Dicker Data posts strong earnings growth as margin narrows

Software, AI and device refresh cycle drove lift in revenue as a rise enterprise deals trimmed margin.

Strong revenue growth for the 2025 fiscal year pushed Dicker Data gross revenue to almost $3.9 billion, up 14.9 percent on the previous year.

Despite the positive headline results, gross margin retreated to 9 percent, a slight reduction from 9.6 percent, due to a change in revenue mix.

“Growth during the year was skewed toward larger enterprise customers and higher‑value infrastructure transactions, which typically carry lower percentage margins,” said Vlad Mitnovetski, executive director and COO, Dicker Data.

Enterprise demand is expected to remain strong in FY26, driven by data centre modernisation, AI infrastructure and software adoption, alongside a pickup in SMB and midmarket demand.

“As this mix normalises, it provides an opportunity for margin balance while maintaining top‑line momentum,” Mitnovetski told CRN Australia.

Strong software, cybersecurity and compliance demand

Software was the strongest performing category for Dicker Data in 2025, growing 21 percent year on year and delivering $1.1 billion in gross software sales.

The strong demand is being driven by business-critical investment in software, cybersecurity, identity and compliance solutions as organisations respond to the changing regulatory and threat landscape.

“These trends are expected to persist into FY26 as customers prioritise resilience, regulatory compliance and operational efficiency,” Mitnovetski said.

Device refresh cycle set to continue

Endpoint solutions grew 18 percent in FY25 and the company expects the replacement wave to continue. The Windows 10 end-of-support deadline has driven an uplift in device refresh activity.

In addition, early Windows 11 deployments are now approaching their three- to four-year replacement window. The growing adoption of AI-enabled and Copilot+ PCs is driving endpoint demand.

While there’s a substantial installed base of Windows 10 commercial devices that will need to be replaced, Mitnovetski acknowledged it’s concentrated in the SMB segment, where customers are more price‑sensitive and more likely to extend asset life cycles.

Industry forecasts indicate endpoint device growth of 6.6 percent in 2026. “While we acknowledge near‑term variability in SMB refresh timing, we remain slightly more bullish on the medium‑term opportunity,” he said.

“This is supported by increasing adoption of AI‑capable devices and growing awareness of the productivity and security benefits associated with modern endpoint platforms,” he added.

Partners key to AI growth

Dicker Data has more than 12,200 partners across Australia and New Zealand and added 17 new vendors during FY25, including VAST Data, BMC, CrowdStrike and Shure. It’s part of a deliberate strategy to “broaden and future‑proof the portfolio” across the region.

“We expect to continue adding vendors at a similar pace in FY26 as we diversify revenue streams and ensure our offering remains aligned with evolving partner and customer needs,” said Mitnovetski.

Throughout 2025, Dicker Data also focused on AI education and enablement together with its proof of concept (PoC) environment to support partners in deploying AI.

Partners are increasingly relying on the company’s technical, architectural and go-to-market expertise to navigate AI opportunities, the report noted.

While some engagements remain in early phases, several have converted into commercially meaningful production revenue, according to Mitnovetski.

“Momentum is building as customers move from experimentation toward structured deployment, supported by our infrastructure, software and enablement capabilities,” he added.