PC Connection, Inc. (CNXN) Q2 2025 Earnings Call Transcript
Earnings Conference Call Overview: PC Connection, Inc. held its Q2 2025 earnings conference call on July 30, 2025, featuring key executives including CEO Tim McGrath and CFO Tom Baker, discussing the company's financial performance and future outlook.
Forward-Looking Statements Disclaimer: The company provided a cautionary note regarding forward-looking statements, emphasizing that actual results may differ due to various factors outlined in their annual report and other SEC filings.
Trade with 70% Backtested Accuracy
Analyst Views on CNXN
About CNXN
About the author
PC Connection Declares 33.3% Increase in Quarterly Dividend
- Dividend Increase: PC Connection has declared a quarterly dividend of $0.20 per share, marking a 33.3% increase from the previous $0.15, reflecting enhanced profitability and commitment to shareholder returns.
- Yield Performance: The forward yield of 1.31% not only boosts investor return expectations but may also attract more income-seeking investors to the company's stock, enhancing its market appeal.
- Shareholder Arrangement: The dividend will be payable on March 6, with a record date of February 17 and an ex-dividend date also on February 17, ensuring that existing shareholders benefit from this distribution, thereby bolstering shareholder confidence.
- Market Performance Target: PC Connection aims for a 200 basis point market outperformance in 2026 through expanded AI-enabled solutions, indicating a proactive strategic positioning in technology innovation and market competitiveness.
PC Connection, Inc. Reports Record Q4 2025 Earnings
- Performance Highlights: PC Connection achieved a record gross profit of $135.6 million in Q4 2025, reflecting a 4.5% year-over-year increase, indicating strong performance in Business and Enterprise Solutions despite challenges in the Public Sector.
- Sales Data: Total net sales reached $702.9 million, down 0.8% year-over-year primarily due to delays in public sector projects, while Enterprise Solutions saw an 11.9% increase in sales to $338.7 million, demonstrating robust market demand.
- Shareholder Returns: The Board authorized an additional $50 million for the share repurchase program and declared a $0.20 per share dividend, a 33% increase from the previous year, reflecting confidence in future cash flows and commitment to shareholders.
- Future Outlook: Management expects to outperform the U.S. IT market by 200 basis points in 2026, continuing to focus on high-value solutions in cloud, cybersecurity, and AI to drive long-term customer relationships and profitable growth.
PC Connection Q4 Earnings Beat Expectations
- Earnings Beat: PC Connection reported a Q4 non-GAAP EPS of $0.91, exceeding expectations by $0.05, indicating a solid performance in profitability despite revenue challenges.
- Revenue Decline: The company’s revenue of $702.9 million represents a 0.8% year-over-year decline, missing market expectations by $32.59 million, highlighting challenges in achieving sales growth in a competitive landscape.
- Market Reaction Analysis: Although revenue fell short, the earnings beat may positively impact the stock price in the short term, as investors could remain optimistic about the company's profitability.
- Future Outlook: The company must implement strategies to address the revenue decline, potentially through product innovation or operational optimization to enhance market competitiveness and achieve sustainable growth.
Connection Recognized as One of Forbes' America's Dream Employers for 2026
Recognition by Forbes: Connection has been named one of America's Dream Employers by Forbes, ranking 81st among 500 companies based on a survey of college students and employees from large organizations.
Employee-Centric Culture: The company's President and CEO, Tim McGrath, emphasized the importance of a supportive work environment and shared values, which contribute to employee empowerment and satisfaction.
Workplace Initiatives: Connection has implemented various initiatives to enhance employee satisfaction, including flexible work arrangements, health and wellness programs, professional development, and community outreach.
Company Overview: PC Connection, Inc. is a Fortune 1000 company providing IT solutions across various sectors, with a focus on delivering customized products and services to businesses, government, and educational institutions.
Daily Upgrade Report for Validea Motley Fool Strategy - November 18, 2025
Validea's Small-Cap Growth Investor Model: The model, based on Motley Fool's strategy, identifies small-cap growth stocks with strong fundamentals and price performance, highlighting several stocks with improved ratings, such as Finward Bancorp and FRMO Corp.
Company Ratings and Descriptions: Various companies, including NewtekOne Inc. and RADCOM Ltd., have seen their ratings increase significantly, indicating potential investment interest based on their financial health and market performance.
Industry Focus: The stocks analyzed span multiple industries, including banking, investment services, and technology, showcasing a diverse range of investment opportunities for small-cap and mid-cap stocks.
Investment Strategy Insights: The article emphasizes the importance of scoring above 80% for investment interest, with detailed analyses provided for each company to assess their alignment with the investment strategy's criteria.
Projected Target Price for TDIV Analyst: $113
ETF Target Price Analysis: The First Trust NASDAQ Technology Dividend Index Fund ETF (TDIV) has an implied analyst target price of $113.24, indicating a potential upside of 15.39% from its current trading price of $98.14.
Notable Holdings with Upside: Key underlying holdings of TDIV, including PC Connection, Inc. (CNXN), SAP SE, and Science Applications International Corp (SAIC), show significant upside potential, with target prices exceeding their recent trading prices by 29.83%, 27.80%, and 26.45%, respectively.
Analyst Target Justification: The article raises questions about whether analysts' target prices are justified or overly optimistic, suggesting that high targets could lead to future downgrades if they do not align with recent developments in the companies or industry.
Investor Research Recommendation: Investors are encouraged to conduct further research to assess the validity of analyst targets and to understand the implications of high price targets relative to current stock prices.
PC Connection Declares 33.3% Increase in Quarterly Dividend
- Dividend Increase: PC Connection has declared a quarterly dividend of $0.20 per share, marking a 33.3% increase from the previous $0.15, reflecting enhanced profitability and commitment to shareholder returns.
- Yield Performance: The forward yield of 1.31% not only boosts investor return expectations but may also attract more income-seeking investors to the company's stock, enhancing its market appeal.
- Shareholder Arrangement: The dividend will be payable on March 6, with a record date of February 17 and an ex-dividend date also on February 17, ensuring that existing shareholders benefit from this distribution, thereby bolstering shareholder confidence.
- Market Performance Target: PC Connection aims for a 200 basis point market outperformance in 2026 through expanded AI-enabled solutions, indicating a proactive strategic positioning in technology innovation and market competitiveness.
PC Connection, Inc. Reports Record Q4 2025 Earnings
- Performance Highlights: PC Connection achieved a record gross profit of $135.6 million in Q4 2025, reflecting a 4.5% year-over-year increase, indicating strong performance in Business and Enterprise Solutions despite challenges in the Public Sector.
- Sales Data: Total net sales reached $702.9 million, down 0.8% year-over-year primarily due to delays in public sector projects, while Enterprise Solutions saw an 11.9% increase in sales to $338.7 million, demonstrating robust market demand.
- Shareholder Returns: The Board authorized an additional $50 million for the share repurchase program and declared a $0.20 per share dividend, a 33% increase from the previous year, reflecting confidence in future cash flows and commitment to shareholders.
- Future Outlook: Management expects to outperform the U.S. IT market by 200 basis points in 2026, continuing to focus on high-value solutions in cloud, cybersecurity, and AI to drive long-term customer relationships and profitable growth.
PC Connection Q4 Earnings Beat Expectations
- Earnings Beat: PC Connection reported a Q4 non-GAAP EPS of $0.91, exceeding expectations by $0.05, indicating a solid performance in profitability despite revenue challenges.
- Revenue Decline: The company’s revenue of $702.9 million represents a 0.8% year-over-year decline, missing market expectations by $32.59 million, highlighting challenges in achieving sales growth in a competitive landscape.
- Market Reaction Analysis: Although revenue fell short, the earnings beat may positively impact the stock price in the short term, as investors could remain optimistic about the company's profitability.
- Future Outlook: The company must implement strategies to address the revenue decline, potentially through product innovation or operational optimization to enhance market competitiveness and achieve sustainable growth.
Connection Recognized as One of Forbes' America's Dream Employers for 2026
Recognition by Forbes: Connection has been named one of America's Dream Employers by Forbes, ranking 81st among 500 companies based on a survey of college students and employees from large organizations.
Employee-Centric Culture: The company's President and CEO, Tim McGrath, emphasized the importance of a supportive work environment and shared values, which contribute to employee empowerment and satisfaction.
Workplace Initiatives: Connection has implemented various initiatives to enhance employee satisfaction, including flexible work arrangements, health and wellness programs, professional development, and community outreach.
Company Overview: PC Connection, Inc. is a Fortune 1000 company providing IT solutions across various sectors, with a focus on delivering customized products and services to businesses, government, and educational institutions.
Daily Upgrade Report for Validea Motley Fool Strategy - November 18, 2025
Validea's Small-Cap Growth Investor Model: The model, based on Motley Fool's strategy, identifies small-cap growth stocks with strong fundamentals and price performance, highlighting several stocks with improved ratings, such as Finward Bancorp and FRMO Corp.
Company Ratings and Descriptions: Various companies, including NewtekOne Inc. and RADCOM Ltd., have seen their ratings increase significantly, indicating potential investment interest based on their financial health and market performance.
Industry Focus: The stocks analyzed span multiple industries, including banking, investment services, and technology, showcasing a diverse range of investment opportunities for small-cap and mid-cap stocks.
Investment Strategy Insights: The article emphasizes the importance of scoring above 80% for investment interest, with detailed analyses provided for each company to assess their alignment with the investment strategy's criteria.
Projected Target Price for TDIV Analyst: $113
ETF Target Price Analysis: The First Trust NASDAQ Technology Dividend Index Fund ETF (TDIV) has an implied analyst target price of $113.24, indicating a potential upside of 15.39% from its current trading price of $98.14.
Notable Holdings with Upside: Key underlying holdings of TDIV, including PC Connection, Inc. (CNXN), SAP SE, and Science Applications International Corp (SAIC), show significant upside potential, with target prices exceeding their recent trading prices by 29.83%, 27.80%, and 26.45%, respectively.
Analyst Target Justification: The article raises questions about whether analysts' target prices are justified or overly optimistic, suggesting that high targets could lead to future downgrades if they do not align with recent developments in the companies or industry.
Investor Research Recommendation: Investors are encouraged to conduct further research to assess the validity of analyst targets and to understand the implications of high price targets relative to current stock prices.
