ePlus executives told investors the solution provider and managed services provider is helping customers modernize their IT infrastructure by designing, deploying, and securing AI, cloud, data center, and networking projects while also expanding its security and managed services expertise.
ePlus is seeing customers lean on the solution provider and MSP to modernize their IT environments as demand for AI, cloud, data center, and security projects, which is driving a record quarter for gross billings and a higher full-year forecast, according to two of its top executives.
During the Herndon, Va.-based company’s fiscal second-quarter 2027 financial conference call Thursday, ePlus CEO and President Mark Marron said net sales grew nearly 10 percent, gross profit rose 11.2 percent, and operating income climbed 15.8 percent. He said the growth was largely organic and spread across a diversified customer base.
Marron (pictured) said his company’s decision to exit the domestic finance business last year lets ePlus focus on faster-growing areas including AI, cloud, data centers, security, and networking. That matters because of what customers now want, he said.
[Related: ePlus Snaps Up Daymark To Supercharge Microsoft Cloud Push In The Northeast]
“As customers navigate increasingly complex IT requirements, they are looking for partners that can help them modernize infrastructure, strengthen security, and deploy emerging technologies effectively,” he said.
Marron called AI a significant long-term growth driver, with demand turning into opportunities in data center, agentic AI, and security.
AI Infrastructure Fuels Data Center, Cloud Growth
Darren Raiguel, ePlus president and chief operating officer, said that demand is visible in the product business, where net sales rose 12.8 percent year over year to $547.1 million and gross billings topped $1 billion. Open orders were up nearly $750 million, led by data center and cloud, whose net sales grew 39.2 percent.
“We are also seeing a significant increase in AI-related customer engagements, ranging from use case validation to purchasing and implementation,” Raiguel said. “As customers advance these initiatives, they are looking to ePlus to help design, deploy, and secure the infrastructure required to support increasingly complex workloads.”
Raiguel said ePlus landed several multimillion-dollar wins fueled by AI and IT modernization, including data center connectivity for a neocloud customer, a storage update for a utility, and secure network work for a defense tech company.
Security, Managed Services Expand ePlus Opportunity
Security product net sales rose 10.3 percent, and security products made up 22.9 percent of gross billing over the trailing 12 months, Raiguel said.
“We are also seeing security more closely integrated with infrastructure projects as customers look to deploy AI securely and at scale,” he said. “Our skills and experience in this area enable us to help customers better secure their environments, consolidate into platform solutions, and make more effective investments.”
On the services side, Raiguel said managed services net sales grew 12 percent, driven by offerings such as storage-as-a-service and enhanced maintenance. Professional services net sales declined against a tough comparison and project delays among large retail customers, but ePlus continues to invest in talent, including its field chief technology officer and principal technologist team.
“Our extensive portfolio of professional and managed services allows us to augment and support customers throughout the technology lifecycle, from planning and design to implementation and management,” Raiguel said. “This services-led approach distinguishes ePlus and reinforces our role as a trusted, value-added solutions provider.”
Partners and customers are taking notice, Raiguel said. During the quarter, ePlus became the first company in North America to reach ambassador status with Santa Clara, Calif.-based Everpure, was named North American flash partner of the year by San Jose, Calif.-based NetApp, and became a certified services partner in Anthropic’s Claude partner network.
Marron added that ePlus’ recent acquisition of Daymark Solutions broadens the company’s Northeast presence and brings a Microsoft Tier 1 CSP certification.
ePlus Raises Fiscal 2027 Growth Forecast
With $381 million in cash and strong growth in bookings and open orders, he said ePlus raised its fiscal 2027 guidance to upper single-digit growth in net sales and gross profit, with adjusted EBITDA up in the low double digits.
“In closing, we remain confident in our strategy and our ability to capitalize on the opportunities ahead, while maintaining financial discipline and a balanced approach to capital allocation,” Marron said.
During the question-and-answer period following the prepared remarks, when asked when ePlus could expect to see some relief from supply constraints, especially memory, Raiguel said there are still some issues in the compute space on the memory side.
“It’s more on the high-end compute, especially the GPU-type arenas, and there’s some delays that are also [impacting] the high-end networking space,” he said. “But in general, it’s not affecting broadly across the markets for delays. It’s just more about price increases than anything else.”
When asked about increasing order backlog, Marron said ePlus is seeing accelerating adoption of AI around the modernization space.
“The demand in terms of data center infrastructure has picked up across the board, and there’s more emphasis on cybersecurity with what’s going on,” he said. “So that all fits within our sweet spot in terms of where our strengths are, both from a services and from a product perspective.”
ePlus Fiscal Q2 2027 Revenue, Earnings By The Numbers
For its second fiscal quarter 2027, which ended September 30, ePlus reported total revenue of $667.9 million, up about 9.7 percent from last year’s $608.8 million.
That included product sales of $547.1 million, up from last year’s $485.1 million, and services revenue of $120.8 million, down slightly from $123.8 million.
On a more granular level, the company reported telecom, media, and entertainment revenue of $153.9 million, down 12.9 percent; healthcare revenue of $100.4 million, up 22 percent, financial services revenue of $93.5 million, up 48.3 percent, SLED revenue of $91.9 million, up 5.3 percent; technology revenue of $69.4 million, down 0.2 percent; retail revenue of $35.0 million, down 12.7 percent; and other revenue of $121.8 million, up 37.9 percent.
Total revenue beat analyst expectations by $31.8 million, according to Seeking Alpha.
The company also reported net income of $40.4 million or $1.56 per share, up from last year’s $34.9 million or $1.32 per share.
ePlus stock rose nearly 12 percent Friday, closing at $92.11.
