The Short Answer
Descartes Systems (DSGX) has a qualitative business verdict that is HALAL and passes the known filing-based asset ratios, but the overall screen remains incomplete. Descartes is a leading provider of cloud-based logistics-technology and trade-compliance software delivered over its Global Logistics Network.
Logistics-software development is generally permissible at the activity level. The January 31, 2026 Canadian filing reports no interest-bearing debt, and the known asset-based ratios pass; gross interest income and prohibited-activity revenue are not separately quantified.
Current quantitative Sharia screen
Based on 40-F figures for the period ended 2026-01-31; calculated 2026-07-15.
0 / 1,895.665
356.526 / 1,895.665
421.297 / 1,895.665
- Financial
- Incomplete
- Overall
- Incomplete
Debt/assets is 0.00%, liquidity/assets is 18.81% and receivables-plus-cash/assets is 22.22%; gross interest income is unavailable.
- Financial
- Pass
- Overall
- Incomplete
Known debt, liquidity and receivables-plus-cash ratios are below the examined MSCI limits; gross interest income and business activity remain incomplete.
- Financial
- Pass
- Overall
- Incomplete
Known debt/assets and identifiable liquidity/assets are below the examined Malaysia limits; this is a calculation against SAC ratios, not an official classification.
- Financial
- Not calculated
- Overall
- Incomplete
A licensed historical market-cap series is not stored; filing-based asset ratios remain documented.
Business-activity disclosure
Descartes develops logistics, transportation-management, customs and trade-compliance software delivered through its Global Logistics Network. The core software activity is generally permissible, but the filing does not provide a universal prohibited-revenue numerator for downstream customers or use cases.
Limitation: No universal prohibited-activity revenue numerator or scholar-specific purification percentage is disclosed, and gross interest income is not separately isolated.
Purification
Gross interest income is not separately disclosed and no scholar-approved purification percentage is asserted.
Inputs, assumptions and primary sources
- Amounts are USD millions in U.S. dollars from Descartes Systems Group's January 31, 2026 Form 40-F.
- The filing's consolidated balance sheet reports no interest-bearing debt balance at period end; operating leases are excluded.
- Cash and cash equivalents are $356.526 million, accounts receivable net is $64.771 million and no separately identified interest-bearing securities balance is added.
- Fiscal-year revenue is $728.992 million. The filing does not separately disclose gross interest income, so no income percentage is estimated.
- Descartes is a Canadian foreign issuer; this SEC 40-F is used as the primary filing source without changing the article URL.
This is a reproducible financial screen, not a fatwa. A failed total-assets screen can coexist with a pass under a market-cap methodology. ZakatInvest keeps the qualitative assessment separate so numerical thresholds do not erase material context.
Sharia Screening Methodology
Islamic scholars use several criteria to screen stocks:
- Business activity screen: Is the company's primary business halal?
- Debt ratio: Total debt / market cap must be under 33%
- Interest income: Interest income / total revenue must be under 5%
- Haram revenue: Revenue from haram sources must be under 5%
- Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)
Descartes' Business Activity
Descartes develops and sells:
- Logistics software: Routing-and-scheduling and transportation-management solutions
- Trade compliance: Customs, regulatory-compliance, and trade-data-and-intelligence products
- Ecommerce shipping: Shipping-and-fulfillment connectivity over the Global Logistics Network
These are general-purpose logistics-software businesses delivered as recurring subscription-and-transaction services. This is permissible at the activity level.
Concerns to Be Aware Of
1. Acquisition Activity
Descartes is a serial acquirer. Acquisition activity can periodically add debt and goodwill, so the financial screen should be re-verified following material acquisitions — though the company funds most deals from internally-generated cash.
2. End-Market Look-Through
Descartes' software is sold into mixed-Sharia-profile end-markets (transportation, logistics, manufacturing, distribution, and retail). Under standard methodology, the relevant classification is general-purpose logistics-software development rather than the look-through end-customer mix.
3. Minor Interest Income
Gross interest income is not separately disclosed in the filing, so no income percentage or fixed purification amount is asserted here.
Filing-Based Ratios (January 31, 2026)
Using the latest Descartes Systems Group Form 40-F (USD millions):
- Debt / total assets: 0.00%
- Cash + securities / total assets: 18.81%
- Receivables + cash / total assets: 22.22%
- Gross interest income: Not separately disclosed
Methodology Interpretation
These are ZakatInvest calculations from the cited filing, not claims of current index membership or an official scholar ruling:
- FTSE-style: Known ratios pass, but gross interest income is unavailable.
- MSCI-style: Known debt, liquidity and receivables-plus-cash ratios pass.
- Malaysia-style: Known debt and liquidity ratios pass; this is not an official classification.
Bottom Line
Descartes Systems (DSGX) has a generally permissible logistics-software business and passes the known filing-based asset ratios. Because gross interest income and a universal prohibited-revenue numerator are not disclosed, the overall result remains incomplete rather than a universal halal certification; re-check after material acquisitions and consult the methodology you follow.
For Muslim investors seeking supply-chain software exposure, DSGX sits alongside other halal-screened names like Manhattan Associates (MANH) and Trimble (TRMB).
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