APPLIED INDUSTRIAL TECHNOLOGIES INCAIT
APPLIED INDUSTRIAL TECHNOLOGIES INC Segments Disclosure
SEGMENT INFORMATION
The Company's reportable segments are: Service Center (formerly Service Center Based Distribution) and Engineered Solutions. The Company changed the reportable segment name from Service Center Based Distribution to Service Center in the fourth quarter of fiscal 2025. There was no change in the composition of either reportable segment. These reportable segments contain the Company's various operating segments which have been aggregated based upon similar economic and operating characteristics. The Service Center segment operates through local service centers and distribution centers with a focus on providing products and services addressing the maintenance and repair of production equipment and motion control infrastructure. Products primarily include industrial bearings, motors, belting, drives, couplings, pumps, linear motion products, hydraulic and pneumatic components, filtration supplies, and hoses, as well as other related supplies for general operational needs of customers’ machinery and equipment. The Engineered Solutions segment includes our operations that specialize in distributing, engineering, designing, integrating, and repairing hydraulic and pneumatic fluid power technologies, engineered flow control products and services, and automation technologies. The accounting policies of the Company’s reportable segments are as described in Note 1.
The Company's chief operating decision maker (CODM) is the chief executive officer. The CODM uses Segment Operating Income as the measure of segment profit and loss in measuring segment performance, determining how to allocate the Company's assets, evaluating performance in periodic reviews, and during the development of the annual budget and the regular forecasting process. The chief operating decision maker considers budget-to-actual variances on a quarterly basis, as well as segment-specific forecasting, when making decisions about the allocation of operating and capital resources to each segment. The CODM also uses the segment's net sales in measuring segment performance.
In addition to the two reportable segments, there is a category of certain business activities and expenses, referred to as corporate & other, that does not constitute an operating segment. Corporate & other expense, net includes the cost of our corporate headquarters and corporate functions, primarily compensation and benefits, and related administrative expenses and other expenses not directly associated with any reportable segment. These corporate and other expenses reconcile segment operating income to total consolidated income before income taxes.
Segment Financial Information
| Year Ended June 30, 2025 | Service Center | Engineered Solutions | Total | ||||||||||||||
| Total sales | $ | 3,017,254 | $ | 1,601,211 | $ | 4,618,465 | |||||||||||
Less: Inter-segment sales1 | 2,906 | 52,135 | 55,041 | ||||||||||||||
| Net sales | $ | 3,014,348 | $ | 1,549,076 | $ | 4,563,424 | |||||||||||
| Less segment expenses: | |||||||||||||||||
| Cost of sales | 2,135,158 | 1,045,107 | |||||||||||||||
Selling, distribution, and administrative expense, including depreciation2 | 485,720 | 315,231 | |||||||||||||||
| Segment operating income | $ | 393,470 | $ | 188,738 | $ | 582,208 | |||||||||||
| Corporate & other expense, net | 83,679 | ||||||||||||||||
| Interest expense, net | 612 | ||||||||||||||||
| Other income, net | (3,050) | ||||||||||||||||
| Income before income taxes | $ | 500,967 | |||||||||||||||
| Year Ended June 30, 2024 | Service Center | Engineered Solutions | Total | ||||||||||||||
| Total sales | $ | 3,059,363 | $ | 1,472,617 | $ | 4,531,980 | |||||||||||
Less: Inter-segment sales1 | 2,808 | 49,766 | 52,574 | ||||||||||||||
| Net sales | $ | 3,056,555 | $ | 1,422,851 | $ | 4,479,406 | |||||||||||
| Less segment expenses: | |||||||||||||||||
| Cost of sales | 2,173,085 | 969,668 | |||||||||||||||
Selling, distribution, and administrative expense, including depreciation2 | 486,476 | 272,074 | |||||||||||||||
| Segment operating income | $ | 396,994 | $ | 181,109 | $ | 578,103 | |||||||||||
| Corporate & other expense, net | 82,280 | ||||||||||||||||
| Interest expense, net | 2,831 | ||||||||||||||||
| Other income, net | (5,138) | ||||||||||||||||
| Income before income taxes | $ | 498,130 | |||||||||||||||
| Year Ended June 30, 2023 | Service Center | Engineered Solutions | Total | ||||||||||||||
| Total sales | $ | 2,969,494 | $ | 1,491,750 | $ | 4,461,244 | |||||||||||
Less: Inter-segment sales1 | 2,652 | 45,798 | 48,450 | ||||||||||||||
| Net sales | $ | 2,966,842 | $ | 1,445,952 | $ | 4,412,794 | |||||||||||
| Less segment expenses: | |||||||||||||||||
| Cost of sales | 2,120,467 | 1,005,362 | |||||||||||||||
Selling, distribution, and administrative expense, including depreciation2 | 475,793 | 265,134 | |||||||||||||||
| Segment operating income | $ | 370,582 | $ | 175,456 | $ | 546,038 | |||||||||||
| Corporate & other expense, net | 72,887 | ||||||||||||||||
| Interest expense, net | 21,639 | ||||||||||||||||
| Other expense, net | 1,701 | ||||||||||||||||
| Income before income taxes | $ | 449,811 | |||||||||||||||
1The Company accounts for inter-segment sales using market rates.
2Amortization of intangibles is recorded within selling, distribution, and administrative expense, and therefore included in segment operating income for all periods presented.
Supplemental Segment Financial Information
| Service Center | Engineered Solutions | Total | |||||||||||||||
| Year Ended June 30, 2025 | |||||||||||||||||
| Assets used in the business | $ | 1,765,631 | $ | 1,409,913 | $ | 3,175,544 | |||||||||||
| Depreciation and amortization of property | 17,492 | 7,407 | 24,899 | ||||||||||||||
| Amortization of intangibles | 3,144 | 32,437 | 35,581 | ||||||||||||||
| Capital expenditures | 22,544 | 4,643 | 27,187 | ||||||||||||||
| Year Ended June 30, 2024 | |||||||||||||||||
| Assets used in the business | $ | 1,865,269 | $ | 1,086,641 | $ | 2,951,910 | |||||||||||
| Depreciation and amortization of property | 17,700 | 5,731 | 23,431 | ||||||||||||||
| Amortization of intangibles | 3,188 | 25,735 | 28,923 | ||||||||||||||
| Capital expenditures | 18,040 | 6,824 | 24,864 | ||||||||||||||
| Year Ended June 30, 2023 | |||||||||||||||||
| Assets used in the business | $ | 1,736,393 | $ | 1,006,939 | $ | 2,743,332 | |||||||||||
| Depreciation and amortization of property | 17,932 | 4,334 | 22,266 | ||||||||||||||
| Amortization of intangibles | 2,857 | 27,948 | 30,805 | ||||||||||||||
| Capital expenditures | 15,390 | 11,086 | 26,476 | ||||||||||||||
Geographic Information
Long-lived assets are based on physical locations and are composed of the net book value of property and right of use assets. Information by geographic area is as follows:
| June 30, | 2025 | 2024 | |||||||||
| Long-Lived Assets: | |||||||||||
| United States | $ | 269,218 | $ | 209,987 | |||||||
| Canada | 33,230 | 26,436 | |||||||||
| Other Countries | 14,360 | 15,393 | |||||||||
| Total | $ | 316,808 | $ | 251,816 | |||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Aug 15, 2025 | Showing above |
| 2024 | Aug 16, 2024 | |
| 2023 | Aug 11, 2023 | |
| 2022 | Aug 12, 2022 | |
| 2021 | Aug 17, 2021 | |
| 2020 | Aug 14, 2020 | |
| 2019 | Aug 16, 2019 | |
| 2018 | Aug 17, 2018 | |
| 2017 | Aug 18, 2017 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.