Global Industrial (NYSE:GIC) reported third-quarter revenue growth and higher profitability as the company continued to shift toward a customer-centric, relationship-led business-to-business sales model. Management said growth was supported by large strategic accounts, industrial and retail customers, digital purchasing capabilities and operating-cost leverage.
Revenue increased 10.2% to $389.5 million during the quarter, while average daily sales rose 8.5%. Chief Executive Officer Anesa Chaibi said the company has now produced four consecutive quarters of high-single-digit average daily sales growth.
Operating income from continuing operations rose 24.3% to $32.7 million. Excluding a $2 million benefit related to tariff refunds, operating income increased 16.7%, and operating margin improved by 50 basis points, according to Senior Vice President and Chief Financial Officer Tex Clark.
Growth Led by Strategic Accounts and Customer Verticals
Chaibi said Global Industrial’s sales strategy has increasingly focused on developing vertical expertise and improving coordination among its sales, marketing and merchandising functions. The company is seeking to become a more integrated supplier for customers that operate multiple facilities and purchase a broad range of industrial and maintenance, repair and operations products.
“Growth continues to be led by our industrial and retail customer verticals, with strong double-digit performance among our largest strategic accounts,” Chaibi said.
Management said vertical specialization has helped the company identify larger opportunities, expand participation in customer projects and increase share of wallet. Chaibi also pointed to growth in digital and e-procurement channels, which delivered double-digit revenue growth during the quarter.
In response to an analyst question, Chaibi said e-procurement integration has made it easier for customers to connect their purchasing portals with Global Industrial, reducing steps required to place orders and helping the company capture more customer spending. She said the company’s more specialized sales approach has also improved its understanding of needs across industrial, commercial, retail, public-sector and healthcare customers.
Global Industrial also held a national trade show in Dallas that drew more than 1,200 attendees, including more than 500 customer representatives and 460 supplier partner representatives. Chaibi said the event enabled the company to present its product and solution offerings while obtaining direct customer feedback on purchasing, efficiency and operational needs.
Canada Outpaces U.S. Revenue Growth
U.S. revenue rose 9.3% in the third quarter, while Canadian revenue increased 28.3% in local currency. Clark said revenue growth was driven primarily by volume and mix gains, with pricing contributing about 2 percentage points to overall growth.
Demand remained relatively consistent through the quarter, although year-over-year growth moderated to 7% in September. Clark said growth in the early part of the fourth quarter had returned to a level in line with third-quarter average daily sales growth.
The company cautioned that the fourth quarter will have fewer selling days than the comparable period a year earlier. Global Industrial expects 61 selling days in the fourth quarter of 2026, compared with 66 days in the fourth quarter of 2025.
Clark said the difference represents an approximately 8% headwind to reported GAAP revenue growth. As a result, management said average daily sales will be a more useful indicator of underlying performance during the fourth quarter.
Margin Benefits Offset by Freight and Transportation Pressures
Third-quarter gross profit totaled $138.9 million, and gross margin was 35.7%. The reported margin included a 60-basis-point benefit from recognition of previously received tariff refunds. Excluding that benefit, Clark said gross margin was 35.1%, representing sequential improvement from the second quarter.
Management expects any remaining benefit from IEEPA tariff refunds recognized in future quarters to be immaterial.
Clark cited several fourth-quarter margin headwinds, including seasonal parcel surcharges, higher ocean freight costs and elevated diesel prices. Parcel carriers’ peak-season surcharges began in the final week of the third quarter and are expected to continue through mid-January. Ocean freight costs have risen amid shipping disruptions, fuel costs and weather-related impacts, while Canadian tariffs on U.S.-sourced products are adding pressure in Canada.
Given those factors, management expects fourth-quarter gross margin to be roughly in line with the 34.5% margin reported in the fourth quarter of 2025.
Chaibi said pricing discipline has become embedded in the company’s approach to managing costs and other external pressures. Clark added that higher revenue allowed the company to leverage its fixed cost base during the quarter.
Selling, general and administrative expense was $106.2 million, improving by 90 basis points as a percentage of sales. Clark said the improvement primarily reflected fixed-cost leverage from the company’s revenue growth, while noting that SG&A ratios typically rise in the lower-volume first and fourth quarters.
Cash Generation, Dividends and Balance Sheet
Global Industrial generated $44.5 million in operating cash flow from continuing operations during the quarter. Depreciation and amortization totaled $2 million, while capital expenditures were $1 million. The company continues to expect full-year capital expenditures of $3 million to $4 million, primarily for maintenance investments within its distribution network.
The company ended September with approximately $119.2 million in cash, no debt and more than $119.8 million in excess availability under its credit facility. It expects its tax rate for the remainder of 2026 to be between 26% and 26.5%.
Global Industrial announced a quarterly dividend of $0.28 per share and a special cash dividend of $1 per share of common stock. Chaibi said the payments reflect the company’s intention to return capital to shareholders while maintaining financial flexibility for growth opportunities.
Looking ahead, Chaibi said the company sees opportunities to supplement organic growth with strategic acquisitions that could expand its capabilities and market reach. She also said management remains mindful of macroeconomic volatility and cost pressures while focusing on execution, customer relationships and profitable growth.
About Global Industrial (NYSE:GIC)
Global Industrial Company (NYSE:GIC) is a distributor of industrial, commercial and business products serving organizations across North America. The company sells products through its e-commerce platforms, catalogs and sales representatives, serving businesses, government agencies, educational institutions and other commercial customers.
Its product offerings include material-handling and storage equipment, shelving, cabinets, workbenches, safety supplies, janitorial and sanitation products, packaging materials, tools, lighting, HVAC equipment, office furniture and other facility-maintenance products.
