W.W. Grainger (GWW) 10-K risk factor changes: FY2024 vs FY2023

Market variables, such as inflation of product costs, labor [removed: rates and] [added: rates,] fuel, freight and energy costs, as well as geopolitical events, could negatively impact Grainger's ability to effectively manage its operating and administrative expenses.

In addition, Grainger's inability to pass on increases in costs to customers in a timely manner, or at all, could cause Grainger's operating and administrative expenses to [removed: grow,] [added: grow more rapidly than net sales,] which could result in lower gross profit margins and lower net earnings.

Grainger’s logistics or supply chain network could be disrupted by the occurrence of: one or more natural or [removed: human induced] [added: weather-related] disasters, including earthquakes, tsunamis, storms, hurricanes, floods, fires, droughts, tornados and other extreme weather events or conditions; [added: longer-term climate shifts that affect transportation infrastructure or material availability;] pandemic diseases or viral contagions; geopolitical events, such as war, civil unrest or terrorist attacks in a country in which Grainger operates or in which its suppliers are located; disruptions to transportation infrastructure and networks, including from transport providers or third-party work stoppages related to labor strikes or lockouts; and the imposition of measures that create barriers to or increases in costs associated with international trade.

[removed: Many of these customers operate in markets that are subject to fluctuations resulting from market uncertainty, trade and tariff policies, costs of goods] sold, currency exchange rates, interest rate fluctuations, government spending and government shutdowns, economic downturns, recessions, foreign competition, offshoring of production, oil and natural gas prices, geopolitical developments, labor shortages, work stoppages, [removed: inflation,] natural or human induced disasters, extreme weather, outbreaks of pandemic disease, inflation, deflation, and a variety of other factors beyond Grainger’s control.

These factors could include economic downturns, recessions, outbreaks of pandemic disease, natural or human induced disasters, cybersecurity attacks, extreme weather, geopolitical unrest, [removed: new] [added: new, threatened] or increased tariffs, trade issues and policies, detention orders or withhold release orders on imported products, labor problems or shortages experienced by Grainger’s suppliers or others in the supply chain, transportation availability, staffing and cost, shortage of raw materials, supplier consolidation, unilateral product cost increases by suppliers of products in short supply, inflation and other factors, any of which could adversely affect a supplier’s ability to manufacture or deliver products or could result in an increase in Grainger’s product costs.

Fluctuations in the price of fuel or increased demand for freight [removed: services, including as a result of a pandemic,] [added: services] could affect transportation costs.

While the Consolidated Financial Statements are reported in U.S. dollars, [added: the Financial Statements of Grainger’s subsidiaries outside the U.S. are prepared using the local currency as the functional currency and translated into U.S. dollars.]

In addition, Grainger is exposed to foreign currency exchange rate risk with respect to the U.S. dollar relative to the local currencies of Grainger’s international subsidiaries, primarily the Japanese yen, Mexican peso, Canadian dollar, [added: and] British pound sterling, [removed: Chinese renminbi and euro,] arising from transactions in the normal course of business, such as sales and loans to wholly owned subsidiaries, sales to customers, purchases from suppliers, and bank loans and lines of credit denominated in foreign currencies.

The facilities maintenance industry is highly competitive, and changes in competition and other risks could [added: increase our costs,] impact demand for Grainger’s products and [removed: services.][added: services or impact the profitability of our business.]

There are several large competitors in the industry, [removed: although most of the market is served by] [added: as well as] small local and regional competitors.

Grainger faces competition [removed: in all markets it serves] from manufacturers (including some of its own suppliers) that sell directly to [removed: certain segments of the market,] [added: customers,] wholesale distributors, catalog houses, retail enterprises and online businesses.

To manage these potential pressures, Grainger continuously considers the adoption of new operating initiatives, including new marketing programs, productivity improvements, inventory management and loss prevention initiatives, [added: practical applications of artificial intelligence (AI)] and other similar strategies.

Developing, upgrading, managing or implementing new technologies, [added: including AI,] business applications, strategies and innovations may require significant investment of resources by Grainger, may result in unexpected costs and disruptions to operations, may take longer than expected, may increase Grainger's vulnerability to cyber breaches, attacks or intrusions, and may not provide all anticipated benefits.

Grainger has also increased, and expects to continue to increase, its investments in developing, managing and implementing [removed: artificial intelligence (AI), machine learning and] [added: AI, such as] large language model technologies.

For example, Grainger relies in part on [removed: Internet] [added: internet] search engines to drive traffic to its websites, and the reach of Grainger’s eCommerce channels is impacted by how and [removed: where its websites rank in both paid and unpaid search results.]

MonotaRO's disclosure and reporting obligations under TSE listing requirements and Japanese securities laws, including the timing of such obligations, may vary from Grainger's obligations under New York Stock Exchange [added: listing requirements and U.S. securities laws.]

Systems implementation disruption and any other IT disruption could have an adverse effect on [removed: its business.][added: the Company.]

If critical information systems fail or otherwise become unavailable, Grainger’s ability to operate its [removed: eCommerce] [added: digital] platforms, process orders, maintain proper levels of inventories, collect accounts receivable, disburse funds, manage its supply chain, monitor results of operations, and process and store team member or customer data, among other functions, could be adversely affected.

Grainger has experienced these incidents in the past, which it deemed immaterial to its business and operations individually and in the [removed: aggregate] [added: aggregate,] and may be subject to other incidents in the future.

Cybersecurity [added: threats and] incidents, including breaches of information systems [removed: security,] [added: security] could damage Grainger’s reputation, disrupt operations, increase costs and/or decrease revenues.

Through Grainger’s sales and [removed: eCommerce] [added: digital] channels, [added: as well as its ordinary course of business,] Grainger collects and stores personally identifiable, confidential, proprietary and other information from [removed: customers] [added: customers, team members, suppliers, website visitors, and other entities or individuals] so that they may, among other things, purchase products or services, enroll in promotional programs, register on Grainger’s websites or otherwise communicate or interact with Grainger.

Moreover, Grainger’s operations routinely involve receiving, storing, processing and transmitting sensitive information pertaining to its business, customers, suppliers and team [removed: member,] [added: members,] and other sensitive matters.

[removed: Cyber] [added: Cybersecurity] threats are rapidly evolving and [added: some of] the means for obtaining access to information in digital and other storage media are becoming increasingly sophisticated.

Each year, [removed: cyber-attackers] [added: cybersecurity threat actors] make numerous attempts to access the information stored in Grainger's information [removed: systems.][added: systems or Grainger's third-party business partners.]

Loss of customer, supplier, and team member information, intellectual property or other business information, or failure to comply with data privacy and security [removed: laws] [added: laws, or failure to maintain systems or software,] could, for example, disrupt operations, damage Grainger’s reputation and expose Grainger to claims from customers, suppliers, financial institutions, regulators, payment card associations, team members and others, any of which could have a material adverse effect on Grainger, including its [added: business strategy,] financial condition and results of operations.

If successful, [removed: cyber-attacks] [added: cybersecurity incidents] may expose Grainger to risk of loss or misuse of proprietary or confidential information or disruptions of business operations.

Grainger's IT infrastructure also includes products and services provided by suppliers, vendors and other [removed: third parties,] [added: third-party business partners,] and these [removed: providers] [added: third parties] can experience [removed: breaches of their systems] [added: cybersecurity threats, breaches, attacks, disruptions,] and [removed: products] [added: cybersecurity incidents] that impact the security of systems and proprietary or confidential information.

Although Grainger performs risk assessments on third parties where [added: Grainger deems] appropriate to learn about their security program, there is a risk that the confidentiality of data held or accessed by them may be [removed: compromised.][added: compromised or their systems may be disrupted or interrupted by threat actors.]

Moreover, [removed: Grainger] [added: Grainger, and its third-party business partners,] may face [added: cybersecurity] threats [added: and cybersecurity incidents which can include unauthorized access] to [removed: its] information systems, [removed: for example, unauthorized access,] business email compromise, viruses, malicious code, ransomware, [removed: phishing,] [added: denial-of-service attacks,] and organized cyber-attacks.

If successful, those attempting to penetrate Grainger’s or its [removed: vendors’] [added: third-party business partners’] information systems may misappropriate intellectual property or personally identifiable, credit card, confidential, proprietary or other sensitive customer, supplier, team member or business information, or cause systems disruption.

[removed: Any breach of Grainger’s security measures or any breach, error or] malfeasance [removed: of those of] [added: by] its third-party [removed: service providers] [added: business partners] could cause Grainger to incur significant costs to protect any customers, suppliers, team members and other parties whose information is compromised.

Although Grainger maintains insurance coverage that may, subject to policy terms and conditions, cover certain aspects of [removed: cyber and information security] [added: cybersecurity] risks, depending on the nature, location and extent of any event, such insurance coverage may be insufficient to cover all losses.

Grainger has experienced certain cybersecurity [removed: incidents] [added: incidents,] and in each [removed: instance] [added: instance,] Grainger provided notifications [added: where required by applicable law] and adopted remedial measures.

None of these incidents have been deemed to be material to Grainger and Grainger has neither incurred any material net expenses nor been materially penalized or subject to any material settlement amounts with respect to such [removed: incidents in the last three years.][added: incidents.]

Although Grainger generally relies on third parties to facilitate eCommerce payments and payment processing services, Grainger may become subject to additional compliance requirements and regulations regarding these [removed: transactions,] [added: transactions] and may also suffer losses from online fraudulent transactions on its eCommerce channels.

In addition, Grainger must pay certain transaction fees relating to these transactions, which may increase over time and could have an impact on product margin, [removed: profitability and] operating [removed: costs.][added: costs and profitability.]

[removed: Additionally] [added: Additionally,] collective bargaining or unionization of team members could decrease Grainger's operational flexibility and lead to work stoppages or slowdowns.

The success of Grainger's team member hiring and retention also depends on Grainger's ability to build and maintain a [removed: diverse and inclusive] workplace culture that enables [removed: its] [added: all] team members to [removed: thrive.][added: have the opportunity for a fulfilling and meaningful career.]

Generally, higher wages and benefit costs, competition for [removed: diverse] talent, and the risk of an increase in team member turnover, could adversely affect Grainger's results of operations.

Grainger devotes time and resources to [removed: environmental, social and governance (ESG) efforts] [added: initiatives] that [removed: are consistent] [added: align] with its corporate values and are designed to strengthen its business and protect and preserve its [removed: reputation, including programs driving environmental sustainability, ethics and corporate responsibility, strong communities, diversity, equity and inclusion, and gender equality.][added: reputation.]

Additionally, climate-related policies, carbon pricing mechanisms, and regulations aimed at reducing emissions may increase energy and raw material costs, which could put additional pressure on Grainger’s margins.

Inflation may also reduce demand for products, resulting in lower sales volumes.

For example, disruptions to global transportation networks, such as rising sea levels impacting ports or extreme weather damaging logistics hubs, could increase delays and costs.

Many of these customers operate in markets that are subject to fluctuations resulting from market uncertainty, trade and tariff policies, costs of goods

Certain policies, including carbon pricing, emissions trading systems, and regulations limiting industrial emissions, may further contribute to cost fluctuations for fuel, energy, and raw materials.

For example, climate-related regulations on transportation emissions could increase fuel costs,

thereby impacting the cost of product distribution.

where its websites rank in both paid and unpaid search results.

In addition to intense competition for talent, workforce dynamics are constantly evolving.

If Grainger does not manage changing workforce dynamics effectively, it could materially adversely affect Grainger's culture, reputation, and operational flexibility.

Moreover, changes in immigration policies may impair our ability to recruit and hire technical and professional talent globally.

These efforts include maintaining high standards of product quality and safety, ethical business practices, strong customer relationships, operational reliability, and a commitment to providing a positive workplace environment.

Grainger’s disclosures related to environmental and social matters expose it to risks that could adversely affect its reputation and performance.

Grainger has established and publicly announced environmental and social programs, including its efforts to address climate change, human rights, and an inclusive workplace.

These statements reflect its current plans and are not guarantees that Grainger will be able to achieve them.

Grainger’s pursuit of or inability to update, achieve, or accurately report its goals could damage its reputation, financial performance, and growth, leading to increased scrutiny from customers, enforcement authorities, and other various stakeholders and potential risks related to "anti-ESG sentiment", such as reputational harm, lawsuits, or market access restrictions.

Grainger’s ability to achieve any environmental or social change is subject to numerous risks, some of which are outside of its control.

For example, evolving climate-related regulations in multiple jurisdictions—such as stricter emissions limits, carbon disclosure mandates, and supply chain sustainability requirements—may require Grainger to adjust its operations and increase compliance investments.

For instance, California's new climate disclosure requirements and SEC-mandated climate risk reporting could increase compliance burdens and legal exposure.

Furthermore, our customers may adopt procurement policies that include environmental or social provisions or requirements that their suppliers should comply with, or they may seek to include such provisions or requirements in their procurement terms and conditions.

Standards for tracking and reporting Grainger's activity, if any, related to environmental and social matters continue to evolve.

Grainger’s selection of voluntary disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or differ from those of others.

Methodologies for reporting environmental and social data may be updated and previously reported data may be adjusted to reflect improvement in availability and quality of third-party data, changing assumptions, changes in the nature and scope of Grainger’s operations and other changes in circumstances.

Grainger’s processes and controls for reporting such matters across its operations and supply chain are evolving along with multiple disparate standards for identification, measurement, and reporting Regulatory disclosure standards are or may become required by the SEC, European and other regulators (including, but not limited to, the EU Corporate Sustainability Reporting Directive, the EU Corporate Sustainability Due Diligence Directive, the state of California’s new climate change disclosure requirements, and climate-change disclosure requirements from the SEC that may become effective), and such standards may change over time, which could result in revisions to Grainger’s current goals, reported progress in achieving such goals, or ability to achieve such goals in the future.

If Grainger’s environmental and social practices do not meet evolving government, investor or other stakeholder expectations and standards, then Grainger’s reputation or its attractiveness as an investment, business partner, product or service provider or employer could be negatively impacted, and Grainger could be subject to litigation or regulatory proceedings.

Technology Risks

The proliferation of AI may impact our industry and the markets in which we compete, and the development and use of AI presents competitive, reputational and liability risks.

Grainger believes the proliferation of AI will have a significant impact on customer preferences and market dynamics in its industry, and Grainger’s ability to effectively compete in this space will be critical to its financial performance.

Grainger also believes that the effective use of AI in its internal operations is important to its long-term success.

Grainger is working to incorporate AI capabilities into its digital platforms, as well as across Grainger in its own internal operations, and its research into and continued development of such technologies remain ongoing.

As with many innovations, AI presents risks, challenges, and unintended consequences that could affect its rate and success of adoption, and therefore Grainger’s business, and there is no guarantee that Grainger’s use of AI or incorporation of AI capabilities into its business will benefit its business operations or result in solutions that are preferred by its customers.

Grainger has invested, and expects to continue to invest, significant resources to build and support its AI products.

If Grainger’s digital platforms fail to operate as anticipated or as well as competing products or otherwise do not meet customer needs or if Grainger is unable to bring AI-enabled products and solutions to market as effectively, or with the same speed or in the same volumes, as our competitors, Grainger may fail to recoup its investments in AI or improve its financial performance, its competitive position may be harmed, and its business and reputation may be adversely impacted.

In addition, AI algorithms may be flawed.

Datasets may be insufficient or contain biased information.

AI models deployed by Grainger or its partners may lead to unexpected or unintended outcomes that could erode trust in its digital platforms and potentially cause harm to individuals or society.

These deficiencies and other failures of AI systems could subject Grainger to competitive harm, regulatory action, legal liability, including under new proposed legislation regulating AI in jurisdictions such as the U.S. and European Union, new applications of existing data protection, privacy, intellectual property, and other laws, and brand or reputational harm.

Additionally, Grainger’s obligations to comply with the evolving legal and regulatory landscape could entail significant costs or limit its ability to incorporate certain AI capabilities into its digital platforms.

Some AI capabilities also present ethical issues, and Grainger may be unsuccessful in identifying or resolving issues before they arise.

If Grainger enables or offers AI products or solutions or implement AI capabilities in its internal operations that are controversial because of their impact on human rights, the environment, privacy, employment, or other social, economic, or political issues, Grainger may experience brand or reputational harm or greater team member attrition.

The recent global geopolitical and trade environment has resulted in raw material inflation and potential for increased escalation of domestic and international tariffs and retaliatory trade policies.

the Financial Statements of Grainger’s subsidiaries outside the U.S. are prepared using the local currency as the functional currency and translated into U.S. dollars.

While the use of these technologies can present significant benefits to Grainger, it also creates risks and challenges.

listing requirements and U.S. securities laws.

The transition in recent years to remote and “hybrid” working arrangements may increase Grainger’s vulnerability to cybersecurity incidents, including breaches of information systems security, which could damage Grainger’s reputation and commercial relationships, disrupt operations, increase costs and/or decrease revenues, and expose Grainger to claims or other actions from customers, suppliers, financial institutions, regulators, payment card associations, team members and others.

Grainger has been subject to unauthorized access in the past, which it deemed immaterial to its business and operations individually and in the aggregate and may be subject to other incidents in the future.

in Japan, the Act on Protection of Personal Information, and in the European Union, the General Data Protection Regulation) and cybersecurity requirements (including protection of information and incident responses), environmental protection laws, currency exchange controls and cash repatriation restrictions, health and safety laws, import and export compliance (including the U.S. Commerce Department’s Export Administration Regulations, trade sanctions promulgated by the Office of Foreign Asset Control and anti-money laundering regulations), intellectual property laws, labor laws (including federal and state wage and hour laws), product compliance or safety laws, supplier regulations regarding the sources of supplies or products, tax laws (including as to U.S. taxes on international subsidiaries), unclaimed property laws and laws, regulations and standards applicable to other commercial matters.

The Organization for Economic Cooperation and Development (OECD) Pillar Two guidelines address the increasing digitization of the global economy, re-allocating taxing rights among countries.

The OECD continues to release additional guidance and countries are implementing legislation with widespread adoption of the Pillar Two Framework expected during 2024.

Grainger continues to evaluate the Pillar Two Framework and its potential impact on future periods.

Based on information to date, Grainger does not expect either the Pillar One or Two proposals to materially impact the Company’s global income tax liability or effective tax rate.

Grainger may be adversely impacted by the effects of climate change and may incur increased costs and experience other impacts due to new or more stringent environmental laws and regulations designed to address climate change.

The potential impacts of climate change on Grainger’s suppliers, product offerings, operations, facilities and customers are accelerating and uncertain.

Increased public awareness and concern regarding global climate change have resulted in, and may continue to result in, more international, federal, and/or state or other stakeholder requirements or expectations that have resulted in, and could continue to result in, more restrictive or expansive standards, such as stricter limits on greenhouse gas emissions or more prescriptive reporting of environmental, social, and governance metrics.

There continues to be a lack of consistent climate change legislation and standards, which creates economic and regulatory uncertainty.

New or changing environmental laws and regulations could also increase Grainger’s operating costs, including through higher utility and transportation costs, and Grainger is unable to predict the potential impact such laws and regulations could have on its financial condition and results of operations.

In addition, the potential physical risks of climate change may impact the availability and cost of materials and natural resources, sources and supply of energy and product demand, impact Grainger's transportation costs and supply chain network, and could increase Grainger’s operating costs.

Natural disasters as a result of climate change at locations where Grainger, its suppliers or customers operate could cause disruptions to Grainger’s operations, which could adversely affect sales and could negatively impact Grainger’s business, financial condition, results of operations and cash flows.

If environmental laws, regulations, and other stakeholder requirements impose significant operational restrictions or compliance requirements upon Grainger or its suppliers, products, or customers, or Grainger's operations are disrupted due to physical impacts of climate change, Grainger's business, capital expenditures, financial condition, results of operations, reputation, and competitive position could be negatively impacted.

This section of this Form 10-K generally discusses [removed: 2023] [added: 2024] and [removed: 2022] [added: 2023] items and year-to-year comparisons between [removed: 2023] [added: 2024] and [removed: 2022.][added: 2023.]

Discussions of [removed: 2021] [added: 2022] items and year-to-year comparisons between [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] are not included in this Form 10-K, and can be found in MD&A of Financial Condition and Results of Operations in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2022.][added: 2023.]

Grainger uses [removed: a combination of] its high-touch solutions and endless assortment businesses to serve [removed: its] customers worldwide, [removed: which] [added: who] rely on Grainger for products and services that enable them to run safe, sustainable and productive operations.

The Company’s continued strategic aspiration for [removed: 2024] [added: 2025] is to relentlessly expand Grainger’s leadership position by being the go-to partner for people who build and run safe, sustainable, and productive operations.

[removed: In the] [added: The] High-Touch Solutions North America (High-Touch Solutions N.A.) [removed: segment, businesses are] [added: segment is] focused on three areas: advantaged MRO solutions, differentiated sales and services, and unparalleled customer service.

In the Endless Assortment segment, [removed: businesses are] [added: the business is] focused on product assortment expansion and innovative customer acquisition and retention capabilities.

The global economy continues to experience [removed: volatile disruptions] [added: volatility and uncertainty] including to the commodity, labor and transportation markets, arising from a combination of geopolitical [removed: events] [added: conditions] and [added: events, and] various economic and financial factors.

These [removed: disruptions] [added: conditions] have affected the Company's operations and may continue to affect the Company's business, financial condition and results of operations.

The Company continues to monitor economic conditions in the U.S. and globally, and the impact of macroeconomic pressures, including repercussions from changes in interest rates, currency exchange fluctuations, [removed: inflation] [added: changing inflationary environment,] and a potential recession on the Company’s business, customers, suppliers and other third parties.

[removed: As a result of continued inflation, the] [added: The] Company has implemented strategies designed to mitigate certain adverse effects [added: from the impact] of [removed: higher costs] [added: the changing inflationary environment] while [removed: also] remaining market price competitive.

In this section, Grainger utilizes non-GAAP [added: (as defined below)] measures where it believes it will assist users of its financial statements in understanding its business.

For further information regarding the Company's non-GAAP measures including reconciliations to the most directly comparable [removed: GAAP] [added: U.S. generally accepted accounting principles (GAAP)] measures, see [removed: below] "Non-GAAP Measures."

The following table is included as an aid to understanding the changes in Grainger's Consolidated Statements of Earnings for the twelve months ended December 31, [removed: 2023] [added: 2024] and [removed: 2022] [added: 2023] (in millions of dollars).

| | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2022] [added: 2023] | | | | | | % Change | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2022] [added: 2023] | | | | | |

| Net sales(1) | | | $ | [removed: 16,478] [added: 17,168] | | | | | $ | [removed: 15,228] [added: 16,478] | | | | | [removed: 8.2] [added: 4.2] | | % | | | | 100.0 | | % | | | | 100.0 | | % |

| Cost of goods sold | | | [removed: 9,982] [added: 10,410] | | | | | | [removed: 9,379] [added: 9,982] | | | | | | [removed: 6.4] [added: 4.3] | | | | | | 60.6 | | | | | | [removed: 61.6] [added: 60.6] | | |

| Gross profit | | | [removed: 6,496] [added: 6,758] | | | | | | [removed: 5,849] [added: 6,496] | | | | | | [removed: 11.1] [added: 4.0] | | | | | | 39.4 | | | | | | [removed: 38.4] [added: 39.4] | | |

| Selling, general and administrative expenses | | | [removed: 3,931] [added: 4,121] | | | | | | [removed: 3,634] [added: 3,931] | | | | | | [removed: 8.2] [added: 4.8] | | | | | | [removed: 23.8] [added: 24.0] | | | | | | [removed: 23.9] [added: 23.8] | | |

| Operating earnings | | | [removed: 2,565] [added: 2,637] | | | | | | [removed: 2,215] [added: 2,565] | | | | | | [removed: 15.8] [added: 2.8] | | | | | | [removed: 15.6] [added: 15.4] | | | | | | [removed: 14.5] [added: 15.6] | | |

| Other expense – net | | | [removed: 65] [added: 53] | | | | | | [removed: 69] [added: 65] | | | | | | [removed: (5.5)] [added: (18.5)] | | | | | | [removed: 0.4] [added: 0.3] | | | | | | 0.4 | | |

| Income tax provision | | | [removed: 597] [added: 595] | | | | | | [removed: 533] [added: 597] | | | | | | [removed: 12.0] [added: (0.3)] | | | | | | [removed: 3.6] [added: 3.5] | | | | | | [removed: 3.5] [added: 3.6] | | |

| Net earnings | | | [removed: 1,903] [added: 1,989] | | | | | | [removed: 1,613] [added: 1,903] | | | | | | [removed: 18.0] [added: 4.5] | | | | | | 11.6 | | | | | | [removed: 10.6] [added: 11.6] | | |

| Less noncontrolling interest | | | [removed: 74] [added: 80] | | | | | | [removed: 66] [added: 74] | | | | | | [removed: 12.5] [added: (8.1)] | | | | | | 0.5 | | | | | | [removed: 0.4] [added: 0.5] | | |

| Net earnings attributable to W.W. Grainger, Inc. | | | $ | [removed: 1,829] [added: 1,909] | | | | | $ | [removed: 1,547] [added: 1,829] | | | | | [removed: 18.2] [added: 4.4] | | | | | | 11.1 | | % | | | | [removed: 10.2] [added: 11.1] | | % |

| Diluted earnings per share: | | | $ | [removed: 36.23] [added: 38.71] | | | | | $ | [removed: 30.06] [added: 36.23] | | | | | [removed: 20.5] [added: 6.8] | | % | | | | | | | | | | | | |

The following table is included as an aid to understanding the changes of Grainger's total net sales, daily net sales and daily organic constant currency net sales from the prior period for the twelve months ended December 31, [removed: 2023] [added: 2024] (in millions of dollars):

| | | | For the Years Ended December 31, | | | | | | | | | | | | | | | | | | | | | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| | | | [removed: 2023] [added: 2024] | | | | | | % Change(1) | | | | | | [removed: 2022] [added: 2023] | | | | | | % Change(1) | | | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Net sales | | | $ | [removed: 16,478] [added: 17,168] | | | | | [removed: 8.2] [added: 4.2] | | % | | | | $ | [removed: 15,228] [added: 16,478] | | | | | [removed: 16.9] [added: 8.2] | | % | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Daily net sales(2) | | | $ | [removed: 65.2] [added: 66.5] | | | | | [removed: 8.6] [added: 3.4] | | % | | | | $ | [removed: 59.5] [added: 65.2] | | | | | [removed: 16.5] [added: 8.6] | | % | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Daily, organic constant currency net sales(2) | | | $ | [removed: 65.8] [added: 67.4] | | | | | [removed: 9.5] [added: 4.7] | | % | | | | $ | [removed: 61.0] [added: 65.8] | | | | | [removed: 19.3] [added: 9.5] | | % | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| (1) Calculated on the basis of prior year reported net sales for the years ended December 31, [removed: 2023] [added: 2024] and [removed: 2022. | | | | | | | | | | | | | | | | | | | | | | | | | | |] [added: 2023.] | | | | | | | | | | | | | | | | | | | | | | | |

| (2) Daily net sales are adjusted for the difference in U.S. selling days relative to the prior year period. Daily, organic constant currency net sales [removed: excludes the results of E & R Industrial Sales, Inc. in the comparable prior year period post date of divestiture and excludes] [added: are also adjusted to exclude] the impact on net sales due to year-over-year foreign currency exchange rate [removed: fluctuations.] [added: fluctuations and the prior year period results of E&R divested in the fourth quarter of 2023.] There were [removed: 254] [added: 256] and [removed: 255] [added: 254] sales days in the full year [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] respectively. For further information regarding the Company's non-GAAP measures, including reconciliations to the most directly comparable GAAP [removed: measures,] [added: measure,] see below "Non-GAAP Measures." | | | | | | | | | | | | | | | | | | | | | | | | [removed: | | | | | | | | | | | | | | | | | | | | | | | | | | |]

Net sales of [removed: $16,478] [added: $17,168] million for the year ended December 31, [removed: 2023] [added: 2024] increased [removed: $1,250] [added: $690] million, or [removed: 8%,] [added: 4%,] and on a daily, organic constant currency basis, net sales increased [removed: 10%] [added: 5%] compared to the same period in [removed: 2022.][added: 2023.]

Both High-Touch Solutions N.A. and the Endless Assortment segments contributed to sales growth in [removed: 2023.][added: 2024.]

Gross profit of [removed: $6,496] [added: $923] million for the year ended December 31, [removed: 2023] [added: 2024] increased [removed: $647] [added: $59] million, or [removed: 11%,] [added: 7%,] and gross profit margin of [removed: 39.4% increased 100] [added: 29.5% decreased 10] basis points compared to the same period in [removed: 2022.][added: 2023.]

Both segments contributed to [removed: margin] [added: gross profit dollar] expansion in [removed: 2023.][added: 2024.]

Selling, general, and administrative (SG&A) expenses of [removed: $3,931] [added: $4,121] million for the year ended December 31, [removed: 2023] [added: 2024] increased [removed: $297] [added: $190] million, or [removed: 8%.][added: 5%.]

Adjusted SG&A of [removed: $3,905] [added: $4,105] million increased [removed: $250] [added: $200] million, or [removed: 7%,] [added: 5%,] compared to the same period in [removed: 2022] [added: 2023] driven by higher marketing and payroll [added: and benefit] expenses.

[removed: Adjusted] SG&A leverage improved [removed: 30] [added: 40] basis points [added: compared to the same period] in 2023.

*Macroeconomic Conditions*

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SG&A leverage and adjusted SG&A leverage decreased 20 basis points in 2024.

Income tax provision of $595 million for the year ended December 31, 2024 decreased $2 million, compared to the same period in 2023.

Adjusted income taxes of $599 million decreased $2 million compared to the same period in 2023.

The adjusted effective tax rates were 23.0% and 23.8%.

| Selling, general and administrative expenses | | | | | | 3,356 | | | | | | 3,212 | | | | | | 4.5 | | |

The increase was primarily due to volume.

| | | | | | | 2024 | | | | | | 2023 | | | | | | % Change | | |

The Company adjusts its reported net sales when there are differences in the number of U.S. selling days relative to the prior year period and also excludes the impact on reported net sales due to changes in foreign currency exchange rate fluctuations and results of certain divested businesses.

*Restructuring Actions*

In the second quarter of 2024, the Company recorded restructuring charges in SG&A of $15 million in the High-Touch Solutions N.A. segment and $1 million in Grainger's Other businesses.

The charges consisted primarily of team member severance and benefit costs.

The Company does not expect this business exit to have a material effect on its future results of operations.

| | | | | | | 2024 | | | | | | % Change(2) | | | | | | 2024 | | | | | | % Change(2) | | | | | | 2024 | | | | | | % Change(2) | | | | | | | | |

| Reported net sales | | | | | | $ | 13,720 | | | | | 3.4 | | % | | | | $ | 3,134 | | | | | 7.5 | | % | | | | $ | 17,168 | | | | | 4.2 | | % | | | | | | |

| Daily net sales | | | | | | 53.2 | | | | | | 2.6 | | | | | | 12.1 | | | | | | 6.6 | | | | | | 66.5 | | | | | | 3.4 | | | | | | | | |

| Foreign currency exchange(4) | | | | | | 0.1 | | | | | | 0.1 | | | | | | 0.6 | | | | | | 5.0 | | | | | | 0.6 | | | | | | 0.9 | | | | | | | | |

| Business divestiture(5) | | | | | | 0.3 | | | | | | 0.5 | | | | | | — | | | | | | — | | | | | | 0.3 | | | | | | 0.4 | | | | | | | | |

| Daily, organic constant currency net sales | | | | | | $ | 53.6 | | | | | 3.2 | | % | | | | $ | 12.7 | | | | | 11.6 | | % | | | | $ | 67.4 | | | | | 4.7 | | % | | | | | | |

| (2) Compared to net sales in the prior year period. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| *Twelve Months Ended December 31, 2024* | | | Reported | | | | | | Adjustment(1) | | | | | | Adjusted | | | | | | % Change Reported(2) | | | | | | % Change Adjusted(2) | | |

| Endless Assortment | | | 663 | | | | | | — | | | | | | 663 | | | | | | | | | | | | | | |

| Other(3) | | | 102 | | | | | | (1) | | | | | | 101 | | | | | | | | | | | | | | |

| Selling, general and administrative expenses | | | $ | 4,121 | | | | | $ | (16) | | | | | $ | 4,105 | | | | | 4.8% | | | | | | 5.1% | | |

| *Earnings* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Endless Assortment | | | 260 | | | | | | — | | | | | | 260 | | | | | | | | | | | | | | |

| Other(3) | | | (8) | | | | | | 1 | | | | | | (7) | | | | | | | | | | | | | | |

| Operating earnings | | | $ | 2,637 | | | | | $ | 16 | | | | | $ | 2,653 | | | | | 2.8% | | | | | | 2.4% | | |

| Income tax provision(4) | | | (595) | | | | | | (4) | | | | | | (599) | | | | | | | | | | | | | | |

| Net earnings | | | $ | 1,989 | | | | | $ | 12 | | | | | $ | 2,001 | | | | | | | | | | | | | |

| Diluted earnings per share | | | $ | 38.71 | | | | | $ | 0.25 | | | | | $ | 38.96 | | | | | 6.8% | | | | | | 6.2% | | |

| *Twelve Months Ended December 31, 2023* | | | Reported | | | | | | Adjustment(1) | | | | | | Adjusted | | | | | | % Change Reported(2) | | | | | | % Change Adjusted(2) | | |

| Other(3) | | | 88 | | | | | | — | | | | | | 88 | | | | | | | | | | | | | | |

| *Earnings* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

*Inflationary Cost Environment and Macroeconomic Pressures*

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Organic net sales results exclude the impact of changes in foreign currency exchange rates and results of certain divested businesses in the comparable prior year period post date of divestiture.

In the fourth quarter of 2022, Grainger divested Cromwell's wholly owned software business in the U.K. and recorded a one-time pre-tax gain on the divestiture of $21 million in SG&A.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | 2022 | | | | | | % Change(2) | | | | | | 2022 | | | | | | % Change(2) | | | | | | 2022 | | | | | | % Change(2) | | | | | | | | |

| Reported net sales | | | | | | $ | 12,182 | | | | | 19.6 | | % | | | | $ | 2,787 | | | | | 8.2 | | % | | | | $ | 15,228 | | | | | 16.9 | | % | | | | | | |

| Daily net sales | | | | | | 47.6 | | | | | | 19.1 | | | | | | 10.9 | | | | | | 7.7 | | | | | | 59.5 | | | | | | 16.5 | | | | | | | | |

| Foreign currency exchange(4) | | | | | | 0.1 | | | | | | 0.2 | | | | | | 1.3 | | | | | | 12.4 | | | | | | 1.5 | | | | | | 2.8 | | | | | | | | |

| Daily, organic constant currency net sales | | | | | | $ | 47.7 | | | | | 19.3 | | % | | | | $ | 12.2 | | | | | 20.1 | | % | | | | 61.0 | | | | | | 19.3 | | % | | | | | | |

| (2) Calculated on the basis of prior year reported net sales. Daily, organic constant currency net sales excludes the results of E&R in the comparable prior year period post date of divestiture for the year ended December 31, 2023. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | For the Year Ended December 31, 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | Reported | | | | | | Business Divestiture(1) | | | | | | Adjusted | | | | | | % Change Adjusted | | | | | | % of Net Sales Adjusted(2) | | |

| Other(3) | | | 88 | | | | | | — | | | | | | 88 | | | | | | (3.8) | | | | | | 30.0 | | |

| Other(3) | | | (2) | | | | | | — | | | | | | (2) | | | | | | (81.2) | | | | | | (0.8) | | |

| (3) Grainger's businesses reported in Other do not meet the criteria of a reportable segment. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | For the Year Ended December 31, 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Endless Assortment | | | 594 | | | | | | — | | | | | | 594 | | | | | | 19.4 | | | | | | 21.3 | | |

| Other(3) | | | 72 | | | | | | 21 | | | | | | 93 | | | | | | (11.4) | | | | | | 35.4 | | |

| Endless Assortment | | | 223 | | | | | | — | | | | | | 223 | | | | | | (3.8) | | | | | | 8.0 | | |

| Other(3) | | | 9 | | | | | | (21) | | | | | | (12) | | | | | | (37.3) | | | | | | (4.6) | | |

| Operating earnings | | | $ | 2,215 | | | | | $ | (21) | | | | | $ | 2,194 | | | | | 41.9 | | | | | | 14.4 | | |

| Income tax provision(4) | | | (533) | | | | | | — | | | | | | (533) | | | | | | 43.8 | | | | | | (3.5) | | |

| Net earnings | | | $ | 1,613 | | | | | $ | (21) | | | | | $ | 1,592 | | | | | 43.0 | | | | | | 10.5 | | |

| Diluted earnings per share: | | | $ | 30.06 | | | | | $ | (0.40) | | | | | $ | 29.66 | | | | | 49.3% | | | | | | | | |

| (1) Reflects the gain on the divestiture of Cromwell's enterprise software business in the fourth quarter of 2022. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| (2) Calculated on the basis of reported net sales for the year ended December 31, 2022. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

The increase was due to volume of 5% and price, which includes customer mix, of 4%.

The increase was driven by freight and supply chain efficiencies in 2023.

The increase was driven by freight efficiencies at MonotaRO partially offset by unfavorable product mix at Zoro in 2023.

SG&A leverage decreased 30 basis points compared to the same period in 2022.

Operating earnings of $233 million for the year ended December 31, 2023 increased $10 million, or 4%, compared to the same period in 2022.

The increase was due to higher gross profit dollars, partially offset by higher SG&A in 2023.

| | | | 2023 | | | | | | 2022 | | |

The increase compared to the prior year period was due to higher earnings and favorable changes in year-over-year working capital largely driven by sales growth, inventory management and timing of cash receipts and payments.

The increase compared to the prior year period primarily reflects increased U.S. supply chain investments including capacity, automation and sustainability initiatives, as well as technology enhancements across the Company.

The increase compared to the prior year period was primarily due to higher treasury stock repurchases.

For the fiscal year ended December 31, [removed: 2023,] [added: 2024,] approximately 18% of the Company's net sales were denominated in a currency other than the Company's functional U.S. dollar currency.

A hypothetical 10% change in the relative value of the U.S. dollar would not materially impact the Company's net earnings for [removed: 2023.][added: 2024.]

The annualized effect of a hypothetical 1 percentage point increase in interest rates on Grainger’s variable-rate debt obligations would not materially impact the Company's net earnings for [removed: 2023.][added: 2024.]

For debt and derivative instrument information, see Note 5 [removed: and Note 11] of the Notes to Consolidated Financial Statements in Part II, Item 8: Financial Statements and Supplementary Data of this Form 10-K.

The Company regularly monitors commodity trends and, as a broad line supplier, mitigates any material exposure to commodity price risk by having alternative sourcing plans in place that mitigate the risk of supplier concentration, passing commodity-related inflation to customers [removed: or suppliers] and continuing to scale its distribution networks, including its transportation infrastructure.

For further information on the Company's principles, see below [removed: "Workplace] [added: "Human Capital - Workplace] Practices and Policies."

For further segment information, see Part II, Item 7: Management’s Discussion and Analysis (MD&A) of Financial Condition and Results of Operations and Note [removed: 13] [added: 12] of the Notes to Consolidated Financial Statements in Part II, Item 8: Financial Statements and Supplementary Data of this Form 10-K.

][added: Strategy25_1632x1538_1.15.2025.jpg](https://www.sec.gov/Archives/edgar/data/277135/000027713525000010/gww-20241231_g1.jpg)]

No single end customer accounted for more than 10% of total sales for the year ended December 31, [removed: 2023.][added: 2024.]

No single product category comprised more than 20% of the Company's sales for the year ended December 31, [removed: 2023.][added: 2024.]

Zoro offers more than [removed: 13] [added: 14] million products and MonotaRO provides access to more than [removed: 22] [added: 24] million products, primarily through its websites and catalogs.

No single supplier comprised more than 5% of Grainger's total purchases for the year ended December 31, [removed: 2023.][added: 2024.]

[removed: Additionally,] Grainger offers comprehensive inventory management through its KeepStock® program that includes vendor-managed inventory, customer-managed inventory and onsite vending machines.

Approximately 20% of [removed: 2023] [added: 2024] sales were private label MRO items bearing Grainger’s registered trademarks, including DAYTON®, [removed: SPEEDAIRE®, AIR HANDLER®,] [added: GRAINGER®, CONDOR®, WESTWARD®,] TOUGH GUY®, [removed: WESTWARD®, CONDOR®] [added: SPEEDAIRE®, LUMAPRO®,] and [removed: LUMAPRO®.][added: AIR HANDLER®.]

In addition to Grainger’s U.S. based operations, which in [removed: 2023] [added: 2024] generated approximately 82% of its consolidated net sales, Grainger operates its business principally through wholly owned subsidiaries in Canada, Mexico and the U.K., and through its majority-owned subsidiary in Japan.

In [removed: 2023,] [added: 2024,] compliance with the applicable laws, regulations and standards did not have a material effect on capital expenditures, earnings or competitive position.

Grainger has been consistently recognized for its commitment to its culture, [removed: diversity, equity and inclusion efforts] [added: an inclusive workplace] and team member engagement.

As of December 31, [removed: 2023,] [added: 2024,] Grainger had more than 26,000 team members worldwide, of whom approximately [removed: 23,200] [added: 23,500] were full-time and [removed: 2,900] [added: 3,000] were part-time or temporary.

The Grainger Edge principles [removed: also] [added: work as a system and] guide the Company’s actions supporting health and safety, [removed: diversity, equity and inclusion,] [added: an inclusive workplace,] and team member experience, including talent [removed: acquisition and team member] [added: acquisition,] retention, development and compensation and benefits.

The results from engagement surveys are used to inform programs and processes designed and implemented to enhance the [removed: inclusive] culture Grainger aspires to achieve.

In [removed: 2023,] [added: 2024,] the Company’s Occupational Safety and Health Administration Total Recordable Incident Rate in the U.S. was 1.3 and the Company’s Lost Time Incident Rate in the U.S. was [removed: 0.4] [added: 0.5] based upon the number of incidents per 100 team members (or per 200,000 work hours).

Grainger believes a [removed: diverse] [added: broad] talent pool is essential to live its principles, foster innovation, build high-performing teams and drive business results.

The Company understands that future business success requires a mix of current and new skill sets, multiple experiences, and a [removed: diversity] [added: broad array] of backgrounds and perspectives, and strives to reflect this [removed: priority] in its hiring, retention and promotion practices.

[removed: The] [added: As of December 31, 2024, the] Company’s Board of Directors is comprised of approximately 31% female and 23% racially and ethnically diverse directors.

Grainger also maintains this [removed: strong] commitment with the [removed: CEO's] [added: executive] leadership [removed: team and throughout the organization.][added: teams.]

The [removed: CEO's] U.S. based [added: executive] leadership team is comprised of approximately [removed: 40% women and approximately 30%] [added: 27%] racially and ethnically diverse leaders.

[removed: As of December 31, 2023, within] [added: Within] Grainger’s [removed: U.S.] [added: global] workforce, approximately [removed: 39%] [added: 42%] of team members were women and approximately [removed: 37%] [added: 39%] of [added: U.S.] team members were racially and ethnically diverse.

As part of its efforts in these areas, the Company offers competitive compensation and benefits to meet the [removed: diverse] needs of team members and support their physical and mental health and well-being, financial future and work-life balance.

Following is information about the executive officers of Grainger, including age, as of January 31, [removed: 2024.][added: 2025.]

| Nancy L. Berardinelli-Krantz [removed: (46)] [added: (47)] | | | Senior Vice President and Chief Legal [removed: Officer, a position assumed in] [added: Officer since] January 2023. [removed: Previously,] Ms. Berardinelli-Krantz [added: previously] served [removed: in roles of increasing responsibility] [added: as Senior Vice President and Deputy Chief Legal Officer] at Eaton Corporation (Eaton), a power management company, from [removed: 2011-2015 and again from 2017-2022. Her most recent position was Senior Vice President and Deputy Chief Legal Officer. After her return] [added: June 2022] to [removed: Eaton, her other positions were: Senior Vice President and General Counsel, Digital, Innovation and Technology; Senior Vice President, Ethics and Compliance; and Vice President and Chief Counsel, Litigation. Ms. Berardinelli-Krantz] [added: December 2022. Prior to being promoted to that role, she] held [removed: various positions] [added: a variety] of senior leadership [added: roles] at [added: Eaton. Ms. Berardinelli-Krantz served in senior leadership positions at] The Goodyear Tire & Rubber Company, a multinational tire manufacturer, and worked [removed: for the] [added: at Jones Day, an] international law [removed: firm of Jones Day.] [added: firm.] Ms. Berardinelli-Krantz is a veteran of the United States Army and Judge Advocate General’s Corps, where she served as a trial attorney in Fort Hood, Texas, and for the Contract Appeals Division in Washington, D.C. She also served as a trial defense counsel in Baghdad, Iraq. | | |

| D.G. Macpherson [removed: (56)] [added: (57)] | | | Chairman of the Board, [removed: a position assumed in] [added: since] October [removed: 2017,] [added: 2017] and Chief Executive [removed: Officer, a position assumed in] [added: Officer since] October 2016 at which time he was also appointed to the Board of Directors. [removed: Previously,] Mr. Macpherson [added: previously] served as Chief Operating [removed: Officer, a position assumed in 2015,] [added: Officer from August 2015 to September 2016,] Senior Vice President and Group President, Global Supply Chain and [removed: International, a position assumed in 2013,] [added: International from September 2013 to July 2015,] Senior Vice President and President, Global Supply Chain and Corporate [removed: Strategy, a position assumed in 2012,] [added: Strategy from January 2012 to August 2013,] and Senior Vice President, Global Supply [removed: Chain, a position assumed in 2008.] [added: Chain from November 2008 to December 2011.] Prior to Grainger, Mr. Macpherson served as Partner and Managing Director at Boston Consulting Group, a global management consulting firm. | | |

| Deidra C. Merriwether [removed: (55)] [added: (56)] | | | Senior Vice President and Chief Financial Officer, [removed: a position assumed in] [added: since] January 2021. [removed: Previously,] Ms. Merriwether [added: previously] served as Senior Vice President, and President, North American Sales & Services, [removed: a position assumed in] [added: from] November [removed: 2019,] [added: 2019 to December 2020,] Senior Vice President, U.S. Direct Sales and Strategic Initiatives, [removed: a position assumed in] [added: from] September [removed: 2017,] [added: 2017 to November 2019,] Vice President, Pricing and Indirect [removed: Procurement, a position assumed in] [added: Procurement from April] 2016 [added: to August 2017] and [removed: as a] Vice President in Finance from 2013 to 2016. Prior to Grainger, Ms. Merriwether held various positions of increasing responsibility at Sears Holdings Corporation, a broadline retailer, [removed: PriceWaterhouseCoopers,] [added: PricewaterhouseCoopers LLP,] a global professional services firm, and Eli Lilly & Company, a global pharmaceutical company. | | |

| Paige K. Robbins [removed: (55)] [added: (56)] | | | Senior Vice President and President, Grainger Business [removed: Unit, a position assumed in] [added: Unit since] January 2021. [removed: Previously,] Ms. Robbins [added: previously] served as Senior Vice President and Chief Technology, Merchandising, Marketing, [removed: and] Strategy [removed: Officer, a position assumed in] [added: Officer from] November [removed: 2019, as] [added: 2019 to December 2020,] Senior Vice President and Chief Merchandising, Marketing, Digital, Strategy [removed: Officer, a position assumed in] [added: Officer from] May [added: 2019 to October] 2019, [removed: as] Senior Vice President and Chief Digital [removed: Officer, a position assumed in] [added: Officer from] September [removed: 2017, and as] [added: 2017 to April 2019,] Senior Vice President, Global Supply Chain, Branch Network, Contact Centers and Corporate [removed: Strategy, a position assumed in 2016. Since] [added: Strategy from November 2016 to August 2017 and various other positions since] joining Grainger in September [removed: 2010, Ms. Robbins has held various positions as a Vice President, including in the areas of Global Supply Chain and Logistics.] [added: 2010.] Prior to Grainger, Ms. Robbins served as Partner and Managing Director at Boston Consulting Group, a global management consulting firm. | | |

| Laurie R. Thomson [removed: (50)] [added: (51)] | | | Vice President, Controller and principal accounting [removed: officer, a position assumed in] [added: officer since] May 2021. [removed: Previously,] Ms. Thomson [added: previously] served as Vice President, Internal Audit and Finance Continuous Improvement [removed: of the Company, a position assumed in] [added: from] November [removed: 2019,] [added: 2019 to April 2021,] Vice President, Internal Audit from October 2016 to November 2019, [added: as] Senior Director, Finance from June 2011 to September 2016, and Director, Internal Audit from February 2008 to June 2011. [added: Prior to Grainger,] Ms. Thomson [removed: is a certified public accountant and prior to Grainger] served as Director, Internal Audit at CVS Health Corporation, a pharmacy healthcare provider, and Audit Manager at Arthur Andersen LLP, a professional services firm. [added: Ms. Thomson is a certified public accountant.] | | |

Additionally,

*Inclusive Workplace*

The Company aspires to increasingly promote a welcoming, inclusive culture that values all people.

Grainger's commitment to inclusion applies throughout the organization.

Grainger's global executive leadership team is comprised of approximately 33% women leaders.

| Jonny LeRoy (53) | | | Senior Vice President and Chief Technology Officer since April 2020. Mr. LeRoy previously served as Head of Technology for North America for ThoughtWorks, a technology consultancy, from 2013 to March 2020. Prior to being promoted to Head of Technology for North America, Mr. LeRoy held roles of increasing responsibility at ThoughtWorks. Prior to joining ThoughtWorks, Mr. LeRoy was a founder and Chief Technology Officer of Whatsonwhen, an online travel information company. | | |

*Diversity, Equity and Inclusion*

The Company aspires to increasingly promote a welcoming, inclusive culture that values all people – regardless of sex, gender, race, color, religion, national origin, age, disability, veteran status, sexual orientation, gender expression or experiences – through recruiting outreach, internal networking, business resource groups and mentoring programs.

Grainger's commitment to diversity, equity and inclusion starts at the top.

| Matt Fortin (57) | | | Senior Vice President and Chief Human Resources Officer, a position assumed in September 2023. Previously, Mr. Fortin served as Group Vice President, Merchandising and Supplier Management, Grainger Business Unit, a position assumed in 2022, Vice President and President, Merchandising and Supplier Management, a position assumed in May 2018, and as Vice President and President, Global Product Management and Indirect Procurement, a position assumed in September 2017. Since joining Grainger in 2006, Mr. Fortin has held various other positions, including in the areas of supply chain, sourcing and operations in China. Prior to Grainger, Mr. Fortin spent 16 years at General Motors, a multinational automotive manufacturing company, in various leadership roles in manufacturing, purchasing, continuous improvement and general management. | | |

For a description of legal proceedings, see the disclosure contained in Note [removed: 14] [added: 13] to the Consolidated Financial Statements included in Part II, Item 8: Financial Statements and Supplementary Data of this Form 10-K, which is incorporated herein by reference.

For the fiscal year ended December 31, [removed: 2023][added: 2024]

The aggregate market value of the voting common equity held by non-affiliates of the registrant was [removed: $35,235,880,897] [added: $40,147,032,828] as of the close of trading as reported on the New York Stock Exchange on June 30, [removed: 2023.][added: 2024.]

The registrant had [removed: 49,173,357] [added: 48,216,708] shares of the Company’s Common Stock outstanding as of February 14, [removed: 2024.][added: 2025.]

Portions of the registrant's definitive proxy statement to be filed in connection with the annual meeting of shareholders to be held on April [removed: 24, 2024,] [added: 30, 2025,] are incorporated by reference into Part III of this Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2023] [added: 2024] (Form 10-K) where indicated.

| Item 1: | | | BUSINESS | | | | | | | | | | | | | | | [removed: [4](#i81aa82e55c054c1fa32fd055ec949ce7_16)] [added: [4](#i8b8d2609d2a047f5bf71c933524911e6_16)] | | |

| Item 1A: | | | RISK FACTORS | | | | | | | | | | | | | | | [removed: [12](#i81aa82e55c054c1fa32fd055ec949ce7_22)] [added: [12](#i8b8d2609d2a047f5bf71c933524911e6_22)] | | |

| Item 1B: | | | UNRESOLVED STAFF COMMENTS | | | | | | | | | | | | | | | [removed: [21](#i81aa82e55c054c1fa32fd055ec949ce7_25)] [added: [22](#i8b8d2609d2a047f5bf71c933524911e6_25)] | | |

| Item 1C: | | | CYBERSECURITY | | | | | | | | | | | | | | | [removed: [2](#i81aa82e55c054c1fa32fd055ec949ce7_1609)[2](#i81aa82e55c054c1fa32fd055ec949ce7_1609)] [added: [24](#i8b8d2609d2a047f5bf71c933524911e6_28)] | | |

| Item 2: | | | PROPERTIES | | | | | | | | | | | | | | | [removed: [22](#i81aa82e55c054c1fa32fd055ec949ce7_28)] [added: [24](#i8b8d2609d2a047f5bf71c933524911e6_31)] | | |

| Item 3: | | | LEGAL PROCEEDINGS | | | | | | | | | | | | | | | [removed: [22](#i81aa82e55c054c1fa32fd055ec949ce7_31)] [added: [24](#i8b8d2609d2a047f5bf71c933524911e6_34)] | | |

| Item 4: | | | MINE SAFETY DISCLOSURES | | | | | | | | | | | | | | | [removed: [22](#i81aa82e55c054c1fa32fd055ec949ce7_34)] [added: [24](#i8b8d2609d2a047f5bf71c933524911e6_37)] | | |

| Item 5: | | | MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED SHAREHOLDER | | | | | | | | | | | | | | | [removed: [23](#i81aa82e55c054c1fa32fd055ec949ce7_40)] [added: [25](#i8b8d2609d2a047f5bf71c933524911e6_43)] | | |

| Item 6: | | | RESERVED | | | | | | | | | | | | | | | [removed: [24](#i81aa82e55c054c1fa32fd055ec949ce7_43)] [added: [26](#i8b8d2609d2a047f5bf71c933524911e6_46)] | | |

| Item 7: | | | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL | | | | | | | | | | | | | | | [removed: [25](#i81aa82e55c054c1fa32fd055ec949ce7_46)] [added: [27](#i8b8d2609d2a047f5bf71c933524911e6_49)] | | |

| Item 7A: | | | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | | | | | | | | | | | | | | | [removed: [36](#i81aa82e55c054c1fa32fd055ec949ce7_67)] [added: [36](#i8b8d2609d2a047f5bf71c933524911e6_70)] | | |

| Item 8: | | | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA | | | | | | | | | | | | | | | [removed: [37](#i81aa82e55c054c1fa32fd055ec949ce7_70)] [added: [37](#i8b8d2609d2a047f5bf71c933524911e6_73)] | | |

| Item 9: | | | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS | | | | | | | | | | | | | | | [removed: [65](#i81aa82e55c054c1fa32fd055ec949ce7_160)] [added: [65](#i8b8d2609d2a047f5bf71c933524911e6_169)] | | |

| Item 9A: | | | CONTROLS AND PROCEDURES | | | | | | | | | | | | | | | [removed: [65](#i81aa82e55c054c1fa32fd055ec949ce7_163)] [added: [65](#i8b8d2609d2a047f5bf71c933524911e6_172)] | | |

| Item 9B: | | | OTHER INFORMATION | | | | | | | | | | | | | | | [removed: [67](#i81aa82e55c054c1fa32fd055ec949ce7_172)] [added: [67](#i8b8d2609d2a047f5bf71c933524911e6_181)] | | |

| Item 9C: | | | DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS | | | | | | | | | | | | | | | [removed: [67](#i81aa82e55c054c1fa32fd055ec949ce7_175)] [added: [67](#i8b8d2609d2a047f5bf71c933524911e6_184)] | | |

| Item 10: | | | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE | | | | | | | | | | | | | | | [removed: [68](#i81aa82e55c054c1fa32fd055ec949ce7_181)] [added: [68](#i8b8d2609d2a047f5bf71c933524911e6_190)] | | |

| Item 11: | | | EXECUTIVE COMPENSATION | | | | | | | | | | | | | | | [removed: [68](#i81aa82e55c054c1fa32fd055ec949ce7_184)] [added: [68](#i8b8d2609d2a047f5bf71c933524911e6_193)] | | |

| Item 12: | | | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND | | | | | | | | | | | | | | | [removed: [68](#i81aa82e55c054c1fa32fd055ec949ce7_187)] [added: [68](#i8b8d2609d2a047f5bf71c933524911e6_196)] | | |

| Item 13: | | | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR | | | | | | | | | | | | | | | [removed: [68](#i81aa82e55c054c1fa32fd055ec949ce7_190)] [added: [68](#i8b8d2609d2a047f5bf71c933524911e6_199)] | | |

| Item 14: | | | PRINCIPAL ACCOUNTANT FEES AND SERVICES | | | | | | | | | | | | | | | [removed: [68](#i81aa82e55c054c1fa32fd055ec949ce7_193)] [added: [68](#i8b8d2609d2a047f5bf71c933524911e6_202)] | | |

| Item 15: | | | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES | | | | | | | | | | | | | | | [removed: [7](#i81aa82e55c054c1fa32fd055ec949ce7_199)[0](#i81aa82e55c054c1fa32fd055ec949ce7_199)] [added: [70](#i8b8d2609d2a047f5bf71c933524911e6_208)] | | |

| Item 16: | | | FORM 10-K SUMMARY | | | | | | | | | | | | | | | [removed: [7](#i81aa82e55c054c1fa32fd055ec949ce7_205)[3](#i81aa82e55c054c1fa32fd055ec949ce7_205)] [added: [73](#i8b8d2609d2a047f5bf71c933524911e6_214)] | | |

Important factors that could cause actual results to differ materially from those presented or implied in the forward-looking statements include, without limitation: inflation, higher product costs or other expenses, including operational and administrative expenses; [removed: the impact of macroeconomic pressures and geopolitical trends, changes and events;] a major loss of customers; loss or disruption of sources of supply; changes in customer or product mix; increased competitive pricing pressures; changes in third-party practices regarding digital advertising; failure to enter into or sustain contractual arrangements on a satisfactory basis with group purchasing organizations; failure to develop, manage or implement new technology initiatives or business strategies, including with respect to Grainger's eCommerce [removed: platforms;] [added: platforms and artificial intelligence;] failure to adequately protect intellectual property or successfully defend against infringement claims; fluctuations or declines in Grainger's gross profit margin; Grainger's responses to market pressures; the outcome of pending and future litigation or governmental or regulatory proceedings, including with respect to wage and hour, anti-bribery and corruption, environmental, regulations related to advertising, marketing and the [removed: Internet,] [added: internet,] consumer protection, pricing (including disaster or emergency declaration pricing statutes), product liability, compliance or safety, trade and export compliance, general commercial disputes, or privacy and cybersecurity matters; investigations, inquiries, audits and changes in laws and regulations; failure to comply with laws, regulations and standards, including new or stricter environmental laws or regulations; government contract matters; the impact of any government shutdown; disruption or breaches of information technology or data security systems involving Grainger or third parties on which Grainger depends; general industry, economic, market or political conditions; general global economic conditions including [removed: tariffs and] [added: existing, new, or increased tariffs,] trade issues and [removed: policies;] [added: changes in trade policies, inflation, and interest rates;] currency exchange rate fluctuations; market volatility, including price and trading volume volatility or price declines of Grainger's common stock; commodity price volatility; facilities disruptions or shutdowns; higher fuel costs or disruptions in transportation services; [added: effects of] outbreaks of pandemic disease or viral [removed: contagions;] [added: contagions, global conflicts,] natural or human induced disasters, extreme [removed: weather] [added: weather,] and other catastrophes or conditions; effects of climate change; failure to execute on our efforts and programs related to environmental, social and governance matters; competition for, or failure to attract, retain, train, motivate and develop executives and key team members; loss of key members of management or key team members; loss of operational flexibility and potential for work stoppages or slowdowns if team members unionize or join a collective bargaining arrangement; changes in effective tax rates; changes in credit ratings or outlook; Grainger's incurrence of indebtedness or failure to comply with restrictions and obligations under its debt agreements and instruments and other factors identified under Part I, Item 1A: Risk Factors and elsewhere in this Form 10-K.

| Signatures | | | | | | | | | | | | | | | | | | [74](#i8b8d2609d2a047f5bf71c933524911e6_217) | | |

| Signatures | | | | | | | | | | | | | | | | | | [73](#i81aa82e55c054c1fa32fd055ec949ce7_208) | | |

Grainger has a [added: dedicated] cybersecurity team that works to prevent, detect, and respond to cybersecurity threats.

The [added: cybersecurity] team has implemented processes designed to assess, identify and manage material risks [added: from cybersecurity threats] and vulnerabilities to the Company’s security posture, including prioritizing and remediating such risks.

The team also works to assess and manage cybersecurity risks by: (i) reviewing [removed: cyber] risks [added: from cybersecurity threats] with senior [removed: management, including the Senior Vice President and Chief Technology Officer (CTO);] [added: management;] (ii) incorporating cybersecurity in its enterprise risk processes; (iii) establishing regular reviews of cybersecurity risks and mitigation efforts, including with the Audit Committee and the Board; and (iv) using third parties as needed for reviews and testing.

Grainger’s cybersecurity team reviews and updates its information security strategy and [added: aligns] plans [removed: to align] [added: based on] cybersecurity prioritization with the identified top enterprise risks.

[added: However,] Grainger, or third-party service providers engaged by Grainger, may be subject to [added: cybersecurity incidents, or] other unauthorized access of information systems in the future.

There can be no assurance that any future [added: cybersecurity incident or] unauthorized access to or breach of these information systems will not be material to Grainger’s business, [added: strategy, results of] operations or financial condition.

The Company’s [removed: CTO] [added: CISO] routinely provides [added: material] cybersecurity updates to the Audit Committee and information to the Board.

The cybersecurity team is led by the Vice President and Chief Information Security Officer (CISO), who is responsible for assessing and managing material risks from cybersecurity threats.

Grainger’s CISO has over 20 years of cybersecurity experience and maintains industry recognized security certifications.

Grainger engages with third parties in order to enhance, implement, assess and monitor its cybersecurity processes, controls, and posture.

As of the date of this filing, Grainger does not believe that any risks from cybersecurity threats, including as a result of past cybersecurity incidents, have had, or are reasonably likely to have, a material adverse effect on Grainger, including its business strategy, results of operations or financial condition.

The management team engaged in the cybersecurity risk management process, including the CTO, has risk management backgrounds, certifications, and/or cyber experience in prior professional roles and at Grainger.

The team maintains expertise on cyber risk management through third-party consultants, external trainings, and affiliations with relevant organizations.

Both the Board and the Audit Committee regularly review the Company’s risk assessment and management processes and policies and receive regular updates from the Company’s management team members who are responsible for the effectiveness of the Company’s ERM program.

The CTO leads an information security team that works to facilitate the protection of the Company’s information and computing assets.

As of December 31, [removed: 2023,] [added: 2024,] Grainger’s owned and leased facilities totaled approximately [removed: 30.4] [added: 30.3] million square feet.

| U.S.(1) | | | | | | DCs | | | | | | [removed: 11,635] [added: 11,642] | | | | | | High-Touch Solutions N.A. | | |

| U.S.(2) | | | | | | Branch locations | | | | | | [removed: 6,324] [added: 6,327] | | | | | | High-Touch Solutions N.A. | | |

| Japan(3) | | | | | | DCs | | | | | | [removed: 3,370] [added: 3,380] | | | | | | Endless Assortment | | |

| U.S.(4) | | | | | | Other facilities | | | | | | [removed: 3,878] [added: 3,847] | | | | | | High-Touch Solutions N.A. | | |

| (2) Consists of 245 branches, [removed: 62] [added: 65] onsite and four will-call express locations. These facilities range in size from under 1,000 to 110,000 square feet. These facilities are primarily owned. | | | | | | | | | | | | | | | | | | | | |

| (3) Consists of four DCs that range in size from approximately 160,000 to 2.1 million square feet. These facilities are both owned and leased. Other facilities include office space that range in size from approximately [removed: 1,500] [added: 1,000] to 90,000 square feet. These facilities are primarily leased. | | | | | | | | | | | | | | | | | | | | |

| (6) In Mexico, Grainger has [removed: 16] [added: 15] branch locations, two DCs and one other location which total [removed: 655,000] [added: 650,000] square feet. | | | | | | | | | | | | | | | | | | | | |

| (8) In the U.K., Grainger has [removed: 35] [added: 33] branch and other facility locations and one DC which total [removed: 705,000] [added: 685,000] square feet. | | | | | | | | | | | | | | | | | | | | |

The following table provides information relating to Grainger's repurchase of common stock during the three months ended December 31, [removed: 2023:][added: 2024:]

[removed: (C)Purchases] [added: (C)Prior to April 28, 2024, purchases] were made pursuant to a share repurchase program approved by Grainger's Board of Directors and announced [added: on] April 28, 2021 (2021 Program).

(D)The difference of [removed: 21] [added: 206] shares between the Total Number of Shares Purchased and the Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs represents shares purchased by the administrator and record keeper of the W.W. Grainger, Inc. Retirement Savings Plan for the benefit of the team members who participate in the plan.

The following stock price performance graph compares the cumulative total return on an investment in Grainger common stock with the cumulative total return of an investment in each of the Dow Jones US Industrial Suppliers Total Stock Market [removed: Index] [added: Index, which includes Grainger,] and the S&P 500 Stock Index.

It covers the period commencing December 31, [removed: 2018] [added: 2019] and ending December 31, [removed: 2023.][added: 2024.]

The graph assumes that the value for the investment in Grainger common stock and in each index was $100 on December 31, [removed: 2018,] [added: 2019,] and that all dividends were reinvested.

[removed: ][added: ]

| | | | [removed: 2018 | | |] 2019 | | | 2020 | | | 2021 | | | 2022 | | | 2023 | | | [added: 2024 | | |]

| Dow Jones US Industrial Suppliers Total Stock Market Index | | | 100 | | | [removed: 133] [added: 125] | | | [removed: 166] [added: 170] | | | [removed: 226] [added: 151] | | | [removed: 200] [added: 223] | | | [removed: 296] [added: 260] | | |

As of February 14, 2025, there were 496 shareholders of record of Grainger’s common stock.

A substantially greater number of holders of Grainger common stock are "street name" or beneficial holders, whose shares of record are held by banks, brokers, and other financial institutions.

| Oct. 1 – Oct. 31 | | | 11,339 | | | $1,023.97 | | | 11,332 | | | 4,570,888 | | | shares | | |

| Nov. 1 – Nov. 30 | | | 148,340 | | | $1,190.32 | | | 148,340 | | | 4,422,548 | | | shares | | |

| Dec. 1 – Dec. 31 | | | 241,646 | | | $1,132.63 | | | 241,447 | | | 4,181,101 | | | shares | | |

| Total | | | 401,325 | | | | | | 401,119 | | | | | | | | |

On April 24, 2024, Grainger's Board of Directors authorized a program for the Company to repurchase an aggregate amount of up to five million shares in the open market, through privately negotiated transactions and block transactions, pursuant to a trading plan or otherwise (2024 Program) with no expiration date.

In authorizing the 2024 Program, the Board of Directors terminated the 2021 Program.

| W.W. Grainger, Inc. | | | $ | 100 | | $ | 123 | | $ | 158 | | $ | 172 | | $ | 259 | | $ | 332 | |

| S&P 500 Stock Index | | | 100 | | | 118 | | | 152 | | | 125 | | | 158 | | | 197 | | |

The approximate number of shareholders of record of Grainger’s common stock as of February 14, 2024, was 510 with approximately 593,729 additional shareholders holding stock through nominees.

| Oct. 1 – Oct. 31 | | | 154,423 | | | $708.93 | | | 154,423 | | | 1,833,521 | | | shares | | |

| Nov. 1 – Nov. 30 | | | 150,765 | | | $787.67 | | | 150,765 | | | 1,682,756 | | | shares | | |

| Dec. 1 – Dec. 31 | | | 130,851 | | | $819.69 | | | 130,830 | | | 1,551,926 | | | shares | | |

| Total | | | 436,039 | | | | | | 436,018 | | | | | | | | |

The 2021 Program authorized the repurchase of up to five million shares with no expiration date.

| W.W. Grainger, Inc. | | | $ | 100 | | $ | 122 | | $ | 150 | | $ | 193 | | $ | 210 | | $ | 317 | |

| S&P 500 Stock Index | | | 100 | | | 131 | | | 156 | | | 200 | | | 164 | | | 207 | | |

We have audited the accompanying consolidated balance sheets of W.W. Grainger, Inc. and subsidiaries (the Company) as of December 31, [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] the related consolidated statements of earnings, comprehensive earnings, shareholders’ equity and cash flows for each of the three years in the period ended December 31, [removed: 2023,] [added: 2024,] and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2023,] [added: 2024,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February [removed: 22, 2024] [added: 20, 2025] expressed an unqualified opinion thereon.

| *Description of the Matter* | | | At December 31, [removed: 2023,] [added: 2024,] the goodwill balance of the Canada business reporting unit was [removed: $124] [added: $114] million. As discussed in Notes 1 and 4 [removed: of] [added: to] the financial statements, goodwill is tested at the reporting unit level annually during the fourth quarter and more frequently if impairment indicators exist. Auditing management’s annual goodwill impairment analysis [removed: is] [added: for the Canada business reporting unit was] complex [removed: and highly judgmental] due to [removed: the] [added: certain assumptions that were] significant [removed: estimation required] to [removed: determine] the [removed: fair value of the reporting unit. In particular,] [added: analysis. Management performed an annual impairment analysis in] the [removed: fair value estimate was sensitive] [added: fourth quarter] to [removed: significant] [added: evaluate changes in key] assumptions [removed: such as] [added: and operating results since the last impairment test. The more subjective assumptions used in the analysis were] projections of future [added: revenue growth and] operating expenditures, which are [added: all] affected by expectations about future market or economic conditions. | | |

| *How We Addressed the Matter in Our Audit* | | | Our audit procedures [removed: included, among others] [added: included] obtaining an understanding, evaluating the design and testing the operating effectiveness of controls over the Company’s goodwill impairment analysis, including controls over management’s review of the [removed: significant assumption described above.] [added: changes in key assumptions and operating results since the last impairment test.] | | |

| | | | To test [removed: the estimated fair value] [added: management's annual goodwill impairment analysis] of the Canada business reporting unit, we performed audit procedures that [removed: included, among others, assessing methodologies and involving our valuation specialists to assist in testing] [added: included evaluating] the [removed: significant] [added: key] assumptions and [removed: testing] [added: operating results considering] the [removed: completeness] [added: relevant events] and [removed: accuracy of] [added: circumstances identified since] the [removed: underlying data used by] [added: date of] the [removed: Company in its analysis.] [added: last fair value calculation.] We compared the significant assumptions used by management to current industry and economic trends, changes to the Company’s business model, customer [removed: base or] product mix, and other relevant factors. We [added: also] assessed the historical accuracy of management’s estimates and performed sensitivity analyses of significant assumptions to evaluate the changes in [removed: the] fair value [removed: of the reporting units] that would result from changes in the [removed: assumptions.] [added: assumptions utilized in the last quantitative assessment.] | | |

| | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | |

| Net sales | | | $ | [removed: 16,478] [added: 17,168] | | | | | $ | [removed: 15,228] [added: 16,478] | | | | | $ | [removed: 13,022] [added: 15,228] | |

| Cost of goods sold | | | [removed: 9,982] [added: 10,410] | | | | | | [removed: 9,379] [added: 9,982] | | | | | | [removed: 8,302] [added: 9,379] | | |

| Gross profit | | | [removed: 6,496] [added: 6,758] | | | | | | [removed: 5,849] [added: 6,496] | | | | | | [removed: 4,720] [added: 5,849] | | |

| Selling, general and administrative expenses | | | [removed: 3,931] [added: 4,121] | | | | | | [removed: 3,634] [added: 3,931] | | | | | | [removed: 3,173] [added: 3,634] | | |

| Operating earnings | | | [removed: 2,565] [added: 2,637] | | | | | | [removed: 2,215] [added: 2,565] | | | | | | [removed: 1,547] [added: 2,215] | | |

| Interest expense – net | | | [removed: 93] [added: 77] | | | | | | 93 | | | | | | [removed: 87] [added: 93] | | |

| Other – net | | | [removed: (28)] [added: (24)] | | | | | | [removed: (24)] [added: (28)] | | | | | | [removed: (25)] [added: (24)] | | |

| Total other expense – net | | | [removed: 65] [added: 53] | | | | | | [removed: 69] [added: 65] | | | | | | [removed: 62] [added: 69] | | |

| Earnings before income taxes | | | [removed: 2,500] [added: 2,584] | | | | | | [removed: 2,146] [added: 2,500] | | | | | | [removed: 1,485] [added: 2,146] | | |

| Income tax provision | | | [removed: 597] [added: 595] | | | | | | [removed: 533] [added: 597] | | | | | | [removed: 371] [added: 533] | | |

| Net earnings | | | [removed: 1,903] [added: 1,989] | | | | | | [removed: 1,613] [added: 1,903] | | | | | | [removed: 1,114] [added: 1,613] | | |

| Less net earnings attributable to noncontrolling interest | | | [removed: 74] [added: 80] | | | | | | [removed: 66] [added: 74] | | | | | | [removed: 71] [added: 66] | | |

| Net earnings attributable to W.W. Grainger, Inc. | | | $ | [removed: 1,829] [added: 1,909] | | | | | $ | [removed: 1,547] [added: 1,829] | | | | | $ | [removed: 1,043] [added: 1,547] | |

| Basic | | | $ | [removed: 36.39] [added: 38.84] | | | | | $ | [removed: 30.22] [added: 36.39] | | | | | $ | [removed: 19.94] [added: 30.22] | |

| Diluted | | | $ | [removed: 36.23] [added: 38.71] | | | | | $ | [removed: 30.06] [added: 36.23] | | | | | $ | [removed: 19.84] [added: 30.06] | |

| Basic | | | [removed: 49.9] [added: 48.9] | | | | | | [removed: 50.9] [added: 49.9] | | | | | | [removed: 51.9] [added: 50.9] | | |

| Diluted | | | [removed: 50.1] [added: 49.0] | | | | | | [removed: 51.1] [added: 50.1] | | | | | | [removed: 52.2] [added: 51.1] | | |

| Net earnings | | | $ | [removed: 1,903] [added: 1,989] | | | | | $ | [removed: 1,613] [added: 1,903] | | | | | $ | [removed: 1,114] [added: 1,613] | |

| Foreign currency translation adjustments [removed: – net of reclassification to earnings] | | | [removed: (11)] [added: (137)] | | | | | | [removed: (101)] [added: (11)] | | | | | | [removed: (64)] [added: (101)] | | |

| Postretirement benefit plan losses – net of tax expense of [added: $0,] $2, [removed: $6,] and [removed: $0,] [added: $6,] respectively | | | [removed: (2)] [added: (1)] | | | | | | [removed: (17)] [added: (2)] | | | | | | [removed: —] [added: (17)] | | |

| Total other comprehensive earnings (losses) | | | [removed: (13)] [added: (138)] | | | | | | [removed: (118)] [added: (13)] | | | | | | [removed: (64)] [added: (118)] | | |

| Comprehensive earnings – net of tax | | | [removed: 1,890] [added: 1,851] | | | | | | [removed: 1,495] [added: 1,890] | | | | | | [removed: 1,050] [added: 1,495] | | |

| Net earnings | | | [removed: 74] [added: 80] | | | | | | [removed: 66] [added: 74] | | | | | | [removed: 71] [added: 66] | | |

| Foreign currency translation adjustments | | | [removed: (21)] [added: (36)] | | | | | | [removed: (34)] [added: (21)] | | | | | | [removed: (29)] [added: (34)] | | |

| Total comprehensive earnings (losses) attributable to noncontrolling interest | | | [removed: 53] [added: 44] | | | | | | [removed: 32] [added: 53] | | | | | | [removed: 42] [added: 32] | | |

| Comprehensive earnings attributable to W.W. Grainger, Inc. | | | $ | [removed: 1,837] [added: 1,807] | | | | | $ | [removed: 1,463] [added: 1,837] | | | | | $ | [removed: 1,008] [added: 1,463] | |

| Assets | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2022] [added: 2023] | | |

| Cash and cash equivalents | | | $ | [removed: 660] [added: 1,036] | | | | | $ | [removed: 325] [added: 660] | |

| Accounts receivable (less allowance for credit losses of [removed: $35] [added: $32] and [removed: $36,] [added: $35,] respectively) | | | [removed: 2,192] [added: 2,232] | | | | | | [removed: 2,133] [added: 2,192] | | |

| Inventories – net | | | [removed: 2,266] [added: 2,306] | | | | | | [removed: 2,253] [added: 2,266] | | |

| Prepaid expenses and other current assets | | | [removed: 156] [added: 163] | | | | | | [removed: 266] [added: 156] | | |

| Total current assets | | | [removed: 5,274] [added: 5,737] | | | | | | [removed: 4,977] [added: 5,274] | | |

| Property, buildings and equipment – net | | | [removed: 1,658] [added: 1,927] | | | | | | [removed: 1,461] [added: 1,658] | | |

| Net earnings | | | $ | 1,989 | | | | | $ | 1,903 | | | | | $ | 1,613 | |

| Net earnings | | | — | | | — | | | 1,909 | | | — | | | — | | | 80 | | | 1,989 | | |

| Balance at December 31, 2024 | | | $ | 55 | | $ | 1,399 | | $ | 13,677 | | $ | (274) | | $ | (11,499) | | $ | 345 | | $ | 3,703 | |

The Company considers cash equivalents to be short term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.

payments for non-components such as real estate taxes and insurance.

it cannot be reasonably estimated are disclosed.

*Accounting Pronouncements Recently Adopted*

The Company adopted this ASU effective December 31, 2024 on a retrospective basis and it did not have a material impact on the Consolidated Financial Statements.

For the related segment reporting disclosure, see Note 12.

In November 2024, the FASB issued ASU 2024-03, *Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses*.

This update requires public entities to disclose required information for inventory purchases, employee compensation, depreciation, intangible asset amortization and selling expense.

The effective date is for fiscal years beginning after December 15, 2026, with the option to early adopt prior to the effective date and should be applied on prospective basis, but retrospective application is permitted.

The majority of Company revenue originates from contracts with a single performance obligation to deliver products, whereby performance obligations are satisfied when control of the product is transferred to the customer per the arranged shipping terms.

| | | | As of | | | | | | | | |

| Balance at December 31, 2024 | | | | | | $ | 306 | | | | | $ | 49 | | | | | | | | | | | $ | 355 | |

| 4.45% senior notes due 2034 | | | 500 | | | | | | 477 | | | | | | — | | | | | | — | | |

| 1.85% senior notes due 2025 | | | 500 | | | | | | 498 | | | | | | — | | | | | | — | | |

| Total debt | | | $ | 2,778 | | | | | $ | 2,491 | | | | | $ | 2,300 | | | | | $ | 2,147 | |

In September 2024, Grainger issued $500 million in unsecured 4.45% Senior Notes (4.45% Notes).

Grainger intends to use the net proceeds from this offering to repay the 1.85% Senior Notes that mature in February 2025 and any remaining net proceeds for general corporate purposes.

The 4.45% Notes mature in September 2034, require no principal payments until maturity, and interest is paid semi-annually in arrears, beginning March 15, 2025.

Under this method, the resulting carrying value adjustments as of December 31, 2024 and 2023, are presented in Other in the table above and the estimated fair value of the interest rate swaps, based on Level 2 inputs within the fair value hierarchy, are reported on the Consolidated Balance Sheets in Other non-current liabilities.

The gain or loss on the interest rate swaps as well as the offsetting gain or loss on the 1.85% Senior Notes, are recognized in the Consolidated Statements of Earnings in Interest expense – net and the effect for the twelve months ended December 31, 2024 and 2023 was not material.

In the third quarter of 2024, the term loan was paid in full.

| 2025 | | | | | | $ | 502 | |

| 2029 | | | | | | — | | |

| Thereafter | | | | | | 2,300 | | |

| Total | | | | | | $ | 2,803 | |

| Benefits paid | | | (9) | | | | | | (10) | | |

| Initial healthcare cost trend rate (pre age 65) | | | 6.90 | | % | | | | 7.20 | | % | | | | 7.50 | | % |

| | | | 2024 | | | | | | 2023 | | |

| 2029 | | | | | | 8 | | |

| 2030-2034 | | | | | | 41 | | |

| | | | | | | 2024 | | | | | | 2023 | | |

| | | | | | | 2024 | | | | | | 2023 | | |

| 2029 | | | | | | 50 | | |

| Balance at December 31, 2024 – net of tax | | | $ | (468) | | $ | 76 | | $ | (3) | | | | | $ | (395) | | $ | (121) | | $ | (274) | |

| | | | 2024 | | | | | | 2023 | | | | | | 2022 | | |

| | | | 2024 | | | | | | 2023 | | | | | | 2022 | | |

| | | | 2024 | | | | | | 2023 | | |

February 22, 2024

| | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | |

| Balance at January 1, 2021 | | | $ | 55 | | $ | 1,239 | | $ | 8,779 | | $ | (61) | | $ | (8,184) | | $ | 265 | | $ | 2,093 | |

| Net earnings | | | — | | | — | | | 1,043 | | | — | | | — | | | 71 | | | 1,114 | | |

| Reclassification due to the adoption of ASU 2019-12 | | | — | | | — | | | 12 | | | — | | | — | | | — | | | 12 | | |

*Reclassifications*

Certain reclassifications have been made to prior year amounts in Grainger's Consolidated Statements of Cash Flows to conform with the current year presentation.

The Company reclassified amounts to separately disclose Non-cash lease expense as an adjustment to reconcile net earnings to net cash provided by operating activities and Operating lease liabilities as a change in operating assets and liabilities.

Previously, the net activity for these amounts were included in Depreciation and amortization.

The change had no effect on previously reported results including net cash provided by (used in) operating, investing and financing activities or net earnings for the twelve months ended December 31, 2023, 2022 and 2021.

million as of December 31, 2023 and 2022, respectively, and are reported as part of Accrued expenses.

The Company considers all highly liquid investments with original maturities of three months or less at time of purchase to be cash equivalents.

documented periodically.

In addition, the segments have unique underlying risks associated with customer purchasing behaviors.

In the High-Touch Solutions N.A. segment, more than two-thirds of revenue is derived from customer contracts whereas in the Endless Assortment segment, a majority of revenue is derived from non-contractual purchases.

| | | | As of | | | | | | | | | | | | | | |

| Balance at January 1, 2022 | | | | | | $ | 321 | | | | | $ | 63 | | | | | | | | | | | $ | 384 | |

| Subtotal | | | 2,319 | | | | | | 2,166 | | | | | | 2,340 | | | | | | 2,081 | | |

The 2023 Credit Facility replaced the Company's former $1.25 billion unsecured revolving credit facility, dated as of February 2020 (2020 Credit Facility), which was scheduled to mature in February 2025.

The 2020 Credit Facility was terminated in October 2023.

The resulting carrying value adjustments as of December 31, 2023 and 2022, are presented in Other in the table above.

As of December 31, 2023 and 2022, the carrying amount of the term loan, including current maturities due within one year, was $32 million and $69 million, respectively.

The term loan matures in 2024, payable over two equal remaining semi-annual principal installments in 2024 and bears an average interest rate of 0.05%.

| Total | | | | | | $ | 2,337 | |

| Pre age 65 | | | 7.50 | | % | | | | 6.50 | | % | | | | 5.81 | | % |

| Pre age 65 | | | 7.20 | | % | | | | 7.50 | | % | | | | 6.50 | | % |

| Corporate bonds | | | 56 | | | | | | 57 | | |

| Government/municipal bonds | | | 9 | | | | | | 12 | | |

| Thereafter | | | | | | 119 | | |

| Fair value of shares vested | | | $ | 35 | | | | | | | | $ | 31 | | | | | | | | $ | 51 | | | | |

| Balance at December 31, 2021 – net of tax | | | $ | (219) | | $ | 99 | | $ | (6) | | | | | $ | (126) | | $ | (30) | | $ | (96) | |

NOTE 11 - DERIVATIVE INSTRUMENTS

The Company's earnings and cash flows are subject to fluctuations due to changes in foreign currency exchange rates and interest rates.

Grainger currently enters into certain derivatives or other financial instruments to hedge against these risks, and may continue to do so in the future.

*Fair Value Hedges*

The Company uses interest rate swaps to hedge a portion of its fixed-rate long-term debt.

These swaps are treated as fair value hedges and consequently the gain or loss on the derivative as well as the offsetting gain or loss on the hedged item, are recognized in the Consolidated Statements of Earnings in Interest expense – net.

The notional amount of the Company’s outstanding fair value hedges as of December 31, 2023 and 2022 were $450 million and $500 million, respectively.

Grainger's management assessed the effectiveness of Grainger's internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

Based on its assessment under that framework and the criteria established therein, Grainger's management concluded that Grainger's internal control over financial reporting was effective as of December 31, [removed: 2023.][added: 2024.]

Ernst & Young LLP, an independent registered public accounting firm, has audited Grainger's internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] as stated in their report, which is included herein.

There were no changes to Grainger's internal control over financial reporting for the quarter ending December 31, [removed: 2023] [added: 2024] that have materially affected, or are reasonably likely to materially affect, Grainger's internal control over financial reporting.

We have audited W.W. Grainger, Inc. and subsidiaries’ internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, W.W Grainger, Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2023,] [added: 2024,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2023] [added: 2024] and [removed: 2022,] [added: 2023,] the related consolidated statements of earnings, comprehensive earnings, shareholders’ equity and cash flows for each of the three years in the period ended December 31, [removed: 2023,] [added: 2024,] and the related notes and our report dated February [removed: 22, 2024] [added: 20, 2025] expressed an unqualified opinion thereon.

February 20, 2025

February 22, 2024

None of the Company's directors or officers adopted, modified or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the Company's quarter ended December 31, [removed: 2023.][added: 2024.]

The information required by this item is incorporated by reference to Grainger's proxy statement relating to the annual meeting of shareholders to be held April [removed: 24, 2024,] [added: 30, 2025,] under the captions “Board Qualifications, Attributes, Skills and Background,” “Annual Election of Directors,” “Candidates for Board Membership,” “Director Nominees’ Experience and Qualifications,” “Audit Committee,” and “Board Affairs and Nominating [removed: Committee,” and "Delinquent Section 16(a) Reports." Information required by this item regarding executive officers of Grainger is set forth in Part I, Item 1, under the caption “Information about our Executive Officers.”][added: Committee”.]

Information required by this item regarding executive officers of Grainger is set forth in Part I, Item 1, under the caption “Information about our Executive Officers.”

The Company has adopted an insider trading policy and program that govern the purchase, sale and other disposition of its securities by the Company’s directors, officers, team members and contractors, and family members of any of the foregoing, as well as the Company itself.

The insider trading policy provides that the Company will comply with insider trading laws, rules and regulations and the New York Stock Exchange listing standards.

The foregoing summary of the Company’s insider trading policy and program is qualified in its entirety by reference to the full text thereof attached hereto as Exhibit 19.

The information required by this item is incorporated by reference to Grainger’s proxy statement relating to the annual meeting of shareholders to be held April [removed: 24, 2024,] [added: 30, 2025,] under the captions “Director Compensation,” “Compensation Discussion and Analysis,” “Compensation Committee of the Board,” “Report of the Compensation Committee of the Board,” [added: and] “CEO Pay [removed: Ratio,” and “Pay Versus Performance Disclosure.”][added: Ratio.”]

The information required by this item is incorporated by reference to Grainger's proxy statement relating to the annual meeting of shareholders to be held April [removed: 24, 2024,] [added: 30, 2025,] under the captions “Ownership of Grainger Stock” and “Equity Compensation Plans.”

The information required by this item is incorporated by reference to Grainger's proxy statement relating to the annual meeting of shareholders to be held April [removed: 24, 2024,] [added: 30, 2025,] under the captions “Director Independence,” “Annual Election of Directors” and “Transactions with Related Persons.”

The information required by this item is incorporated by reference to Grainger's proxy statement relating to the annual meeting of shareholders to be held April [removed: 24, 2024,] [added: 30, 2025,] under the caption “Audit Fees and Audit Committee Pre-Approval Policies and Procedures.”

| REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM PCAOB ID: | | | 42 | | | [removed: [37](#i81aa82e55c054c1fa32fd055ec949ce7_73)] [added: [37](#i8b8d2609d2a047f5bf71c933524911e6_76)] | | |

| CONSOLIDATED STATEMENTS OF EARNINGS FOR THE YEARS ENDED DECEMBER 31, [removed: 2023, 2022] [added: 2024, 2023] AND [removed: 2021] [added: 2022] | | | | | | [removed: [39](#i81aa82e55c054c1fa32fd055ec949ce7_76)] [added: [39](#i8b8d2609d2a047f5bf71c933524911e6_79)] | | |

| CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS FOR THE YEARS ENDED DECEMBER 31, [removed: 2023, 2022] [added: 2024, 2023] AND [removed: 2021] [added: 2022] | | | | | | [removed: [40](#i81aa82e55c054c1fa32fd055ec949ce7_79)] [added: [40](#i8b8d2609d2a047f5bf71c933524911e6_82)] | | |

| CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, [removed: 2023] [added: 2024] AND [removed: 2022] [added: 2023] | | | | | | [removed: [41](#i81aa82e55c054c1fa32fd055ec949ce7_82)] [added: [41](#i8b8d2609d2a047f5bf71c933524911e6_85)] | | |

| CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, [removed: 2023, 2022] [added: 2024, 2023] AND [removed: 2021] [added: 2022] | | | | | | [removed: [42](#i81aa82e55c054c1fa32fd055ec949ce7_85)] [added: [42](#i8b8d2609d2a047f5bf71c933524911e6_88)] | | |

| CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, [removed: 2023, 2022] [added: 2024, 2023] AND [removed: 2021] [added: 2022] | | | | | | [removed: [43](#i81aa82e55c054c1fa32fd055ec949ce7_88)] [added: [43](#i8b8d2609d2a047f5bf71c933524911e6_91)] | | |

| NOTES TO CONSOLIDATED FINANCIAL STATEMENTS | | | | | | [removed: [44](#i81aa82e55c054c1fa32fd055ec949ce7_91)] [added: [44](#i8b8d2609d2a047f5bf71c933524911e6_94)] | | |

| [removed: [2.1](http://www.sec.gov/Archives/edgar/data/277135/000110465915055285/a15-16633_1ex2d1.htm)] [added: [2.1](https://www.sec.gov/Archives/edgar/data/277135/000110465915055285/a15-16633_1ex2d1.htm)] | | | | | | Share Purchase Agreement, dated as of July 30, 2015, by and among Grainger, GWW UK Holdings Limited, Gregory Family Office Limited and Michael Gregory, incorporated by reference to Exhibit 2.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated July 31, 2015. | | |

| [removed: [3.1](http://www.sec.gov/Archives/edgar/data/277135/0000277135-98-000011.txt)] [added: [3.1](https://www.sec.gov/Archives/edgar/data/277135/0000277135-98-000011.txt)] | | | | | | Restated Articles of Incorporation, incorporated by reference to Exhibit 3(i) to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998. | | |

| [removed: [3.2](http://www.sec.gov/Archives/edgar/data/277135/000110465917015516/a17-8047_1ex3d1d1.htm)] [added: [3.2](https://www.sec.gov/Archives/edgar/data/277135/000110465917015516/a17-8047_1ex3d1d1.htm)] | | | | | | By-laws, as amended on March 9, 2017, incorporated by reference to Exhibit 3.1.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated March 9, 2017. | | |

| [removed: [4.1](http://www.sec.gov/Archives/edgar/data/277135/000110465915044837/a15-11230_5ex4d1.htm)] [added: [4.1](https://www.sec.gov/Archives/edgar/data/277135/000110465915044837/a15-11230_5ex4d1.htm)] | | | | | | Indenture, dated as of June 11, 2015, between W.W. Grainger, Inc. and U.S. Bank National Association, as trustee, incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated June 11, 2015. | | |

| [removed: [4.2](http://www.sec.gov/Archives/edgar/data/277135/000110465915044837/a15-11230_5ex4d2.htm)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/277135/000110465915044837/a15-11230_5ex4d2.htm)] | | | | | | First Supplemental Indenture, dated as of June 11, 2015, between W.W. Grainger, Inc. and U.S. Bank National Association, as trustee, and Form of 4.60% Senior Notes due 2045, incorporated by reference to Exhibit 4.2 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated June 11, 2015. | | |

| [removed: [4.3](http://www.sec.gov/Archives/edgar/data/277135/000110465916121315/a16-8597_3ex4d1.htm)] [added: [4.3](https://www.sec.gov/Archives/edgar/data/277135/000110465916121315/a16-8597_3ex4d1.htm)] | | | | | | Second Supplemental Indenture, dated as of May 16, 2016, between W.W. Grainger, Inc., and U.S. Bank National Association, as trustee, incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated May 16, 2016. | | |

| [removed: [4.4](http://www.sec.gov/Archives/edgar/data/277135/000110465917034230/a17-12594_3ex4d1.htm)] [added: [4.4](https://www.sec.gov/Archives/edgar/data/277135/000110465917034230/a17-12594_3ex4d1.htm)] | | | | | | Third Supplemental Indenture, dated as of May 22, 2017, between W.W. Grainger, Inc., and U.S. Bank National Association, as trustee, incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated May 22, 2017. | | |

| [removed: [4.5](http://www.sec.gov/Archives/edgar/data/277135/000110465916121315/a16-8597_3ex4d1.htm)] [added: [4.5](https://www.sec.gov/Archives/edgar/data/277135/000110465916121315/a16-8597_3ex4d1.htm)] | | | | | | Form of 3.75% Senior Notes due 2046 (included in Exhibit 4.3), incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated May 16, 2016. | | |

| [removed: [4.6](http://www.sec.gov/Archives/edgar/data/277135/000110465917034230/a17-12594_3ex4d1.htm)] [added: [4.6](https://www.sec.gov/Archives/edgar/data/277135/000110465917034230/a17-12594_3ex4d1.htm)] | | | | | | Form of 4.20% Senior Notes due 2047 (included in Exhibit 4.4), incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Current Report on Form 8-K dated May 22, 2017. | | |

| [removed: [4.7](https://www.sec.gov/Archives/edgar/data/277135/000027713524000011/gww-20231231xex47.htm)] [added: [4.7](https://www.sec.gov/Archives/edgar/data/277135/000027713525000010/gww-20241231xex47.htm)] | | | | | | Description of Registrant's Securities Pursuant to Section 12 of the Securities Exchange Act of [removed: 1934.] [added: 1934.] | | |

| [removed: [4.8](http://www.sec.gov/Archives/edgar/data/277135/000110465920025418/tm208239d5_ex4-1.htm)] [added: [4.8](https://www.sec.gov/Archives/edgar/data/277135/000110465920025418/tm208239d5_ex4-1.htm)] | | | | | | Fourth Supplemental Indenture, dated as of February 26, 2020, between W.W. Grainger, Inc., and U.S. Bank National Association, as trustee incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.'s Current Report on Form 8-K dated February 21, 2020. | | |

| [removed: [4.9](http://www.sec.gov/Archives/edgar/data/277135/000110465920025418/tm208239d5_ex4-1.htm)] [added: [4.9](https://www.sec.gov/Archives/edgar/data/277135/000110465920025418/tm208239d5_ex4-1.htm)] | | | | | | Form of 1.85% Senior Notes due 2025 (included in Exhibit 4.8), incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.'s Current Report on Form 8-K dated February 21, 2020. | | |

| [removed: [10.1](http://www.sec.gov/Archives/edgar/data/277135/000027713509000012/exhibit10bi.htm)] [added: [10.1](https://www.sec.gov/Archives/edgar/data/277135/000027713509000012/exhibit10bi.htm)] | | | | | | Form of Indemnification Agreement between W.W. Grainger, Inc. and each of its directors and certain of its executive officers, incorporated by reference to Exhibit 10(b)(i) to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009.* | | |

| [removed: [10.2](http://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10v.htm)] [added: [10.2](https://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10v.htm)] | | | | | | Frozen Executive Death Benefit Plan, as amended, incorporated by reference to Exhibit 10(b)(v) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2007.* | | |

| [removed: [10.3](http://www.sec.gov/Archives/edgar/data/277135/000027713509000005/exhibit10v1.htm)] [added: [10.3](https://www.sec.gov/Archives/edgar/data/277135/000027713509000005/exhibit10v1.htm)] | | | | | | First amendment to the Frozen Executive Death Benefit Plan, incorporated by reference to Exhibit 10(b)(v)(1) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2008.* | | |

| [removed: [10.4](http://www.sec.gov/Archives/edgar/data/277135/000027713510000011/exhibit10biv2.htm)] [added: [10.4](https://www.sec.gov/Archives/edgar/data/277135/000027713510000011/exhibit10biv2.htm)] | | | | | | Second amendment to the Frozen Executive Death Benefit Plan, incorporated by reference to Exhibit 10(b)(iv)(2) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2009.* | | |

| [removed: [10.5](http://www.sec.gov/Archives/edgar/data/277135/000027713504000007/exhibit10_8.htm)] [added: [10.5](https://www.sec.gov/Archives/edgar/data/277135/000027713504000007/exhibit10_8.htm)] | | | | | | Supplemental Profit Sharing Plan, as amended, incorporated by reference to Exhibit 10(viii) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2003.* | | |

| [removed: [10.6](http://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10ix.htm)] [added: [10.6](https://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10ix.htm)] | | | | | | Supplemental Profit Sharing Plan II, as amended, incorporated by reference to Exhibit 10(b)(ix) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2007.* | | |

| [removed: [10.7](http://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10xi.htm)] [added: [10.7](https://www.sec.gov/Archives/edgar/data/277135/000027713508000006/exhibit10xi.htm)] | | | | | | Voluntary Salary and Incentive Deferral Plan, as amended, incorporated by reference to Exhibit 10(b)(xi) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2007.* | | |

| [removed: [10.8](https://www.sec.gov/Archives/edgar/data/277135/000027713524000011/gww-20231231xex108.htm)] [added: [10.8](https://www.sec.gov/Archives/edgar/data/277135/000027713525000010/gww-20241231xex108.htm)] | | | | | | Summary Description of the Directors Compensation Program.* | | |

| [10.10](https://www.sec.gov/Archives/edgar/data/277135/000027713524000011/gww-20231231xex1010.htm) | | | | | | Summary Description of the Company Management Incentive [removed: Program.*] [added: Program, incorporated by reference to Exhibit 10.10 to W.W. Grainger, Inc's Annual Report on Form 10-K for the year ended December 31, 2023.*] | | |

| [removed: [10.11](http://www.sec.gov/Archives/edgar/data/277135/000027713510000011/exhibit10bxxv.htm)] [added: [10.11](https://www.sec.gov/Archives/edgar/data/277135/000027713510000011/exhibit10bxxv.htm)] | | | | | | Incentive Program Recoupment Agreement, incorporated by reference to Exhibit 10(b)(xxv) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2009.* | | |

| [removed: [10.12](http://www.sec.gov/Archives/edgar/data/277135/000027713511000011/exhibit10bxxvii.htm)] [added: [10.12](https://www.sec.gov/Archives/edgar/data/277135/000027713511000011/exhibit10bxxvii.htm)] | | | | | | Form of Change in Control Employment Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10(b)(xxvii) to W.W. Grainger, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2010.* | | |

| [removed: [10.13](http://www.sec.gov/Archives/edgar/data/277135/000104746915002102/a2223255zdef14a.htm#30)] [added: [10.13](https://www.sec.gov/Archives/edgar/data/277135/000104746915002102/a2223255zdef14a.htm#30)] | | | | | | W.W. Grainger, Inc. 2015 Incentive Plan, incorporated by reference to Exhibit B of W.W. Grainger, Inc.’s Proxy Statement dated March 13, 2015.* | | |

| [removed: [10.14](http://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex101.htm)] [added: [10.14](https://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex101.htm)] | | | | | | First Amendment to the W.W. Grainger, Inc. 2015 Incentive Plan, incorporated by reference to 10.1 of W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017.* | | |

| [removed: [10.15](http://www.sec.gov/Archives/edgar/data/277135/000027713518000029/gww-2018093018xex101.htm)] [added: [10.15](https://www.sec.gov/Archives/edgar/data/277135/000027713518000029/gww-2018093018xex101.htm)] | | | | | | W.W. Grainger, Inc. 2015 Incentive Plan as Amended and Restated Effective October 31, 2018, incorporated by reference to Exhibit 10.1 to W.W. Grainger, Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 2018.* | | |

| [removed: [10.16](http://www.sec.gov/Archives/edgar/data/277135/000027713516000052/gww-2016063016xex101.htm)] [added: [10.16](https://www.sec.gov/Archives/edgar/data/277135/000027713516000052/gww-2016063016xex101.htm)] | | | | | | Form of Stock Option Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.1 to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016.* | | |

| [removed: [10.17](http://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex102.htm)] [added: [10.17](https://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex102.htm)] | | | | | | Form of Stock Option Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.2 to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017.* | | |

| [removed: [10.18](http://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex103.htm)] [added: [10.18](https://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex103.htm)] | | | | | | Form of Restricted Stock Unit Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.3 to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017.* | | |

| [removed: [10.19](http://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex104.htm)] [added: [10.19](https://www.sec.gov/Archives/edgar/data/277135/000027713517000018/gww-2017033117xex104.htm)] | | | | | | Form of 2017 Performance Share Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.4 to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017.* | | |

| [removed: [10.20](http://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex103.htm)] [added: [10.20](https://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex103.htm)] | | | | | | Form of 2018 W.W. Grainger, Inc. 2015 Incentive Plan Stock Option Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.3 to W.W. Grainger, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.* | | |

| [removed: [10.21](http://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex104.htm)] [added: [10.21](https://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex104.htm)] | | | | | | Form of 2018 W.W. Grainger, Inc. 2015 Incentive Plan Restricted Stock Unit Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.4 to W.W. Grainger, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.* | | |

| [removed: [10.22](http://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex105.htm)] [added: [10.22](https://www.sec.gov/Archives/edgar/data/277135/000027713518000016/gww-2018033118xex105.htm)] | | | | | | Form of 2018 W.W. Grainger, Inc. 2015 Incentive Plan Performance Restricted Stock Unit Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.5 to W.W. Grainger, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.* | | |

| [4.10](https://www.sec.gov/Archives/edgar/data/277135/000027713524000173/gww-20240930xex41.htm) | | | | | | Fifth Supplemental Indenture, dated as of September 12, 2024, by and between the Company and U.S. Bank Trust Company, National Association, as Trustee (including Form of Note), incorporated by reference to Exhibit 4.1 to W.W. Grainger, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024. | | |

| [10.40](https://www.sec.gov/Archives/edgar/data/277135/000027713525000010/exhibit1040-separationagre.htm) | | | | | | Separation Agreement and General Release between W.W. Grainger, Inc. and Matthew E. Fortin dated as of August 23, 2024. | | |

| [10.41](https://www.sec.gov/Archives/edgar/data/277135/000027713524000059/gww-20240331xex101.htm) | | | | | | 2024 Form of W.W. Grainger, Inc. 2022 Incentive Plan Restricted Stock Unit Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.1 to W.W. Grainger, Inc's Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.* | | |

| [10.42](https://www.sec.gov/Archives/edgar/data/277135/000027713524000059/gww-20240331xex102.htm) | | | | | | 2024 Form of W.W. Grainger, Inc. 2022 Incentive Plan Performance Stock Unit Award Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.2 to W.W. Grainger, Inc's Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.* | | |

| [10.43](https://www.sec.gov/Archives/edgar/data/277135/000027713524000059/gww-20240331xex103.htm) | | | | | | 2024 Form of Confidentiality, Invention Assignment, Non-Competition and Non-Solicitation Agreement between W.W. Grainger, Inc. and certain of its executive officers, incorporated by reference to Exhibit 10.3 to W.W. Grainger, Inc's Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.* | | |

| [19](https://www.sec.gov/Archives/edgar/data/277135/000027713525000010/exhibit19-insidertradingpo.htm) | | | | | | Insider Trading Policy. | | |

| () Filed herewith. | | | | | | | | |

| (*) Furnished herewith. | | | | | | | | |

DATE: February [removed: 22, 2024][added: 20, 2025]

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant on February [removed: 22, 2024,] [added: 20, 2025,] in the capacities indicated.

| [removed: /s/ D.G. Macpherson] | | | | | | [removed: /s/] George [removed: Davis] [added: Davis] | | |

| (Principal Executive Officer) | | | | | | /s/ [removed: V. Ann Hailey] [added: George Davis] | | |

| /s/ D.G. Macpherson | | | | | | /s/ Rodney C. Adkins | | |

| D.G. Macpherson | | | | | | Rodney C. Adkins | | |

| D.G. Macpherson | | | | | | George Davis | | |

| | | | | | | V. Ann Hailey | | |