Investing.com -- On Monday, Fastenal Company (NASDAQ: FAST) reported first quarter results that met analyst expectations.

But shares of the company fell 5.84% in pre-market trading after the announcement as investors focused on moderating growth trends and margin pressures.

The industrial supplies distributor posted adjusted earnings per share of $0.30, matching the consensus estimate, on revenue of $2.2 billion, also in line with expectations. Revenue increased 12.4% compared to the first quarter of 2025, driven by share gains and broad-based demand across core end markets. Daily sales rose 12.4% YoY to $34.9 million.

Operating margin expanded 20 basis points to 20.3%, reflecting operating leverage and cost discipline, though this was partially offset by an ongoing shift in customer mix. Gross margin declined to 44.6% from 45.1% in the prior year period, pressured by unfavorable price/cost dynamics of approximately 50 basis points and headwinds from transportation costs and customer rebates.

"Sales performance reflects the contribution from improved customer contract signings since the first quarter of 2024, as well as a slight improvement in industrial production in the first quarter of 2026," the company stated.

Net income rose 13.8% to $339.8 million, while operating cash flow surged 44.3% to $378.4 million, representing 111% of net income, supported by disciplined working capital management.

The company signed 6,950 weighted FASTBin and FASTVend devices during the quarter and maintained its full-year 2026 guidance of between 28,000 and 30,000 machine equivalent units. Sales through FMI Technology increased 16.6% to $1.0 billion, representing 44.9% of total sales.

Fastenal returned $295.7 million to shareholders through dividends of $275.6 million and share repurchases of $20.1 million during the quarter.