(Reuters) -Industrial supplies distributor Fastenal on Monday warned of a slight margin squeeze in the fourth quarter, as it moves up delivery schedules to manage tariff costs amid soft U.S. industrial demand.
Shares of the company fell over 5%, following third-quarter earnings that narrowly missed expectations.
"We accelerated some inventory schedules for future delivery into the current periods ahead of tariffs," chief accounting officer Sheryl Lisowski said on Fastenal's post-earnings call.
She also said Fastenal has incrementally increased prices due to rising supply chain costs.
Companies have been front-loading deliveries before potential increases in tariffs, a strategy that could keep stock levels elevated in the months ahead.
Last week, Levi Strauss said it had pulled forward roughly 70% of its holiday inventory and adjusted prices to offset the impact of shifting tariff policies.
Fastenal posted a profit of 29 cents per share for the quarter ended September 30, lower than analysts' average estimate of 30 cents, according to data compiled by LSEG.
"We think investors may also be weighing the Administration's tariff rhetoric on Friday and whether a further escalation in fastener costs could lead to potential demand destruction," KeyBanc analyst Kenneth Newman said.
Revenue for the third quarter rose 11.7% to about $2.13 billion, roughly in line with Wall Street expectations.
"Market conditions remained sluggish providing minimal contribution," the company said in its earnings presentation.
(Reporting by Parth Chandna and Aishwarya Jain in Bengaluru; Editing by Vijay Kishore, Sahal Muhammed and Shreya Biswas)
By Parth Chandna
