Metalworking and MRO supplies distributor MSC Industrial Supply reported its 2025 third quarter financial results on July 1, showing a continued year-over-year decline in sales for the March-May period, but a sequential improvement, while net profit fell considerably despite a slightly higher gross margin performance.

For the three months ended June 1, MSC posted total sales of $971.1 million that were down 0.8% year-over-year. Sequentially, that was up from 2Q25’s reported $891.7 million in sales and 4.7% decrease.

The company’s 3Q gross margin of 41.0% was up 10 basis-points year-over-year, and flat sequentially — attributed to favorable price and cost.

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MSC’s 3Q operating profit of $82.7 million was down 22.5% year-over-year, with operating margin of 8.5% likewise down 240 bps. Net profit of $56.8 million was down 20.7% year-over-year. On an adjusted basis, operating profit of $87.2 million was down 21.8% year-over-year.

“We delivered fiscal third quarter results that were in line with our expectations for both average daily sales and operating margins,” MSC CEO Erik Gershwind said in the financial release. “While we certainly have plenty of room for improvement, we saw early signs of progress in each of our three critical strategic areas of focus — reenergizing the core customer, maintaining momentum in high-touch solutions, and optimizing our cost to serve.”

Sales Breakdown

The 3Q25 report showed that average daily sales (ADS) growth declined in two of the three months tracked during the quarter. They increased 2.1% year-over-year in March, but decline 3.1% in April and 2.3% in May, despite positive acquisitions impacts of 0.6%, 0.6% and 0.5%, respectively. The March ADS figure was MSC’s best monthly mark since August 2023 (+8.9%).

For June, MSC’s preliminary ADS estimate showed a flat 0.0%.

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For the third quarter of 2025, MSC’s national account customers — accounting for 37% of sales — reported a 1.7% drop in ADS. Similarly, core and other customers — 54% of sales — saw a 0.8% decline. Meanwhile, public sector customers — 9% of sales — experienced an increase of 2.4% year-over-year.

The report also showed a flat year-over-year increase in ADS within MSC’s manufacturing end-market, while its non-manufacturing sector posted a 2.4% decline.

eCommerce and Headcount

In 3Q25, 63.7% ($618.9 million) of MSC’s total sales came via eCommerce (including website, EDIT, VMI, vending and more), up sequentially from $567.5 million in 2Q25, but down slightly from 3Q24’s $619.5 million.

MSC ended its fiscal 3Q25 with a total headcount of 7,494, up from a total of 2,664 in 3Q24, and likewise up from 2Q25’s 7,261. Recent headcount increases include 30 associates from the company’s fiscal 2024 acquisitions and 14 associates from its fiscal 2023 acquisitions.

Full-Year Outlook

MSC released its updated financial outlook for the fourth quarter (June-August), forecasting ADS to fare between down 0.5% to up 1.5% year-over-year, along with an adjusted operating margin of 8.5% to 9.0%.

Gershwind added: “The fiscal third quarter included encouraging data points, such as core customer sequential improvement, continued momentum in our high-touch solutions and a building productivity pipeline. Looking longer term, we remain steadfast in our commitment to restoring performance consistent with our long-term objectives of growing to 400 basis points or more above the IP Index and expanding operating margins to the mid-teens.”

MSC is ranked No. 6 on MDM’s 2025 Top Distributors List for MRO Industrial, No. 5 for Fasteners and No. 10 for Safety.