Distribution Solutions Group, Inc.
For the period ended Sep 30, 2026. Filed Nov 5, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 5, 2026
DSGR$34.93-0.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0000703604-26-000041
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-05.
0000703604-26-000051
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 174 previous paragraphs and 175 current paragraphs.
107 unchanged; 58 reworded; 10 added; 8 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 17 previous and 17 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
On October 15, 2026, Merger Sub completed the offering of $800 million aggregate principal amount of its 10.000% Senior Notes due 2032, the proceeds of which are held in escrow pending satisfaction of specified conditions, including consummation of the Merger. If the Merger is completed, DSG, as the surviving corporation, will assume Merger Sub’s obligations under the Notes. For additional information, see Note 17 – Subsequent Events in Part I, Item 1, Financial Statements.
Current report
On September 1, 2026, DSG completed the acquisition of American Fasteners Corporation (“American Fasteners” and the “American Fasteners Transaction”). American Fasteners is located in South Florida and distributes fasteners, tools construction supplies and other industrial products throughout South Florida, Latin America and the Caribbean. American Fasteners was acquired to expand DSG’s operating footprint in the South Florida, Latin America and the Caribbean markets.
Current report
Revenue increased approximately $8.7 million, or 7.2%, to $130.3 million in thethird quarter of 2026 compared to $121.5 million in thethird quarter of 2025. The increase was primarily driven by$3.8 million of additional revenue generated by the 2026 acquisition of American Fasteners and increased sales of $5.0 million to Lawson’s core, strategic and government customers.
Current report
Selling, general and administrative expenses increased $0.5 million to $61.5 million in the third quarter of 2026 compared to $60.9 million in the prior year quarter. There were approximately $0.6 million of additional expenses driven by the 2026 acquisition of American Fasteners and $2.8 million of increased acquisition related expenses, offset primarily by lower employee costs and lower outside service costs.
Current report
Revenue increased $2.1 million to$62.1 millionin thethird quarter of 2026 compared to $60.0 million in the third quarter of 2025 driven by $4.0 million of additional revenue generated by the 2026 acquisition of Eastern Valve partially offset by a decrease in organic revenue of $1.9 million primarily from decreased sales to plumbing and heating customers.
Current report
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Current report
Selling, general and administrative expenses increased $1.8 million to $185.3 million in the first nine months of 2026 compared to $183.5 million in the same period of 2025. The increase was primarily driven by approximately $0.6 million of additional expenses driven by the 2026 acquisition of American Fasteners, higher acquisition expenses of $3.0 million and higher severance expense of $0.9 million. These were partially offset by lower employee costs of approximately $0.9 million.
Current report
The Company's primary sources of liquidity are cash flows from operations, available cash and borrowing capacity under the Credit Agreement. As of September 30, 2026, the Company had approximately $763.0 million of outstanding indebtedness, including $89.2 million of outstanding revolving loans, and approximately $305.7 million of borrowing availability under its revolving credit facility, net of outstanding letters of credit, under the Credit Agreement. The Company was in compliance with its financial covenants under the Credit Agreement as of September 30, 2026. For additional information, see Note 8 – Debt in Part I, Item 1, Financial Statements.
Current report
The Merger Agreement restricts the Company's ability to incur certain indebtedness before completion of the Merger, including generally limiting outstanding revolving loans to $100 million, subject to specified exceptions, including borrowings to finance certain acquisitions, and applicable approvals. The Company financed its acquisitions of American Fasteners and GradeEight through available cash and revolving borrowings under the Credit Agreement. The acquisition of GradeEight was completed subsequent to September 30, 2026. For additional information, see Note 17 – Subsequent Events in Part I, Item 1, Financial Statements.
Current report
In connection with the proposed Merger, Merger Sub, which is affiliated with LKCM Headwater and is not a subsidiary of the Company, completed the Notes Offering on October 15, 2026. The proceeds are held in escrow and are not currently available to the Company. If the Merger is completed, the Company will assume the obligations under the Notes. The Notes are not reflected in the Company's indebtedness or liquidity as of September 30, 2026. For additional information, see Note 17 – Subsequent Events in Part I, Item 1, Financial Statements.
Removed paragraphs (8)
Previous report
Revenue increased approximately $1.2 million, or 1.0%, to $125.5 million in thesecond quarter of 2026 compared to $124.3 million in thesecond quarter of 2025. The increase was primarily driven by increased sales to Lawson’s strategic and government customers, partially offset by a decline in sales to Lawson’s core customers.
Previous report
Selling, general and administrative expenses increased $1.3 million to $61.9 million in the second quarter of 2026 compared to $60.6 million in the prior year quarter. The increase was primarily driven by higher severance expense of $1.3 million and higher medical claims costs.
Previous report
Revenue increased $7.9 million to$63.7 millionin thesecond quarter of 2026 compared to $55.9 million in the second quarter of 2025 driven by $4.1 million of additional revenue generated by the 2026 acquisition of Eastern Valve and an increase in organic revenue of $3.8 million primarily from increased sales volume in Eastern and Western Canada.
Previous report
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
Previous report
Selling, general and administrative expenses increased $1.3 million to $123.8 million in the first six months of 2026 compared to $122.5 million in the same period of 2025. The increase was primarily driven by higher severance expense of $1.2 million and higher medical claims costs.
Previous report
Credit Agreement Amendment and Merger Financing
Previous report
On July 15, 2026, in connection with the Merger Agreement, the Company entered into the Credit Agreement Amendment. The Credit Agreement Amendment permits, subject to its terms and conditions, revolving loans under the credit facility to be used to finance the Merger and related transactions and establishes a “certain funds” framework applicable to such borrowings. The Merger Agreement requires the Company to provide customary financing cooperation, including using commercially reasonable efforts to maintain the credit agreement financing or pursue specified alternative debt financing. The availability of financing is not a condition to the obligations of Parent, Intermediate and Merger Sub to complete the Merger.
Previous report
The Credit Agreement Amendment was entered into after June 30, 2026 and therefore did not affect the Company’s outstanding borrowings or borrowing availability as of that date. Under the terms of the Merger agreement, during the period between execution of the Merger Agreement and completion of the Merger, revolving loans under the credit facility, other than borrowings to finance certain contemplated acquisitions, may not exceed $100.0 million outstanding at any time. Accordingly, although the credit facility provided $344.7 million of unused additional borrowing capacity at June 30, 2026, the Merger Agreement now caps at $100.0 million the amount of revolving borrowings that may be outstanding under the credit facility while the Merger is pending, subject to limited exceptions for certain contemplated acquisitions. For additional information, see Note 16 – Subsequent Events in Part I, Item 1, Financial Statements and our Current Report on Form 8-K filed with the SEC on July 16, 2026.
Reworded paragraphs (58)
Previous wording
Completion of the Merger is subject to specified closing conditions, including receipt of specified stockholder approvals and expiration or termination of the applicable waiting period under the HSR Act, and is not subject to a financing condition. If ther Merger is completed, DSG will become privately held and DSG common stock will be delisted from Nasdaq. In connection with the execution of the Merger Agreement, we amended our existing credit agreement to permit, subject to its terms and conditions, revolving loans to be used to finance the Merger and related transactions. For additional information, see
Current wording
Completion of the Merger is subject to specified closing conditions, including receipt of specified stockholder approvals and expiration or termination of the applicable waiting period under the HSR Act, and is not subject to a financing condition. The applicable waiting period under the HSR Act terminated on August 20, 2026. If the Merger is completed, DSG will become privately held and DSG common stock will be delisted from Nasdaq. In connection with the execution of the Merger Agreement, we amended our existing credit agreement to permit, subject to its terms and conditions, revolving loans to be used to finance the Merger and related transactions. For additional information, see Note 16 – Recent Developments in Part I, Item 1, Financial Statements and our Current Report on Form 8-K filed with the SEC on July 16, 2026.
Previous wording
DSG believes that the Purchasing Managers Index (“PMI”) published by the Institute for Supply Management is an indicative measure of the relative strength of the economic environment of the industry in which it operates. The PMI is a composite index of economic activity in the U.S. manufacturing sector. A measure of the PMI index above 50 is generally viewed as indicating an expansion of the manufacturing sector while a measure below 50 is generally viewed as representing a contraction. The average monthly PMI was 53.0 in the six months ended June 30, 2026, compared to 49.4 in thesix months ended June 30, 2025.
Current wording
DSG believes that the Purchasing Managers Index (“PMI”) published by the Institute for Supply Management is an indicative measure of the relative strength of the economic environment of the industry in which it operates. The PMI is a composite index of economic activity in the U.S. manufacturing sector. A measure of the PMI index above 50 is generally viewed as indicating an expansion of the manufacturing sector while a measure below 50 is generally viewed as representing a contraction. The average monthly PMI was 53.6 in the nine months ended September 30, 2026, compared to 49.1 in thenine months ended September 30, 2025.
Previous wording
Our results of operations are not directly comparable on a year-over-year basis due to acquisition activity. We account for acquisitions under Accounting Standards Codification 805, Business Combinations (“ASC 805”). Accordingly, the results of acquisitions are only included subsequent to their respective acquisition dates. Refer to Note 3 – Business Acquisitions in Part I, Item 1. Financial Statements for a description of the acquisition completed in 2026 and the reportable segment in which the acquisition’s results of operations are included.
Current wording
Our results of operations are not directly comparable on a year-over-year basis due to acquisition activity. We account for acquisitions under Accounting Standards Codification 805, Business Combinations (“ASC 805”). Accordingly, the results of acquisitions are only included subsequent to their respective acquisition dates. Refer to Note 3 – Business Acquisitions in Part I, Item 1. Financial Statements for a description of the acquisitions completed in 2026 and the reportable segment in which the acquisition’s results of operations are included.
Previous wording
The following table provides a reconciliation of Net income (loss) to Adjusted EBITDA on a consolidated basis and Operating income (loss) to Adjusted EBITDA by segment for thethree and six months ended June 30, 2026 and 2025. A reconciliation of Net income (loss) to Adjusted EBITDA by segment is not provided because management does not determine or review net income at the segment level and does not allocate non-operating costs and expenses to its segments, such as income taxes, interest expense, and various other non-operating income and expense.
Current wording
The following table provides a reconciliation of Net income (loss) to Adjusted EBITDA on a consolidated basis and Operating income (loss) to Adjusted EBITDA by segment for thethree and nine months ended September 30, 2026 and 2025. A reconciliation of Net income (loss) to Adjusted EBITDA by segment is not provided because management does not determine or review net income at the segment level and does not allocate non-operating costs and expenses to its segments, such as income taxes, interest expense, and various other non-operating income and expense.
Previous wording
(5)Other non-recurring costs consist of certain non-recurring strategic projects, costs related to the proposed Merger (as described in Note 16 – Subsequent Events in Part I, Item 1. Financial Statements) and other non-recurring items.
Current wording
(5)Other non-recurring costs consist of certain non-recurring strategic projects, costs related to the proposed Merger (as described in Note 16 – Recent Developments in Part I, Item 1. Financial Statements) and other non-recurring items.
Previous wording
Consolidated revenue increased$55.3 million in the second quarter of 2026 compared to thesecond quarter of 2025 primarily driven by an increase in organic revenue of $51.2 million or 10.2% and $4.1 million of additional revenue generated by the 2026 acquisition of Eastern Valve. Consolidated gross profit increased and Selling, general and administrative expenses increased in thesecond quarter of 2026 compared to theprior year quarter, primarilyto support the increase in revenue.
Current wording
Consolidated revenue increased$55.7 million in the third quarter of 2026 compared to thethird quarter of 2025 primarily driven by an increase in organic revenue of $47.9 million or 9.2% and $7.8 million of additional revenue generated by the 2026 acquisitions of Eastern Valve and American Fasteners. Consolidated gross profit increased and Selling, general and administrative expenses increased in thethird quarter of 2026 compared to theprior year quarter, primarilyto support the increase in revenue.
Previous wording
Gross profit decreased $4.2 million, or 6.1%, to $64.4 million in the second quarter of 2026 compared to gross profit of $68.6 million in the prior year quarter primarily as a result of a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases. Lawson gross profit as a percentage of revenue was 51.3% in the second quarter of 2026 compared to 55.2% in the prior year quarter. The gross profit margin percentage decrease was primarily due to a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases.
Current wording
Gross profit increased $0.9 million, or 1.4%, to $67.3 million in the third quarter of 2026 compared to gross profit of $66.3 million in the prior year quarter primarily from the inclusion of additional gross profit of $1.0 million from the acquisition of American Fasteners. Lawson gross profit as a percentage of revenue was 51.6% in the third quarter of 2026 compared to 54.6% in the prior year quarter. The gross profit margin percentage decrease was primarily due to the lower gross profit margin profile of American Fasteners as compared to Lawson’s historical business, a sales mix shift toward lower margin customers and increased vendor costs partially offset by customer price increases.
Previous wording
During the three months ended June 30, 2026, Lawson generated Adjusted EBITDA of$11.9 million, or 9.5%of sales. This isa decrease of$3.8 million from the same period a year agoprimarily driven by the lower gross profit margin percentage partially offset by increased revenue.
Current wording
During the three months ended September 30, 2026, Lawson generated Adjusted EBITDA of $17.2 million, or 13.2% of sales. This is an increase of $3.3 million from the same period a year ago, primarily driven by approximately $0.5 million of adjusted EBITDA generated by the 2026 acquisition of American Fasteners, increased organic revenue and leveraging Selling, general, and administrative expenses over a higher sales base, partially offset by the lower gross profit margin percentage.
Previous wording
Revenue increased $33.9 million, or 17.4%, to$229.0 million in thesecond quarter of 2026 compared to $195.0 million in the second quarter of 2025. The increase was primarily driven by a $15.0 million increase in revenue from test and measurement, a $16.8 million increase in revenue from direct and indirect electronics production supplies, and a $3.8 million increase in revenue from rentals, chambers and refurbished, along with an increase in revenue from the European region, partially offset by a $1.7 million decrease in revenue from fabrication and value added services.
Current wording
Revenue increased $35.8 million, or 17.3%, to$242.3 million in thethird quarter of 2026 compared to $206.5 million in the third quarter of 2025. The increase was primarily driven by a $11.2 million increase in revenue from test and measurement, a $19.4 million increase in revenue from direct and indirect electronics production supplies, and a $6.5 million increase in revenue from rentals, chambers and refurbished, partially offset by a $1.3 million decrease in revenue from fabrication and value added services.
Previous wording
Gross profit increased $8.4 million to $50.9 million in the second quarter of 2026 compared to gross profit of $42.6 million in the prior year quarter. The increase was primarily driven by the increase in revenue. TestEquity gross profit as a percentage of revenue increased to 22.2% in thesecond quarter of 2026 compared to 21.8% in the prior year quarter primarily due to higher supplier rebates.
Current wording
Gross profit increased $9.2 million to $52.8 million in the third quarter of 2026 compared to gross profit of $43.6 million in the prior year quarter. The increase was primarily driven by the increase in revenue. TestEquity gross profit as a percentage of revenue increased to 21.8% in thethird quarter of 2026 compared to 21.1% in the prior year quarter primarily due to higher supplier rebates and lower inventory write-offs.
Previous wording
Selling, general and administrative expenses increased $2.4 million to$40.2 million inthe second quarter of 2026 compared to $37.8 million in the prior year quarter. The increase was primarily driven by an increase in stock-based compensation of $0.3 million, higher salaries, commissions and bonuses as part of strategic leadership investments in 2026 and higher incentive compensation driven by the increase in revenue. These were partially offset by a higher gain on the sale of rental assets of $0.5 million and lower bad debt expense of $1.0 million.
Current wording
Selling, general and administrative expenses increased $3.5 million to$44.4 million inthe third quarter of 2026 compared to $41.0 million in the prior year quarter. The increase was primarily driven by higher salaries, commissions and bonuses as part of strategic leadership investments in 2026 and higher incentive compensation driven by the increase in revenue.
Previous wording
During the three months ended June 30, 2026, TestEquity generated Adjusted EBITDA of $20.0 million or 8.7% of sales. This is an increase of $6.5 million from the same period a year ago, which was primarily driven by the increase in revenue and gross profit margin while leveraging Selling, general, and administrative expenses over a higher sales base.
Current wording
During the three months ended September 30, 2026, TestEquity generated Adjusted EBITDA of $17.5 million or 7.2% of sales. This is an increase of $5.2 million from the same period a year ago, which was primarily driven by the increase in revenue and gross profit margin while leveraging Selling, general, and administrative expenses over a higher sales base.
Previous wording
Revenue increased $12.3 million, or 9.7%, to$140.1 millionin thesecond quarter of 2026 compared to $127.8 million in the second quarter of 2025. The increase in revenue was primarily driven by increases in the industrial power, technology, transportation, and consumer industrial vertical markets of $8.0 million, $3.2 million, $1.6 million and $1.5 million, respectively, partially offset by a decline of $2.2 million in the aerospace and defense vertical market.
Current wording
Revenue increased $9.3 million, or 7.1%, to$139.8 millionin thethird quarter of 2026 compared to $130.5 million in the third quarter of 2025. The increase in revenue was primarily driven by increases in the industrial power, technology, and consumer industrial vertical markets of $6.6 million, $4.6 million and $2.5 million, respectively, partially offset by a decline of $3.7 million in the renewables market and $1.0 million in the aerospace and defense vertical market.
Previous wording
Gross profit increased $3.6 million to $43.5 millionin thesecond quarter of 2026 compared to gross profit of$40.0 million in the prior year quarter, primarily due to the increase in revenue. Gexpro Services gross profit as a percentage of revenue decreased to 31.1% in thesecond quarter of 2026 compared to 31.3% in the prior year quarter primarily as a result ofadditional tariff charges passed through to customers of approximately $1.7 million which negatively impacted the gross margin percentage.
Current wording
Gross profit increased $2.4 million to $43.3 millionin thethird quarter of 2026 compared to gross profit of$40.9 million in the prior year quarter, primarily due to the increase in revenue. Gexpro Services gross profit as a percentage of revenue decreased to 30.9% in thethird quarter of 2026 compared to 31.3% in the prior year quarter primarily as a result of an unfavorable sales mix shift toward lower margin vertical markets and additional tariff charges passed through to customers of approximately $0.5 million which negatively impacted the gross margin percentage.
Previous wording
Selling, general, and administrative expenses increased $2.9 million to $29.0 million inthe second quarter of 2026 compared to $26.1 million in the prior year quarter primarily driven by higher medical claim costs and stock-based compensation of$0.4 million.
Current wording
Selling, general, and administrative expenses increased $2.6 million to $29.7 million inthe third quarter of 2026 compared to $27.0 million in the prior year quarter primarily driven by higher medical claim costs of $0.5 million, higher acquisition expenses of$1.1 million andhigher stock-based compensation of$0.3 million.
Previous wording
During the three months ended June 30, 2026, Gexpro Services generated Adjusted EBITDA of $18.3 million or 13.1% of sales, an increase of$1.2 million from the same period a year ago primarily driven by the increase in revenue.
Current wording
During the three months ended September 30, 2026, Gexpro Services generated Adjusted EBITDA of $18.1 million or 12.9% of sales, an increase of$0.3 million from the same period a year ago primarily driven by the increase in revenue.
Previous wording
Gross profit increased $2.1 million to $21.0 million in the second quarter of 2026 compared to gross profit of $19.0 million in the prior year quarter primarily from the inclusion of additional gross profit of$1.3 million from the acquisition of Eastern Valve. Gross profit as a percentage of revenue decreased to 33.0% in thesecond quarter of 2026 compared to 33.9% in the prior year quarter primarily due to a sales mix shift toward lower margin customers.
Current wording
Gross profit increased $0.9 million to $20.4 million in the third quarter of 2026 compared to gross profit of $19.5 million in the prior year quarter primarily from the inclusion of additional gross profit of$1.1 million from the acquisition of Eastern Valve. Gross profit as a percentage of revenue increased to 32.9% in thethird quarter of 2026 compared to 32.5% in the prior year quarter primarily due to a sales mix shift toward higher margin customers.
Previous wording
Selling, general and administrative expenses were flat at $17.2 million inthe second quarter of 2026 compared to $17.2 million in the prior year quarter. There were approximately$0.5 millionof additional expenses driven by the 2026 acquisition of Eastern Valve which were offset by lower facility costs of $0.4 million.
Current wording
Selling, general and administrative expenses increased$0.6 million to$16.6 million inthe third quarter of 2026 compared to $16.0 million in the prior year quarter. There were approximately$0.6 millionof additional expenses driven by the 2026 acquisition of Eastern Valve.
Previous wording
During the three months ended June 30, 2026, Canada Branch Division generated Adjusted EBITDA of$5.7 million, or 9.0%of sales. This isan increase of $2.1 million from the same period a year ago, primarily driven byapproximately $0.9 million of adjusted EBITDA generated by the 2026 acquisition of Eastern Valve.
Current wording
During the three months ended September 30, 2026, Canada Branch Division generated Adjusted EBITDA of$6.0 million, or 9.7%of sales. This isan increase of $0.3 million from the same period a year ago, primarily driven byapproximately $0.6 million of adjusted EBITDA generated by the 2026 acquisition of Eastern Valve.
Previous wording
Interest expense decreased $1.2 million in the second quarter of 2026 compared tothe prior year quarter primarily due to lower average interest rates in 2026.
Current wording
Interest expense decreased $0.5 million in the third quarter of 2026 compared tothe prior year quarter primarily due to lower average interest rates in 2026 partially offset by higher average debt balances.
Previous wording
Other income (expense), net consists of effects of changes in foreign currency exchange rates, interest income, net and other non-operating income and expenditures. The $0.2 million change in the second quarter of 2026 compared to the same period of 2025 is primarily due to an increase in the gain on the sale of property, plant and equipment.
Current wording
Other income (expense), net consists of effects of changes in foreign currency exchange rates, interest income, net and other non-operating income and expenditures. The $0.8 million change in the third quarter of 2026 compared to the same period of 2025 is primarily due to a decrease in interest income and favorable changes in foreign currency exchange rates.
Previous wording
Income tax expense was $5.9 million, a 41.0% effective tax rate for the three months ended June 30, 2026 compared to an income tax expense of $6.9 million and a 57.8% effective tax rate for the three months ended June 30, 2025. The change in the year-over-year effective tax rate was primarily due to a change in valuation allowances related to interest expense limitation on deferred tax assets, state taxes and foreign income. The change in the valuation allowances includes updated U.S. deferred tax projections, particularly related to future taxable income generated by the Company’s deferred tax liabilities. The income tax expense recorded in the second quarter of 2026 is based on the estimated year-end effective tax rate.
Current wording
Income tax expense was $2.4 million, a 21.0% effective tax rate for the three months ended September 30, 2026 compared to income tax expense of $1.9 million and a 23.0% effective tax rate for the three months ended September 30, 2025. The change in the year-over-year effective tax rate was primarily due to a decrease in the Company’s valuation allowance in the quarter, offset by state taxes and foreign income. The change in the valuation allowance includes updated U.S. deferred tax projections, particularly related to future taxable income generated by the Company’s deferred tax liabilities. The income tax expense recorded in the third quarter of 2026 is based on the estimated year-end effective tax rate.
Previous wording
Our consolidated revenue increased $73.3 million inthe firstsix months of 2026 compared to the firstsix months of 2025 primarily driven by an increase in organic revenue of 7.0% and $4.9 million of additional revenue generated by the 2026 acquisition of Eastern Valve. Consolidated Gross profit and Selling, general and administrative expenses also increased over the prior year primarily to support the increase in revenue.
Current wording
Our consolidated revenue increased $128.9 million inthe first nine months of 2026 compared to the first nine months of 2025 primarily driven by an increase in organic revenue of 7.8% and $12.6 million of additional revenue generated by the 2026 acquisitions of Eastern Valve and American Fasteners. Consolidated Gross profit and Selling, general and administrative expenses also increased over the prior year primarily to support the increase in revenue.
Previous wording
Revenue increased $4.5 million, or 1.8%, to$249.2 million in the firstsix months of 2026 compared to revenue of$244.8 million in the same period of 2025. The increase was primarily driven by increased sales to Lawson’s strategic and government customers, partially offset by a decline in sales to Lawson’s core customers.
Current wording
Revenue increased $13.2 million, or 3.6%, to$379.5 million in the first nine months of 2026 compared to revenue of$366.3 million in the same period of 2025. The increase was primarily driven by $3.8 million of additional revenue generated by the 2026 acquisition of American Fasteners and increased sales to Lawson’s strategic and government customers of $11.4 million, partially offset by a decline in sales to Lawson’s core customers of $1.9 million.
Previous wording
Gross profit decreased $7.4 million to $129.4 million in the first six months of 2026 compared to gross profit of $136.8 million in the same period of 2025 primarily as a result of a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases. Lawson gross profit as a percentage of revenue was 51.9% in the first six months of 2026 compared to 55.9% in the prior year period. The gross profit margin percentage decrease was primarily due to a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases.
Current wording
Gross profit decreased $6.5 million to $196.7 million in the first nine months of 2026 compared to gross profit of $203.1 million in the same period of 2025 primarily as a result of a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases. Lawson gross profit as a percentage of revenue was 51.8% in the first nine months of 2026 compared to 55.5% in the prior year period. The gross profit margin percentage decrease was primarily due to a sales mix shift toward lower margin customers, increased vendor costs and higher tariff rates on inbound freight partially offset by customer price increases.
Previous wording
During thesix months ended June 30, 2026, Lawson generated Adjusted EBITDA of $23.5 million, a decrease of $6.5 million, or 21.8% from the same period a year ago primarily driven by the lower gross profit margin percentage partially offset by increased revenue.
Current wording
During thenine months ended September 30, 2026, Lawson generated Adjusted EBITDA of $40.7 million, a decrease of $3.3 million, or 7.4% from the same period a year ago primarily driven by the lower gross profit margin percentage partially offset by increased revenue.
Previous wording
Revenue increased $49.4 million, or 12.9%, to$433.2 million in the firstsix months of 2026 compared to $383.8 million in the same period in 2025. The increase was primarily driven bya $24.7 million increase in revenue from test and measurement, a $25.0 million increase in revenue from electronic production supplies and a $4.4 million increase in revenue from rental and refurbished, partially offset by a $4.7 million decrease in revenue from value added services.
Current wording
Revenue increased $85.2 million, or 14.4%, to$675.5 million in the first nine months of 2026 compared to $590.3 million in the same period in 2025. The increase was primarily driven bya $38.4 million increase in revenue from test and measurement and chambers, a $45.0 million increase in revenue from electronic production supplies and a $8.3 million increase in revenue from rental and refurbished, partially offset by a $6.6 million decrease in revenue from value added services.
Previous wording
Gross profit increased $12.2 million to$96.5 million in the firstsix months of 2026 compared to$84.3 million in the same period of 2025. The increase was primarily driven by the increase in revenue. TestEquity gross profit as a percentage of revenue increased to 22.3% in the firstsix months of 2026 compared to 22.0% in the prior year primarily due tohigher supplier rebates.
Current wording
Gross profit increased $21.4 million to$149.3 million in the first nine months of 2026 compared to$127.9 million in the same period of 2025. The increase was primarily driven by the increase in revenue. TestEquity gross profit as a percentage of revenue increased to 22.1% in the first nine months of 2026 compared to 21.7% in the prior year primarily due tohigher supplier rebates of approximately $4.6 million, partially offset byan unfavorable sales mix shift toward lower margin end markets.
Previous wording
Selling, general and administrative expenses increased $6.3 million to$81.7 million in the first six months of 2026 compared to$75.4 million in the same period of 2025. The increase was primarily drivenby anincrease in stock-based compensation of $0.9 million, an increase inmerger and acquisition expenses of$0.4 million, and higher salaries, commissions and bonuses as part of strategic leadership investments in 2026. These were partially offset by a higher gain on the sale of rental assets and lower bad debt expense.
Current wording
Selling, general and administrative expenses increased $9.8 million to$126.1 million in the first nine months of 2026 compared to$116.4 million in the same period of 2025. The increase was primarily drivenby higher salaries, commissions and bonuses as part of strategic leadership investments in 2026. These were partially offset by a higher gain on the sale of rental assets of $1.0 million and $1.5 million of lower bad debt expense.
Previous wording
During thesix months ended June 30, 2026, TestEquity generated Adjusted EBITDA of$33.2 million, an increase of$6.9 million, or 26.4%, from the same period a year agowhich was primarily driven by the increase in revenue and gross profit margin while leveraging Selling, general, and administrative expenses over a higher sales base.
Current wording
During thenine months ended September 30, 2026, TestEquity generated Adjusted EBITDA of$50.8 million, an increase of$12.1 million, or 31.4%, from the same period a year agowhich was primarily driven by the increase in revenue and gross profit margin while leveraging Selling, general, and administrative expenses over a higher sales base.
Previous wording
Revenue increased $11.1 million, or 4.5%, to$257.8 million in the firstsix months of 2026 compared to$246.7 million in the same period of 2025. The increase in revenue was primarily driven by increased sales in the industrial power, technology, and consumer and industrial vertical markets of $11.6 million, $4.0 million, and $3.0 million, respectively, partially offset by decreased sales within the renewables and aerospace and defense vertical markets of $4.2 million and $3.6 million, respectively.
Current wording
Revenue increased $20.4 million, or 5.4%, to$397.6 million in the first nine months of 2026 compared to$377.2 million in the same period of 2025. The increase in revenue was primarily driven by increased sales in the industrial power, technology, and consumer and industrial vertical markets of $18.2 million, $8.6 million, and $5.5 million, respectively, partially offset by decreased sales within the renewables and aerospace and defense vertical markets of $7.8 million and $4.6 million, respectively.
Previous wording
Gross profit increased $2.2 million to$79.3 million in the firstsix months of 2026 compared to$77.1 million inthe same period of 2025 primarily due to the increase in revenue. Gexpro Services’ gross profit as a percentage of revenue decreased to 30.8% in the firstsix months of 2026 compared to 31.2% in the prior year period primarily as a result of additional tariff charges passed through to customers of approximately $4.6 million which negatively impacted the gross margin percentage.
Current wording
Gross profit increased $4.6 million to$122.6 million in the first nine months of 2026 compared to$118.0 million inthe same period of 2025 primarily due to the increase in revenue. Gexpro Services’ gross profit as a percentage of revenue decreased to 30.8% in the first nine months of 2026 compared to 31.3% in the prior year period primarilyas a result of additional tariff charges passed through to customers of approximately $5.2 million which negatively impacted the gross margin percentage.
Previous wording
Selling, general, and administrative expenses increased $4.4 million to$56.4 million in the firstsix months of 2026 compared to$51.9 million in the same period of 2025. The increase was primarily driven by investments to support sales growth, higher stock-based compensation expense of$0.8 million and higher severance expense of $0.4 million.
Current wording
Selling, general, and administrative expenses increased $7.1 million to$86.0 million in the first nine months of 2026 compared to$79.0 million in the same period of 2025. The increase was primarily driven by investments to support sales growth, higher stock-based compensation expense of$1.0 million and higher acquisition expenses of $1.3 million.
Previous wording
During thesix months ended June 30, 2026, Gexpro Services generated Adjusted EBITDA of$30.3 million, a decrease of $1.7 million, or 5.4% from the same period a year agoprimarily driven by a lower gross margin percentage and an increase in selling, general, and administrative expenses.
Current wording
During thenine months ended September 30, 2026, Gexpro Services generated Adjusted EBITDA of$48.4 million, a decrease of $1.4 million, or 2.8% from the same period a year agoprimarily driven by a lower gross margin percentage and an increase in selling, general, and administrative expenses.
Previous wording
Revenue increased $8.3 million, or 7.8%, to$114.7 millionin the firstsix months of 2026 compared to $106.4 million in the same period of 2025 driven by$4.9 million of additional revenue generated by the 2026 acquisition of Eastern Valveand an increase in organic revenue of $3.4 million. Favorable foreign currency exchange rate changes positively impacted sales by $2.7 million.
Current wording
Revenue increased $10.4 million, or 6.3%, to$176.8 millionin the first nine months of 2026 compared to $166.4 million in the same period of 2025 driven by$8.9 million of additional revenue generated by the 2026 acquisition of Eastern Valveand a favorable impact of $1.8 million from changes in foreign currency exchange rate changes.
Previous wording
Gross profit increased $2.4 million to $38.3 million in thefirstsix months of 2026 compared to gross profit of $35.9 million in the same period of 2025 primarily from the inclusion of additional gross profitof$1.6 million generated by the 2026 acquisitionof Eastern Valve. Gross profit as a percentage of revenue decreased to 33.3% in the firstsix months of 2026 compared to 33.7% in the prior year primarily due to a sales mix shift toward lower margin customers.
Current wording
Gross profit increased $3.3 million to $58.7 million in thefirst nine months of 2026 compared to gross profit of $55.4 million in the same period of 2025 primarily from the inclusion of additional gross profitof$2.7 million generated by the 2026 acquisitionof Eastern Valve. Gross profit as a percentage of revenue was flat at 33.2% in the first nine months of 2026 compared to 33.3%.
Previous wording
Selling, general and administrative expenses increased $0.6 million to$34.0 million inthe first six months of 2026 compared to $33.5 million in the prior year quarter. The increase was primarily due to approximately$0.7 millionof additional expenses driven by the 2026 acquisition of Eastern Valve.
Current wording
Selling, general and administrative expenses increased $1.1 million to$50.6 million inthe first nine months of 2026 compared to $49.5 million in the prior year quarter. The increase was primarily due to approximately$1.3 millionof additional expenses driven by the 2026 acquisition of Eastern Valve.
Previous wording
During the firstsix months of 2026, Canada Branch Division generated Adjusted EBITDA of$8.5 million, an increase of $2.3 million from the same period a year ago with an increase of approximately $1.1 million driven by the acquisition of Eastern Valve.
Current wording
During the first nine months of 2026, Canada Branch Division generated Adjusted EBITDA of$14.6 million, an increase of $2.5 million from the same period a year ago, with an increase of approximately $1.6 million driven by the acquisition of Eastern Valve.
Previous wording
Interest expense decreased $3.3 million in the first six months of 2026 compared to the same period of 2025 primarily due to lower average interest rates in 2026.
Current wording
Interest expense decreased $3.8 million in the first nine months of 2026 compared to the same period of 2025 primarily due to lower average interest rates in 2026 partially offset by higher average debt balances.
Previous wording
The$1.0 million in expense in the first six months of 2025 related to the change in fair value of the earnout liabilities associated with the Frontier acquisition.
Current wording
The$1.0 million in expense in the first nine months of 2025 related to the change in fair value of the earnout liabilities associated with the Frontier acquisition.
Showing the first 40 of 58 pairs. Open the source sections for the rest.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Note 16 – Subsequent Events in Part I, Item 1, Financial Statements and our Current Report on Form 8-K filed with the SEC on July 16, 2026.