W W Grainger (GWW) 47th Annual Raymond James Institutional Investor Conference summary

Business overview and strategy

• Operates two go-to-market models: High-Touch for large, complex customers and Endless Assortment for small and mid-sized businesses, each tailored to different customer needs.

• High-Touch accounts for 80% of revenue, leveraging deep product knowledge, value-added solutions, and strong customer relationships.

• Endless Assortment, with Zoro.com and Monotaro.com, targets simpler, online-focused needs and represents 20% of revenue.

• Both models compete in large, fragmented markets with significant growth potential and are supported by a robust supply chain and technology investments.

• Purpose-driven culture, codified as the Grainger Edge, underpins operations and has earned industry recognition.

Technology and innovation

• Significant investments in proprietary data, AI, and machine learning drive marketing, merchandising, and customer solutions.

• AI and ML models are used to expand product offerings, improve marketing ROI, and streamline seller tasks.

• Gen AI is being deployed for pricing, customer service, and shopping assistance.

• AI is expected to increase price transparency, but supply chain execution remains a key differentiator.

• Ongoing efforts to ensure data exposed to AI agents drives customers to their platforms.

Financial performance and outlook

• High-Touch segment has outgrown the broader MRO market by over 500 basis points in the last decade.

• Endless Assortment has more than doubled revenue in five years, nearing $4 billion annually.

• 2026 guidance: revenue of $18.7–$19.1 billion, organic sales growth of 6.5–9%, and EPS of $42.25–$44.75, up 10% at midpoint.

• Operating margin expected to expand by 40–90 basis points, aided by exiting the UK market and margin recovery.

• Long-term targets include stabilizing gross margins around 39% and growing SG&A slower than sales.