PC nection(US:CNXN)2026-02-04 21:05Financial Performance - Net sales for Q4 2025 decreased by 0.8% year over year to $702.9 million, while gross billings increased by 2.9% to $1.1 billion[3] - Gross profit for Q4 2025 rose by 4.5% to $135.6 million, with gross margin increasing by 100 basis points to 19.3%[5] - Net income for Q4 2025 remained flat at $20.7 million, translating to diluted EPS of $0.82, up from $0.78 in Q4 2024[3] - For the full year 2025, net sales increased by 2.5% to $2.9 billion, with gross billings rising by 2.7% to $4.1 billion[10] - Adjusted diluted EPS for Q4 2025 was $0.91, compared to $0.78 for Q4 2024, reflecting a significant year-over-year increase[3] - Net income for the year ended December 31, 2025, was $83,722,000, down from $87,095,000 in 2024[29] - Net income for Q4 2025 was $20,712, a slight decrease of 0% compared to $20,721 in Q4 2024, and total net income for the year was $83,722, down 4% from $87,095 in 2024[33] - Adjusted Net Income for Q4 2025 rose by 11% to $23,063 from $20,721 in Q4 2024, with total Adjusted Net Income for the year at $88,149, a 2% increase from $86,142[36] Segment Performance - The Business Solutions segment saw a 4.2% increase in net sales to $273.5 million in Q4 2025, while the Public Sector Solutions segment experienced a 36.8% decline to $90.8 million[11] - Enterprise Solutions net sales rose to $338,662,000 with a gross margin of 14.2%, compared to $302,711,000 and 14.9% in the previous year[28] Cash and Liquidity - Cash and cash equivalents as of December 31, 2025, were $406.7 million, down from $442.6 million a year earlier[9] - Cash and cash equivalents increased to $193,221,000 from $178,318,000 year-over-year[30] - Cash flows provided by operating activities for Q4 2025 were $27,418, compared to $25,248 in Q4 2024, with total cash flows for the year at $65,438, significantly down from $173,868[31] - The company declared a quarterly dividend of $0.20 per share, with a total of $81.2 million available for future share repurchases[2] Shareholder Actions - The company repurchased 179,235 shares at an aggregate price of $10.7 million during Q4 2025[9] Expenses and Other Income - The company reported a significant increase in severance expenses, totaling $3,083 in Q4 2025, compared to none in Q4 2024, reflecting restructuring activities[36] - The company recorded $1.7 million in other income from a legal settlement, impacting the financial results positively[34] - Total depreciation and amortization expenses for Q4 2025 were $2,850, a 10% decrease from $3,166 in Q4 2024[33] Operational Metrics - Inventory turns decreased to 18 from 23, indicating a slower inventory turnover rate[26] - Days sales outstanding increased to 76 days from 72 days, reflecting a longer collection period for receivables[26] - Total assets increased to $1,350,925,000 from $1,299,354,000 year-over-year[30] Earnings Per Share - Diluted earnings per share increased by 5% to $0.82 from $0.78 year-over-year[26] - Diluted Earnings per Share for Q4 2025 increased by 5% to $0.82 compared to $0.78 in Q4 2024, while Adjusted Diluted Earnings per Share rose by 16% to $0.91 from $0.78[36] EBITDA - Adjusted EBITDA for the year ended December 31, 2025, increased by 6% to $126.4 million compared to $118.9 million in 2024[13] - Adjusted EBITDA for Q4 2025 increased by 13% to $31,771 compared to $28,083 in Q4 2024, while the last twelve months (LTM) Adjusted EBITDA was $126,417, up 6% from $118,936[33] Interest Income - The company experienced a 25% decrease in interest income, reporting $(3,591) in Q4 2025 compared to $(4,779) in Q4 2024[33]