ScanSource Inc. (NASDAQ:SCSC) shares surged 19.2% in premarket trading on Thursday after the technology distributor delivered stronger-than-expected fourth-quarter results and unveiled an agreement to acquire IT solutions integrator MicroAge for $220.5 million in cash.
Adjusted earnings per share reached $1.46, comfortably ahead of the $1.14 analyst consensus. Quarterly revenue climbed 17% year-on-year to $953.1 million from $812.9 million, significantly exceeding expectations of $821.95 million.
Hardware demand drives strong quarterly growth
ScanSource attributed much of the revenue increase to robust hardware demand and broad-based expansion across its North American operations.
Its Specialty Technology Solutions segment generated net sales of $927.2 million during the quarter, representing an 18% increase from the same period a year earlier.
Gross profit advanced 14% year-on-year to $119.8 million, although gross margin narrowed slightly to 12.6% from 12.9%. Operating income increased 19% to $31.7 million.
“I’m proud of our team’s excellent fourth quarter performance, with 17% sales growth and even stronger EPS growth,” said Mike Baur, Chair and CEO. “We’re also excited about our agreement to acquire MicroAge, which we believe will accelerate growth, expand margins, and adds new services capabilities.”
ScanSource agrees $220.5 million MicroAge acquisition
Alongside its earnings announcement, ScanSource revealed an agreement to acquire MicroAge, an IT solutions integrator, for $220.5 million in cash.
The transaction is designed to broaden ScanSource’s services capabilities while supporting faster growth and improved margins. Subject to regulatory clearance and other closing conditions, the acquisition is expected to complete during the quarter ending September 30, 2026.
The proposed purchase represents a significant strategic expansion for ScanSource as it looks to complement its established technology distribution operations with additional IT integration and services expertise.
FY27 guidance points to continued growth
For fiscal 2027, ScanSource expects net sales to increase between 6% and 10%, excluding any contribution from the pending MicroAge acquisition.
Adjusted EBITDA is forecast at between $158 million and $165 million, giving a midpoint of $161.5 million. No corresponding analyst consensus estimate was provided for comparison.
ScanSource also ended fiscal 2026 with strong cash generation. Operating cash flow reached $123.1 million for the year, while the company returned capital to shareholders by repurchasing $97.9 million of its shares.
The combination of a sizeable earnings and revenue beat, double-digit underlying sales growth and the planned MicroAge acquisition helped drive the sharp positive reaction in ScanSource shares.
ScanSource stock price
