Fastenal Amplifies Jitters About Industrial Demand
The manufacturing bellwether cites a challenging second quarter and warns again of softening markets.
Sales of fasteners — a core product — were flat in the second quarter, the first time that category hasn’t experienced growth on a quarterly basis since the final months of 2020.
Photographer: Luke Sharrett/Bloomberg
Industrial demand isn’t cratering, but it isn’t booming anymore, either, and it’s becoming harder to ignore the jitters.
Fastenal Co., a distributor of factory floor odds and ends whose results are typically a good indicator for the broader manufacturing sector, unofficially kicked off the second-quarter earnings season on Thursday. The period was “challenging,” Fastenal said, with daily sales growth in June decelerating to the slowest pace in two years amid softer manufacturing demand. Sales of fasteners — a core product — were flat in the second quarter compared with those in the period a year earlier. It’s the first time that category hasn’t experienced growth on a quarterly basis since the final months of 2020. Fastenal isn’t signing as many contracts as it had hoped for inventory management services embedded on-site at customers’ facilities, and the company cut its full-year goal for new deals. Demand for these offerings can be lumpy, and Fastenal said leadership changes may have created some distraction in the recent quarter, but a pullback can correlate with companies becoming more circumspect with their spending.