So some of that ties to what I’m talking about with the projects being deployed as compared to buying new technology. The second part of that is what I had said to Maggie a little bit earlier is that some of these deals, some of these enterprise deals or customers pushed into Q4 and we’ve seen an early pickup, and we don’t think the demand parameters are changing both in terms of our pipeline our backlog and what we’re hearing from our sales teams related to their forecast for Q4.
Matt Sheerin: I got it. Okay. And could you remind me on the revenue contribution from the in this quarter from the acquisition that you just completed does that have much of an impact?
Mark Marron: It was a Matt. It was immaterial to net sales, maybe 3% to 4% of net sales. So it was immaterial for the quarter.
Matt Sheerin: Okay. I mean but for the March quarter? I could you just you just you just closed the acquisition, right? So you have a quarter where revenues also?
Mark Marron: Yes, sorry that’s immaterial to Matt. That’s a small acquisition roughly 35, 36 employees. What it does for us it gives us a platform for the Mountain West. And they’ve got skill sets in the kind of data center cloud security space that we can we can build upon and then bring all the other things that ePlus brings to the table. So we think it’s a nice platform to build on but it’s immaterial for Q4. Okay.
Matt Sheerin: Okay. Fair enough. And just relative to your EBITDA guidance for the year at the low end that would imply that your EBITDA or operating margin for the March quarter would be or an operating profit would be down year-over-year despite a good revenue growth because your revenue growth is going to be up double-digits year-over-year. So what’s beneath — what’s happening there and why is that down?
Mark Marron: Well, I think, if you look at it Matt is probably some of the things that we talk about. We’re investing for the future. So we believe we’re a growth company. So we didn’t touch on AI yet, but we’ve made some big investments as it relates to resources AI optimized solutions. We built out a lab a customer innovation center. So Elaine touched on our head count was up. I think it was 152 employees, I’d say about 130 to 135 were customer facing. So you’ll see our salaries and benefits still up based on the investments we’re making there. And then over time, I think you’ll start to see operating leverage, but we still believe we’ll be in the range on the adjusted EBITDA and the net sales on the low end that we talked about.
Matt Sheerin: Okay. Very good. Thank you very much.
Mark Marron: All right. Thanks, Matt.
Operator: And your final question comes from the line of Greg Burns with Sidoti. Greg, your line is now open.
Greg Burns: Yes. Just — sort of a kind of follow-up on the on the product sales. Is just a little bit of a bottleneck, you saw this quarter. Cisco imply that maybe there was a couple of quarters like it was going to be longer duration here to work through some of this bottleneck of product that’s been shipped but it seems like you feel that you’re going to rebound pretty quickly in the next quarter. Can you just help us understand what gives you confidence there? I know you touched on a little bit, but Cisco in particular seem to think that it was going to be a little bit of a longer term headwind for them to work through this product — product that’s out in the market?
Mark Marron: Yes, hey, Greg how are you? So a couple of different things. So I don’t I don’t think we have the I’ll say supply chain issues that Cisco has. Now, obviously it’s a portion of what we do, but we’ve seen our open orders continue to go down on a regular basis overall. So I think some of it is open. Orders are getting closer. I won’t say they’re at pre-COVID levels, but they’re a little more. I don’t know if normalized, but at more natural levels that we think. So we’ve got a good handle on our open orders slash backlog. You know the supply chain easing really eased up a lot for us. I can’t speak to Cisco, but for us in the first half if you think about it being up 22%, I don’t think there were too many companies out there up 22% in the first half on net sales.
So you had that supply chain easing. And then the other thing for the quarter is, we’ve seen the activity pickup. We’ve got the forecast from our sales team and the demand parameters really haven’t changed for us. We feel we’re in the right value added areas, with cloud security, network modernization, AI and all those services we’re predicting. So that would be the reason behind it.
Q – Greg Burns: Okay. And then with some your AI practice, AI Ignite is that mainly a services opportunity like a professional service opportunity. Is there hardware associated with that? And do you feel like you have the capabilities in-house to grow that business, or is that something that you need to maybe add inorganic expertise to grow that part of your business?
Mark Marron: Yes. So, Hey, Greg, a couple of different things there. One is in the early innings, if you think about it, but I think it’s going to change how companies operate as they go forward in the future. The other thing and it kind of fits right in our wheelhouse. So if you think about converged infrastructure hyper-converged AI optimized infrastructure is the same thing, in terms of compute networking storage, and all the things that kind of plays to our strengths. So, a lot of that we have resources, but we have invested in additional resources. And I had mentioned the lab and the customer innovation center, but it’s not just a services play. So, it’s actually the services is the first part of it where we help them kind of explore, adopt and optimize AI.
