ScanSource Q4 Earnings Surpass Estimates, Revenues Increase Y/Y

ScanSource, Inc. SCSC reported adjusted earnings of $1.02 per share in fourth-quarter fiscal 2025 (ended June 30, 2025), beating the Zacks Consensus Estimate of 91 cents. The bottom line improved 28% from the prior-year quarter’s earnings of 80 cents.

On a reported basis, the company delivered earnings of 88 cents per share compared with the prior-year quarter’s 64 cents per share.

SCSC’s Revenues Rise Y/Y On North America Growth

The company reported net revenues  of $813 million in the quarter under review, up 8.9% from the year-ago quarter. The top line beat the Zacks Consensus Estimate of $773 million.

Net revenues in the United States and Canada were up 12.2% to $745 million. International sales decreased 17.4% to $68.2 million.

Specialty Technology Solutions’ revenues rose 9.2% to $789 million in fourth-quarter fiscal 2024, courtesy of broad-based growth in North America.

Revenues at Intelisys & Advisory were $24.2 million in the reported quarter, up 1.3% year over year, driven by acquisitions.

ScanSource’s Adjusted EBITDA Margin Rises in Q4

The cost of sales amounted to $708 million in the fiscal fourth quarter, up 9.1% from the year-ago quarter. The gross profit totaled $105 million, up 8% from the year-ago quarter’s $97 million. The gross margin came in at 12.9% in the reported quarter compared with the prior-year quarter’s 13%.

Selling, general and administrative expenses increased 4.7% year over year to $72 million. The adjusted operating profit was $31 million in comparison to the prior-year quarter’s $26 million. Adjusted EBITDA was up 13% year over year to $38.6 million. The adjusted EBITDA margin was 4.7% compared with 4.6% in the prior-year quarter.

SCSC’s Cash Position & Balance Sheet

The company reported cash and cash equivalents of $126 million as of June 30, 2025, in comparison to $185 million as of June 30, 2024. The company generated $112 million of cash in operating activities in fiscal 2025 compared with $372 million in the prior year. The company’s long-term debt was $128 million at the end of fiscal 2025, down from $136 million at the end of fiscal 2024.

FY24 Performance of ScanSource

SCSC reported adjusted earnings per share of $3.57 in fiscal 2025 in comparison with $3.08 in the prior year. The bottom line beat the Zacks Consensus Estimate of $3.47.

Including one-time items, the bottom line came in at $3.00, declining 2% from $3.06 in fiscal 2024. Revenues were down 6.7% year over year to $3.04 billion. The top line beat the Zacks Consensus Estimate of $3.01 billion.

SCSC FY26 Outlook

ScanSource expects net revenues of $3.1-$3.3 billion for fiscal 2026. Adjusted EBITDA is projected between $150 million and $160 million. The company expects a free cash flow of at least $80 million.

ScanSource’s Share Price Performance

The company's shares have lost 8.7% in the past year against the industry’s 18% growth.

SCSC’s Zacks Rank

ScanSource currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

SCSC’s Peer Performances

MSC Industrial Direct Company, Inc. MSM reported a third-quarter fiscal 2025 (ended on May 31, 2025) adjusted EPS of $1.08, which beat the Zacks Consensus Estimate of $1.03. The bottom line decreased 18.8% year over year.

MSC Industrial generated revenues of around $971 million in the quarter under review, down 0.8% from $979 million in the year-ago quarter. The top line beat the Zacks Consensus Estimate of $970 million. Average daily sales fell 0.8% year over year in the quarter. However, this came in line with the company’s expectations, driven by improving performance in volumes.

SiteOne Landscape Supply, Inc. SITE posted an adjusted EPS of $2.86 in the second quarter of 2025, missing the Zacks Consensus Estimate of $2.89. The company posted earnings of $2.63 per share in the second quarter of 2024.

SITE registered revenues of $1.46 billion for the June-end quarter of 2025, in line with the Zacks Consensus Estimate. The top line rose 3.4% year over year.

W.W. Grainger, Inc. GWW reported earnings per share (EPS) of $9.97 in second-quarter 2025, missing the Zacks Consensus Estimate of $10.00. However, the bottom line improved 2% year over year.

Grainger’s quarterly revenues rose 5.6% year over year to $4.55 billion. The top line beat the Zacks Consensus Estimate of $4.52 billion. Daily sales increased 5.6% from the prior-year quarter. We predicted daily sales to increase 3.8% in the quarter.

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