WD-40: 3 Key Takeaways for Long-Term Investors

On its fourth quarter of fiscal year 2026 earnings call, held on Oct. 21, 2026, WD-40 (NASDAQ:WDFC) announced full fiscal year net sales of $688 million, up 11% year over year. The company relies on its asset-light business model, which requires minimal capital expenditure to compound returns over time. Understanding management's execution across geographic expansion and margin recovery is essential for evaluating its long-term trajectory. Three takeaways stood out for long-term investors on the call.

1. Japan Direct Market Transition Unlocks Asian Growth

Direct distribution allows the company to capture higher revenue and build scale in key mature economies. Management transitioned Japan to a direct market to replicate its previous sales expansions in Mexico and Brazil.

Building on the success of our direct market transitions in Mexico and Brazil, we recently made Japan a U.S. direct market. Expanding our presence in 1 of the world's largest economies.
-- Steven A. Brass, President and Chief Executive Officer

2. Price Increases and Supply Chain Actions Offset Margin Pressures

Gross margin, the percentage of revenue remaining after subtracting direct manufacturing costs, dipped to 52.8% in the fourth quarter due to elevated raw material costs. Management implemented targeted price increases and supply chain efficiencies to restore profit margins toward its long-term target of 55%.

As pricing actions and ongoing cost optimization initiatives begin to take effect over the next 1 to 2 quarters, we expect gross margin to improve sequentially throughout fiscal year 27, with recovery accelerating in the second half of the year.
-- Sara Hyzer, Vice President and Chief Financial Officer

3. Flagship Maintenance Product Holds Massive Unrealized Global Potential

Core maintenance products drive predictable cash flows that fund brand expansion and share repurchases. Management estimates the global attainable market for its flagship brand at $2.2 billion, leaving significant runway across international trade blocs.

WD-40 Multi Use Product remains the foundation of our growth strategy. Our path forward is clear. Expand availability across more channels and geographies, build brand awareness and put more cans into the hands of targeted end users.
-- Steven A. Brass, President and Chief Executive Officer

Looking Ahead

Revenue momentum accelerates into fiscal year 2027, and management is not hiding its satisfaction with early performance. A flexible supply chain and strong brand equity protect returns as leadership maintains pricing discipline.

We will maintain a strong balance sheet invest behind our strategic priorities, and deploy capital with discipline to drive long term returns for stockholders.
-- Keith Stauffer, Vice President, Global Finance, and Incoming Chief Financial Officer

Capital discipline underpins long-term compounding, while full-year net sales are targeted to grow 4% to 7%.

Our iconic global brand disciplined execution, flexible global supply chain and strong financials provide the durability to navigate changing market conditions, while continuing to deliver growth.
-- Steven A. Brass, President and Chief Executive Officer

The Motley Fool recommends WD-40. The Motley Fool has a disclosure policy.