Climb Global Solutions — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net sales increased 37% year-over-year to $220.3 million, compared to $161.3 million in Q3 2025.
• Gross billings increased 40% year-over-year to $706.4 million, compared to $504.6 million in Q3 2025.
• Gross profit increased 28% year-over-year to $33.0 million, compared to $25.7 million in Q3 2025.
• Net income increased 69% year-over-year to $7.9 million ($0.43 per diluted share), compared to $4.7 million ($0.25 per diluted share) in Q3 2025.
• Adjusted net income increased 34% year-over-year to $8.0 million ($0.43 per diluted share), compared to $6.0 million ($0.33 per diluted share) in Q3 2025.
• Adjusted EBITDA increased 35% year-over-year to $14.7 million, compared to $10.9 million in Q3 2025.
• Effective margin (Adjusted EBITDA as a percentage of gross profit) increased 230 basis points to 44.6%, compared to 42.3% in Q3 2025.
• SG&A expenses were $20.9 million in Q3 2026, compared to $16.2 million in Q3 2025; SG&A as a percentage of gross billings decreased to 3.0% from 3.2%.
• Cash and cash equivalents were $66.9 million as of September 30, 2026, compared to $36.6 million on December 31, 2025.
• The company had no outstanding debt on September 30, 2026, with no borrowings under its $50 million revolving credit facility.
• Accounts receivable increased to $342.1 million as of September 30, 2026, from $324.3 million on December 31, 2025.

Guidance and Future Outlook:

• Management expects to close out 2026 on a strong note and deliver another year of record performance.
• The company remains focused on identifying emerging technologies to strengthen its line card and support continued organic growth.
• Climb plans to evaluate accretive acquisition opportunities that fit its culture and high-touch model, with Europe identified as a key area of focus.
• The company is making strategic investments in technology and automation to support greater scale, efficiency, and operating leverage.

Business Segments and Product Lines:

• Distribution segment gross billings increased 41% year-over-year to $680.5 million.
• Solutions segment gross billings increased 14% year-over-year to $25.9 million.
• 19 of the company's top 20 vendors generated sequential growth during the quarter.
• Newer relationships with Fortinet and Darktrace are showing meaningful progress.
• The company operates across the US, Canada, and Europe through business units including Climb Channel Solutions, Grey Matter, and Climb Global Services.

Market and Competitive Landscape:

• The company's vendor portfolio includes innovative technology vendors in Security, Data Management, Connectivity, Storage & HCI, Virtualization & Cloud, and Software & ALM industries.
• The company expanded its European presence through the acquisition of NeoVAD subsequent to the quarter end, bolstering its position in France.
• The acquisition of Interworks earlier in the year contributed to the quarter's performance.

Risks and Challenges:

• Forward-looking statements highlight risks related to the ability to recognize anticipated benefits of acquisitions (NeoVAD and Interworks), including successful integration, retention of key personnel, and vendor relationships.
• Risks include the ability to sustain organic growth, identify and finance acquisitions on acceptable terms, and realize anticipated synergies.
• Potential challenges include managing changes in product mix and gross margins, competitive pricing pressures, and the impact of inflation, tariffs, and interest rates.
• Risks also encompass the continued acceptance of the distribution channel by vendors and customers, timely availability of new products, and the successful integration of artificial intelligence tools.

Management Commentary and Tone:

• CEO Dale Foster described the quarter as delivering "record results across certain key financial metrics," driven by strong momentum across the vendor portfolio and execution of strategic priorities.
• Management highlighted the "focused line card" as central to performance and noted the strategic fit of the NeoVAD acquisition in building scale and capabilities across European operations.
• The tone reflects confidence in the company's strong balance sheet and proven track record of execution.

Other Key Points:

• Climb Global Solutions announced the acquisition of NeoVAD subsequent to the quarter end to expand its European presence.
• The company previously acquired interworks.cloud ("Interworks") earlier in 2026.
• No dividends were paid per common share in the three months ended September 30, 2026, compared to $0.04 in the same period of 2025.
• A four-for-one stock split was completed on March 20, 2026, with share data retrospectively adjusted.
• The company will host a conference call on October 29, 2026, at 8:30 a.m. Eastern time to discuss results.