--- title: "Distribution Solutions | 10-Q: FY2026 Q1 Revenue Beats Estimate at USD 496 M" type: "News" locale: "en" url: "https://longbridge.com/en/news/284761435.md" datetime: "2026-04-30T11:45:45.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/284761435.md) - [en](https://longbridge.com/en/news/284761435.md) - [zh-HK](https://longbridge.com/zh-HK/news/284761435.md) --- # Distribution Solutions | 10-Q: FY2026 Q1 Revenue Beats Estimate at USD 496 M Revenue: As of FY2026 Q1, the actual value is USD 496 M, beating the estimate of USD 489.3 M. EPS: As of FY2026 Q1, the actual value is USD 0.01, missing the estimate of USD 0.16. EBIT: As of FY2026 Q1, the actual value is USD 25.8 M. ### Consolidated Financial Performance #### Operational Metrics - **Net Income (Loss)**: Net income for the three months ended March 31, 2026, was $382 thousand, a decrease from $3,261 thousand in the same period of 2025 . - **Operating Income (Loss)**: Consolidated operating income decreased to $13,630 thousand for the three months ended March 31, 2026, from $20,097 thousand in the three months ended March 31, 2025 . - **Adjusted EBITDA**: Consolidated Adjusted EBITDA was $37,833 thousand for the three months ended March 31, 2026, compared to $42,786 thousand for the same period in 2025 . #### Cash Flow - **Cash Flow from Operating Activities**: Net cash used in operating activities was - $20,359 thousand for the three months ended March 31, 2026, compared to - $4,762 thousand for the same period in 2025 . - **Cash Flow from Investing Activities**: Net cash used in investing activities was - $21,824 thousand for the three months ended March 31, 2026, compared to - $5,053 thousand for the same period in 2025 . - **Cash Flow from Financing Activities**: Net cash provided by financing activities was $32,046 thousand for the three months ended March 31, 2026, compared to $7,633 thousand for the same period in 2025 . #### Capital Expenditures - Total net capital expenditures for property, plant and equipment and rental equipment were $5,600 thousand for the three months ended March 31, 2026 . ### Segmented Financial Performance #### Lawson Segment - **Segment Revenue**: Increased by 2.7% to $123,736 thousand in Q1 2026 from $120,462 thousand in Q1 2025, driven by increased sales to strategic and government customers . - **Gross Profit**: Decreased by 4.8% to $64,987 thousand in Q1 2026 from $68,234 thousand in Q1 2025 . Gross profit margin was 52.5% in Q1 2026 compared to 56.6% in Q1 2025, due to sales mix shift towards lower margin customers, increased vendor costs, and higher tariff rates . - **Selling, General and Administrative Expenses**: Remained flat at $61,931 thousand in Q1 2026 compared to $61,918 thousand in Q1 2025 . - **Operating Income (Loss)**: Decreased by 51.6% to $3,056 thousand in Q1 2026 from $6,316 thousand in Q1 2025 . - **Adjusted EBITDA**: Decreased by 19.1% to $11,569 thousand in Q1 2026 from $14,307 thousand in Q1 2025 . - **Capital Expenditures**: Totaled $1,367 thousand in Q1 2026, down from $3,976 thousand in Q1 2025 . #### TestEquity Segment - **Segment Revenue**: Increased by 8.2% to $204,176 thousand in Q1 2026 from $188,773 thousand in Q1 2025, primarily due to a $19.0 million increase from test and measurement, rentals, chambers, refurbished, direct and indirect electronics production supplies . - **Gross Profit**: Increased by 9.2% to $45,594 thousand in Q1 2026 from $41,757 thousand in Q1 2025 . Gross profit margin increased to 22.3% in Q1 2026 from 22.1% in Q1 2025, primarily due to lower inventory write-offs . - **Selling, General and Administrative Expenses**: Increased by 10.4% to $41,547 thousand in Q1 2026 from $37,627 thousand in Q1 2025, mainly due to higher stock-based compensation, acquisition expenses, and strategic leadership investments . - **Operating Income (Loss)**: Decreased by 2.0% to $4,047 thousand in Q1 2026 from $4,130 thousand in Q1 2025 . - **Adjusted EBITDA**: Increased by 3.4% to $13,246 thousand in Q1 2026 from $12,811 thousand in Q1 2025 . - **Capital Expenditures**: Totaled $6,461 thousand in Q1 2026, up from $3,188 thousand in Q1 2025 . #### Gexpro Services Segment - **Segment Revenue**: Decreased by 1.1% to $117,648 thousand in Q1 2026 from $118,905 thousand in Q1 2025, mainly due to declines in renewables and aerospace and defense vertical markets . - **Gross Profit**: Decreased by 3.6% to $35,757 thousand in Q1 2026 from $37,106 thousand in Q1 2025 . Gross profit margin decreased to 30.4% in Q1 2026 from 31.2% in Q1 2025, primarily due to the pass-through of tariff charges . - **Selling, General and Administrative Expenses**: Increased by 5.8% to $27,356 thousand in Q1 2026 from $25,865 thousand in Q1 2025, mainly due to higher medical claim costs and stock-based compensation . - **Operating Income (Loss)**: Decreased by 25.3% to $8,401 thousand in Q1 2026 from $11,241 thousand in Q1 2025 . - **Adjusted EBITDA**: Decreased by 19.7% to $12,027 thousand in Q1 2026 from $14,975 thousand in Q1 2025 . - **Capital Expenditures**: Totaled $716 thousand in Q1 2026, down from $987 thousand in Q1 2025 . #### Canada Branch Division Segment - **Segment Revenue**: Increased by 0.9% to $51,022 thousand in Q1 2026 from $50,543 thousand in Q1 2025, driven by $0.8 million of additional revenue from the Eastern Valve acquisition . - **Gross Profit**: Increased by 1.9% to $17,210 thousand in Q1 2026 from $16,897 thousand in Q1 2025, primarily due to the Eastern Valve acquisition . Gross profit margin increased slightly to 33.7% in Q1 2026 from 33.4% in Q1 2025 . - **Selling, General and Administrative Expenses**: Increased by 3.6% to $16,824 thousand in Q1 2026 from $16,246 thousand in Q1 2025, mainly due to additional expenses from Eastern Valve and higher acquisition-related expenses . - **Operating Income (Loss)**: Decreased by 40.7% to $386 thousand in Q1 2026 from $651 thousand in Q1 2025 . - **Adjusted EBITDA**: Increased by 7.7% to $2,818 thousand in Q1 2026 from $2,616 thousand in Q1 2025, driven by the Eastern Valve acquisition . - **Capital Expenditures**: Totaled $368 thousand in Q1 2026, up from $356 thousand in Q1 2025 . ### Outlook and Strategy Distribution Solutions Group, Inc. plans to pursue organic growth by exploring opportunities that offer different channels to reach customers, increase revenue, and generate positive results . The company also aims to actively pursue acquisition opportunities that are complementary to its existing businesses and are expected to be financially accretive . For the full fiscal year 2026, Distribution Solutions Group, Inc. expects to spend approximately $25.0 million to $30.0 million for net capital expenditures to support ongoing operations . ### Related Stocks - [DSGR.US](https://longbridge.com/en/quote/DSGR.US.md) ## Related News & Research - [Distribution Solutions Q1 revenue rises 3.8%, beats estimates](https://longbridge.com/en/news/284761371.md) - [Yext to Announce First Quarter Fiscal Year 2027 Financial Results on June 2, 2026 | YEXT Stock News](https://longbridge.com/en/news/286970613.md) - [Hafnia’s Q1 2026 Financial Results Presentation to Be Held on 27 May 2026 | HAFN Stock News](https://longbridge.com/en/news/287014236.md) - [LOWE'S REPORTS FIRST QUARTER 2026 SALES AND EARNINGS RESULTS | LOW Stock News](https://longbridge.com/en/news/287043063.md) - [ONWARD Medical to Announce First Quarter 2026 Results on May 26, 2026 | ONWRY Stock News](https://longbridge.com/en/news/286858298.md)