PC Connection (CNXN) came out with quarterly earnings of $0.60 per share, beating the Zacks Consensus Estimate of $0.42 per share. This compares to earnings of $0.50 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 42.86%. A quarter ago, it was expected that this information technology services provider would post earnings of $0.90 per share when it actually produced earnings of $0.78, delivering a surprise of -13.33%.Over the ...

PC Connection (CNXN) Q1 2025 Earnings Call April 30, 2025 04:30 PM ET Company Participants Samantha Smith - Account ManagerTimothy McGrath - President & CEOThomas Baker - Senior VP, CFO & TreasurerAdam Tindle - Managing Director Conference Call Participants Anthony Lebiedzinski - Senior Equity Research Analyst Operator Thank you, operator, and good afternoon, everyone. Welcome to the First Quarter twenty twenty five Connections Earnings Conference Call. My name is Deedee, and I will be the coordinator for t ...

PC Connection (CNXN) Q1 2025 Earnings Call April 30, 2025 04:30 PM ET Speaker0 Thank you, operator, and good afternoon, everyone. Welcome to the First Quarter twenty twenty five Connections Earnings Conference Call. My name is Deedee, and I will be the coordinator for today. At this time, all participants are in listen only mode. Following the prepared remarks, there will be a question and answer session. As a reminder, this conference call is the property of Connection and may not be recorded or rebroadcas ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934* For the quarterly period ended March 31, 2025 (Exact name of registrant as specified in its charter) Delaware 02-0513618 incorporation or organization) (State or other jurisdiction of (I.R.S. Employer Identification No.) 730 Milford Road Merrimack, New Hampshire 03054 (Address of principal executive offices) ...

Exhibit 99.1 Investor Relations Contact: Thomas Baker, 603.683.2505 Senior Vice President, CFO, and Treasurer tom@connection.com CONNECTION (CNXN) REPORTS FIRST QUARTER 2025 RESULTS Announces a $50 Million Increase to the Share Repurchase Program FIRST QUARTER SUMMARY: Merrimack, NH—April 30, 2025—Connection (PC Connection, Inc.; NASDAQ: CNXN), a leading information technology solutions provider to business, government, healthcare and education markets, today announced results for the first quarter ended Ma ...

PART I [Item 1. Business](index=6&type=section&id=Item%201.%20Business) PC Connection, Inc. is a Fortune 1000 IT solutions provider operating through three segments, offering a wide range of products and services, with a focus on AI and cloud solutions - The company operates through three segments: **Connection Enterprise Solutions**, **Connection Business Solutions**, and **Connection Public Sector Solutions**[20](index=20&type=chunk) Net Sales Distribution by Operating Segment (2022-2024) | Operating Segment | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Enterprise Solutions | 42% | 42% | 42% | | Business Solutions | 38% | 38% | 40% | | Public Sector Solutions | 20% | 20% | 18% | | **Total** | **100%** | **100%** | **100%** | Net Sales by Major Product Category (2022-2024) | Product Category | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Notebooks/Mobility | 35% | 33% | 37% | | Desktops | 11% | 9% | 10% | | Software | 10% | 12% | 9% | | Servers/Storage | 7% | 7% | 7% | | Net/Com Products | 8% | 10% | 7% | | Displays and Sound | 10% | 9% | 10% | | Accessories | 12% | 11% | 13% | | Other Hardware/Services | 7% | 9% | 7% | | **Total** | **100%** | **100%** | **100%** | - In 2024, major product purchases were from distributors **Ingram Micro, Inc. (25%)** and **TD Synnex Corporation (23%)**, and manufacturer **Dell Inc. (11%)**[55](index=55&type=chunk) - Products manufactured by **Microsoft (15%)**, **HP Inc. (12%)**, and **Dell Inc. (12%)** represented approximately of total product purchases in 2024, respectively, with a disruption from these manufacturers posing a **material adverse effect**[56](index=56&type=chunk) - The company's growth strategy includes a focus on delivering **artificial intelligence (AI) and automation solutions**, driven through its **CNXN Helix effort** launched in 2023[31](index=31&type=chunk) - As of December 31, 2024, the company employed **2,580 full-time equivalent persons**, with **711 being sales representatives**[22](index=22&type=chunk)[88](index=88&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from intense competition, heavy reliance on key vendors, technological disruption from cloud computing and AI, cybersecurity threats, and control by a principal stockholder - The business is exposed to substantial competition from other national solutions providers, direct-selling manufacturers, and e-tailers, which could **reduce market share and profit margins**[104](index=104&type=chunk)[106](index=106&type=chunk) - A majority of products are acquired from a limited number of vendors, including **Ingram Micro, TD Synnex, and Dell**, and a disruption in supply from these key partners would likely have a **material adverse effect** on operations and cash flows[118](index=118&type=chunk)[119](index=119&type=chunk) - The growing demand for **cloud-based services (SaaS, IaaS, PaaS)** and **virtualization** may disrupt traditional hardware and software distribution models, potentially **reducing demand** for products sold by the company[122](index=122&type=chunk) - The business is heavily dependent on IT systems and faces risks from **cyberattacks**, which could lead to operational disruption, data loss, liability, and reputational harm[140](index=140&type=chunk)[141](index=141&type=chunk)[142](index=142&type=chunk) - The company is controlled by its principal stockholder, **Patricia Gallup**, who beneficially owned approximately **52% of the outstanding common stock** as of December 31, 2024, allowing her to control board elections and all matters requiring stockholder approval[161](index=161&type=chunk) [Item 1B. Unresolved Staff Comments](index=52&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the Securities and Exchange Commission - None[162](index=162&type=chunk) [Item 1C. Cybersecurity](index=52&type=section&id=Item%201C.%20Cybersecurity) The company manages cybersecurity risks through an Information Security Steering Committee and external experts, with no material threats identified as of the report date - Cybersecurity risk is managed by an **Information Security Steering Committee**, which includes the CIO and CFO, and is overseen by the **Board of Directors**[165](index=165&type=chunk)[168](index=168&type=chunk) - The company utilizes **external consultants, security firms, and risk management experts** to enhance its cybersecurity oversight[163](index=163&type=chunk) - As of the filing date, the company is not aware of any cybersecurity threats that have had or are reasonably likely to have a **material effect** on the business[164](index=164&type=chunk) [Item 2. Properties](index=54&type=section&id=Item%202.%20Properties) The company leases its corporate headquarters from an affiliate and operates a large distribution center in Ohio, with current properties deemed sufficient for future needs - The corporate headquarters at **730 Milford Road, Merrimack, NH**, is leased from **G&H Post**, an affiliated company related through common ownership[169](index=169&type=chunk) - The company leases a facility in **Wilmington, Ohio**, for its distribution, order fulfillment, and technology integration operations, serving all three operating segments[61](index=61&type=chunk)[171](index=171&type=chunk) [Item 3. Legal Proceedings](index=54&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in ordinary course legal proceedings, none of which are expected to have a material adverse effect on its financial condition - The company is subject to various legal proceedings in the ordinary course of business but does not expect them to have a **material adverse effect** on its financial condition or results[172](index=172&type=chunk) [Item 4. Mine Safety Disclosures](index=54&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[173](index=173&type=chunk) PART II [Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=56&type=section&id=Item%205.%20Market%20for%20the%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq, paid quarterly dividends in 2024, increased its share repurchase authorization to $120.0 million, and underperformed market indices over five years - The company's common stock trades on the **Nasdaq Global Select Market** under the symbol **"CNXN"**[176](index=176&type=chunk) 2024 Quarterly Dividends Paid | Declaration Date | Payment Date | Dividend per Share | Total Dividend (millions) | | :--- | :--- | :--- | :--- | | Feb 12, 2024 | Mar 15, 2024 | $0.10 | $2.6 | | Apr 30, 2024 | May 29, 2024 | $0.10 | $2.6 | | Jul 30, 2024 | Aug 13, 2024 | $0.10 | $2.6 | | Oct 29, 2024 | Nov 12, 2024 | $0.10 | $2.6 | - On February 5, 2025, the Board declared a quarterly dividend of **$0.15 per share**, payable in March 2025[177](index=177&type=chunk) Share Repurchases in Q4 2024 | Period | Total Shares Purchased | Average Price Paid Per Share | Value of Shares Remaining for Repurchase (thousands) | | :--- | :--- | :--- | :--- | | Oct 2024 | 3,419 | $68.31 | $64,334 | | Nov 2024 | 31,097 | $70.19 | $62,152 | | Dec 2024 | 34,850 | $70.78 | $59,685 | | **Total Q4** | **69,366** | **$70.39** | **$59,685** | - The Board increased the share repurchase program authorization by **$40.0 million** in May 2024, bringing the aggregate authorized amount to **$120.0 million**[178](index=178&type=chunk)[180](index=180&type=chunk) [Item 6. [Reserved]](index=58&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved - [Reserved][183](index=183&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=60&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In FY2024, net sales decreased by 1.7% to $2.80 billion, while gross margin improved to 18.6%, leading to a net income of $87.1 million, supported by strong liquidity and an improved cash conversion cycle [Results of Operations](index=63&type=section&id=Results%20of%20Operations) In 2024, net sales decreased by 1.7% to $2.80 billion, while gross profit increased by 1.6% to $519.8 million, and operating income declined to $97.1 million due to higher SG&A expenses Consolidated Financial Performance (2022-2024) | Metric | 2024 | 2023 | 2022 | | :--- | :--- | :--- | :--- | | Net Sales (in millions) | $2,802.1 | $2,850.6 | $3,125.0 | | Gross Margin | 18.6% | 18.0% | 16.8% | | SG&A as % of Net Sales | 15.1% | 14.2% | 13.0% | | Income from Operations as % of Net Sales | 3.5% | 3.6% | 3.9% | Year-Over-Year Change in Net Sales and Gross Profit by Segment (2024 vs 2023) | Segment | Net Sales Change ($M) | Net Sales Change (%) | Gross Profit Change ($M) | Gross Profit Change (%) | | :--- | :--- | :--- | :--- | :--- | | Enterprise Solutions | $(19.9) | (1.7)% | $1.1 | 0.6% | | Business Solutions | $(26.5) | (2.5)% | $5.3 | 2.2% | | Public Sector Solutions | $(2.1) | (0.4)% | $1.7 | 1.9% | | **Total** | **$(48.5)** | **(1.7)%** | **$8.1** | **1.6%** | - The decrease in 2024 net sales was primarily driven by lower sales of advanced technology categories, including **net/com products (down $85.7 million)** and **software (down $44.1 million)**, partially offset by increases in **notebooks/mobility (up $42.3 million)** and **desktops (up $31.3 million)**[197](index=197&type=chunk) - SG&A expenses increased by **$16.4 million (4.0%)** in 2024, primarily due to investments in resources to strengthen sales, technical sales, and services capabilities[197](index=197&type=chunk)[207](index=207&type=chunk) [Liquidity and Capital Resources](index=69&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $178.3 million in cash and $264.3 million in short-term investments, an undrawn $50 million credit facility, and an improved cash conversion cycle of 40 days Key Liquidity and Cash Flow Metrics (in millions) | Metric | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $178.3 | $145.0 | | Short-term investments | $264.3 | $152.2 | | Credit facility availability | $50.0 | $50.0 | | Net cash from operating activities (FY) | $173.9 | $197.9 | Cash Conversion Cycle (in days) | Component | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Days of Sales Outstanding (DSO) | 72 | 73 | | Days of Supply in Inventory (DIO) | 15 | 20 | | Days of Purchases Outstanding (DPO) | (47) | (42) | | **Cash Conversion Cycle** | **40** | **51** | - The company had **no borrowings outstanding** under its **$50.0 million credit facility** as of December 31, 2024, and was in compliance with all covenants[216](index=216&type=chunk)[227](index=227&type=chunk) [Critical Accounting Policies and Estimates](index=75&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant judgment in revenue recognition (principal vs. agent), allowances for credit losses, inventory obsolescence, and annual goodwill impairment testing, with no impairment found in 2024 - A critical judgment in revenue recognition is determining if the company is the **principal (gross revenue)** or **agent (net revenue)**, with the company generally being the principal for hardware and on-premise software, and an agent for cloud products, third-party services, and software maintenance[236](index=236&type=chunk)[238](index=238&type=chunk)[241](index=241&type=chunk)[242](index=242&type=chunk) - For the year ended December 31, 2024, the company recognized **$147.5 million in net sales** on an agency (net) basis[244](index=244&type=chunk) - The company performs ongoing credit evaluations for its accounts receivable and maintains an allowance for credit losses, which was **$3.3 million** at year-end 2024[255](index=255&type=chunk)[417](index=417&type=chunk) - Goodwill, totaling **$73.6 million**, is tested for impairment annually, and a qualitative assessment in 2024 indicated that goodwill was **not impaired**[263](index=263&type=chunk)[265](index=265&type=chunk) [Item 7A. Quantitative and Qualitative Disclosure About Market Risk](index=83&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) The company faces market risk from interest rate fluctuations and inflation, but management believes a 10% interest rate change or current inflation would not materially affect its financial statements - The company is exposed to **interest rate risk** on its cash equivalents, short-term investments, and variable-rate credit facility, but management believes a hypothetical **10% change in rates** would not be material[268](index=268&type=chunk) - Inflation is noted as a risk that could increase costs, but it is not considered to have had a **material effect** on the financial statements for the reported period[268](index=268&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=83&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section indicates that the company's consolidated financial statements and supplementary data are included in the report, beginning on page F-1 - The consolidated financial statements and supplementary data required by this item are included in the report starting at page F-1[269](index=269&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=83&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[270](index=270&type=chunk) [Item 9A. Controls and Procedures](index=83&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with an unqualified audit opinion from the independent registered public accounting firm - Management, including the CEO and CFO, concluded that the company's **disclosure controls and procedures were effective** as of December 31, 2024[271](index=271&type=chunk)[273](index=273&type=chunk) - Management concluded that the company's **internal control over financial reporting was effective** as of December 31, 2024, based on the criteria set forth by COSO[276](index=276&type=chunk)[277](index=277&type=chunk) - The independent registered public accounting firm issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting[281](index=281&type=chunk) [Item 9B. Other Information](index=88&type=section&id=Item%209B.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading agreements during the fourth quarter of 2024 - No directors or officers adopted or terminated a **Rule 10b5-1 trading plan** during the fourth quarter of 2024[288](index=288&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=88&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - Not Applicable[289](index=289&type=chunk) PART III [Item 10. Directors, Executive Officers, and Corporate Governance](index=89&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%2C%20and%20Corporate%20Governance) This section identifies key executive officers and incorporates most governance information by reference from the 2025 Proxy Statement, noting the company's Code of Business Conduct and Ethics - The company's executive officers are **Patricia Gallup (Chair)**, **Timothy McGrath (CEO)**, and **Thomas Baker (CFO)**[293](index=293&type=chunk) - Most information for this item is incorporated by reference from the definitive Proxy Statement for the 2025 Annual Meeting of Stockholders[292](index=292&type=chunk) [Item 11. Executive Compensation](index=89&type=section&id=Item%2011.%20Executive%20Compensation) The information required by this item concerning executive and director compensation is incorporated by reference from the company's 2025 definitive Proxy Statement - Information required by this item is incorporated by reference from the Proxy Statement[297](index=297&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=89&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) The information required by this item, including security ownership of beneficial owners and management, as well as equity compensation plan details, is incorporated by reference from the company's 2025 definitive Proxy Statement - Information regarding security ownership and equity compensation plans is incorporated by reference from the Proxy Statement[298](index=298&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=91&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The information required by this item concerning related party transactions and director independence is incorporated by reference from the company's 2025 definitive Proxy Statement - Information regarding related transactions and director independence is incorporated by reference from the Proxy Statement[300](index=300&type=chunk) [Item 14. Principal Accounting Fees and Services](index=91&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) The information required by this item concerning principal accounting fees and services, as well as pre-approval policies, is incorporated by reference from the company's 2025 definitive Proxy Statement - Information regarding accounting fees and services is incorporated by reference from the Proxy Statement[301](index=301&type=chunk) PART IV [Item 15. Exhibits and Financial Statement Schedules](index=92&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all documents filed as part of the Annual Report, including consolidated financial statements, financial schedules, and a comprehensive list of exhibits - This item lists the consolidated financial statements, financial statement schedules, and all exhibits filed with the Form 10-K[304](index=304&type=chunk)[307](index=307&type=chunk) [Item 16. Form 10-K Summary](index=97&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company reports that there is no Form 10-K summary - None[320](index=320&type=chunk)

Financial Data and Key Metrics Changes - For the full year 2024, revenue was $2.8 billion, a decrease of 1.7% compared to the prior year, while gross profit was $519.8 million, an increase of 1.6% [9] - Gross margin reached a record 18.6%, growing 60 basis points [9] - SG&A was $422.3 million, an increase of 4% compared to the prior year [10] - Net income was $87.1 million, an increase of 4.6% compared to the prior year, with earnings per diluted share at $3.29 for 2024 compared to $3.15 in the prior year [10] - Q4 consolidated net sales were $708.9 million, an increase of 1.8% compared to last year, while net income in Q4 was $20.7 million, a decrease of 12.9% [11][12] Business Line Data and Key Metrics Changes - In the Business Solutions segment, Q4 net sales were $262.4 million, down 3.7% year-over-year, with a 12% decrease in advanced technology products [15] - Public Sector Solutions Q4 net sales were $143.7 million, up 42.9% year-over-year, with gross profit increasing by 30.2% [16] - Enterprise Solutions segment Q4 net sales were $302.7 million, down 6.4% year-over-year, with gross profit decreasing by 9.3% [18] Market Data and Key Metrics Changes - Overall IT spending was lower than expected in Q4 and for all of 2024, with customers delaying investments in large advanced technology projects [27] - There was year-over-year growth in the device ecosystem, including endpoint and related categories, but many customers delayed investments [28] Company Strategy and Development Direction - The company made significant investments in 2024 to improve business capabilities, including a world-class CRM system and AI-enabled workflow tools [29] - Strategic investments are expected to position the company for success in 2025, with anticipated growth driven by data center and infrastructure projects [30] - The company aims to outperform the US IT market growth rate by 200 basis points in 2025 [35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about 2025, citing a large number of projects in the pipeline and expected customer investments in data center and infrastructure projects [30][34] - There are macroeconomic events that could impact customer investment timing, including developments in the AI landscape and potential tariffs [34] Other Important Information - The company announced a 50% increase in its quarterly dividend to $0.15 per share, payable on March 14, 2025 [22] - Cash flow generated from operations for the year was $173.9 million, with a decrease in inventory benefiting cash from operations [24] Q&A Session Summary Question: Can you comment on the sales progression during the quarter? - October was better than previous years, November was markedly worse, and December was about the same, with expectations for Q1 to be flat or up very low single digits [39] Question: Which vertical markets do you see having the most opportunity? - The large enterprise group has many new projects, with optimism in retail, healthcare, and manufacturing sectors [42][43] Question: How should we think about expected expense growth versus gross profit growth? - SG&A is expected to grow around 3-4% year-on-year, reflecting investments in resources to prepare for future growth [46] Question: What are the expected impacts from tariffs? - The complexity of supply chains makes predictions difficult, but the company is engaging customers to plan for contingencies [50][51]

PC Connection (CNXN) came out with quarterly earnings of $0.78 per share, missing the Zacks Consensus Estimate of $0.90 per share. This compares to earnings of $0.90 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -13.33%. A quarter ago, it was expected that this information technology services provider would post earnings of $1.01 per share when it actually produced earnings of $0.97, delivering a surprise of -3.96%.Over the ...

Financial Performance - Net sales for Q4 2024 increased by 1.8% year over year to $708.9 million, while full year net sales decreased by 1.7% to $2.8 billion[3][11] - Gross profit for Q4 2024 was flat at $129.8 million, with a gross margin of 18.3%, down 30 basis points year over year; for the full year, gross profit increased by 1.6% to $519.8 million, with a gross margin of 18.6%, up 60 basis points[5][11] - Net income for Q4 2024 decreased by 12.9% to $20.7 million, or $0.78 per diluted share, compared to $23.8 million, or $0.90 per diluted share, in the prior year quarter; full year net income increased by 4.6% to $87.1 million, or $3.29 per diluted share[3][11] - Adjusted EBITDA for the full year 2024 decreased by 5% to $118.9 million compared to $125.5 million in 2023[12] - Adjusted EBITDA for Q4 2024 was $28,083, down 14% from $32,738 in Q4 2023; for the year, it decreased by 5% to $118,936 from $125,516[33] - Adjusted Net Income for Q4 2024 was $20,721, a decrease of 13% from $23,778 in Q4 2023; for the year, it increased by 1% to $86,142 from $85,249[36] - Diluted Earnings per Share for Q4 2024 was $0.78, down 13% from $0.90 in Q4 2023; for the year, it increased by 4% to $3.29 from $3.15[36] Segment Performance - The Business Solutions segment saw a 3.7% decrease in net sales to $262.4 million in Q4 2024, while the Public Sector Solutions segment experienced a 42.9% increase to $143.7 million[6] - Notebook/mobility and desktop sales increased by 14% year over year, accounting for 46% of net sales in Q4 2024, while software sales decreased by 35%[14] Expenses and Investments - Selling, general and administrative expenses increased to $107.1 million in Q4 2024, representing 15.1% of net sales, up from 14.6% in the prior year quarter[9] - The company made significant investments in AI and modern infrastructure to enhance integrated solutions capabilities[2] - Stock-based compensation expense increased by 43% to $2,279 in Q4 2024 from $1,597 in Q4 2023; for the year, it rose by 21% to $8,475 from $7,022[33] Cash and Assets - Cash and cash equivalents and short-term investments were $442.6 million as of December 31, 2024, compared to $297.2 million a year earlier[10] - Total assets increased to $1,299,354,000 from $1,188,381,000 year-over-year[30] - Cash and cash equivalents rose to $178,318,000, up from $144,954,000 in the previous year[30] Market and Shareholder Information - The company declared a quarterly dividend of $0.15 per share, payable on March 14, 2025[1] - Market capitalization increased to $1,821,801,000 from $1,771,656,000 year-over-year[26] - Total stockholders' equity grew to $910,990,000, compared to $840,767,000 in the previous year[30] Cash Flow - Cash provided by operating activities for Q4 2024 was $25,248, compared to $12,289 in Q4 2023; for the year, it decreased to $173,868 from $197,954[31] - Cash used in investing activities for Q4 2024 was $5,603, significantly lower than $104,148 in Q4 2023; for the year, it decreased to $115,286 from $160,202[31] - Cash used in financing activities for Q4 2024 was $8,838, compared to $3,696 in Q4 2023; for the year, it increased to $25,218 from $15,728[31] Other Financial Metrics - Inventory turns improved to 23, compared to 17 in the same quarter last year[26] - The product mix showed an increase in Notebooks/Mobility sales to 36% of net sales, up from 32%[26] - The company recorded $1.7 million of income from a legal settlement, impacting other income positively[34] - The company reported a decrease in accounts receivable by $27,441 in Q4 2024 compared to a decrease of $19,270 in Q4 2023[31]

Core Viewpoint - The market anticipates that PC Connection (CNXN) will report flat earnings of $0.90 per share for the quarter ended December 2024, with revenues expected to increase by 2.8% to $716.23 million compared to the previous year [1][3]. Earnings Expectations - The upcoming earnings report is scheduled for February 5, and the stock price may rise if actual results exceed expectations, while a miss could lead to a decline [2]. - The consensus EPS estimate has been revised down by 6.25% over the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for PC Connection is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +2.22% [10][11]. - A positive Earnings ESP is a strong indicator of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [8]. Historical Performance - In the last reported quarter, PC Connection was expected to earn $1.01 per share but reported $0.97, resulting in a surprise of -3.96% [12]. - Over the past four quarters, the company has beaten consensus EPS estimates twice [13]. Conclusion - PC Connection is viewed as a compelling candidate for an earnings beat, but investors should consider other factors that may influence stock performance beyond earnings results [16].