Chris Dankert

Jeff cited an AI quoting and sourcing tool that cut a 5 to 6 day branch process to about 15 minutes as one example.

Max attributed lower heads to role specialization, automation, AI and the large-customer focus; Jeff said there is no headcount cap.

Florness said headcount is the natural output of execution, not deliberate constraint; part-time reloading and AI quoting tools drive productivity.

Max confirmed low-to-mid single-digit pricing is a reasonable expectation but noted strategic-account dynamics make it hard to commit precisely.

Max confirmed normal seasonal step-up but said to factor in the Q4 timing items as the base. Dan added that the bonus reset is only a YoY impact, not sequential.

Max highlighted distribution capacity and throughput as the biggest 2026 investment area, along with truck fleet items and FMI technology. Framed as getting distribution capacity ready for future growth.

Jeff said the CSC program has been extremely successful, with many districts now wanting multiple CSCs. A lot of the $10K+ category growth comes from the CSC program. Still looking to expand the team size.

Jeff said no major shifts remain in role clarification, some maintenance work in certain areas. Dan added they continuously discover nuances from decentralized success stories that refine the approach.

Cort cited revenue from broader product availability plus cost-out from automation and real estate consolidation, deferring sizing to Investor Day; partial.

Bert called the Q4 Motion outlook prudent given holiday production slowdowns, noting October started like September; direct.

Bert confirmed sequential earnings acceleration through quarters with more muted H1. Flat market growth assumed throughout year despite positive January PMI. Interest expense headwind weighted more to H1. Not planning for market condition acceleration based on lessons from 2025.

Bert confirmed benefits split evenly between automotive and industrial, flowing through both gross margin and SG&A productivity. Transformation initiatives include NAPA supply chain, sales effectiveness across both segments, Motion commercial opportunities, pricing tools, and technology productivity.

Will cited broad-based benefits from DC investments including a Canada facility achieving double-digit growth post-investment. Improvements in productivity, service levels, inventory flows, and safety. Two new NAPA DCs being built in 2025.

Will described customer conversations as generally constructive but cautious. Large order book sequentially improving, largely OEM-based. Hopeful that 2026 will bring more clarity on rates and industrial complex to catalyze recovery.

Bert confirmed Q1 inventory investment was the main cash use. Does not expect another big inventory cash use in Q2. Full-year cash flow guidance reaffirmed.

Will confirmed elevated vendor pricing discussions beyond normal annual cadence. Bert noted Q1 tariff impact was immaterial and current circumstances factored into reaffirmed outlook.

CFO: July tracking up 13%, Q3 up around 12% on a daily constant currency basis.

DG confirmed tracking conversion rate, soup-to-nuts process metrics, and competitive surveys across digital factors.

DG framed MRO as never a fast-growing market over 30 years; earnings algorithm is share gain, price, and SG&A management. Similar across all industrial markets.

DG said CapEx increase is mostly supply chain investment, a longer-term network opportunity.

Dee explained partial quarter of May pricing, prior-year comp offset, and cross-competitor pricing timing. Expects annualized 1-1.5% realized plus 2-2.5% from September.

DG agreed SG&A leverage is the primary path to margin expansion with gross margin stable around 39%.

CFO confirmed Lunar New Year has de minimis impact based on historical analysis, with Q1 ATS strength driven by normal customer demand requirements. CEO added customers are investing for AI chip capacity demand playing out in the packaging area.

CEO noted stable machine builder demand with packaging having a good quarter, nonwovens coming off 2 strong years of capacity adds from mid-tier Asian OEMs building in Africa, Middle East, and India, now at low single-digit growth.

CEO confirmed adhesive businesses benefiting from European machine builder activity, with nonwovens doing extremely well year-to-date and packaging business performing well.

CEO explained Atrion benefits from new product launch (Myocardial Protection System), earlier destocking cycle timing, and different product/end market mix.

CEO confirmed active pipeline with fewer inbound opportunities but good overall activity, emphasizing strategic and financial discipline.