Descartes Systems Group again reported record quarterly results as it continues to see “good demand” amid a global trade landscape that remains in flux.
Descartes (NASDAQ: DSGX) reported consolidated revenue of $201 million for its fiscal quarter ended July 31, a 12% year-over-year increase and 1% ahead of the consensus estimate. Services revenue was up 13% y/y to $189 million (organic growth in services revenue was approximately 9%, excluding foreign exchange fluctuations).
Earnings per share of 57 cents for the quarter came in 14 cents higher y/y and a penny ahead of Seeking Alpha’s unadjusted EPS estimate.
Descartes reported adjusted EBITDA of $94.4 million in the period, which was 18% higher y/y. It recorded an adjusted EBITDA margin of 46.9%, which was up 230 basis points y/y.
“Today’s supply chains and logistics operations need to be agile in the face of an increasingly dynamic global trade environment,” said CEO Ed Ryan. “Having a broad scope of solutions on our Global Logistics Network is imperative to help isolate our customers from complexity, bringing together the data and domain expertise required to efficiently manage the lifecycle of shipments.”
The company generated $81 million in cash flow from operations in the period, a 28% y/y increase.
It ended the quarter with $401 million in cash, up $24 million from the prior quarter. It has no debt and an untapped $350 million line of credit. It has used approximately $220 million since the quarter closed to fund two acquisitions.
Descartes acquired Extensiv, a warehouse management and fulfillment tech provider, for $120 million last week. It acquired Tai, a TMS provider to freight brokers, for $100 million at the end of August.
The company implemented a share repurchase plan at the end of 2025 to buy back up to 10% of its public float (8.6 million shares). It repurchased 651,800 shares for $45.1 million in the first half of its fiscal year.
It will continue to use cash to fund future acquisitions. Management said on a Thursday evening call that it would take on leverage, up to 3 times annual EBITDA, to accomplish a larger deal.
Shares of DSGX were up 1.7% in after-hours trading on Thursday.
Why it matters? Descartes’ strong financial performance and strategic acquisitions of warehouse and transportation tech providers highlight the industry’s shift toward unified, agile logistics ecosystems. The expanded network capabilities help supply chain professionals navigate ongoing global trade complexity and operational volatility.
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