MRO, OEM and industrial technology products provider Distribution Solutions Group reported its 2025 second quarter financial results on July 31, highlighted by a considerable increase in year-over-year sales and sequential margin improvements.

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Fort Worth, TX-based DSG posted total 2Q sales of $502 million, up 14.3% year-over-year — largely driven by five acquisitions in 2024 alongside organic growth of 3.3% year-over-year (+2.4% sequentially).

DSG’s 2Q gross margin of 33.9% was down 60 basis points from a year earlier and down 40 bps from 1Q. Adjusted EBITDA margin of 9.7% likewise fell 60 bps year-over-year but improved by 70 bps sequentially.

The company’s 2Q operating profit of $27 million nearly doubled the $14 million of a year earlier, while net profit of $5 million more than doubled the $1.9 million of a year earlier and topped 1Q’s $3.3 million.

MDM’s 2Q25 MarketPulse Report (store link) 

“DSG’s core strengths include strong vendor relationships and robust source capabilities, which have become increasingly important amid ongoing trade policy changes,” DSG CEO and Chairman Bryan King said in the company’s financial report. “These shifts have driven greater customer engagement as DSG teams help guide customers through sourcing options and product alternatives to add value. We remain cautiously optimistic about the remainder of 2025 given this uncertainty.”

Here’s how DSG performed in 2Q across its three main business segments:

Lawson Products (MRO focus) – Sales of $124 million narrowly trailed the $124 million of a year earlier, while average daily sales grew 2.6% (+1.6% sequentially). Adjusted EBITDA margin of 12.6% was down 100 bps year-over-year — attributed to investments in sales transformation — but grew 70 bps from 1Q.

• DSG said Lawson sales force expansion continued in 2Q, as it ended the quarter with approximately 930 sales reps — up from 840 a year earlier and 910 in 1Q. That expansion continues in 2025’s second half.

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Gexpro Services (OEM focus) – sales of $107 million trailed the $128 million of a year earlier, while organic revenue jumped 18.2% on a same-day basis. Organic average daily sales grew 2.4% year-over-year. Adjusted EBITDA margin of 13.4% improved 150 bps year-over-year and 80 bps from 1Q.

TestEquity (Industrial technology focus) – sales of $198 million topped the $195 million of a year earlier and 1Q’s $189 million. Average daily sales dipped 1.2% year-over-year but improved 1.7% sequentially. Adjusted EBITDA margin of 6.9% fell 90 bps year-over-year but ticked up 10 bps sequentially.

At the end of June, DSG announced the appointment of former Global Industrial CEO Barry Litwin as CEO of TestEquity, effective July 14.