PC Connection (NASDAQ:CNXN) Announces Quarterly Earnings Results, Beats Estimates By $0.31 EPS

PC Connection (NASDAQ:CNXN) announced its quarterly earnings results on Wednesday. The company reported $1.31 earnings per share for the quarter, beating analysts’ consensus estimates of $1.00 by $0.31, FiscalAI reports. PC Connection had a net margin of 3.02% and a return on equity of 10.17%. The firm had revenue of $854.00 million for the quarter, compared to analysts’ expectations of $764.79 million.

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

• Connection reported record net sales of $854 million, up 12.4% year over year, with gross profit rising 14.3% to $157.5 million and operating income increasing 39.2% to a record $43 million. Diluted EPS grew 35.1% to $1.31.
• Growth was broad-based, including a 19.5% increase in notebooks, mobility and desktops, 15% software growth, and 11.5% networking growth. Business Solutions and Enterprise Solutions posted double-digit sales growth and both ended the quarter with elevated or record backlogs.
• Management said customer investment remains strong in data-center modernization, cybersecurity, cloud, AI-ready endpoints and enterprise AI infrastructure, and expects to outperform the U.S. IT market by approximately 200 basis points in 2026.
• Management expects third-quarter revenue to decline sequentially and grow at a high-single-digit rate year over year, partly due to Microsoft’s June year-end, typical seasonal patterns, and purchases pulled forward ahead of potential price increases. Some supply-chain-related backlog may not be fulfilled until the fourth quarter.
• First-half operating cash flow was negative $49.5 million as inventory increased by $61.5 million and accounts receivable rose by $80.6 million. Management expects inventory to decline somewhat by year-end, but receivables may remain elevated if current business levels persist.

PC Connection Stock Performance

Shares of PC Connection stock traded down $0.13 during trading hours on Wednesday, reaching $82.97. The company’s stock had a trading volume of 136,326 shares, compared to its average volume of 103,223. PC Connection has a one year low of $54.97 and a one year high of $84.81. The company’s 50 day simple moving average is $73.15 and its 200 day simple moving average is $65.46. The stock has a market cap of $2.09 billion, a P/E ratio of 24.12, a price-to-earnings-growth ratio of 2.07 and a beta of 0.88.

Insiders Place Their Bets

In other PC Connection news, Chairman Patricia Gallup sold 7,142 shares of the firm’s stock in a transaction dated Monday, July 6th. The shares were sold at an average price of $72.86, for a total value of $520,366.12. Following the transaction, the chairman owned 7,006,321 shares of the company’s stock, valued at $510,480,548.06. This trade represents a 0.10% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this link. Insiders have sold a total of 28,592 shares of company stock worth $2,048,512 in the last quarter. 56.60% of the stock is owned by corporate insiders.

Institutional Trading of PC Connection

Hedge funds have recently made changes to their positions in the stock. Qube Research & Technologies Ltd boosted its position in PC Connection by 71.3% during the 3rd quarter. Qube Research & Technologies Ltd now owns 165,573 shares of the company’s stock valued at $10,264,000 after purchasing an additional 68,906 shares during the period. Millennium Management LLC lifted its stake in PC Connection by 98.8% in the first quarter. Millennium Management LLC now owns 115,237 shares of the company’s stock valued at $7,193,000 after buying an additional 57,257 shares during the last quarter. Invesco Ltd. lifted its stake in PC Connection by 22.1% in the fourth quarter. Invesco Ltd. now owns 219,220 shares of the company’s stock valued at $12,662,000 after buying an additional 39,716 shares during the last quarter. Engineers Gate Manager LP acquired a new position in shares of PC Connection during the second quarter valued at $2,585,000. Finally, Bank of America Corp DE boosted its holdings in shares of PC Connection by 99.3% during the second quarter. Bank of America Corp DE now owns 78,340 shares of the company’s stock valued at $5,153,000 after acquiring an additional 39,041 shares during the period. Institutional investors own 42.85% of the company’s stock.

Analyst Ratings Changes

A number of research firms have recently weighed in on CNXN. Weiss Ratings raised shares of PC Connection from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Wednesday, June 3rd. Wall Street Zen raised shares of PC Connection from a “hold” rating to a “buy” rating in a research report on Saturday, May 2nd. One investment analyst has rated the stock with a Buy rating and one has assigned a Hold rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy”.

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.