Applied Industrial Technologies reported net sales of $1.163 billion for the quarter ended December 31, 2025, an 8.4% increase over the prior year. Net income rose to $95.3 million, up from $93.3 million in the year-ago period, translating to diluted earnings per share of $2.51 versus $2.39 a year ago. Organic sales grew 2.2%, driven by a 2.9% increase in the Service Center segment and a 0.5% uptick in Engineered Solutions, while acquisitions contributed an additional 6.0% to the top‐line expansion. EBITDA for the quarter reached $140.4 million, reflecting disciplined cost management and solid underlying demand across end markets.

Gross profit totaled $353.3 million, yielding a gross margin of 30.4%, in line with management expectations. Selling, distribution and administrative expenses amounted to $230.1 million, resulting in an operating income of $123.2 million. The quarter included a LIFO expense of $6.9 million, or $0.14 per share, compared to $0.7 million in the prior year. Excluding this inventory accounting charge, underlying EBITDA margin expanded by approximately 20 basis points, underscoring operational leverage and effective pricing execution despite muted December sales activity.

For fiscal 2026, Applied updated its EPS guidance to a range of $10.45–$10.75, up from $10.10–$10.85, and now anticipates sales growth of 5.5%–7.0%, including 2.5%–4.0% organic. EBITDA margin is forecast at 12.2%–12.4%, with annual LIFO expense expected between $24 million and $26 million. The company announced an 11% increase in its quarterly dividend to $0.51 per share and continues share repurchase activity. Additionally, Applied closed its bolt-on acquisition of Thompson Industrial Supply, adding approximately $20 million in annual sales and strengthening its Southern California Service Center footprint with over 40 new associates.