ePlus Raises Fiscal 2027 Growth Outlook After Sales Rebound

The Tip Desk · November 7, 2026 · 4 min read

Second-quarter net sales rose 9.7% to $667.9 million and the company lifted full-year guidance to upper single-digit growth.

ePlus inc. (PLUS) reversed a near-stall in sales and lifted its fiscal 2027 outlook after a second quarter in which product demand, gross billings and profitability all turned higher.

The technology solutions provider reported net sales of $667.9 million for the three months ended September 30, 2026, up 9.7% from a year earlier, after a 1.0% increase to $649.1 million in the first quarter of fiscal 2027. Gross billings rose 4.3% to a record $1,066.8 million, following a 0.5% rise to $957.1 million. Gross profit increased 11.2% to $180.3 million after a 1.5% decline in the prior quarter, and gross margin was 27.0%, compared with 26.6% a year earlier and 23.3% in the first quarter.

Product segment sales increased 12.8% to $547.1 million, after a 0.6% rise to $529.6 million. The company attributed the product increase to higher revenue from cloud, security, collaboration and other products, partially offset by a decrease in networking products. Product segment gross margin was 25.8%, up from 24.5% a year earlier, which the company said reflected a shift in product mix and more third-party maintenance, subscriptions and services recognized on a net basis.

Cloud net sales increased 39.2% to $178.6 million and cloud gross billings rose 33.1% to $270.0 million. Security net sales were $72.7 million. Networking net sales decreased 9.2% to $234.4 million. By end market, financial services net sales increased 48.3% to $93.5 million and healthcare net sales rose 22.0% to $100.4 million, while telecom, media and entertainment net sales decreased 12.9% to $153.9 million.

Professional services revenue decreased 11.3% to $67.8 million, after a 5.1% decline to $68.1 million in the first quarter. Professional services gross margin declined to 35.4% from 38.2% a year earlier. The company said the drop reflected lower revenue and gross profit from project-related services due to delays from retail customers. Managed services revenue increased 11.9% to $53.1 million, primarily from additional cloud managed services. Managed services gross margin declined to 28.8% from 29.4% a year earlier.

Operating expenses were $123.8 million, up 9.2% from $113.3 million a year earlier, primarily due to higher variable compensation, additional salaries and benefits, general and administrative costs, and expenses related to the acquisition of assets of Daymark Solutions. Operating income increased 15.8% to $56.5 million. Other income (expense), net was a $0.5 million expense, compared with $5.2 million of income a year earlier, due in part to a $3.5 million reduction in the fair value of a contingent consideration receivable from the sale of the domestic financing business, lower interest income and foreign currency transaction losses. Net earnings from continuing operations increased 5.8% to $40.4 million, after a 5.4% decline to $30.3 million in the first quarter. Adjusted EBITDA increased 14.3% to $67.1 million, after a 9.2% decline to $47.8 million. Diluted earnings from continuing operations were $1.56 a share.

President and CEO Mark Marron said record gross billings surpassed the prior year’s record and reflected demand for AI and cybersecurity products. The company acquired certain assets and liabilities of Daymark Solutions, a provider of IT solutions and professional services focused on hybrid cloud, cybersecurity, compliance and data centers. Cash and cash equivalents were $380.9 million at September 30, 2026, down from $410.8 million at March 31, 2026. Inventory increased 35.1% to $271.4 million, which the company said was due to several ongoing projects. Accounts receivable—trade, net increased 14.9% to $746.9 million.

ePlus is increasing its fiscal 2027 guidance to upper single-digit year-over-year growth for net sales and gross profit and low double digits for adjusted EBITDA, after reiterating fiscal 2027 guidance in the prior quarter. The company said the guidance does not factor in recessionary conditions or other unexpected developments. The board declared a quarterly cash dividend of $0.27 a share, payable December 16, 2026. Marron said accelerating AI adoption, data-center infrastructure demand and cybersecurity spending support the company’s confidence in the sustainability of its business trends.