Connection Posts Record Q3 Sales of $874.3M, EPS Up 28% to $1.24, Declares $0.20 Dividend
CNXN sits 58% above its 52-week low of $54.965.
Summary
Connection reported record third-quarter net sales of $874.3 million, up 23.3%, with diluted EPS of $1.24 versus $0.97 a year ago, and declared a $0.20 quarterly dividend. Gross margin slipped 110 basis points to 18.5% as lower-margin segments drove the growth.
Key Events · Earnings and Guidance · CNXN
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Record Q3 Sales of $874.3M
Net sales rose 23.3% year over year from $709.1 million, with Enterprise Solutions up 27.4% to $407.5 million and Business Solutions up 27.8% to $328.2 million.
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EPS $1.24, Net Income Up 27.2%
Diluted EPS came in at $1.24 versus $0.97 a year ago, and net income rose to $31.5 million from $24.7 million.
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Gross Margin Slips 110 Basis Points
Gross margin fell to 18.5% from 19.6% as Business Solutions margin dropped 270 basis points to 23.8% and Enterprise margin held at 14.8%.
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$0.20 Quarterly Dividend Declared
Payable November 27, 2026 to shareholders of record on November 10, 2026.
Analysis · CNXN · Trade & Services
The headline growth is real: revenue rose 23.3% to $874.3 million and diluted EPS climbed to $1.24 from $0.97, with net income up 27.2% to $31.5 million. Margin is the catch. Gross margin fell 110 basis points to 18.5% as the mix shifted toward lower-margin Enterprise and server/storage business, so profit growth lagged the top line. Alongside the results, the board declared a $0.20 quarterly dividend payable November 27, 2026, and the balance sheet still holds $343.3 million in cash and short-term investments with no debt. Working capital is the item to track: inventory jumped to $226.6 million from $143.6 million at year-end, and nine-month operating cash flow swung to negative $39.8 million.
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At the time of this filing, CNXN was trading at $87.00 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $2.2B. The 52-week trading range was $54.97 to $96.91. This filing was assessed with positive market sentiment and an importance score of 7 out of 10.