Climb Global (CLMB) Q3 2026 Earnings Call Transcript

Image source: The Motley Fool.

DATE

Thursday, Oct. 29, 2026

CALL PARTICIPANTS

• Chief Executive Officer – Dale Foster
• Chief Financial Officer – Matthew Sullivan
• Investor Relations Advisor – Sean Mansouri

Need a quote from a Motley Fool analyst? Email [email protected]

TAKEAWAYS

• Gross Billings — $706.4 million, increasing 40% due to organic growth from new and existing technology vendors.
• Net Sales — $220.3 million, representing a 37% increase from $161.3 million in the third quarter of 2025.
• Net Income — $7.9 million, growing 69% year over year from $4.7 million in the prior year period.
• Diluted EPS — $0.43, an increase from $0.25 per share in the same quarter of the previous year.
• Adjusted EBITDA — $14.7 million, rising 35% from $10.9 million in the third quarter of 2025.
• Effective Margin — 44.6%, increasing 230 basis points reflecting cost-saving initiatives and operational efficiencies.
• Distribution Segment Gross Billings — $680.5 million, reflecting a 41% increase driven by expansion in North America and Europe.
• Solutions Segment Gross Billings — $25.9 million, growing 14% year over year due to organic contributions.
• Gross Profit — $33 million, a 28% increase from $25.7 million in the third quarter of 2025.
• Selling, General, and Administrative Expenses — $20.9 million, compared to $16.2 million, primarily due to the InterWorks acquisition and variable sales compensation.
• SG&A as a Percentage of Gross Billings — 3%, compared to 3.2% in the third quarter of 2025.
• SG&A as a Percentage of Gross Profit — 63.2%, representing a decline from 68.5% in the second quarter of 2026 and 76.7% in the first quarter of 2026.
• Cash and Cash Equivalents — $66.9 million as of Sept. 30, 2026, compared to $36.6 million at the end of fiscal 2025.
• Revolving Credit Facility — $50 million, with zero debt outstanding at the end of the third quarter.
• Vendor Performance — 19 of the top 20 vendors, generating sequential growth during the period.
• New Vendor Evaluations — one new brand agreement signed (Harmonic Security) out of 32 total brands evaluated during the quarter.
• Cybersecurity Revenue Mix — 70% of the company’s business, driven by demand for network and endpoint security solutions.
• Reseller Network — 7,000 to 7,500 unique customers worldwide, used by the company to target specific market fits for vendors.
• Vendor Scale — Darktrace, one of the company’s newer relationships, reached a $100 million run rate according to management.
• Acquisition-Related Costs — $118,000 for the quarter, compared to $594,000 in the prior year period.
• Provision for Income Taxes — $2.9 million for the quarter, reflecting a higher effective tax rate compared to $1.6 million in the third quarter of 2025.

SUMMARY

Climb Global Solutions, Inc. (CLMB +23.29%) reported financial results for the third quarter of 2026, noting growth across its distribution and solutions segments. Management attributed the performance to momentum within its vendor portfolio and the integration of InterWorks. The company expanded its European footprint through the acquisition of NeoVAD and identified a new category of “challenger vendors” to target for future distribution. Investments in IT infrastructure, automation, and a proprietary cloud marketplace are intended to streamline global operations and increase productivity as the company scales.

• Management identifies “challenger vendors” as established technology companies seeking focused distribution partners to expand channel reach and reseller engagement.
• CEO Foster noted that 80% of the company’s business is comprised of renewal annuity streams, which management expects to benefit from year-end budget cycles.
• The company is developing a proprietary cloud marketplace platform to allow managed service providers and resellers to purchase and manage cloud subscriptions directly.
• CEO Foster stated, “A portion of our business should be a self-service platform that we’re building so our customers can interface and do it quickly.”
• The acquisition of NeoVAD provides the company with exclusive vendor relationships in France that command margins typically double those seen in North America.
• CEO Foster noted a shift in the market where private equity-owned vendors are prioritizing channel distribution over direct sales models to improve operational efficiency.

INDUSTRY GLOSSARY

• ALM (Application Lifecycle Management): The product lifecycle management of computer programs, including requirements, architecture, coding, testing, and maintenance.
• Effective Margin: A non-GAAP metric defined as adjusted EBITDA as a percentage of gross profit.
• Gartner’s Magic Quadrant: A graphical market research methodology that categorizes technology vendors as leaders, challengers, visionaries, or niche players.
• Gross Billings: The total dollar value of customer purchases of goods and services during a period, including transaction values recognized on a net basis.
• HCI (Hyperconverged Infrastructure): An IT framework that combines computing, storage, and networking into a single system to reduce data center complexity.
• MSP (Managed Service Provider): A company that remotely manages a customer’s IT infrastructure and end-user systems.
• VAR (Value-Added Reseller): A company that adds features or services to an existing product and resells it as an integrated solution.

Full Conference Call Transcript

Operator: Good morning everyone, and thank you for participating in today’s conference call to discuss Climb Global Solutions’ financial results for the third quarter ended September 30, 2026. Joining us today are Climb’s CEO, Mr. Dale Foster, the company’s CFO, Mr. Matthew Sullivan, and the company’s investor relations advisor, Mr. Sean Mansouri with Elevate IR. By now, everyone should have access to the third quarter 2026 earnings press release, which was issued yesterday afternoon at approximately 4:05 P.M. Eastern Time. The release is available in the investor relations section of Climb Global Solutions website at www.climbglobalsolutions.com. This call will also be available for webcast replay on the company’s website. Following management remarks, we will open the call for your questions.

I would now like to turn the call over to Mr. Mansouri for introductory comments.

Sean Mansouri: Thank you. Before I introduce Dale, I’d like to remind listeners that certain comments made on this conference call and webcast are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain known and unknown risks and uncertainties, as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements. These forward-looking statements are also subject to other risks and uncertainties that are

Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.