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4w ago

Softcat Raises Full‑Year Profit Forecast After AI Infrastructure Surge

Corporate demand for AI‑capable hardware, together with an order pull‑forward caused by memory shortages, lifted third‑quarter results and pushed management to raise its outlook.

AI (Artificial Intelligence) letters are placed on computer motherboard in this illustration taken, June 23, 2023. REUTERS/Dado Ruvic/Illustration/File Photo/File Photo

Overview

  • Softcat reported double‑digit year‑on‑year growth in gross profit and underlying operating profit for the three months to 30 April.
  • The board upgraded full‑year underlying operating profit guidance from high single‑digit growth to mid‑teens following the stronger quarter.
  • The company attributed the momentum to corporate spending on AI‑enabled infrastructure and to some customers advancing hardware purchases because of global memory chip shortages.
  • Shares jumped about 9–10% in early trading after the update while analysts welcomed the upgrade but warned pulled‑forward orders may reduce growth in the next fiscal year.
  • Softcat highlighted its broad product and services mix and a customer base of more than 10,000, and it is using AI tools internally as it looks to convert current demand into longer‑term market share gains.