Softcat update signals strong Q1

Softcat has indicated in a first-quarter trading update that the business has experienced a strong start to its fiscal year and is on course to meet expectations.

The channel player shared a brief update for the three months to 31 October, reporting “strong double-digit year-on-year growth in gross profit and underlying operating profit”.

The statement revealed the growth was coming from a broad number of technology categories and across a wide number of customer segments, which bodes well for the rest of the fiscal year.

“I’m pleased to report further encouraging progress for Softcat in the period, with continued good demand from customers across the wide range of our technology proposition. We operate in a large and growing market, and continue to gain market share, reflecting our special culture, differentiated offering and deep customer relationships,” said Softcat CEO Graham Charlton.

“The sustained investment behind our strategic priorities strengthens our ability to address the increasingly complex needs of customers and deliver on the significant growth opportunities ahead,” he added.

The trading update signalled to investors that the Softcat board was pleased with the progress, and it remained in line with the expectations it had laid out when it shared results for its 2025 fiscal year.

Last month, the firm indicated that there were a number of large deals in the pipeline and those were likely to start coming through in the first half, providing the business with a strong platform to begin its fiscal year.

The first-quarter numbers come on the back of a successful time for Softcat, which recently shared preliminary numbers for the year ended 31 July, marking its 20th consecutive year of growth.

Gross invoiced income for the year climbed by 26.8% to come in at £3.62m, gross profit was up by 18.3%, and underlying operating profit growth improved by 16.9%.

The business benefited from a strong second half, supported by a number of larger projects and very large low-margin deals. During the period, Softcat also made its first acquisition, bringing data and artificial intelligence (AI) specialist Oakland into the fold.

Speaking towards the end of last month about the annual results, Charlton said the fundamentals of the business, with its ability to cover growth areas, including security, cloud and artificial intelligence (AI), meant it was able to continue to grow.

“We have never been in a better position to address the increasingly complex needs of customers, who are adapting to rapid developments across all facets of their technology,” said Charlton.

“During the year, we completed our first acquisition, bolstering our data, automation and AI capabilities in an exciting growth segment. And we have once again proven our ability to deliver larger and more complex solutions projects, an area we have been investing in for a number of years,” he added.

“Our strong performance provides us with the confidence to accelerate investment in our own systems and processes, ensuring that we have a modern and efficient infrastructure to reinforce our competitive advantage and deliver on the significant growth opportunities ahead.”