- QQ1 2025 total net sales were $543.2 million, down 5.3% year over year and 1.5% quarter over quarter, reflecting a difficult year-on-year comparison and prior supply-chain easing that benefited the prior-year period. The gross margin was 23.63%, and the company reported a net income of $27.3 million ($1.02 per diluted share). These results sit within a backdrop of deliberate SG&A investments to support AI, security, and services offerings, including the Peak acquisition, with higher hiring and ramp costs that temporarily pressured near-term profitability.
- The services business remained a strong growth pillar, advancing 15.8% year over year with managed services up 28% and bookings up ~70%, underscoring the shift toward recurring revenue and higher visibility. AI-related initiatives (AI Ignite, NVIDIA DGX managed services, and related advisory services) are gaining traction in pipeline discussions across verticals, signaling a potential acceleration in annuity-like revenues as customers mature their AI journeys.
- Management reaffirmed fiscal 2025 guidance: net sales growth of 3%-6% and adjusted EBITDA of $200–$215 million. With a cash balance of roughly $351 million and a notably improved working-capital posture (inventory at a multi-year low, inventory turns ~14 days, CCC ~37 days), ePlus has ample liquidity to fund investments, opportunistic acquisitions, and continued share repurchases. The near-term challenge remains a tougher second-quarter comparison, but the ramp in services, AI-related engagements, and ongoing cost discipline are expected to support a stronger back-half performance and margin expansion over time.