ePlus Reports Third Quarter and First Nine Months Financial Results of Fiscal Year 2026

Core Insights - ePlus inc. reported strong financial results for the third quarter of fiscal year 2026, with net sales increasing by 24.6% year-over-year to $614.8 million, driven by higher product sales despite a slight decline in service revenue [5][6][12] - The company has raised its fiscal year 2026 guidance for net sales, gross profit, and Adjusted EBITDA, reflecting strong performance and momentum [23][25] Financial Performance - For the third quarter ended December 31, 2025, consolidated net sales reached $614.8 million, up from $493.2 million in the same quarter last year, while gross billings increased by 15.6% to $982.1 million [5][6] - Consolidated gross profit rose by 26.8% to $158.7 million, with a gross margin of 25.8%, compared to 25.4% in the prior year [6][9] - Net earnings from continuing operations surged by 129.3% to $33.4 million, with diluted earnings per share increasing by 130.9% to $1.27 [12][20] Segment Performance - Product segment sales increased by 32.2% to $501.8 million, driven by growth in networking, cloud, security, and collaboration products [7][15] - Professional services segment revenues decreased by 7.8% to $64.1 million, primarily due to project delays, while managed services segment revenue increased by 10.5% to $48.8 million [8][9] - The overall gross profit for the managed services segment increased by 7.5%, although gross margin declined to 29.0% [9] Balance Sheet Highlights - As of December 31, 2025, cash and cash equivalents were $326.3 million, down from $389.4 million, while inventory increased by 100.1% to $241.0 million [22] - Accounts receivable increased by 35.0% to $698.0 million, indicating growth in sales and projects in process [22] Fiscal Year Guidance - The company now expects net sales to increase by 20% to 22% year-over-year, up from previous guidance of mid-teens growth [23] - Gross profit is projected to grow at a rate of 19% to 21%, and Adjusted EBITDA is expected to increase by 41% to 43% over the previous fiscal year [23] Dividend Announcement - ePlus announced a quarterly cash dividend of $0.25 per common share, payable on March 18, 2026, to shareholders of record as of February 24, 2026 [28]