PVF, plumbing, HVAC, infrastructure and industrial supplies distributor Ferguson reported its fiscal 3Q25 (February-April) financial results on June 3, which showed a solid acceleration in U.S. sales, while Canadian sales declined month-over-month.

The company posted 3Q sales of $7.6 billion, up 4.3% year-over-year driven by a 5,0% gain in organic revenue and acquisition growth of 1.0%, offset by 1.7% adverse impact of foreign exchange rates.

The 3Q sales growth was a notable improvement from both 2Q25’s 3.0% increase and 1Q25’s 0.8% growth.

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Gross margin of 31.0% increased 50 basis-points year-over-year.

Ferguson’s year-over-year revenue growth topped expectations of an increase of 3.0% from Baird’s Industrial Distribution team, as did organic growth (+1.7%) and pricing (-1.5%), while margin growth well exceeded Baird’s expectation of a 70 bps contraction.

The company’s reported operating profit was $606 million (8.0% operating margin), 3.0% lower than last year. Adjusted operating profit of $715 million (9.4% adjusted operating margin) was 6.1% above the year prior.

“Our associates continued to take care of our customers, outperform the market and drive solid growth in the third quarter,” Ferguson CEO Kevin Murphy said in the financial release. “The combination of strong volume growth, gross margin actions, moderating deflation and the early benefits of streamlining our business drove adjusted operating profit growth and adjusted operating margin expansion.”

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U.S./Canada

In the U.S. — where Ferguson did 95.4% of business — 3Q sales were up 4.5%. Organic revenue was up 5.0% year-over-year, alongside a 1.0% contribution from acquisitions.

Residential end markets, which account for just over half of the U.S. revenue, remained subdued compared to non-residential end markets, with increased activity in large capital projects. The company also gained market share, with non-residential revenue growing by approximately 7% in the third quarter.

Adjusted profit in the U.S. of $726 million increased 6.0% year-over-year.

Meanwhile, 3Q25 Canada sales of $333 million decreased 0.3% year-over-year, with contributions of 3.0% in organic revenue growth and 2.8% in acquisitions offset by an adverse impact of 4.4% from foreign exchange rates and a 1.7% impact from one fewer sales day.

Acquisitions

During the quarter, Ferguson expanded its U.S. footprint with two acquisitions: Independent Pipe & Supply Corp., a commercial/mechanical distributor in the Northeast, and Light Innovations Inc., a residential showroom in Little Rock, AR, supporting the Ferguson Home strategy.

In Canada, Ferguson also acquired National Fire — comprising National Fire Equipment Ltd. and National Fire Fabrication Ltd. — a provider of fire protection products and fabrication services operating across seven locations nationwide.

Full-year Guidance

Ferguson updated its fiscal 2025 guidance in its third quarter financial release. The company now expects low to mid-single digit growth in net sales and a full-year adjusted operating margin range up from 8.3-8.8% to 8.5-9.0%.

Murphy added: “We remain confident in our markets over the medium term and continue to balance investment in key strategic opportunities, leveraging multiyear tailwinds in both residential and non-residential markets as we support the complex project needs of our specialized professional customers.”

Ferguson was No. 1 on MDM’s 2024 Top Distributors List for Plumbing, No. 2 for HVACR, No 2. For Industrial PVF, No. 3 for Industrial Supplies, No. 3 for Building Materials/Construction.