ePlus Gets A-Plus From Wall Street As Security Solutions Boost Revenue

‘Given the critical need to protect cyberinfrastructure against cyberthreats, we expect security to be a growing contributor for us and we continue to be a thought leader and evolve our solution set in this area,’ says ePlus President and CEO Mark Marron following the solution provider’s first-quarter earnings report.

Solution provider ePlus said customer demand for more robust cybersecurity solutions led to big sales gains in its first quarter ended June 30, with overall earnings growing 7 percent year over year.

“We continued to see strong demand for security in the first quarter,” Mark Marron, president and CEO of Herndon, Va.-based ePlus, told investors during Wednesday’s earnings call. “Adjusted gross billings for security products and services grew 54.9 percent year over year. Security accounted for over 21 percent of our adjusted gross billings on a trailing 12-month basis, which is a new high for us. Given the critical need to protect cyberinfrastructure against cyberthreats, we expect security to be a growing contributor for us and we continue to be a thought leader and evolve our solution set in this area.”

Wall Street responded by sending ePlus shares up $10.20, or 14.16 percent, in afternoon trading to $82.29. Earnings per share were up $1.21 for the quarter.

Marron said the company is helping customers in the cloud access security broker (CASB) space with what he called the “challenge of visibility and control” in their Software-as-a-Service environments. In June, ePlus launched its Vulnerability Management as a Service, providing real-time identification, prioritization and remediation of organizational cybersecurity weakness. In addition, ePlus is providing business recovery services following ransomware attacks, helping businesses “mitigate malware” and providing “high-touch” services with security consultants, he said.

“This gives us the opportunity for remediation technology and consulting to bring businesses back online and help bolster defenses to prevent future attacks,” Marron said.

But ePlus—No. 38 on the 2019 CRN Solution Provider 500—didn’t just win in security, according to Marron, who said the company’s services revenue in general was up 35.8 percent year over year. During the quarter the company’s 3,400 enterprise and midmarket customers increasingly looked to ePlus to provide professional, managed and staffing services, he said.

“Each of these services keeps us close to our customers, providing substantial opportunity to provide consultative services and to cross-sell and upsell additional products,” Marron said.

Overall, ePlus’ revenue for the quarter came in at $381.3 million, up 6.9 percent from $356.5 million in the year-ago quarter.

“Customers are continuing to digitize their businesses, create and utilize multi-cloud infrastructure, upgrade their collaboration and networks, and invest in IT security,” Marron said. “We believe we are very well positioned with the right mix of professional and managed services, and the right product mix to meet customer demand and anticipate market trends.”