PC Connection (NASDAQ:CNXN) Posts Quarterly Earnings Results, Beats Expectations By $0.05 EPS

PC Connection (NASDAQ:CNXN) released its earnings results on Wednesday. The company reported $0.91 earnings per share for the quarter, beating the consensus estimate of $0.86 by $0.05, FiscalAI reports. PC Connection had a net margin of 2.91% and a return on equity of 9.61%. The business had revenue of $702.94 million during the quarter, compared to analysts’ expectations of $735.49 million.

Here are the key takeaways from PC Connection’s conference call:

• Business Solutions and Enterprise Solutions delivered record gross profit and margin expansion, with Business Solutions gross margin up 160 bps and Enterprise Solutions net sales up 11.9%, driving outperformance versus expectations.
• The Public Sector business declined sharply, with net sales down 36.8% due to a non‑repeating project and K‑12 rollout delays, creating an almost $30–$40 million near‑term headwind into Q1 2026.
• Consolidated profitability improved as gross profit rose 4.5% to $135.6 million, gross margin expanded 100 bps to 19.3%, and adjusted diluted EPS increased 16.7% to $0.91 despite slightly lower net sales.
• Management executed a voluntary retirement and additional reductions (Q4 charges of $3.1M; $5.9–$6.2M expected across Q4/Q1) that are projected to deliver roughly $7–$8M of annual cost savings and support improved operating leverage.
• Capital returns and liquidity remain strong — the company returned $91.4M in 2025, added $50M to its buyback program, raised the quarterly dividend 33% to $0.20 per share, and ended Q4 with $406.7M in cash and short‑term investments.

PC Connection Stock Up 2.3%

Shares of NASDAQ CNXN traded up $1.36 during mid-day trading on Wednesday, reaching $60.15. 140,746 shares of the company were exchanged, compared to its average volume of 74,263. The stock has a market capitalization of $1.52 billion, a P/E ratio of 18.62, a P/E/G ratio of 1.58 and a beta of 0.83. The company’s 50-day simple moving average is $58.67 and its 200-day simple moving average is $60.62. PC Connection has a twelve month low of $54.97 and a twelve month high of $73.31.

Institutional Investors Weigh In On PC Connection

A number of institutional investors have recently made changes to their positions in the company. EverSource Wealth Advisors LLC boosted its position in shares of PC Connection by 625.0% in the second quarter. EverSource Wealth Advisors LLC now owns 580 shares of the company’s stock valued at $38,000 after acquiring an additional 500 shares during the period. PNC Financial Services Group Inc. increased its position in PC Connection by 196.7% during the third quarter. PNC Financial Services Group Inc. now owns 629 shares of the company’s stock worth $39,000 after acquiring an additional 417 shares during the period. Quarry LP acquired a new stake in PC Connection in the 3rd quarter worth about $75,000. Russell Investments Group Ltd. boosted its holdings in PC Connection by 194.0% in the 3rd quarter. Russell Investments Group Ltd. now owns 1,411 shares of the company’s stock valued at $87,000 after purchasing an additional 931 shares during the period. Finally, Tower Research Capital LLC TRC grew its position in shares of PC Connection by 535.3% during the 2nd quarter. Tower Research Capital LLC TRC now owns 1,601 shares of the company’s stock worth $105,000 after purchasing an additional 1,349 shares in the last quarter. Institutional investors own 42.85% of the company’s stock.

Wall Street Analyst Weigh In

CNXN has been the subject of a number of analyst reports. Weiss Ratings reissued a “hold (c)” rating on shares of PC Connection in a research report on Monday, December 29th. Zacks Research upgraded shares of PC Connection from a “strong sell” rating to a “hold” rating in a research note on Monday, December 29th. Two equities research analysts have rated the stock with a Hold rating, According to MarketBeat.com, the company has an average rating of “Hold”.

About PC Connection

PC Connection, Inc (NASDAQ: CNXN), now operating under the trade name Connection, is a value-added provider of information technology solutions founded in 1982 and headquartered in Merrimack, New Hampshire. The company offers a broad portfolio of hardware and software products sourced from leading technology vendors, alongside professional services designed to help organizations design, deploy and maintain IT environments.

Connection’s product offerings encompass desktop and notebook computers, servers and storage systems, networking and cybersecurity solutions, as well as cloud and virtualization technologies.