024 follow typical seasonality, despite slower Onsites?  
   **A:** It's difficult to predict specific sales trends due to many moving pieces. While Onsites may grow less quickly, there could be an uptick in non-Onsite national accounts. Weather impacts and other variables make it challenging to assess deviations from normal seasonal trends.  **[FAST_3370405_17]** 

f122d90d800a22b6e4a8dcc83996a7503c2c420719785b57381f6813561f42f5

- **Fastenal achieved a record number of Onsite signings with 102 signings during the quarter**, indicating significant improvement in customer acquisition efforts and market share gains.  **[FAST_3379777_2]**
- **Strategic changes in the sales approach are beginning to show positive results**, as evidenced by improvements in contract signings and increased customer enthusiasm, which should reaccelerate market share gains as we proceed through 2024.  **[FAST_3379777_4]** **[FAST_3379777_9]** **[FAST_3379777_5]**
- The **Purchasing Manager's Index (PMI) moved above 50 in March for the first time since October 2022**, signaling potential improvement in the industrial economy that could benefit Fastenal in the second half of the year.  **[FAST_3379777_1]**

dbe6fbec15b2fbd70a4a38d4dd7d282a9c88a3dd942207238b350fb9dd63f9d8

c115147e4066a1a2e5d50a36e9262c9c2cf1f9bd234cb984315e53e2e43faead

- **Fastenal's sales are highly concentrated**, with **1% of customer sites generating about 48% of sales**, which could pose a risk if these key customers reduce spending.  **[FAST_3412793_10]**
- **Operating expenses are expected to increase** as growth returns due to the reinstatement of employee bonuses, which may limit margin expansion. **70% of operating expenses is labor**, and as business improves, bonuses will "reassert themselves," impacting costs.  **[FAST_3412793_15]**
- **There has been a decline in revenue from smaller customers**, particularly those spending less than $5,000 per month, reflecting potential challenges in serving this segment and potential loss of market share. **98% of the decline** came from customers in this bucket.  **[FAST_3412793_11]**

ff68a99a4321c1de07f9423a13ac2ed94ef838889d978dc90e17a60f85df3b74

1. **SG&A Investments**  
   **Q:** Are you increasing SG&A spend to drive higher growth?  
   **A:** Management explained that they have been investing to grow throughout the cycle. While SG&A growth has been limited to **5% or less** in each of the last five quarters, they highlighted a **20% growth in sales travel** expenses aimed at improving contract business and signings. They emphasized that they are not panicking over a **2% growth quarter** and will continue investing rather than slashing costs.  **[FAST_3379777_7]** 

2. **Gross Margin Outlook**  
   **Q:** Has your view on gross margin cadence changed?  
   **A:** Management stated that their view on gross margin cadence has not changed. They expect gross margin to be down in 2024 but not as much as in historical periods. In the first quarter, gross margin was down **20 basis points**, which is representative of their expectations. They believe the variables affecting gross margin remain in place as anticipated.  **[FAST_3379777_9]** 

3. **Pricing and Cost Pressures**  
   **Q:** Are you seeing inflationary pressures that could lead to price increases?  
   **A:** Management noted that they are not currently hearing about significant inflation in raw materials that would necessitate raising prices. While U.S. steel indexes have been volatile, the foreign steel indexes relevant to their supply chain have not shown significant changes. They mentioned that raw materials like steel comprise about **one-third** or less of the final product's value. Therefore, steel has not been a catalyst for price changes, and they are not seeing rampant inflation that would require price adjustments.  **[FAST_3379777_12]** 

4. **Potential Tariff Impact**  
   **Q:** What is your perspective on potential tariffs and their impact?  
   **A:** Management emphasized their commitment to maintaining a reliable, high-quality, and cost-effective supply chain with diversified sourcing. They have been diversifying their supplier base geographically for the past **four to five years** to mitigate risks like tariffs. While tariffs can increase supply chain costs and impact pricing to customers, they are prepared to manage such changes and believe they are better equipped now than **five years ago** to handle pricing and costing processes in response to tariffs or other cost increases.  **[FAST_3379777_8]** 

5. **Onsite Performance and Leadership Changes**  
   **Q:** What drove the strong Onsite performance this quarter?  
   **A:** Management attributed the improved Onsite performance to organizational changes made in the spring of **2023**. They realigned everything under one sales leader and consolidated the U.S. back into one business unit to focus on common goals. As a result, Onsite signings improved, noting **102** new signings. They also mentioned record sign-ups for their trade show, indicating increased engagement from the sales team and customers. They believe these changes are starting to show positive results, although they acknowledge that more time is needed to see the full impact.  **[FAST_3379777_5]** 

6. **Store Closures and Onsite Growth**  
   **Q:** How will fewer store closures affect Onsite growth?  
   **A:** Management explained that while closing branches sometimes led to Onsite growth when business moved to Onsite locations, they don't believe that closing branches directly drives Onsite growth. They anticipate their traditional branch count to be stable to slightly up over time, with primary growth coming from adding more Onsites. They are confident in sustaining organic growth through this focus on Onsite expansion.  **[FAST_3379777_13]** 

7. **End Market Challenges**  
   **Q:** Where are the negative outliers in your end markets today?  
   **A:** Management indicated that most end markets are experiencing general softness with no significant outliers. They mentioned that fabricated metals and machinery have been challenging for a while, but currently, the softness is broad-based across most markets. They are not receiving many specific market call-outs at this time.  **[FAST_3379777_11]** 

8. **New Disclosure on OEM vs. MRO Fasteners**  
   **Q:** Why did you break out OEM versus MRO fastener business?  
   **A:** Management stated they have been internally tracking the split between OEM and MRO fastener sales for several years and felt comfortable sharing this data now. They noted that both OEM and MRO fasteners tend to move directionally with industrial production, but the magnitude may differ. Sharing this information provides more granularity into their business, including how Onsites are more oriented towards OEM fasteners. They believe this adds useful color for understanding their business.  **[FAST_3379777_6]** 

9. **Customer Expo Impact**  
   **Q:** Does the customer expo lead to revenue or build relationships?  
   **A:** Management explained that the customer expo serves both purposes. It helps close deals and expands business by engaging decision-makers from both Fastenal and customers. The expo allows customers to see and understand their offerings, such as vending machines and RFID setups, and interact with suppliers and other customers. They expect a return on the investment in the expo, with business expansion occurring shortly thereafter.  **[FAST_3379777_10]** 

10. **Change and Organizational Friction**  
    **Q:** What about recent changes is creating friction?  
    **A:** Management discussed that change can be challenging in a successful business. They highlighted that their Western business unit was negative this quarter, while the Eastern unit was positive. They emphasized the need for leaders who prioritize growth over simply harvesting the business. Adjusting the organization's focus and direction can create friction, but they believe it is necessary to drive growth and expand customer partnerships.  **[FAST_3379777_15]** 

11. **Onsite Signings Progression**  
    **Q:** How did Onsite signings progress through the quarter?  
    **A:** Management indicated that Onsite signings were consistent throughout the quarter, with March possibly being the biggest month. They did not provide specific details but suggested there was steady progress without significant fluctuations.  **[FAST_3379777_14]** 

12. **Price/Cost Dynamics**  
    **Q:** Can you stay price/cost positive if pricing remains flat?  
    **A:** Management noted that pricing excluding fasteners remains positive. While fastener pricing may be negative, it is largely offset by non-fastener pricing. They described the pricing environment as fairly unremarkable, with pricing within a **0% to 2%** range. They are not seeing significant factors that would disrupt their ability to maintain positive price/cost dynamics.  **[FAST_3379777_16]** 

ddcd56784d517afa544ef3f7e782b36c34a4ba4d5968d8c885fc0c11a4593575

- **Weak demand across key end markets**, including fabricated metals and machinery, leading to overall business softness.  **[FAST_3379777_11]**
- **Expected decline in gross margins in 2024**, due to pressures on pricing and mix, and potential increases in SG&A expenses that could impact operating margins.  **[FAST_3379777_9]** **[FAST_3379777_7]**
- **Challenges in the Western US business unit**, which reported negative growth, indicating uneven performance across regions and difficulties with implementing organizational changes.  **[FAST_3379777_15]**

d27db006694650d3f1810543a41b316cce7f9bc8783036ee3155eb9eaa990567

- **Average order value declined by 11.5% from $224 in January to $216 in September 2024**, resulting in **31% of growth being wiped out due to lower spend per customer**, despite an **11.5% increase in transaction volumes**.  **[FAST_3402772_9]**
- **Significant weakness in key markets**, including **agriculture (expecting extended shutdowns in Q4)**, **consumer durables**, **pulp, paper, and lumber**, and impacts from **Boeing in aerospace**, are pressuring revenues and could continue into coming quarters.  **[FAST_3402772_9]**
- **Higher duties imposed by Mexico and Canada have significantly increased costs for moving products across borders**, leading to meaningful gross margin pressure in the quarter, with **no immediate relief in sight**.  **[FAST_3402772_14]**

a753b001331e97290d9a9cb17e089cc83c99a20c87ca8740150e6ab1ff06e8be

- Fastenal's expansion of Onsite locations has accelerated growth in mature markets, with Onsite sales now exceeding branch sales in some areas, leading to a compound annual growth rate (**CAGR of 8.2%** since 2017).  **[FAST_3370405_4]**
- The company's digital initiatives, including FMI Technology (vending devices) and e-commerce, are driving growth, with the digital footprint reaching **59%** of sales, up from **36%** in January 2020.  **[FAST_3370405_3]**
- Fastenal has diversified its end markets by significantly growing its warehousing customer base, with sales in this sector up **45%** in the fourth quarter and **60%** in December, contributing to overall sales growth.  **[FAST_3370405_16]**

6d145c45912547b460ed4a8789edf603a7ed8313c5d426b0a4812cc963d2cb9f

- **The macroeconomic environment remains challenging, with little sign of improvement in industrial production**, which is negatively impacting Fastenal's sales growth. Executives noted that they do not have "**a lot of green shoots**" on the macro side.  **[FAST_3393052_15]**
- **Fastenal's outgrowth over industrial production has decreased from the historical 5%-6% range to 3%-4%**, indicating difficulties in outperforming the market.  **[FAST_3393052_18]**
- **Margin pressures due to competitive pricing and customer demands are affecting profitability.** The company experienced **negative pricing of 30 to 60 basis points**, and executives acknowledge the challenging marketplace introduces stresses that impact pricing decisions.  **[FAST_3393052_16]**

e901cd267a30b33c5b5462e8541533b78e384ef22ba90a1d64fe8d89f8950e17

- **Management is confident they can increase outgrowth over industrial production to more than 5-6%**, due to recent changes in personnel and approaches aimed at accelerating growth and gaining market share.  **[FAST_3393052_18]**
- **Strong Onsite and FMI signings in the first half of 2024 are expected to benefit sales trends in the second half of 2024 and into 2025**, driving improved growth regardless of macroeconomic conditions.  **[FAST_3393052_15]**
- **Fastenal is successfully winning new business by providing cost-saving solutions to customers**, leading to traction in national account signings and FMI adoption, even in a challenging marketplace.  **[FAST_3393052_16]**

5668785c6667b33843a56d113ac0ff25ee0e8c5bfbdd0f720a1847660f0f6631

- **Management expects operating margin expansion** as growth picks up, with incremental margins at the **high end of 20% to 25%**, due to operational leverage and effective cost control.  **[FAST_3412793_15]**
- **Fastenal is investing in eCommerce capabilities** and expanding inventory to improve product availability, which is expected to **drive sales growth and improve margins** in 2025.  **[FAST_3412793_13]**
- **Customer sentiment is improving**, with regional leaders citing broadening **post-election customer optimism for 2025**, suggesting potential for increased business activity and revenue growth.  **[FAST_3412793_10]**

881c170d33c9978a86b32eab74a64e45040cbebdd5cb1de70a07f02d5dfbeb78

1. **Turnaround and Growth Outlook**  
   **Q:** Do you feel like you've turned a corner, and should we expect outgrowth to improve going forward?  
   **A:** Management believes they've turned a corner after making many changes in 2023 and early 2024, which were initially distracting. With new tools and leadership aligning everyone down the same path, they feel focused and expect outgrowth as they move into **2025**.  **[FAST_3402772_6]** 

2. **Gross Margin Outlook**  
   **Q:** How should we think about gross margin in Q4 given seasonality and recent noise?  
   **A:** Typically, gross margin declines about **30 basis points** in Q4 due to seasonality. However, management expects to do a little better than traditional seasonality this year. The impact of lower rebates that affected Q3 gross margin won't be as significant in Q4, potentially adding a couple of million dollars to gross profit. While there will still be some decline, offsets should moderate the impact.  **[FAST_3402772_7]** 

3. **Sales Growth Needed for Margin Leverage**  
   **Q:** What is the minimum sales growth needed to return to historical incremental margin levels?  
   **A:** Management believes that as they achieve revenue growth north of **mid-single digits**, they can begin to leverage the P&L and grow margins. Below mid-single-digit growth, it's difficult to leverage. Their overall profile hasn't changed; when revenue growth exceeds mid-single digits, they expect to leverage and improve margins.  **[FAST_3402772_8]** 

4. **Industry Headwinds and Outlook**  
   **Q:** Can you provide color on impacts from heavy manufacturing sectors like automotive and aerospace?  
   **A:** Management notes weakness in agriculture due to expected extended shutdowns, softness in consumer durables, and challenges in pulp, paper, and lumber. They are seeing effects from Boeing in the aerospace sector due to the strike. Oil and gas remain stable and are performing decently. These sector-specific issues impact their business, but they anticipate potential stabilization or slight improvement moving into **2025**.  **[FAST_3402772_9]** ,  **[FAST_3402772_10]** 

5. **September Performance and Market Share**  
   **Q:** Was September's performance helped by the macro environment or market share gains?  
   **A:** The improvements in September are attributed more to market share gains and new customer additions than macro factors. Management emphasizes that the accumulated impact of signing new contracts, particularly in Onsite and Fastenal Managed Inventory (FMI), is driving growth. They observed that September ended stronger than it started, indicating positive traction from their initiatives.  **[FAST_3402772_10]** 

6. **Onsite Signings and Growth Strategy**  
   **Q:** Can you provide more details on the maturity of initiatives to drive Onsite signings and regional insights?  
   **A:** Management is focusing on customer acquisition and maturity rather than just counting Onsite signings. They've built internal capabilities to manage customer relationships more effectively, targeting different customer segments with tailored strategies. They plan to communicate progress in terms of customer acquisition and growth across revenue segments, moving away from solely reporting the number of Onsite signings.  **[FAST_3402772_11]** 

7. **Branch Performance Outlook**  
   **Q:** Have the branches started growing again, and what's the outlook for that?  
   **A:** Management expects branches to return to growth in **2025**. Changes made previously had lingering effects, especially in the Western U.S., where sales have been slightly negative. However, the Eastern U.S. has shown growth of nearly **5%**. They believe that as they anniversary these changes and with better alignment in sales leadership, branches will see improved performance.  **[FAST_3402772_12]** 

8. **Impact of Mexico Duties on Gross Margin**  
   **Q:** What's driving the higher mix of duties from Mexico, and will this recur?  
   **A:** Mexico has become more active in charging duties on products moving across the border in the last **6 to 12 months**, significantly impacting gross margin. These higher charges result from increased duty rates, not increased product volume. Moving products not natively from North America incurs these duties, and this has been a meaningful impact on the quarter.  **[FAST_3402772_14]** ,  **[FAST_3402772_15]** 

9. **CapEx and Working Capital Outlook for 2025**  
   **Q:** How should we think about CapEx and working capital investments into 2025?  
   **A:** Management expects CapEx to decrease slightly from **$250 million**, estimating between **$200 million and $225 million** for next year. Significant investments this year include constructing a new automated hub in Utah. They anticipate less expenditure on such projects next year but continue to invest about **3% of sales** into capital, focusing on areas like FMI, distribution, transportation, and IT.  **[FAST_3402772_16]** 

10. **Strategy to Add $1 Billion Revenue Annually**  
    **Q:** What's the strategy to achieve adding $1 billion in revenue per year?  
    **A:** As they approach being a **$10 billion** organization, management aims to grow from adding **$0.5 billion** annually to adding **$1 billion** per year in revenue. They focus on customer acquisition, customer maturity, and executing strategies that drive significant revenue growth. They plan to share more details at an Analyst Day in April, aligning with their customer expo, to discuss guideposts and key performance indicators for achieving this goal.  **[FAST_3402772_17]** 

fb66a7723ed851d5639a5914e35f8ae59f9cb2971f872655766438929c728bb2

- **Fastenal expects revenue growth to accelerate in 2025 as economic conditions stabilize or improve marginally, with increased customer activity and order sizes.**  **[FAST_3402772_9]** **[FAST_3402772_12]**
- **Investments in customer acquisition, digital solutions, and Onsite initiatives are driving increased market share and positioning the company for strong future growth.**  **[FAST_3402772_11]** **[FAST_3402772_3]**
- **Plans to expand inventory availability and operational efficiencies are anticipated to enhance gross margins and support revenue growth in 2025 and beyond.**  **[FAST_3402772_8]** **[FAST_3402772_13]**

e098c04638d5f8361426567cf592e9bb7b2cf4408f6b22ba29c60183e893b2d9

- **Slowing Onsite sales growth and signings below expectations may hinder future revenue growth.**  **[FAST_3370405_14]**
- **Weakness in key end markets, such as machinery and fabricated metals, is negatively impacting Fastenal's business, especially in the Onsite segment.**  **[FAST_3370405_14]**
- **The company did not achieve market share gains at the expected levels, indicating potential challenges in execution and competitive pressures.**  **[FAST_3370405_11]**

ad32e59a0cf1910570f53643242e0e1b3de416b942ae84b98a1cbe610da8dc64

Fastenal Co (FAST)

Financials