Fastenal Company (NASDAQ: FAST) reported fourth-quarter earnings that met analyst expectations but posted revenue slightly below forecasts, sending shares down more than 5% intra-day on Tuesday.

The industrial and construction supplies distributor reported earnings of $0.26 per share for the quarter ended December 31, 2025, in line with consensus estimates. Revenue totaled $2.03 billion, narrowly missing expectations of $2.04 billion, though it still represented an 11.1% increase from the same quarter last year.

Fastenal said its results reflected improved customer contract signings since early 2024, which helped offset ongoing softness in industrial production. Unit sales growth was supported by an increase in customer locations spending at least $10,000 per month. Product pricing contributed between 310 and 340 basis points to net sales growth during the quarter.

Gross margin declined to 44.3% from 44.8% a year earlier, pressured by higher cost of goods sold and the timing of supplier rebates. Operating margin improved modestly to 19.0% from 18.9% in the prior-year period.

Direct product sales, including fasteners and hardware, rose 13.1% year over year, outpacing indirect product growth. Manufacturing customers were a key driver, with the daily sales rate increasing 12.8%.

Looking ahead, Fastenal said it planned to raise capital expenditures in 2026 to a range of $310 million to $330 million, up from $230.6 million in 2025, as it replaces its Atlanta hub facility and increases investment in trucking and IT infrastructure.