PC Connection (CNXN) came out with quarterly earnings of $1 per share, beating the Zacks Consensus Estimate of $0.83 per share. This compares to earnings of $0.80 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 20.48%. A quarter ago, it was expected that this information technology services provider would post earnings of $0.64 per share when it actually produced earnings of $0.50, delivering a surprise of -21.88%. Over the l ...

Table of Contents Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, $0.01 par value CNXN Nasdaq Global Select Market 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 June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period fr ...

Exhibit 99.1 Investor Relations Contact: Thomas Baker, 603.683.2505 Senior Vice President, CFO, and Treasurer tom@connection.com CONNECTION (CNXN) REPORTS SECOND QUARTER 2024 RESULTS Record Quarter for Net Income and Earnings per Share SECOND QUARTER SUMMARY: ● Net sales: $736.5 million, increase of 0.4% y/y ● Gross profit: $136.5 million, up 6.9% y/y ● Gross margin: 18.5%, up 112 basis points y/y ● Net income: $26.2 million, increase of 32.8% y/y ● Diluted EPS: $0.99, compared to $0.75 Merrimack, NH—July 3 ...

Financial Data and Key Metrics Changes - Consolidated net sales for Q1 2024 were $632 million, a decrease of 13.1% compared to the previous year [21] - Gross profit decreased by 3.5% to $118.1 million, but gross margins increased by 187 basis points to 18.7% [21] - Operating income was $13.5 million, down 25.7% year-over-year, with operating income as a percentage of net sales at 2.1% compared to 2.5% in the prior year [10] - Net income for Q1 was $13.2 million, a decrease of 7.4% from $14.2 million in the prior year [10][33] - Diluted earnings per share were $0.50, a decrease of 7.7% from $0.54 in Q1 2023 [84] Business Line Data and Key Metrics Changes - Public Sector Solutions net sales were $93.5 million, down 33.4% year-over-year, primarily due to the absence of large projects that occurred in Q1 2023 [11] - Gross profit for the Public Sector segment was $15 million, a decrease of 26.3%, but gross margin increased by 156 basis points to 16% [12] - Enterprise Solutions segment net sales were $282.7 million, down 10% year-over-year, while gross profit increased by 1.6% to $42.7 million, with gross margin rising by 172 basis points to 15.1% [12] Market Data and Key Metrics Changes - The IT industry is undergoing rapid transformation driven by advancements in AI, cloud computing, and edge technologies, but customers remain cautious with their AI investments [28] - In retail, there was a year-over-year decline, but sequential quarterly revenue growth was observed, indicating momentum [45] - Financial Services revenue and gross profit increased by 8% year-over-year, while healthcare saw a significant rise in proposal requests for services and cybersecurity [46] Company Strategy and Development Direction - The company is focused on helping customers prepare for AI initiatives and expects stronger performance in the second half of the year [20] - The launch of the Helix Center for Applied AI Robotics is seen as a competitive advantage in the AI space [39] - The company remains committed to investing in both organic and inorganic growth opportunities while returning cash to shareholders through dividends and stock repurchases [36] Management's Comments on Operating Environment and Future Outlook - Management noted that customer spending on new technology is uncertain, but they are optimistic about returning to normalized growth rates in the second half of 2024 [42] - The company anticipates that the adoption of AI solutions will drive demand for additional infrastructure, storage, compute, and cybersecurity solutions [38] - Management highlighted that the timing of technology rollouts is becoming clearer, with customers preparing for Windows 11 and AI applications [52] Other Important Information - The Board authorized an additional $40 million increase to the existing share repurchase program, bringing the total available for repurchases to $72.1 million [25] - Cash flow from operations improved by $37.8 million year-over-year to $57.3 million [25] - The effective tax rate for Q1 was 27%, up from 26.8% due to changes in state tax rates [32] Q&A Session Summary Question: Sales cadence throughout the quarter and outlook for Q2 - Management indicated that revenue was approximately 34% in March, lower than the typical range, due to economic apprehension [50] - For Q2, operating income is expected to be flat to low single digits year-over-year, with gross profit also anticipated to see low single-digit growth [51] Question: Acquisitions and valuation multiples - The company is still looking for acquisition opportunities and has the balance sheet to support this, with M&A activity starting to heat up [64] Question: Guidance for gross profit dollar growth for the year - Management expects low single-digit growth in gross profit for the year, with Q2 looking weaker than initially expected [67] Question: Impact of AI-enabled PCs on business - The next generation of AI PCs is expected to drive demand, with a focus on security and performance improvements [74]

PART I FINANCIAL INFORMATION [ITEM 1. FINANCIAL STATEMENTS](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents PC Connection, Inc.'s unaudited condensed consolidated financial statements, including balance sheets, income statements, and cash flows, for Q1 2024 and Q4 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | Metric | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | | :------------------------------------ | :---------------------------- | :----------------------------- | | Total Assets | $1,161,065 | $1,188,381 | | Total Liabilities | $308,393 | $347,614 | | Total Stockholders' Equity | $852,672 | $840,767 | | Cash and cash equivalents | $147,579 | $144,954 | | Short-term investments | $204,374 | $152,232 | | Accounts receivable, net | $527,259 | $606,834 | | Accounts payable | $218,801 | $263,682 | [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) | Metric | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :----------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net sales | $632,025 | $727,545 | | Cost of sales | $513,953 | $605,249 | | Gross profit | $118,072 | $122,296 | | Selling, general and administrative expenses | $104,608 | $103,282 | | Restructuring and other charges | $— | $897 | | Income from operations | $13,464 | $18,117 | | Interest income, net | $4,567 | $1,286 | | Income before taxes | $18,031 | $19,403 | | Income tax provision | $(4,877) | $(5,205) | | Net income | $13,154 | $14,198 | | Basic Earnings per common share | $0.50 | $0.54 | | Diluted Earnings per common share | $0.50 | $0.54 | - Net sales decreased by **13.1%** year-over-year, from **$727,545 thousand** in Q1 2023 to **$632,025 thousand** in Q1 2024[80](index=80&type=chunk) - Gross profit decreased by **3.5%** year-over-year, from **$122,296 thousand** in Q1 2023 to **$118,072 thousand** in Q1 2024[80](index=80&type=chunk) [Condensed Consolidated Statements of Other Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Other%20Comprehensive%20Income) | Metric | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :--------------------------------------------------- | :--------------------------------------------- | :--------------------------------------------- | | Net income | $13,154 | $14,198 | | Unrealized losses on available-for-sale investments, net of tax | $(143) | $— | | Comprehensive income | $13,011 | $14,198 | - The company reported unrealized losses on available-for-sale investments of **$143 thousand** (net of tax) in Q1 2024, compared to no such losses in Q1 2023[81](index=81&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) | Item | Balance - December 31, 2023 (in thousands) | Stock-based compensation expense (in thousands) | Dividend declaration (in thousands) | Net income (in thousands) | Other comprehensive loss, net of tax (in thousands) | Balance - March 31, 2024 (in thousands) | | :----------------------------------- | :--------------------------------------- | :------------------------------------ | :---------------------------------- | :------------------------ | :-------------------------------------------------- | :-------------------------------------- | | Common Shares | 29,262 | — | — | — | — | 29,271 | | Stock Amount | $293 | — | — | — | — | $293 | | Additional Paid-In Capital | $130,878 | $1,949 | — | — | — | $132,596 | | Retained Earnings | $760,898 | — | $(2,636) | $13,154 | — | $771,416 | | Accumulated Other Comprehensive (Loss) Income | $81 | — | — | — | $(143) | $(62) | | Treasury Shares | (2,902) | — | — | — | — | (2,905) | | Shares Amount | $(51,383) | — | — | — | — | $(51,571) | | Total | $840,767 | $1,949 | $(2,636) | $13,154 | $(143) | $852,672 | - Total stockholders' equity increased from **$840,767 thousand** at December 31, 2023, to **$852,672 thousand** at March 31, 2024[89](index=89&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :------------------------------------------ | :--------------------------------------------- | :--------------------------------------------- | | Net cash provided by operating activities | $57,285 | $19,505 | | Net cash used in investing activities | $(51,607) | $(1,882) | | Net cash used in financing activities | $(3,053) | $(5,743) | | Increase in cash and cash equivalents | $2,625 | $11,880 | | Cash and cash equivalents, end of period | $147,579 | $134,810 | - Net cash provided by operating activities significantly increased to **$57,285 thousand** in Q1 2024 from **$19,505 thousand** in Q1 2023, primarily due to a decrease in accounts receivable[22](index=22&type=chunk)[102](index=102&type=chunk) - Net cash used in investing activities increased substantially to **$(51,607) thousand** in Q1 2024, mainly due to purchases of short-term investments[22](index=22&type=chunk)[199](index=199&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) - The financial statements are prepared in accordance with U.S. GAAP and consistent with the accounting policies in the Company's 2023 Annual Report on Form 10-K[15](index=15&type=chunk) - Interest income, net, on cash equivalents and short-term investments increased to **$4,565 thousand** for Q1 2024, up from **$1,308 thousand** for Q1 2023[18](index=18&type=chunk) - No restructuring and other charges were recorded for Q1 2024, compared to **$897 thousand** in Q1 2023 related to workforce reduction[35](index=35&type=chunk)[36](index=36&type=chunk) - Contract liabilities increased to **$8,453 thousand** as of March 31, 2024, from **$4,206 thousand** as of December 31, 2023[28](index=28&type=chunk) - All short-term investments are classified as available-for-sale and recorded at fair value using **Level 1 inputs**[94](index=94&type=chunk)[30](index=30&type=chunk)[41](index=41&type=chunk) - Basic and diluted earnings per share both decreased to **$0.50** for Q1 2024 from **$0.54** for Q1 2023[44](index=44&type=chunk) - The company's operations are organized into three segments: **Enterprise Solutions**, **Business Solutions**, and **Public Sector Solutions**[58](index=58&type=chunk) - The Public Sector Solutions segment experienced the largest decrease in net sales, down **33.4%** year-over-year[60](index=60&type=chunk)[163](index=163&type=chunk) - The company has a **$50,000 thousand** credit facility available until March 31, 2025, with no outstanding borrowings as of March 31, 2024[64](index=64&type=chunk)[69](index=69&type=chunk)[200](index=200&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2024 financial performance, condition, liquidity, capital resources, and critical accounting policies [CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS](index=21&type=section&id=CAUTIONARY%20NOTE%20CONCERNING%20FORWARD-LOOKING%20STATEMENTS) - The report contains forward-looking statements regarding future financial results, business plans, liabilities, competition, and macroeconomic impacts[70](index=70&type=chunk) - These statements are based on current views and assumptions but are subject to known and unknown risks and uncertainties[70](index=70&type=chunk) - Key risks include substantial competition, price competition, loss of major vendors, IT virtualization, service interruptions, increased shipping costs, loss of key personnel, cyberattacks, and macroeconomic factors like inflation and changing interest rates[65](index=65&type=chunk) [OVERVIEW](index=24&type=section&id=OVERVIEW) - PC Connection, Inc. is a **Fortune 1000 Global Solutions Provider** offering IT solutions and services through its Enterprise, Business, and Public Sector Solutions segments[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk) - The company mitigates direct sales efforts by manufacturers by providing comprehensive, product-neutral IT solutions and higher-margin service offerings through its **Technology Solutions Organization (TSO)**[146](index=146&type=chunk) - Primary challenges include increasing product/service revenues and gross margin, recruiting/retaining sales and technical support personnel, and controlling SG&A expenses while investing in IT systems[147](index=147&type=chunk) [RESULTS OF OPERATIONS](index=26&type=section&id=RESULTS%20OF%20OPERATIONS) Key Financial Performance Indicators (as % of Net Sales) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :----------------------------------- | :-------------------------------- | :-------------------------------- | | Net sales | $632.0 million | $727.5 million | | Gross margin | 18.7% | 16.8% | | Selling, general and administrative expenses | 16.6% | 14.2% | | Income from operations | 2.1% | 2.5% | - Net sales decreased by **$95.5 million (13.1%)** year-over-year in Q1 2024, primarily due to decreases in notebooks/mobility, software, and net/com products[137](index=137&type=chunk) - Gross profit decreased by **$4.2 million (3.5%)**, but gross margin increased to **18.7%** from **16.8%**, driven by an increase in software sales recognized on a net basis[137](index=137&type=chunk) Net Sales and Gross Profit by Segment (in millions) | Segment | Net Sales Q1 2024 | Net Sales Q1 2023 | $ Change | % Change | Gross Profit Q1 2024 | Gross Profit Q1 2023 | $ Change | % Change | | :-------------------- | :---------------- | :---------------- | :------- | :------- | :------------------- | :------------------- | :------- | :------- | | Enterprise Solutions | $282.6 | $313.9 | $(31.3) | (10.0)% | $42.7 | $42.1 | $0.6 | 1.6% | | Business Solutions | $255.9 | $273.1 | $(17.2) | (6.3)% | $60.4 | $59.9 | $0.5 | 0.8% | | Public Sector Solutions | $93.5 | $140.5 | $(47.0) | (33.4)% | $15.0 | $20.3 | $(5.3) | (26.3)% | | Total | $632.0 | $727.5 | $(95.5) | (13.1)% | $118.1 | $122.3 | $(4.2) | (3.5)% | SG&A Expenses (in millions) | Category | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :----------------------------------- | :-------------------------------- | :-------------------------------- | | Personnel costs | $78.5 | $79.2 | | Advertising | $7.4 | $6.6 | | Service contracts/subscriptions | $6.0 | $5.2 | | Professional fees | $3.4 | $3.8 | | Depreciation and amortization | $3.3 | $3.1 | | Facilities operations | $1.8 | $2.2 | | Credit card fees | $1.6 | $1.5 | | Other | $2.6 | $1.7 | | Total SG&A expense | $104.6 | $103.3 | | As a percentage of net sales | 16.6% | 14.2% | - Income from operations decreased to **$13.5 million** in Q1 2024 from **$18.1 million** in Q1 2023, primarily due to lower net sales and gross profit[178](index=178&type=chunk) - Interest income, net, increased significantly to **$4.6 million** in Q1 2024 from **$1.3 million** in Q1 2023, driven by higher cash equivalent balances and interest rates[179](index=179&type=chunk) - Net income decreased to **$13.2 million** in Q1 2024 from **$14.2 million** in Q1 2023[168](index=168&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) - Primary liquidity sources are internally generated funds from operations, short-term investments, and borrowings under the credit facility[169](index=169&type=chunk) - The company expects to have sufficient funds for the next twelve months and beyond, with **$147.6 million** in cash and cash equivalents, **$204.4 million** in short-term investments, and a **$50.0 million** available credit facility as of March 31, 2024[170](index=170&type=chunk)[171](index=171&type=chunk)[172](index=172&type=chunk)[181](index=181&type=chunk) Summary of Sources and Uses of Cash (in millions) | Cash Flow Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $57.3 | $19.5 | | Net cash used in investing activities | $(51.6) | $(1.9) | | Net cash used in financing activities | $(3.1) | $(5.7) | | Increase in cash and cash equivalents | $2.6 | $11.9 | - The cash conversion cycle decreased to **53 days** for Q1 2024, down from **65 days** for Q1 2023, primarily due to improved collections (DSO decreased to **70 days** from **71 days**) and inventory management (DIO decreased to **22 days** from **30 days**)[103](index=103&type=chunk)[104](index=104&type=chunk)[196](index=196&type=chunk)[198](index=198&type=chunk) - The **$50.0 million** credit facility, collateralized by accounts receivable, is available until March 2025, with no outstanding borrowings as of March 31, 2024[188](index=188&type=chunk)[200](index=200&type=chunk) - The company was in compliance with all financial covenants as of March 31, 2024, including minimum consolidated net worth (**$852.7 million** actual vs. **$609.6 million** required) and funded debt ratio (**0.0 to 1.0** actual vs. **2.0 to 1.0** maximum)[64](index=64&type=chunk)[110](index=110&type=chunk)[203](index=203&type=chunk) [APPLICATION OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES](index=39&type=section&id=APPLICATION%20OF%20CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) - The company's critical accounting policies and estimates have not materially changed from those discussed in its Annual Report on Form 10-K for the year ended December 31, 2023[204](index=204&type=chunk) [RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS](index=39&type=section&id=RECENTLY%20ISSUED%20FINANCIAL%20ACCOUNTING%20STANDARDS) - Information on recently issued financial accounting standards is detailed in Note 1, 'Basis of Presentation,' within the Notes to Unaudited Condensed Consolidated Financial Statements[189](index=189&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=40&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Reports no material changes to market risks since December 31, 2023, referring to the Annual Report on Form 10-K - No material changes related to the company's market risks have occurred since December 31, 2023[206](index=206&type=chunk) - For a comprehensive description of market risks, refer to Item 7A. 'Quantitative and Qualitative Disclosures About Market Risk' in the Annual Report on Form 10-K for the year ended December 31, 2023[206](index=206&type=chunk) [ITEM 4. Controls and Procedures](index=41&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Details evaluation of disclosure controls and procedures, confirming effectiveness and no material changes in internal control [Disclosure Controls and Procedures](index=41&type=section&id=Disclosure%20Controls%20and%20Procedures) - Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of March 31, 2024[207](index=207&type=chunk) - It was concluded that the disclosure controls and procedures were effective at the reasonable assurance level[207](index=207&type=chunk) [Changes in Internal Control over Financial Reporting](index=41&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - There were no changes in internal control over financial reporting during the fiscal quarter ended March 31, 2024, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[116](index=116&type=chunk) PART II OTHER INFORMATION [ITEM 1. Legal Proceedings](index=42&type=section&id=ITEM%201.%20Legal%20Proceedings) This section incorporates legal proceedings information by reference, noting no expected material adverse effect - Information related to legal proceedings is incorporated by reference from Note 8 - 'Commitments and Contingencies' in the Notes to Unaudited Condensed Consolidated Financial Statements[209](index=209&type=chunk) [ITEM 1A. Risk Factors](index=42&type=section&id=ITEM%201A.%20Risk%20Factors) Refers to the Annual Report on Form 10-K for comprehensive risk factors that could materially affect the business - Readers should carefully consider Item 1A. 'Risk Factors' in the Annual Report on Form 10-K for the year ended December 31, 2023, for factors that could materially affect the business, financial position, and results of operations[117](index=117&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details the stock repurchase program, shares purchased, remaining authorization, and confirms no D&O trading Common Stock Repurchase Program Activity (in thousands, except per share data) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value that May Yet Be Under the Plans or Programs (in millions) | | :----------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------------- | :------------------------------------------------------------------------------- | | 01/01/24-01/31/24 | — | — | — | $32.3 | | 02/01/24-02/29/24 | — | — | — | $32.3 | | 03/01/24-03/31/24 | 2,898 | $64.40 | 2,898 | $32.1 | | Total | 2,898 | $64.40 | 2,898 | | - The Board of Directors approved an increase of **$40.0 million** to the repurchase program on May 1, 2024, bringing the aggregate authorized amount to **$120.0 million**[118](index=118&type=chunk) [Director and Officer Trading Arrangements](index=42&type=section&id=Director%20and%20Officer%20Trading%20Arrangements) - No directors or officers adopted or terminated a Rule 10b5-1 trading agreement or a non-Rule 10b5-1 trading agreement during the first quarter of 2024[128](index=128&type=chunk)[222](index=222&type=chunk) [ITEM 5. Other Information](index=42&type=section&id=ITEM%205.%20Other%20Information) This section serves as a placeholder and contains no specific content [ITEM 6. Exhibits](index=44&type=section&id=ITEM%206.%20Exhibits) Lists all exhibits filed with the Quarterly Report on Form 10-Q, including corporate governance documents and XBRL data - Exhibits include Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws, Director Compensation and Executive Bonus Plan, Section 302 and 906 certifications, and various Inline XBRL Taxonomy documents[120](index=120&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk)[212](index=212&type=chunk)[213](index=213&type=chunk)[214](index=214&type=chunk)[224](index=224&type=chunk)[225](index=225&type=chunk)[226](index=226&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk)[229](index=229&type=chunk) - The financial statements and notes are attached as Exhibit 101, formatted in XBRL (Extensible Business Reporting Language)[229](index=229&type=chunk) [SIGNATURES](index=45&type=section&id=SIGNATURES) Contains the official signatures of the company's authorized officers, confirming report submission - The report was signed by Thomas C. Baker, Senior Vice President, Chief Financial Officer and Treasurer, and Timothy J. McGrath, President and Chief Executive Officer, on May 1, 2024[124](index=124&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk)[218](index=218&type=chunk)

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 2024 RESULTS FIRST QUARTER SUMMARY: ● Net sales: $632.0 million, decrease of 13.1% y/y ● Gross profit: $118.1 million, down 3.5% y/y ● Gross margin: 18.7%, up 187 basis points y/y ● Net income: $13.2 million, decrease of 7.4% y/y ● Diluted EPS: $0.50, compared to $0.54 Merrimack, NH—May 1, 2024—Connection (PC Connection, Inc.; NASDAQ: CNXN), ...

MERRIMACK, N.H.--(BUSINESS WIRE)--Connection (PC Connection, Inc.; NASDAQ: CNXN), a leading information technology solutions provider to business, government, healthcare, and education markets, is pleased to announce the fourth annual IT Superhero Awards. The awards program recognizes IT professionals, nominated by their colleagues, for going above and beyond the call of duty to save the day for their team. The IT Superhero Awards program is open to IT professionals from organizations of all sizes and indu ...

MERRIMACK, N.H.--(BUSINESS WIRE)--Connection (PC Connection, Inc.; NASDAQ: CNXN), a leading information technology solutions provider to business, government, healthcare, and education markets, is pleased to announce that it has been named a 2024 HP Inc. Partner of the Year. HP’s Partner of the Year Awards honor top-performing HP partners for exemplary achievements in growth and innovation. Connection was recognized as the 2024 HP U.S. Personal Systems National Solutions Provider Partner of the Year. Tim M ...

MERRIMACK, N.H.--(BUSINESS WIRE)--Connection (PC Connection, Inc.; NASDAQ: CNXN), a leading information technology solutions provider to business, government, healthcare, and education markets, is pleased to announce that it has been awarded Microsoft Solutions Partner designations for proficiency in all six solution areas: Business Applications; Modern Work; Security; Azure Data & AI; Azure Infrastructure; and Azure Digital & App Innovation. Microsoft Solutions Partner designations are awarded based on th ...

PART I [Business](index=6&type=section&id=Item%201.%20Business) PC Connection, Inc., operating as Connection®, is a Fortune 1000 Global Solutions Provider, simplifying IT for enterprise, SMB, and public sector clients with integrated solutions from over 2,500 vendors - The company operates through three segments: **Enterprise Solutions** (serving large enterprises), **Business Solutions** (serving SMBs), and **Public Sector Solutions** (serving government and education)[93](index=93&type=chunk)[69](index=69&type=chunk)[78](index=78&type=chunk) Net Sales Distribution by Operating Segment (2021-2023) | Operating Segment | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Enterprise Solutions | 42% | 42% | 43% | | Business Solutions | 38% | 40% | 38% | | Public Sector Solutions | 20% | 18% | 19% | | **Total** | **100%** | **100%** | **100%** | Net Sales by Product Category (2021-2023) | Product Category | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Notebooks/Mobility | 33% | 37% | 38% | | Desktops | 9% | 10% | 9% | | Software | 12% | 9% | 10% | | Servers/Storage | 7% | 7% | 7% | | Net/Com Products | 10% | 7% | 7% | | Displays and Sound | 9% | 10% | 10% | | Accessories | 11% | 13% | 12% | | Other Hardware/Services | 9% | 7% | 7% | | **Total** | **100%** | **100%** | **100%** | - Key growth strategies include delivering **AI and automation solutions**, migrating customers to **cloud-based solutions**, expanding IT solution services, increasing sales representative productivity, and pursuing **strategic acquisitions**[103](index=103&type=chunk)[104](index=104&type=chunk)[129](index=129&type=chunk) - The company has **significant vendor concentration**; in 2023, purchases from Ingram Micro, TD Synnex, and Microsoft accounted for **21%**, **19%**, and **11%** of total product purchases, respectively, while products from manufacturers Microsoft, HP Inc., and Dell Inc. represented **15%**, **13%**, and **11%** of total product purchases[163](index=163&type=chunk)[21](index=21&type=chunk) - As of December 31, 2023, the company employed **2,703 full-time equivalent persons**, with **1,152 in sales-related activities**[33](index=33&type=chunk) [Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) The company faces various risks including intense competition, vendor dependency, economic conditions, rapid technological change, cybersecurity threats, regulatory compliance, and the significant influence of a controlling stockholder - Business, Operations, and Industry Risks: - **Competition:** Faces **significant price competition** from other national solutions providers, direct-selling vendors, and e-tailers, which could **reduce profit margins**[530](index=530&type=chunk)[406](index=406&type=chunk)[35](index=35&type=chunk) - **Vendor Dependency:** A majority of products are acquired from a **limited number of vendors**; in 2023, Ingram Micro, TD Synnex, and Microsoft accounted for **21%**, **19%**, and **11%** of purchases, respectively, and disruption of supply would likely have a **material adverse effect**[555](index=555&type=chunk)[537](index=537&type=chunk) - **Economic Conditions:** Unfavorable **economic conditions**, **inflation**, and **rising interest rates** may lead clients to **delay or forgo IT investments**, as observed in 2023[380](index=380&type=chunk)[553](index=553&type=chunk)[531](index=531&type=chunk) - Technology, Data, and IP Risks: - **Technological Change:** Business depends on **continued innovation** (e.g., **AI**, **cloud**) from vendor partners, and failure to adapt to changes like the shift to SaaS could **disrupt traditional distribution models**[542](index=542&type=chunk)[556](index=556&type=chunk)[525](index=525&type=chunk) - **Cybersecurity:** Faces risks from **cyberattacks** which could **disrupt operations**, **expose sensitive data**, and result in **liability and reputational harm**; the company has experienced intrusion attempts, malware, and phishing[411](index=411&type=chunk)[570](index=570&type=chunk)[600](index=600&type=chunk) - Regulatory and Legal Risks: - **Government Contracts:** The Public Sector segment is **highly regulated**, and noncompliance could result in **fines**, **contract termination**, or **debarment**, with government agencies also able to **cancel orders with little notice**[580](index=580&type=chunk)[608](index=608&type=chunk) - Common Stock Risks: - **Controlling Stockholder:** Patricia Gallup, a co-founder, beneficially owned or controlled approximately **55% of the common stock** as of December 31, 2023, allowing her to **control board elections and other stockholder matters**[637](index=637&type=chunk)[612](index=612&type=chunk) [Cybersecurity](index=52&type=section&id=Item%201C.%20Cybersecurity) The company manages cybersecurity risks through an Information Security Steering Committee, overseen by the Board of Directors, and has not experienced any material incidents to date - Cybersecurity risk is managed by an **Information Security Steering Committee** composed of senior management, including the CIO and CFO, and overseen by the **Board of Directors**[640](index=640&type=chunk)[614](index=614&type=chunk) - The company has **not experienced any cybersecurity incidents that have materially affected its business**, strategy, or financial condition as of the report date[639](index=639&type=chunk) - The company utilizes **external parties**, including consultants and security firms, and a **third-party risk management program** to enhance cybersecurity oversight[613](index=613&type=chunk) [Properties](index=54&type=section&id=Item%202.%20Properties) The company's corporate headquarters in Merrimack, NH, and a distribution facility in Wilmington, OH, are leased, and are deemed sufficient for current and future needs - The corporate headquarters in Merrimack, NH, is **leased from G&H Post, an affiliated company** related through common ownership[618](index=618&type=chunk) - A key **distribution and technology integration center** is located in a **leased facility in Wilmington, Ohio**[619](index=619&type=chunk)[38](index=38&type=chunk) [Legal Proceedings](index=54&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various ordinary course legal proceedings, none of which are expected to have a material adverse effect on its financial condition or operations - The company is involved in **various legal proceedings** from the ordinary course of business, but management does **not expect them to have a material impact**[620](index=620&type=chunk)[436](index=436&type=chunk) PART II [Market for 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%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under 'CNXN', with quarterly cash dividends paid, including an increased $0.10 per share declared in February 2024 - The company's common stock trades on the **Nasdaq Global Select Market** under the symbol **CNXN**[674](index=674&type=chunk) 2023 Quarterly Dividends Paid | Declaration Date | Record Date | Payment Date | Dividend per Share | Total Dividend (millions) | | :--- | :--- | :--- | :--- | :--- | | Feb 9, 2023 | Feb 21, 2023 | Mar 10, 2023 | $0.08 | $2.1 | | May 4, 2023 | May 16, 2023 | Jun 2, 2023 | $0.08 | $2.1 | | Aug 2, 2023 | Aug 15, 2023 | Sep 1, 2023 | $0.08 | $2.1 | | Oct 31, 2023 | Nov 14, 2023 | Dec 1, 2023 | $0.08 | $2.1 | - On February 14, 2024, the Board of Directors declared an **increased quarterly cash dividend of $0.10 per share**[648](index=648&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=59&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2023, net sales decreased by 8.8% to $2.85 billion due to lower demand, while gross margin improved to 18.0% from a favorable product mix, and liquidity remained strong with improved cash conversion Key Financial Performance (2023 vs 2022) | Metric | 2023 | 2022 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $2,850.6M | $3,125.0M | -8.8% | | Gross Profit | $511.7M | $526.2M | -2.7% | | Gross Margin | 18.0% | 16.8% | +120 bps | | Income from Operations | $103.2M | $120.6M | -14.4% | | Net Income | $83.3M | $89.2M | -6.6% | - The decrease in 2023 net sales was primarily driven by **lower demand for end-point devices**, with **notebook/mobility sales down $205.2 million** year-over-year[661](index=661&type=chunk) - **Gross margin increased** due to a **favorable product mix**, with a higher proportion of sales from **higher-margin products** like software (recognized on a net basis) and net/com products[661](index=661&type=chunk) - In 2023, the company incurred **$2.7 million in restructuring charges** related to an **involuntary reduction in its headquarters workforce**[665](index=665&type=chunk)[213](index=213&type=chunk) - The company's **liquidity is strong**, with primary sources being cash from operations, **$145.0 million in cash**, **$152.2 million in short-term investments**, and an **undrawn $50.0 million credit facility** as of Dec 31, 2023[697](index=697&type=chunk)[698](index=698&type=chunk)[223](index=223&type=chunk) Cash Conversion Cycle (in days) | Component | Q4 2023 | Q4 2022 | | :--- | :--- | :--- | | Days of sales outstanding (DSO) | 73 | 70 | | Days of supply in inventory (DIO) | 20 | 31 | | Days of purchases outstanding (DPO) | (42) | (35) | | **Cash conversion cycle** | **51** | **66** | [Year-Over-Year Comparisons (2023 vs 2022)](index=64&type=section&id=Item%207.1%20Year-Over-Year%20Comparisons) In 2023, Enterprise and Business Solutions net sales declined due to lower demand, while Public Sector sales grew, and gross margins improved across all segments from a favorable product mix Net Sales by Segment (2023 vs 2022, in millions) | Operating Segment | 2023 | 2022 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Enterprise Solutions | $1,201.1 | $1,324.4 | $(123.3) | (9.3)% | | Business Solutions | $1,075.6 | $1,245.3 | $(169.7) | (13.6)% | | Public Sector Solutions | $573.9 | $555.3 | $18.6 | 3.3% | | **Total** | **$2,850.6** | **$3,125.0** | **$(274.4)** | **(8.8)%** | Gross Profit by Segment (2023 vs 2022, in millions) | Operating Segment | 2023 | 2022 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Enterprise Solutions | $178.9 | $195.1 | $(16.2) | (8.3)% | | Business Solutions | $247.1 | $250.9 | $(3.8) | (1.5)% | | Public Sector Solutions | $85.7 | $80.2 | $5.5 | 7.0% | | **Total** | **$511.7** | **$526.2** | **$(14.5)** | **(2.7)%** | - Other income, net **increased to $10.0 million** in 2023 from $1.1 million in 2022, primarily due to an **$8.9 million increase in interest income** from **higher cash balances and interest rates**[672](index=672&type=chunk) [Application of Critical Accounting Policies and Estimates](index=74&type=section&id=Item%207.2%20Application%20of%20Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant judgment in revenue recognition (principal vs. agent), accounts receivable, inventory valuation, and goodwill impairment, with no impairment identified for goodwill in 2023 or 2022 - **Revenue Recognition:** A critical judgment is the **principal vs. agent determination**; the company generally acts as a **principal for IT hardware and on-premise software (gross revenue)** and as an **agent for cloud products, third-party services, and certain software maintenance (net revenue)**[710](index=710&type=chunk)[261](index=261&type=chunk)[741](index=741&type=chunk) - **Accounts Receivable:** The allowance for credit losses is estimated based on past due status and specific customer financial difficulty; **bad debt expense decreased to $1.8 million in 2023 from $3.3 million in 2022**[715](index=715&type=chunk)[242](index=242&type=chunk) - **Inventory:** The **provision for inventory obsolescence was $2.4 million in 2023, down from $4.3 million in 2022**, based on management's forecast of customer demand[244](index=244&type=chunk)[269](index=269&type=chunk) - **Goodwill:** The company holds **$73.6 million in goodwill** ($66.2M in Enterprise Solutions, $7.4M in Business Solutions); annual qualitative impairment tests in 2023 and 2022 concluded that goodwill was **not impaired**[271](index=271&type=chunk)[382](index=382&type=chunk) [Financial Statements and Supplementary Data](index=82&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements and notes, with Deloitte & Touche LLP providing an unqualified opinion on both financial statements and internal controls, highlighting revenue recognition as a critical audit matter - The independent auditor, Deloitte & Touche LLP, issued an **unqualified opinion** on the **consolidated financial statements** and the **effectiveness of internal control over financial reporting** as of December 31, 2023[283](index=283&type=chunk)[305](index=305&type=chunk)[331](index=331&type=chunk) - The auditor identified **revenue recognition**, specifically the judgment in determining whether the company is a **principal or an agent** in transactions, as a **Critical Audit Matter**[361](index=361&type=chunk)[333](index=333&type=chunk)[334](index=334&type=chunk) [Consolidated Financial Statements](index=103&type=section&id=Item%208.1%20Consolidated%20Financial%20Statements) The consolidated financial statements show total assets of $1.19 billion and stockholders' equity of $840.8 million as of December 31, 2023, with net income of $83.3 million on $2.85 billion in net sales Consolidated Balance Sheet Data (in thousands) | Account | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $144,954 | $122,930 | | Short-term investments | $152,232 | $0 | | Accounts receivable, net | $606,834 | $610,280 | | Inventories, net | $124,179 | $208,682 | | **Total Current Assets** | **$1,048,639** | **$953,792** | | **Total Assets** | **$1,188,381** | **$1,099,826** | | Accounts payable | $263,682 | $232,638 | | **Total Current Liabilities** | **$327,965** | **$310,517** | | **Total Liabilities** | **$347,614** | **$333,651** | | **Total Stockholders' Equity** | **$840,767** | **$766,175** | Consolidated Income Statement Data (in thousands, except per share) | Account | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net sales | $2,850,644 | $3,124,996 | $2,892,595 | | Gross profit | $511,736 | $526,177 | $464,579 | | Income from operations | $103,153 | $120,552 | $96,517 | | **Net income** | **$83,271** | **$89,219** | **$69,906** | | **Diluted EPS** | **$3.15** | **$3.37** | **$2.65** | Consolidated Cash Flow Data (in thousands) | Activity | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net cash from Operating | $197,954 | $34,889 | $57,754 | | Net cash from Investing | $(160,202) | $(9,077) | $(8,733) | | Net cash from Financing | $(15,728) | $(11,192) | $(36,366) | | **Increase in Cash** | **$22,024** | **$14,620** | **$12,655** | [Notes to Consolidated Financial Statements](index=109&type=section&id=Item%208.2%20Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue disaggregation, an undrawn $50 million credit facility, a $32.3 million share repurchase authorization, income tax provisions, and segment performance data - **Note 2 (Revenue):** Revenue is disaggregated by product category and segment; for 2023, **Notebooks/Mobility was the largest product category at $951.7 million**, and the **Enterprise Solutions segment had the highest net sales at $1.20 billion**[419](index=419&type=chunk)[391](index=391&type=chunk) - **Note 4 (Goodwill):** **Goodwill totaled $73.6 million** as of Dec 31, 2023, with $66.2 million allocated to Enterprise Solutions and $7.4 million to Business Solutions; **no impairment was recorded**[424](index=424&type=chunk)[449](index=449&type=chunk) - **Note 9 (Bank Borrowings):** The company has a **$50 million credit facility** expiring in March 2025; there were **no outstanding borrowings** as of December 31, 2023[481](index=481&type=chunk)[459](index=459&type=chunk) - **Note 10 (Stockholders' Equity):** The Board has authorized a share repurchase program, with approximately **$32.3 million remaining authorization** for future purchases as of Dec 31, 2023; in 2023, **129,000 shares were repurchased for $5.4 million**[483](index=483&type=chunk)[463](index=463&type=chunk) - **Note 11 (Income Taxes):** The **effective tax rate for 2023 was 26.4%**, compared to 26.7% in 2022; the **income tax provision was $29.8 million**[475](index=475&type=chunk)[723](index=723&type=chunk) Segment Operating Income (in thousands) | Segment | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Enterprise Solutions | $39,216 | $53,477 | $74,653 | | Business Solutions | $76,150 | $79,475 | $43,783 | | Public Sector Solutions | $2,177 | $1,105 | $(4,928) | | Headquarters/Other | $(14,390) | $(13,505) | $(16,991) | | **Total Operating Income** | **$103,153** | **$120,552** | **$96,517** | [Controls and Procedures](index=82&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management and the independent auditor concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2023, with no material changes reported - Based on their evaluation, the CEO and CFO concluded that the company's disclosure controls and procedures were **effective as of December 31, 2023**[249](index=249&type=chunk) - Management assessed internal control over financial reporting using the COSO 2013 framework and concluded it was **effective as of December 31, 2023**[251](index=251&type=chunk)[280](index=280&type=chunk) - The independent registered public accounting firm issued an **unqualified audit report** on the company's **internal control over financial reporting** as of December 31, 2023[252](index=252&type=chunk)[305](index=305&type=chunk) - There were **no material changes to internal control over financial reporting** during the fourth quarter of 2023[252](index=252&type=chunk)[281](index=281&type=chunk) [Other Information](index=87&type=section&id=Item%209B.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading agreements during the fourth quarter of 2023 - **No directors or officers adopted or terminated a Rule 10b5-1 trading plan** during the fourth quarter of 2023[310](index=310&type=chunk) PART III [Directors, Executive Officers, and Corporate Governance](index=88&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%2C%20and%20Corporate%20Governance) This section identifies executive officers and confirms the adoption of a Code of Business Conduct and Ethics, with other governance information incorporated by reference from the 2024 Proxy Statement - Information regarding directors, executive officers, corporate governance, and the audit committee is **incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders**[289](index=289&type=chunk)[58](index=58&type=chunk) - The company has adopted a **Code of Business Conduct and Ethics**, which is posted on its website[292](index=292&type=chunk) [Executive Compensation](index=88&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive and director compensation is incorporated by reference from the company's 2024 Proxy Statement - Information regarding executive and director compensation is **incorporated by reference from the 2024 Proxy Statement**[293](index=293&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=88&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Details on security ownership by beneficial owners and management, and equity compensation plans, are incorporated by reference from the 2024 Proxy Statement - Information regarding security ownership and equity compensation plans is **incorporated by reference from the 2024 Proxy Statement**[294](index=294&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=90&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships, related party transactions, and director independence is incorporated by reference from the 2024 Proxy Statement - Information regarding related transactions and director independence is **incorporated by reference from the 2024 Proxy Statement**[295](index=295&type=chunk) [Principal Accounting Fees and Services](index=90&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Details on principal accounting fees and services, including pre-approval policies, are incorporated by reference from the 2024 Proxy Statement - Information regarding principal accounting fees and services is **incorporated by reference from the 2024 Proxy Statement**[296](index=296&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=91&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all documents filed with the Form 10-K, including consolidated financial statements, schedules, an exhibit index, and financial data in interactive XBRL format - This section lists the **consolidated financial statements** and **Schedule II—Valuation and Qualifying Accounts** as being filed with the report[318](index=318&type=chunk)[319](index=319&type=chunk) - An **exhibit index** is provided, listing all **material contracts**, **governance documents**, and **required certifications** filed with the SEC[298](index=298&type=chunk)[347](index=347&type=chunk) - Financial statements and notes are submitted in **XBRL format** for **interactive data analysis**[325](index=325&type=chunk)