For the quarter ended December 2024, CDW (CDW) reported revenue of $5.19 billion, up 3.3% over the same period last year. EPS came in at $2.48, compared to $2.57 in the year-ago quarter.The reported revenue represents a surprise of +4.34% over the Zacks Consensus Estimate of $4.97 billion. With the consensus EPS estimate being $2.33, the EPS surprise was +6.44%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations ...

CDW (CDW) came out with quarterly earnings of $2.48 per share, beating the Zacks Consensus Estimate of $2.33 per share. This compares to earnings of $2.57 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 6.44%. A quarter ago, it was expected that this information technology company would post earnings of $2.84 per share when it actually produced earnings of $2.63, delivering a surprise of -7.39%.Over the last four quarters, the ...

EXHIBIT 99.1 CDW Reports Fourth Quarter and Full Year 2024 Earnings | | | | | | | | Three Months Ended December 31, | | | | | | Year Ended December 31, | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | (Dollars in millions, except | | | | | | | | | % | | | | | | % | | per share amounts) | | | | | 2024 | | 2023 | | Chg. | | 2024 | | 2023 | | Chg. | | Net | Sales | | | $ | 5,186.0 | $ | 5,018.5 | | 3.3 | % $ | 20,998.7 | $ | 21,376.0 | | (1.8)% | | Gross ...

Core Viewpoint - Analysts expect CDW to report quarterly earnings of $2.33 per share, reflecting a year-over-year decline of 9.3%, with revenues projected at $4.96 billion, down 1.2% from the previous year [1] Earnings Projections - The consensus EPS estimate has been adjusted downward by 0.1% over the past 30 days, indicating a reassessment by analysts [1][2] Revenue Estimates by Segment - The consensus estimate for 'Public- Government' is $611.01 million, a decrease of 7.5% year-over-year [4] - 'Net sales- Public' is estimated at $1.78 billion, showing a slight increase of 0.5% from the prior year [4] - 'Public- Healthcare' is projected to reach $564.70 million, reflecting a year-over-year increase of 5.4% [4] - 'Net sales- Small Business' is expected to be $371.93 million, indicating a 0.5% increase from the previous year [5] - 'Public- Education' is forecasted at $608.59 million, with a year-over-year change of 5.1% [5] - 'Net sales- Corporate' is projected to be $2.15 billion, reflecting a decline of 5.7% year-over-year [5] Major Product and Services Estimates - 'Net sales- Other' is estimated at $635.66 million, indicating an 8.3% increase year-over-year [6] - 'Net sales- Major Product and Services- Other' is expected to be $25.97 million, reflecting a decrease of 5.9% [6] - 'Net sales- Major Product and Services- Hardware- Notebooks/Mobile Devices' is projected at $1.14 billion, showing a year-over-year increase of 5.6% [6] - 'Net sales- Major Product and Services- Hardware- Netcomm Products' is estimated at $620.43 million, indicating a decline of 4.2% [7] - 'Net sales- Major Product and Services- Hardware- Desktops' is expected to reach $254.36 million, reflecting a 5.2% increase from the prior year [7] - Overall, 'Net sales- Major Product and Services- Hardware' is projected at $3.47 billion, indicating a year-over-year decline of 2.2% [8] Stock Performance - Over the past month, CDW shares have returned +10.7%, outperforming the Zacks S&P 500 composite's +1% change [8]

CDW Corporation (CDW) is slated to report fourth-quarter 2024 results on Feb. 05, before market open.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.The Zacks Consensus Estimate for revenues is $4.96 billion, suggesting a 1.2% decline from the year-ago quarter’s reported figure.The consensus estimate for earnings is pegged at $2.33 per share, unchanged in the past 60 days, indicating a decrease of 9.3% from the year-ago quarter’s reported figure.CDW’s earnings missed the Zacks Conse ...

CDW Corporation (CDW) shares have lost 20.7% over the past three months, underperforming the broader Zacks Computer and Technology sector’s return of 6.7% and the Zacks Computers - IT Services industry’s growth of 7.4%.It has also lagged its key industry peers, including Grid Dynamics (GDYN) , Accenture (ACN) and DXC Technology’s (DXC) gains of 48.8%, 6.7% and 5.4%, respectively.The underperformance was primarily led by a 2% decline in net sales to $5.52 billion for the third quarter of 2024, falling short ...

Core Viewpoint - CDW Corporation has strengthened its portfolio through the acquisition of Mission Cloud Services Inc., enhancing its capabilities in AWS-focused professional services and cloud solutions [1][2]. Group 1: Acquisition Details - The acquisition of Mission Cloud Services complements CDW's Digital Velocity division, which includes cloud, data, AI, and software platform engineering, thereby expanding its market presence in cloud services [2]. - Mission's expertise in generative AI and AWS certification allows CDW to provide end-to-end support for AWS-managed environments, enhancing its AWS capabilities [2][3]. - With this acquisition, CDW now holds 17 AWS Competencies, reinforcing its status as an AWS Premier Tier Partner [3]. Group 2: Growth Strategy and Market Position - The acquisition aligns with CDW's three-part growth strategy, aimed at delivering customer-oriented results across the technology stack and customer lifecycle [3]. - CDW's enhanced AWS practice is expected to provide a competitive edge in the growing cloud services market, particularly in emerging markets where cloud adoption is increasing [4]. - The integration of Mission's services is anticipated to positively impact CDW's revenue performance and stock movement [4]. Group 3: Previous Acquisitions - CDW has been actively pursuing strategic acquisitions to bolster organic growth, including the purchase of Enquizit in June 2023, which specializes in AWS cloud services [5]. - Other notable acquisitions include Locus Recruiting LLC in February 2023 and Sirius Computer Solutions in December 2021, which have strengthened CDW's capabilities in managed services and cloud offerings [6]. Group 4: Financial Performance - In the last reported quarter, CDW's revenues decreased by 2% year over year to $5.517 billion, missing the consensus estimate by 3.5%, attributed to economic uncertainty and slower customer decisions on tech spending [7]. - CDW's stock has experienced a decline of 15.1% over the past year, contrasting with the subindustry's growth of 21.4% [9].

HARRISBURG, Pa., Nov. 20, 2024 (GLOBE NEWSWIRE) -- D&H Distributing, a leading provider of technology solutions to the North American channel, announces it was named 2024 CDW Large Distributor Partner of the Year. CDW’s Partner of the Year Awards were presented on November 14 during the 2024 CDW Partner Summit in Las Vegas, honoring CDW partners that represent the power of modern, customer-first partnerships and provided exemplary products, programs, solutions and services to support CDW and its customers t ...

```markdown PART I FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements of CDW Corporation and its subsidiaries for the periods ended September 30, 2024, and December 31, 2023, including balance sheets, statements of operations, comprehensive income, cash flows, and stockholders' equity, along with detailed notes on business description, accounting policies, recent pronouncements, accounts receivable, debt, fair value measurements, income taxes, earnings per share, commitments, contingencies, and segment information [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) | Metric | September 30, 2024 (millions) | December 31, 2023 (millions) | Change (millions) | | :-------------------------------- | :---------------------------- | :--------------------------- | :------------------ | | Cash and cash equivalents | $946.7 | $588.7 | $358.0 | | Short-term investments | $211.7 | — | $211.7 | | Accounts receivable, net | $4,894.0 | $4,567.5 | $326.5 | | Total current assets | $7,661.6 | $6,705.0 | $956.6 | | Total Assets | $14,376.7 | $13,284.6 | $1,092.1 | | Accounts payable-trade | $3,179.9 | $2,881.0 | $298.9 | | Current maturities of long-term debt | $423.2 | $613.1 | $(189.9) | | Total current liabilities | $5,458.6 | $5,442.0 | $16.6 | | Debt (long-term) | $5,607.5 | $5,031.8 | $575.7 | | Total Liabilities | $12,027.4 | $11,242.1 | $785.3 | | Total Stockholders' Equity | $2,349.3 | $2,042.5 | $306.8 | - Total assets increased by **$1,092.1 million** to **$14,376.7 million** as of September 30, 2024, compared to December 31, 2023, primarily driven by increases in cash and cash equivalents, short-term investments, and accounts receivable[7](index=7&type=chunk) - Total liabilities increased by **$785.3 million**, largely due to an increase in long-term debt, while total stockholders' equity rose by **$306.8 million**[7](index=7&type=chunk) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | YoY Change (%) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (%) | | :---------------- | :-------------------------- | :-------------------------- | :------------- | :-------------------------- | :-------------------------- | :------------- | | Net sales | $5,516.6 | $5,628.3 | (2.0)% | $15,812.7 | $16,357.5 | (3.3)% | | Gross profit | $1,200.7 | $1,227.7 | (2.2)% | $3,447.1 | $3,498.6 | (1.5)% | | Operating income | $481.6 | $478.4 | 0.7% | $1,242.7 | $1,245.9 | (0.3)% | | Net income | $316.4 | $315.5 | 0.3% | $813.6 | $808.2 | 0.7% | | Diluted EPS | $2.34 | $2.32 | 0.9% | $6.00 | $5.92 | 1.4% | - Net sales decreased by **2.0%** for the three months and **3.3%** for the nine months ended September 30, 2024, compared to the prior year, primarily due to lower sales in the Public and Corporate segments and a decrease in netcomm products[94](index=94&type=chunk)[98](index=98&type=chunk) - Despite lower sales, operating income saw a slight increase of **0.7%** for the three-month period, while net income also increased by **0.3%** and diluted EPS by **0.9%** for the same period[10](index=10&type=chunk)[96](index=96&type=chunk) [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income | $316.4 | $315.5 | $813.6 | $808.2 | | Other comprehensive income (loss) | $26.7 | $(24.7) | $16.3 | $2.9 | | Comprehensive income | $343.1 | $290.8 | $829.9 | $811.1 | - Comprehensive income increased significantly for both the three-month period (**18.0%**) and nine-month period (**2.3%**) ended September 30, 2024, primarily driven by positive foreign currency translation adjustments and a smaller unrealized loss from cash flow hedges compared to the prior year[12](index=12&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity (millions) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (millions) | | :---------------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Net cash provided by operating activities | $932.0 | $1,062.2 | $(130.2) | | Net cash used in investing activities | $(305.5) | $(195.9) | $(109.6) | | Net cash used in financing activities | $(270.7) | $(739.7) | $469.0 | | Net increase in cash and cash equivalents | $358.0 | $125.5 | $232.5 | - Net cash provided by operating activities decreased by **$130.2 million**, primarily due to changes in accounts receivable and merchandise inventory, partially offset by an increase in accounts payable-trade[14](index=14&type=chunk)[144](index=144&type=chunk) - Net cash used in investing activities increased by **$109.6 million**, mainly due to purchases of short-term investments in 2024 with no comparable activity in 2023[14](index=14&type=chunk)[148](index=148&type=chunk) - Net cash used in financing activities decreased by **$469.0 million**, driven by new debt issuances and lower share repurchases, partially offset by payments for debt extinguishment[14](index=14&type=chunk)[149](index=149&type=chunk) [Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity) | Metric (millions) | Balance as of Dec 31, 2023 | 9 Months Ended Sep 30, 2024 | Balance as of Sep 30, 2024 | | :---------------- | :------------------------- | :-------------------------- | :------------------------- | | Common Shares | 134.1 | (0.9) | 133.2 | | Paid-in Capital | $3,691.3 | $115.9 | $3,807.2 | | Accumulated Deficit | $(1,525.5) | $174.6 | $(1,350.9) | | Accumulated Other Comprehensive Loss | $(124.6) | $16.3 | $(108.3) | | Total Stockholders' Equity | $2,042.5 | $306.8 | $2,349.3 | - Total stockholders' equity increased by **$306.8 million** during the nine months ended September 30, 2024, primarily due to net income of **$813.6 million**, partially offset by **$354.0 million** in common stock repurchases and **$249.0 million** in dividend payments[18](index=18&type=chunk) [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [1. Description of Business and Summary of Significant Accounting Policies](index=10&type=section&id=1.%20Description%20of%20Business%20and%20Summary%20of%20Significant%20Accounting%20Policies) - CDW Corporation is a leading multi-brand provider of IT solutions to business, government, education, and healthcare customers in the US, UK, and Canada, offering a broad array of hardware, software, and integrated IT solutions and services[21](index=21&type=chunk) [2. Recent Accounting Pronouncements](index=10&type=section&id=2.%20Recent%20Accounting%20Pronouncements) - The FASB issued ASU 2023-09 (Income Taxes) and ASU 2023-07 (Segment Reporting) in December and November 2023, respectively, enhancing disclosure requirements. CDW is currently evaluating the impact of these ASUs on its disclosures[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) [3. Accounts Receivable and Contract Balances](index=11&type=section&id=3.%20Accounts%20Receivable%20and%20Contract%20Balances) | Metric (millions) | September 30, 2024 | December 31, 2023 | | :---------------- | :----------------- | :---------------- | | Accounts receivable, current | $4,894.0 | $4,567.5 | | Accounts receivable, noncurrent | $639.4 | $337.5 | | Total accounts receivable | $5,533.4 | $4,905.0 | | Contract assets | $91.0 | $111.8 | | Contract liabilities | $505.0 | $527.4 | - The Company sold approximately **$337 million** of accounts receivable during the nine months ended September 30, 2024, a decrease from **$382 million** in the prior year[31](index=31&type=chunk) - Remaining performance obligations for non-cancelable services contracts longer than 12 months totaled **$214.7 million** as of September 30, 2024, with **$108.3 million** expected within one year[35](index=35&type=chunk) [4. Inventory Financing Agreements](index=11&type=section&id=4.%20Inventory%20Financing%20Agreements) | Metric (millions) | September 30, 2024 | December 31, 2023 | | :---------------- | :----------------- | :---------------- | | Amounts outstanding under inventory financing agreements | $357 | $431 | - CDW utilizes inventory financing agreements to enhance liquidity, receiving extended payment terms without incurring interest. Outstanding amounts decreased from **$431 million** to **$357 million**[36](index=36&type=chunk)[37](index=37&type=chunk) [5. Debt](index=12&type=section&id=5.%20Debt) | Debt Type (millions) | Maturity Date | Interest Rate | Sep 30, 2024 Amount | Dec 31, 2023 Amount | | :------------------- | :------------ | :------------ | :------------------ | :------------------ | | Senior unsecured term loan facility | Dec 2026 | Variable | $634.5 | $634.5 | | Senior notes due 2024 | Dec 2024 | 5.500 % | $183.5 | $575.0 | | Senior notes due 2025 | May 2025 | 4.125 % | $211.1 | $600.0 | | Senior notes due 2030 | Mar 2030 | 5.100 % | $600.0 | — | | Senior notes due 2034 | Aug 2034 | 5.550 % | $600.0 | — | | Total long-term debt | | | $5,607.5 | $5,031.8 | - CDW issued **$1.2 billion** in new senior notes (2030 Notes at **5.100%** and 2034 Notes at **5.550%**) in August 2024. Proceeds were used to fund a cash tender offer for **$391 million** of 2024 notes and **$389 million** of 2025 notes, and for general corporate purposes[43](index=43&type=chunk)[44](index=44&type=chunk) - As of September 30, 2024, the Company had **$1.3 billion** of additional borrowing availability under its Revolving Loan Facility and was in compliance with all debt covenants[38](index=38&type=chunk)[40](index=40&type=chunk) [6. Fair Value Measurements and Financial Instruments](index=14&type=section&id=6.%20Fair%20Value%20Measurements%20and%20Financial%20Instruments) - CDW uses interest rate collar agreements with a total notional amount of **$400 million**, maturing September 30, 2026, to manage interest rate risk on variable interest rate debt. These are designated as cash flow hedges[48](index=48&type=chunk)[49](index=49&type=chunk)[51](index=51&type=chunk) - The Company also executed and settled **$600 million** in treasury lock agreements during Q3 2024 to manage interest rate risk prior to fixed rate debt issuance, resulting in an immaterial loss recorded to AOCL[52](index=52&type=chunk)[53](index=53&type=chunk) - Short-term investments, primarily a certificate of deposit, totaled **$212 million** as of September 30, 2024, with fair value approximating carrying value[54](index=54&type=chunk) [7. Income Taxes](index=15&type=section&id=7.%20Income%20Taxes) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Income tax expense | $111 | $104 | $270 | $261 | | Effective tax rate | 26.0% | 24.8% | 24.9% | 24.4% | - The effective tax rate for both the three and nine months ended September 30, 2024, increased compared to the prior year, primarily due to lower excess tax benefits on equity-based compensation[56](index=56&type=chunk) [8. Earnings Per Share](index=15&type=section&id=8.%20Earnings%20Per%20Share) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Basic weighted-average shares outstanding | 133.5 | 134.1 | 134.0 | 134.8 | | Diluted weighted-average shares outstanding | 134.9 | 135.9 | 135.5 | 136.4 | - Diluted weighted-average shares outstanding decreased for both the three and nine months ended September 30, 2024, reflecting the impact of share repurchases[57](index=57&type=chunk) [9. Commitments and Contingencies](index=15&type=section&id=9.%20Commitments%20and%20Contingencies) - CDW is involved in various legal proceedings and audits in the ordinary course of business. As of September 30, 2024, the Company does not believe any material loss exceeding recognized amounts has been incurred, though ultimate resolutions are unpredictable[58](index=58&type=chunk)[59](index=59&type=chunk) - The Company received a Civil Investigative Demand from the DOJ on June 11, 2024, related to a False Claims Act investigation concerning bids for E-Rate Program contracts. CDW is cooperating but cannot assess the outcome or potential loss at this stage[61](index=61&type=chunk) [10. Segment Information](index=16&type=section&id=10.%20Segment%20Information) - CDW operates through three reportable segments: Corporate (US private sector, >250 employees), Small Business (US private sector, <=250 employees), and Public (US government, education, healthcare). CDW UK and CDW Canada are included in 'Other'[63](index=63&type=chunk) | Segment (millions) | 3 Months Ended Sep 30, 2024 Net Sales | 3 Months Ended Sep 30, 2023 Net Sales | YoY Change (%) | 9 Months Ended Sep 30, 2024 Net Sales | 9 Months Ended Sep 30, 2023 Net Sales | YoY Change (%) | | :----------------- | :------------------------------------ | :------------------------------------ | :------------- | :------------------------------------ | :------------------------------------ | :------------- | | Corporate | $2,161.2 | $2,226.5 | (2.9)% | $6,492.3 | $6,675.2 | (2.7)% | | Small Business | $379.7 | $378.4 | 0.3% | $1,143.5 | $1,186.0 | (3.6)% | | Public | $2,335.7 | $2,422.1 | (3.6)% | $6,303.7 | $6,530.0 | (3.5)% | | Other | $640.0 | $601.3 | 6.4% | $1,873.2 | $1,966.3 | (4.7)% | | Total Net Sales | $5,516.6 | $5,628.3 | (2.0)% | $15,812.7 | $16,357.5 | (3.3)% | | Product/Service (millions) | 3 Months Ended Sep 30, 2024 Net Sales | 3 Months Ended Sep 30, 2023 Net Sales | YoY Change (%) | 9 Months Ended Sep 30, 2024 Net Sales | 9 Months Ended Sep 30, 2023 Net Sales | YoY Change (%) | | :------------------------- | :------------------------------------ | :------------------------------------ | :------------- | :------------------------------------ | :------------------------------------ | :------------- | | Hardware | $3,958.6 | $4,181.4 | (5.3)% | $11,566.6 | $12,149.9 | (4.8)% | | Software | $1,048.3 | $997.0 | 5.1% | $2,778.3 | $2,805.8 | (1.0)% | | Services | $481.9 | $421.3 | 14.4% | $1,386.1 | $1,316.6 | 5.3% | [11. Subsequent Event](index=21&type=section&id=11.%20Subsequent%20Event) - On October 7, 2024, CDW redeemed the remaining outstanding **5.500%** Senior Notes due 2024, totaling **$184 million**, at par[78](index=78&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of CDW's business, key factors influencing financial performance, and a detailed analysis of its consolidated and segment-level results of operations for the three and nine months ended September 30, 2024, compared to 2023. It also includes reconciliations of non-GAAP financial measures, discusses seasonality, and outlines the Company's liquidity and capital resources, including debt, share repurchases, and dividends [Overview](index=22&type=section&id=Overview) - CDW is a Fortune 500 company providing IT solutions to diverse customer segments (Corporate, Small Business, Public) in the US, UK, and Canada, offering over 100,000 products and services from more than 1,000 brands[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) [Trends and Key Factors Affecting our Financial Performance](index=22&type=section&id=Trends%20and%20Key%20Factors%20Affecting%20our%20Financial%20Performance) - Key factors impacting CDW's financial performance include general economic conditions, customer IT spending caution due to macroeconomic uncertainty, changes in government/healthcare/education spending policies, and evolving technology trends such as cloud, generative AI, software-defined architectures, and 'as a service' offerings[85](index=85&type=chunk)[86](index=86&type=chunk)[87](index=87&type=chunk)[89](index=89&type=chunk) [Key Business Metrics](index=23&type=section&id=Key%20Business%20Metrics) - CDW monitors key financial and non-financial metrics including Gross profit, Operating income, Net income, EPS (both GAAP and Non-GAAP), Average daily sales, Net cash provided by operating activities, Adjusted free cash flow, Cash conversion cycle, and Net debt to track business progress and achieve financial objectives[90](index=90&type=chunk) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net sales | $5,516.6 | $5,628.3 | $15,812.7 | $16,357.5 | | Gross profit margin | 21.8% | 21.8% | 21.8% | 21.4% | | Operating income margin | 8.7% | 8.5% | 7.9% | 7.6% | | Non-GAAP operating income | $534.0 | $556.3 | $1,447.8 | $1,520.4 | | Non-GAAP net income per diluted share | $2.63 | $2.72 | $7.04 | $7.31 | | Average daily sales | $86.2 | $89.3 | $82.4 | $85.6 | | Net debt (Sep 30) | $4,872.3 | $5,260.8 | | | | Cash conversion cycle (days) (Sep 30) | 17 | 15 | | | | Adjusted free cash flow (9 Months) | $764.1 | $1,112.9 | | | [Results of Operations](index=24&type=section&id=Results%20of%20Operations) [Consolidated Results](index=24&type=section&id=Consolidated%20Results) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | YoY Change (%) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (%) | | :---------------- | :-------------------------- | :-------------------------- | :------------- | :-------------------------- | :-------------------------- | :------------- | | Net sales | $5,516.6 | $5,628.3 | (2.0)% | $15,812.7 | $16,357.5 | (3.3)% | | Gross profit | $1,200.7 | $1,227.7 | (2.2)% | $3,447.1 | $3,498.6 | (1.5)% | | Selling and administrative expenses | $719.1 | $749.3 | (4.0)% | $2,204.4 | $2,252.7 | (2.1)% | | Operating income | $481.6 | $478.4 | 0.7% | $1,242.7 | $1,245.9 | (0.3)% | | Interest expense, net | $(54.4) | $(57.4) | (5.2)% | $(158.0) | $(173.3) | (8.8)% | | Income tax expense | $(111.2) | $(104.3) | 6.6% | $(270.3) | $(261.3) | 3.4% | | Net income | $316.4 | $315.5 | 0.3% | $813.6 | $808.2 | 0.7% | - Net sales declined across both periods, primarily due to decreased netcomm products and cautious customer spending amid economic uncertainty. However, operating income slightly increased for the three-month period due to lower selling and administrative expenses[94](index=94&type=chunk)[95](index=95&type=chunk)[96](index=96&type=chunk)[98](index=98&type=chunk) - Gross profit margin remained consistent at **21.8%** for the three months, but increased by **40 basis points** for the nine months, driven by a higher contribution of netted down revenue, particularly software as a service[95](index=95&type=chunk)[99](index=99&type=chunk) [Segment Results of Operations](index=26&type=section&id=Segment%20Results%20of%20Operations) | Segment (millions) | 3 Months Ended Sep 30, 2024 Operating Income | 3 Months Ended Sep 30, 2023 Operating Income | YoY Change (%) | 9 Months Ended Sep 30, 2024 Operating Income | 9 Months Ended Sep 30, 2023 Operating Income | YoY Change (%) | | :----------------- | :------------------------------------------- | :------------------------------------------- | :------------- | :------------------------------------------- | :------------------------------------------- | :------------- | | Corporate | $209.0 | $211.1 | (1.0)% | $584.0 | $610.9 | (4.4)% | | Small Business | $45.6 | $45.3 | 0.7% | $137.7 | $129.2 | 6.6% | | Public | $240.2 | $237.1 | 1.3% | $575.4 | $574.9 | 0.1% | | Other | $32.5 | $30.3 | 7.3% | $82.0 | $99.2 | (17.3)% | - Corporate segment net sales decreased due to lower netcomm products, leading to a **1.0%** decrease in operating income for the three months and **4.4%** for the nine months[109](index=109&type=chunk)[110](index=110&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - Public segment net sales decreased by **3.6%** for the three months and **3.5%** for the nine months, primarily due to declines in various hardware categories, but operating income saw slight increases due to lower performance-based compensation[112](index=112&type=chunk)[113](index=113&type=chunk)[118](index=118&type=chunk)[119](index=119&type=chunk) - The 'Other' segment (UK and Canadian operations) saw a **6.4%** increase in net sales for the three months, driven by data storage, servers, and services, resulting in a **7.3%** increase in operating income. However, for the nine months, net sales decreased by **4.7%** and operating income by **17.3%** due to lower software sales and increased transformation expenses[114](index=114&type=chunk)[120](index=120&type=chunk) [Non-GAAP Financial Measure Reconciliations](index=28&type=section&id=Non-GAAP%20Financial%20Measure%20Reconciliations) [Non-GAAP operating income and Non-GAAP operating income margin](index=29&type=section&id=Non-GAAP%20operating%20income%20and%20Non-GAAP%20operating%20income%20margin) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | YoY Change (%) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (%) | | :---------------- | :-------------------------- | :-------------------------- | :------------- | :-------------------------- | :-------------------------- | :------------- | | Operating income, as reported | $481.6 | $478.4 | 0.7% | $1,242.7 | $1,245.9 | (0.3)% | | Amortization of intangibles | $37.7 | $37.3 | | $113.2 | $116.2 | | | Equity-based compensation | $2.7 | $26.0 | | $50.8 | $71.6 | | | Transformation initiatives | $8.3 | $6.4 | | $23.1 | $16.0 | | | Acquisition and integration expenses | $0.5 | $7.1 | | $2.1 | $24.7 | | | Workplace optimization | $2.2 | $(0.4) | | $9.5 | $42.5 | | | Non-GAAP operating income | $534.0 | $556.3 | (4.0)% | $1,447.8 | $1,520.4 | (4.8)% | | Non-GAAP operating income margin | 9.7% | 9.9% | | 9.2% | 9.3% | | - Non-GAAP operating income decreased by **4.0%** for the three months and **4.8%** for the nine months ended September 30, 2024, primarily due to lower reported operating income and reduced adjustments for equity-based compensation and workplace optimization[125](index=125&type=chunk)[126](index=126&type=chunk) [Non-GAAP net income and Non-GAAP net income per diluted share](index=30&type=section&id=Non-GAAP%20net%20income%20and%20Non-GAAP%20net%20income%20per%20diluted%20share) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | YoY Change (%) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (%) | | :---------------- | :-------------------------- | :-------------------------- | :------------- | :-------------------------- | :-------------------------- | :------------- | | US GAAP Net income | $316.4 | $315.5 | 0.3% | $813.6 | $808.2 | 0.7% | | Non-GAAP Net income | $354.9 | $369.4 | (3.9)% | $954.5 | $997.1 | (4.3)% | | Non-GAAP net income per diluted share | $2.63 | $2.72 | | $7.04 | $7.31 | | - Non-GAAP net income decreased by **3.9%** for the three months and **4.3%** for the nine months ended September 30, 2024, reflecting the impact of lower non-GAAP operating income[128](index=128&type=chunk)[129](index=129&type=chunk) [Net sales on a constant currency basis](index=31&type=section&id=Net%20sales%20on%20a%20constant%20currency%20basis) | Metric (millions) | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | YoY Change (%) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (%) | | :---------------- | :-------------------------- | :-------------------------- | :------------- | :-------------------------- | :-------------------------- | :------------- | | Net sales, as reported | $5,516.6 | $5,628.3 | (2.0)% | $15,812.7 | $16,357.5 | (3.3)% | | Foreign currency translation | — | $6.6 | | — | $27.2 | | | Net sales, on a constant currency basis | $5,516.6 | $5,634.9 | (2.1)% | $15,812.7 | $16,384.7 | (3.5)% | - On a constant currency basis, net sales decreased by **2.1%** for the three months and **3.5%** for the nine months ended September 30, 2024, indicating that foreign currency translation had a minor positive impact on reported sales in the prior year[131](index=131&type=chunk) [Free cash flow and Adjusted free cash flow](index=31&type=section&id=Free%20cash%20flow%20and%20Adjusted%20free%20cash%20flow) | Metric (millions) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | YoY Change (millions) | | :---------------- | :-------------------------- | :-------------------------- | :-------------------- | | Net cash provided by operating activities | $932.0 | $1,062.2 | $(130.2) | | Capital expenditures | $(94.0) | $(114.7) | $20.7 |\ | Free cash flow | $838.0 | $947.5 | $(109.5) | | Net change in accounts payable - inventory financing | $(73.9) | $165.4 | $(239.3) | | Adjusted free cash flow | $764.1 | $1,112.9 | $(348.8) | - Adjusted free cash flow decreased by **$348.8 million** to **$764.1 million** for the nine months ended September 30, 2024, primarily due to lower net cash provided by operating activities and a negative net change in inventory financing[132](index=132&type=chunk) [Seasonality](index=31&type=section&id=Seasonality) - CDW's Public segment historically experiences higher sales in the second and third quarters due to the buying patterns of education and government customers[133](index=133&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) [Overview](index=31&type=section&id=Overview) - CDW finances operations and capital expenditures through cash from operations and its Revolving Loan Facility, with **$1.3 billion** available as of September 30, 2024. The Company believes it has adequate liquidity for at least the next year[134](index=134&type=chunk) [Long-Term Debt and Financing Arrangements](index=31&type=section&id=Long-Term%20Debt%20and%20Financing%20Arrangements) - As of September 30, 2024, CDW had **$6.0 billion** in total unsecured indebtedness and was in compliance with all debt covenants[135](index=135&type=chunk) - In Q3 2024, CDW issued **$1.2 billion** in new senior notes (2030 and 2034 Notes) and settled a cash tender offer for **$780 million** of existing notes. Post-period, **$184 million** of 2024 Senior Notes were redeemed[136](index=136&type=chunk)[138](index=138&type=chunk) [Inventory Financing Agreements](index=32&type=section&id=Inventory%20Financing%20Agreements) - CDW uses inventory financing agreements with financial intermediaries to facilitate inventory purchases and enhance liquidity, with outstanding amounts classified as Accounts payable-inventory financing[139](index=139&type=chunk) [Share Repurchase Program](index=32&type=section&id=Share%20Repurchase%20Program) - During the nine months ended September 30, 2024, CDW repurchased **1.6 million** shares of common stock for **$354 million** under its share repurchase program[140](index=140&type=chunk) - In February 2024, the Board authorized a **$750 million** increase to the share repurchase program[168](index=168&type=chunk) [Dividends](index=32&type=section&id=Dividends) | Dividend Amount | Declaration Date | Record Date | Payment Date | | :-------------- | :--------------- | :---------- | :----------- | | $0.620 | Feb 6, 2024 | Feb 26, 2024 | Mar 12, 2024 | | $0.620 | Apr 30, 2024 | May 24, 2024 | Jun 11, 2024 | | $0.620 | Jul 30, 2024 | Aug 26, 2024 | Sep 10, 2024 | | $0.625 | Oct 30, 2024 | Nov 25, 2024 | Dec 10, 2024 | - The Board of Directors declared a quarterly cash dividend of **$0.625 per share** on October 30, 2024, payable December 10, 2024[140](index=140&type=chunk) [Cash Flows](index=33&type=section&id=Cash%20Flows) [Operating Activities](index=33&type=section&id=Operating%20Activities) | Metric (millions) | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | Change (millions) | | :---------------- | :-------------------------- | :-------------------------- | :---------------- | | Net cash provided by operating activities | $932.0 | $1,062.2 | $(130.2) | | Net income | $813.6 | $808.2 | $5.4 | | Adjustments for non-cash items | $250.0 | $277.2 | $(27.2) | | Changes in Accounts receivable | $(320.9) | $42.7 | $(363.6) | | Changes in Merchandise inventory | $(10.5) | $96.1 | $(106.6) | | Changes in Accounts payable-trade | $287.5 | $(273.3) | $560.8 | - Net cash provided by operating activities decreased by **$130.2 million**, primarily due to a significant negative change in accounts receivable (timing of collections) and merchandise inventory, partially offset by a positive change in accounts payable-trade (timing of payments)[144](index=144&type=chunk) [Cash Conversion Cycle](index=34&type=section&id=Cash%20Conversion%20Cycle) | Metric (in days) | September 30, 2024 | September 30, 2023 | | :--------------- | :----------------- | :----------------- | | Days of sales outstanding (DSO) | 79 | 73 | | Days of supply in inventory (DIO) | 14 | 14 | | Days of purchases outstanding (DPO) | (76) | (72) | | Cash conversion cycle | 17 | 15 | - The cash conversion cycle increased to **17 days** at September 30, 2024, from **15 days** in the prior year, primarily driven by an increase in Days of Sales Outstanding (DSO) due to multi-year transactions and collection timing, partially offset by an increase in Days of Purchases Outstanding (DPO)[146](index=146&type=chunk)[147](index=147&type=chunk) [Investing Activities](index=34&type=section&id=Investing%20Activities) - Net cash used in investing activities increased by **$110 million** for the nine months ended September 30, 2024, primarily due to purchases of short-term investments, with no similar activity in the prior year[148](index=148&type=chunk) [Financing Activities](index=34&type=section&id=Financing%20Activities) - Net cash used in financing activities decreased by **$469 million**, driven by new Notes issuance and lower share repurchases, partially offset by payments for the cash tender offer and decreased inventory financing activity[149](index=149&type=chunk) [Issuers and Guarantors of Debt Securities](index=34&type=section&id=Issuers%20and%20Guarantors%20of%20Debt%20Securities) - CDW's unsecured senior notes are issued by CDW LLC and CDW Finance Corporation and guaranteed by Parent and certain 100% owned domestic subsidiaries. These obligations are senior unsecured and structurally subordinated to non-guarantor subsidiaries' liabilities[150](index=150&type=chunk)[151](index=151&type=chunk) | Metric (millions) | Sep 30, 2024 | Dec 31, 2023 | | :---------------- | :----------- | :----------- | | Current assets | $6,678.6 | $5,770.0 | | Total Non-current assets | $6,034.1 | $5,918.1 | | Current liabilities | $4,980.8 | $4,975.4 | | Long-term debt | $5,607.3 | $5,031.4 | | Total Long-term liabilities | $6,485.3 | $5,729.1 | | Metric (millions) | 9 Months Ended Sep 30, 2024 | Year Ended Dec 31, 2023 | | :---------------- | :-------------------------- | :---------------------- | | Net sales | $13,913.7 | $18,759.4 | | Gross profit | $3,079.0 | $4,106.4 | | Operating income | $1,170.0 | $1,507.3 | | Net income | $762.2 | $945.6 | [Commitments and Contingencies](index=35&type=section&id=Commitments%20and%20Contingencies) - Information regarding commitments and contingencies is incorporated by reference from Note 9 to the Consolidated Financial Statements[156](index=156&type=chunk) [Critical Accounting Policies and Estimates](index=35&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - There have been no changes to CDW's critical accounting policies and estimates from those reported in its Annual Report on Form 10-K for the year ended December 31, 2023[157](index=157&type=chunk) [Recent Accounting Pronouncements](index=35&type=section&id=Recent%20Accounting%20Pronouncements) - Information on recent accounting pronouncements is incorporated by reference from Note 2 to the Consolidated Financial Statements[158](index=158&type=chunk) [Forward-Looking Statements](index=35&type=section&id=Forward-Looking%20Statements) - This report contains forward-looking statements subject to risks and uncertainties that may cause actual results to differ materially from expectations. Important factors include economic conditions, vendor relationships, technology innovations, competition, cybersecurity threats, and legal proceedings[159](index=159&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk)[162](index=162&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that there have been no material changes in the Company's quantitative and qualitative disclosures about market risk since its Annual Report on Form 10-K for the year ended December 31, 2023 - No material changes in market risk disclosures have occurred since the December 31, 2023 Annual Report on Form 10-K[163](index=163&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of CDW's disclosure controls and procedures as of September 30, 2024, and reports no material changes in internal control over financial reporting during the quarter [Evaluation of Disclosure Controls and Procedures](index=36&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - CDW's management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective as of September 30, 2024[164](index=164&type=chunk) [Changes in Internal Control over Financial Reporting](index=36&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - There have been no material changes in CDW's internal control over financial reporting during the three months ended September 30, 2024[165](index=165&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates by reference the information on legal proceedings from Note 9 to the Consolidated Financial Statements - Information on legal proceedings is incorporated by reference from Note 9 of the Consolidated Financial Statements[167](index=167&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) This section refers readers to the 'Risk Factors' section in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 - Risk factors are detailed in the Company's Annual Report on Form 10-K for the year ended December 31, 2023[167](index=167&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports no unregistered sales of equity securities and details the Company's common stock repurchases during the three months ended September 30, 2024, under its publicly announced program [Unregistered Sales of Equity Securities](index=37&type=section&id=Unregistered%20Sales%20of%20Equity%20Securities) - There were no unregistered sales of equity securities during the period[167](index=167&type=chunk) [Issuer Purchases of Equity Securities](index=37&type=section&id=Issuer%20Purchases%20of%20Equity%20Securities) | Period | Total Number of Shares Purchased (millions) | Average Price Paid per Share | Maximum Dollar Value Remaining (millions) | | :---------------------- | :------------------------------------------ | :--------------------------- | :---------------------------------------- | | July 1 through July 31, 2024 | 0.1 | $226.39 | $816.1 | | August 1 through August 31, 2024 | 0.3 | $219.09 | $761.9 | | September 1 through September 30, 2024 | 0.1 | $218.99 | $733.5 | | Total | 0.5 | | | - CDW repurchased **0.5 million** shares of common stock during the three months ended September 30, 2024, under its share repurchase program, with **$733.5 million** remaining authorized for future repurchases as of September 30, 2024[168](index=168&type=chunk)[170](index=170&type=chunk) [Item 3. Defaults Upon Senior Securities](index=37&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there were no defaults upon senior securities during the reporting period - No defaults upon senior securities occurred during the period[169](index=169&type=chunk) [Item 4. Mine Safety Disclosures](index=37&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that mine safety disclosures are not applicable to the Company - Mine safety disclosures are not applicable to CDW Corporation[169](index=169&type=chunk) [Item 5. Other Information](index=37&type=section&id=Item%205.%20Other%20Information) This section states that there is no other information to report - No other information is reported in this section[169](index=169&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section provides a list of exhibits filed as part of the Form 10-Q, including supplemental indentures, forms of senior notes, a letter agreement, and certifications - The exhibits include supplemental indentures for the 2030 and 2034 Senior Notes, forms of these notes, a letter agreement, and certifications from the CEO and CFO[172](index=172&type=chunk) SIGNATURES [SIGNATURES](index=39&type=section&id=SIGNATURES) This section contains the required signatures for the Form 10-Q, certifying its submission by CDW Corporation through its Senior Vice President and Chief Financial Officer - The report is signed by Albert J. Miralles, Senior Vice President and Chief Financial Officer of CDW Corporation, on October 30, 2024[175](index=175&type=chunk) ```

CDW Corporation (NASDAQ:CDW) Q3 2024 Earnings Conference Call October 30, 2024 8:30 AM ET Company Participants Steve O'Brien - Vice President-Investor Relations Chris Leahy - Chair and Chief Executive Officer Al Miralles - Senior Vice President and Chief Financial Officer Conference Call Participants Adam Tindle - Raymond James David Vogt - UBS Erik Woodring - Morgan Stanley Amit Daryanani - Evercore Matt Sheerin - Stifel Keith Housum - Northcoast Research Samik Chatterjee - JPMorgan Operator Good morning a ...