ePlus Reports Second Quarter and First Half Financial Results Fiscal Year 2027

ePlus delivered record quarterly billings and raised 2027 guidance on strong profit growth.

What the company is saying

ePlus inc. is emphasizing robust top-line growth and improved profitability for the second quarter and first half of fiscal 2027, highlighting record gross billings exceeding $1 billion. The company frames its performance as a result of strong execution, a diversified business model, and customer demand in areas like AI and cybersecurity. President and CEO Mark Marron attributes the gains to a customer-first approach and product mix shifts, particularly increased sales of cloud, security, and collaboration products. The company spotlights its acquisition of Daymark Solutions as a strategic move to expand IT and cloud services offerings. ePlus is also communicating confidence by raising fiscal 2027 guidance to upper single-digit growth for net sales and gross profit, and low double-digit growth for adjusted EBITDA. The announcement underscores a strong balance sheet, with $381 million in cash at quarter end, and ongoing capital allocation through acquisitions, share repurchases, and dividends.

What the data suggests

The numbers confirm a clear upward trajectory in both revenue and profitability. Second quarter net sales rose 9.7% to $667.9 million, with gross billings up 4.3% to $1,066.8 million and gross profit up 11.2% to $180.3 million. Net earnings from continuing operations increased 5.8% to $40.4 million, while adjusted EBITDA grew 14.3% to $67.1 million. Diluted EPS from continuing operations reached $1.56 (up 7.6%), and non-GAAP EPS was $1.82 (up 19.0%). For the first half, net sales increased 5.2% to $1,317.0 million, gross billings rose 2.5% to $2,023.9 million, and gross profit climbed 5.0% to $331.6 million. Adjusted EBITDA for the half was $114.9 million, up 3.2%. Gross margin improved to 27.0% for the quarter and held steady at 25.2% for the half. The product segment drove growth, with sales up 12.8% in the quarter, while professional services revenue declined 11.3%. Inventory and accounts receivable both increased sharply, reflecting ongoing projects and higher sales activity. The company’s updated guidance signals management’s expectation that these trends will continue, though no precise numerical targets are provided for the new guidance.

Analysis

The announcement is highly factual and proportionate, with the majority of claims supported by realised, audited financial results for both the quarter and half-year. Key profitability metrics (net earnings, adjusted EBITDA, EPS, gross margin) are disclosed alongside revenue and operational figures, satisfying the requirements for a strong_positive signal. The only forward-looking element is the updated fiscal 2027 guidance, which is clearly separated from realised results and does not dominate the narrative. There is no evidence of narrative inflation or exaggerated claims; the tone is positive but justified by the underlying data. The acquisition of Daymark Solutions is disclosed as completed, not merely planned, and the dividend declaration is concrete. Awards and partnership statuses are mentioned but do not inflate the investment case. No large capital outlay is paired with uncertain, long-dated returns.

Risk flags

• ●Inventory increased 35.1% to $271.4 million, which could signal risk if demand slows or project execution is delayed, potentially tying up working capital.
• ●Accounts receivable rose 14.9% to $746.9 million, increasing exposure to customer credit risk and possibly impacting cash flow if collections lag.
• ●Professional services revenue and margin both declined year-over-year, suggesting vulnerability to project delays or shifting customer demand in this segment.
• ●The company’s updated guidance does not factor in potential recessionary conditions or other unexpected developments, leaving room for downside if macroeconomic headwinds intensify.
• ●The acquisition of Daymark Solutions introduces integration risk, as successful realization of expected synergies and retention of key personnel are not guaranteed.

Bottom line

ePlus inc. delivered strong quarterly and half-year results, with record gross billings, double-digit profit growth, and a raised outlook for fiscal 2027. The company’s performance is driven by strength in product sales, especially in cloud and cybersecurity, but offset by weakness in professional services. Balance sheet liquidity remains high, but rising inventory and receivables warrant monitoring. The acquisition of Daymark Solutions expands the company’s IT services footprint but carries typical integration risks. The dividend declaration and increased guidance reinforce management’s confidence, but the lack of precise numerical targets for the new outlook limits forward visibility. The most important takeaway is that ePlus is executing well in its core markets, but investors should watch for signs of margin pressure, working capital strain, or macro-driven demand shifts in the coming quarters.

Announcement summary

(NASDAQ:PLUS) ePlus inc. reported strong financial results for the second quarter and first half of fiscal year 2027, ended September 30, 2026. Net sales for the second quarter increased 9.7% to $667.9 million, with services revenues decreasing 2.4% to $120.8 million. Gross billings for the quarter rose 4.3% to $1,066.8 million, and gross profit increased 11.2% to $180.3 million. Gross margin for the quarter was 27.0%, up from 26.6% in the prior year period. Net earnings from continuing operations for the quarter increased 5.8% to $40.4 million, and adjusted EBITDA rose 14.3% to $67.1 million. Diluted net earnings per common share from continuing operations were $1.56, with non-GAAP diluted net earnings per share at $1.82. For the first half of fiscal 2027, net sales increased 5.2% to $1,317.0 million, and services revenues were $240.2 million. Gross billings for the first half rose 2.5% to $2,023.9 million, and gross profit increased 5.0% to $331.6 million. Gross margin for the first half was 25.2%. Net earnings from continuing operations for the first half increased 0.7% to $70.7 million, and adjusted EBITDA rose 3.2% to $114.9 million. Diluted net earnings per common share from continuing operations for the first half were $2.72, with non-GAAP diluted net earnings per share at $3.11. As of September 30, 2026, cash and cash equivalents were $380.9 million, inventory was $271.4 million, accounts receivable—trade, net was $746.9 million, and total stockholders' equity was $1,096.4 million. The company acquired certain assets and liabilities of Daymark Solutions during the quarter. ePlus announced a quarterly cash dividend of $0.27 per common share, payable on December 16, 2026, to shareholders of record as of November 24, 2026. The company increased its fiscal year 2027 guidance to upper single-digit year-over-year growth for net sales and gross profit, and low double-digit growth for adjusted EBITDA. The company achieved Exclusive Ambassador Partner Status with Everpure and was named NetApp North America Flash Partner of the Year. Total shares outstanding were 26.0 million as of September 30, 2026, and 26.3 million as of March 31, 2026. The company reported no transactions for discontinued operations for the three and six months ended September 30, 2026.

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