Summary of Conference Call for Insight Enterprises Company Overview - **Company**: Insight Enterprises - **CFO**: James Mercado Macro Environment - **Recession Concerns**: Initial recession predictions for the second half of the year ranged from 25% to 50%, but recent news has moderated these concerns [4][5] - **Customer Sentiment**: Customers are navigating uncertainty, with spending patterns aligning with expectations, particularly in hardware [6][10] Financial Performance - **Q1 Performance**: Gross profit was slightly below expectations, but SG&A expenses met forecasts [5][6] - **Q2 Outlook**: Customer spending patterns in Q2 are consistent with expectations, with a cautious but positive outlook for the quarter [6][7] Customer Spending Trends - **Commercial Segment**: Experienced four consecutive quarters of growth, recovering faster than corporate and enterprise segments [33][34] - **Enterprise Segment**: Spending remains constrained, with delays in large deals being more widespread than initially thought [38][39] Tariff Impact - **Tariff Navigation**: Insight has strong partner relationships to help customers manage tariff impacts, with historical data suggesting a 10% tariff does not significantly affect demand [12][14] - **Inventory Positioning**: Some inventory positioning was done in anticipation of tariffs, particularly in the commercial space [18][19] Competitive Landscape - **Differentiation**: Insight's full solutions portfolio, strong cloud offerings, and technical capabilities differentiate it from competitors [27][28] - **Market Position**: Insight is focused on building relationships with new partners, especially in the AI space, to drive future growth [30] Infrastructure and Hardware Trends - **Infrastructure Spending**: Sluggish infrastructure spending attributed to a longer digestion period than expected, but increased customer dialogue suggests potential recovery [56][57] - **Networking Lag**: Networking is lagging behind storage and compute, but expected to improve in the second half of the year [58] AI and Technology Trends - **AI Spending**: Enterprises are beginning to shift budgets towards AI, but significant spending is not yet materializing [64][65] - **PC Refresh Cycle**: The impending end of Windows 10 is driving a refresh cycle, with commercial customers in the middle innings of this cycle [45][46] Financial Guidance - **Gross Profit Expectations**: Q1 gross profit was down 8%, but guidance for the rest of the year suggests a return to low single-digit growth [67][69] - **Cloud Growth**: Cloud services are expected to grow in the double digits, despite headwinds from partner program changes [75] SADA Update - **SADA Performance**: The SADA team is pivoting effectively to focus on services, which is seen as a key differentiator for future growth [78][79] Conclusion - **Outlook**: Insight Enterprises is cautiously optimistic about the second half of the year, with a focus on managing macro uncertainties, enhancing customer relationships, and leveraging its diverse portfolio to navigate competitive pressures [7][8][9]

Financial Performance - Total net sales for the three months ended March 31, 2025, were $2,103,556, a decrease of 11.6% compared to $2,379,485 in the same period of 2024[20] - Gross profit for the three months ended March 31, 2025, was $406,477, down 7.7% from $440,928 in the prior year[20] - Net earnings for the three months ended March 31, 2025, were $7,514, a significant decline of 88.8% compared to $67,027 in the same period of 2024[20] - Basic net earnings per share decreased to $0.24 for the three months ended March 31, 2025, from $2.06 in the same period of 2024[20] - Adjusted earnings from operations for Q1 2025 were $102,352,000, down from $121,750,000 in Q1 2024, reflecting a decline of 15.9%[86] - Earnings from operations decreased 40% year-over-year to $60.1 million, primarily due to a decrease in gross profit and increased selling and administrative expenses[98] - Net earnings for the first quarter of 2025 were $7.5 million, a significant decrease from $67.0 million in the first quarter of 2024, resulting in diluted earnings per share of $0.22, down 87% year-over-year[98] Assets and Liabilities - Total current assets increased to $5,390,136 as of March 31, 2025, compared to $4,844,622 as of December 31, 2024, reflecting a growth of 11.3%[18] - Total liabilities increased to $6,331,629 as of March 31, 2025, from $5,677,967 as of December 31, 2024, representing a rise of 11.5%[18] - Long-term debt increased to $961,172,000 as of March 31, 2025, from $531,233,000 at the end of 2024, reflecting a significant rise of approximately 81%[45] - Total current liabilities rose to $4,385,800 as of March 31, 2025, up from $4,122,202 as of December 31, 2024, indicating an increase of 6.4%[18] Cash Flow and Financing - Cash provided by operating activities in Q1 2025 was $78,050 thousand, down from $247,179 thousand in Q1 2024, reflecting a significant decline[27] - Cash, cash equivalents, and restricted cash at the end of Q1 2025 totaled $324,091 thousand, down from $381,141 thousand at the end of Q1 2024[27] - The company reported a net cash used in financing activities of $15,473 thousand in Q1 2025, compared to $125,267 thousand in Q1 2024, showing improved cash management[27] - The company had net borrowings under its ABL facility of $423.8 million in Q1 2025, compared to net repayments of $42.2 million in Q1 2024[144] Revenue Breakdown - Revenue for the three months ended March 31, 2025, totaled $2,103,556,000, with North America contributing $1,700,643,000[81] - Hardware sales accounted for $1,141,516,000 of total revenue, while software and services contributed $566,284,000 and $395,756,000, respectively[81] - Net sales in North America decreased 11% to $1.7 billion, driven by a 33% decrease in software sales and a 7% decrease in services sales, partially offset by a 2% increase in hardware sales[110] - EMEA net sales decreased 17% to $342.8 million, with software sales down 32% and hardware sales down 5%, while services sales increased by 3%[112] - APAC net sales decreased 3% to $60.1 million, with hardware sales down 13% and services sales down 5%, but software sales increased by 2%[113] Operational Expenses - Operating expenses for the three months ended March 31, 2025, were $339,173, slightly up from $337,434 in the same period of 2024[20] - Significant selling and administrative expenses for Q1 2025 were $295,278,000, compared to $311,135,000 in Q1 2024, reflecting a reduction of 5.1%[86] - Total costs of goods sold for Q1 2025 were $1,697,079,000, compared to $1,938,557,000 in Q1 2024, marking a decrease of 12.4%[86] Tax and Compliance - The effective tax rate for the three months ended March 31, 2025, was 60.5%, significantly higher than the federal statutory rate of 21.0%[62] - As of March 31, 2025, the company had approximately $12,029,000 of unrecognized tax benefits, with $1,614,000 related to accrued interest[63] Strategic Initiatives - The company anticipates that gross margin expansion could continue into future periods as it focuses on selling solutions and increasing services net sales[12] - The company expects to incur additional acquisition expenses as part of its acquisition strategy and plans to use excess cash for strategic acquisitions[12] - The acquisition of Infocenter was completed on May 1, 2024, for a total purchase price of $265,000,000, enhancing the company's service offerings[89] Market Conditions - Inflation has contributed to sustained high interest rates, which are expected to remain above historical levels throughout most of 2025[102] - The company is actively monitoring the global macroeconomic environment, including supply chain impacts and demand fluctuations due to tariffs[102]

Core Insights - Insight Enterprises reported $2.1 billion in revenue for the quarter ended March 2025, reflecting a year-over-year decline of 11.6% [1] - The EPS for the same period was $2.06, down from $2.37 a year ago, with an EPS surprise of +1.48% compared to the consensus estimate of $2.03 [1] Revenue and Earnings Performance - The reported revenue was a surprise of -2.52% against the Zacks Consensus Estimate of $2.16 billion [1] - Key metrics indicate that net sales for services were $395.76 million, which is a -4.8% change year-over-year and below the estimated $422.02 million [4] - Net sales for products were $1.71 billion, representing a -13% year-over-year change, slightly above the estimated $1.70 billion [4] Profitability Metrics - Gross profit for products was reported at $175.97 million, exceeding the estimated $174.34 million [4] - Gross profit for services was $230.50 million, which fell short of the estimated $249.54 million [4] Stock Performance - Shares of Insight Enterprises have returned -6.4% over the past month, compared to the Zacks S&P 500 composite's -0.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Insights - Insight Enterprises reported quarterly earnings of $2.06 per share, exceeding the Zacks Consensus Estimate of $2.03 per share, but down from $2.37 per share a year ago, indicating an earnings surprise of 1.48% [1] - The company posted revenues of $2.1 billion for the quarter ended March 2025, missing the Zacks Consensus Estimate by 2.52%, and down from $2.38 billion year-over-year [2] - Insight Enterprises has underperformed the market, with shares down approximately 9.1% year-to-date compared to the S&P 500's decline of 5.3% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $2.54 on revenues of $2.14 billion, and for the current fiscal year, it is $9.84 on revenues of $8.82 billion [7] - The estimate revisions trend for Insight Enterprises is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6] Industry Context - The Retail - Mail Order industry, to which Insight Enterprises belongs, is currently ranked in the top 38% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Another company in the same industry, 1-800-Flowers.com, is expected to report a quarterly loss of $0.34 per share, reflecting a year-over-year decline of 21.4%, with revenues projected at $364.65 million, down 3.9% from the previous year [9][10]

Financial Data and Key Metrics Changes - In Q1 2025, net revenue was $2.1 billion, a decrease of 12% compared to the previous year, driven by a 13% decline in product revenue, particularly on-prem software [21][22] - Adjusted diluted earnings per share were $2.6, down 13%, primarily due to lower gross profit, partially offset by lower adjusted SG&A expenses [24] - Gross profit decreased by 8%, with a gross margin of 19.3%, an increase of 80 basis points due to a favorable product mix [22][23] Business Line Data and Key Metrics Changes - Hardware revenue increased by 1%, marking the first growth in ten quarters, with strong performance in servers and storage [21][22] - Cloud gross profit was $103 million, a decrease of 3%, while SaaS and Infrastructure as a Service gross profit grew by 17% [22][24] - Insight Core Services revenue decreased by 2%, with gross profit down 4% due to delays in projects from large enterprise clients [7][22] Market Data and Key Metrics Changes - The macro environment has deteriorated, leading to increased volatility and uncertainty, impacting large enterprise clients' spending [7][18] - Demand for hardware is expected to grow in the mid-single digits, while cloud gross profit is anticipated to be flat to slightly down [20][28] Company Strategy and Development Direction - The company aims to accelerate profitable growth by enhancing consulting engagement models and leveraging GenAI technologies [10][11] - Focus on driving attached services to hardware sales and improving supply chain management in response to market dynamics [10][20] - The strategy includes becoming a leading solutions integrator, emphasizing AI, data, and cloud services [30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about hardware spending and AI interest, despite the uncertain macro environment [36][38] - The company anticipates that the second half of 2025 will be stronger than the first half, with improvements in services spending expected [18][19] - Ongoing challenges are expected, particularly with large enterprise clients in North America, but the fundamentals driving the tech industry remain strong [20][28] Other Important Information - The company has been recognized for its diversity and workplace environment, receiving accolades such as Newsweek's America's Greatest Workplaces for Diversity for 2025 [17] - The company has ample liquidity with $1.3 billion available under its ABL facility, allowing it to meet operational needs [27] Q&A Session Summary Question: What drives the confidence in the guidance despite a tougher macro backdrop? - Management noted good momentum in hardware spending and AI interest, alongside effective navigation of partner program changes [34][36] Question: Are there any demand pull-ins from customers? - Minimal pull-ins were observed in Q1, primarily device-related, with a general movement towards leveraging AI technologies [41][43] Question: What are the expectations regarding vendor pricing in light of tariffs? - Some OEMs have raised prices, but generally, pricing has been subdued, with a slight positive impact expected from tariffs [51][53] Question: What is the outlook for the services business? - The services business is expected to improve in the second half of the year, aligning with hardware sales recovery [73]

Financial Data and Key Metrics Changes - In Q1 2025, net revenue was $2.1 billion, a decrease of 12% driven by a 13% decline in product revenue, primarily due to on-prem software related to a large deal in Q1 2024 [21] - Gross profit decreased by 8% due to partner program changes and a decline in on-prem software and agent services [22] - Adjusted diluted earnings per share were $2.6, down 13%, primarily due to lower gross profit [25] - Adjusted EBITDA was $111 million, a decrease of 16%, with a margin contraction of 30 basis points to 5.3% [25] - The adjusted return on invested capital for the trailing twelve months was 14.9%, down from 18% a year ago [26] Business Line Data and Key Metrics Changes - Hardware revenue increased by 1%, marking the first increase in ten quarters, with good performance in servers and storage [21][22] - Cloud gross profit was $103 million, a decrease of 3%, attributed to declines in legacy Microsoft enterprise agreements and a pivot to the mid-market [23] - Insight Core Services revenue decreased by 2%, with gross profit down 4% due to delays in services projects from large enterprise clients [22][24] Market Data and Key Metrics Changes - The macro environment outlook has deteriorated, leading to increased volatility and uncertainty, impacting large enterprise clients' spending [7][18] - AI spending remains a priority for firms, with budget reallocations from other segments to invest in AI [19] Company Strategy and Development Direction - The company aims to accelerate profitable growth by enhancing consulting business engagement models and leveraging GenAI technologies [9][10] - Focus on driving attached services to hardware sales and expanding programs with distribution partners to improve supply availability [9] - The strategy is to become a leading solutions integrator, investing in areas like cloud, data, AI, edge, and cyber [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about hardware spending and AI interest, despite the uncertain macro environment [36][38] - The company anticipates that the second half of the year will be stronger than the first, with expectations for improved services spending aligned with hardware sales [18][19] - Management is prepared for potential downturns with plans for cost management and operational efficiency improvements [72] Other Important Information - The company has been recognized for its diversity and workplace environment, receiving accolades such as America's Greatest Workplaces for Diversity for 2025 [17] - The company continues to focus on corporate citizenship and sustainability, as highlighted in its annual corporate citizenship report [18] Q&A Session Summary Question: What is driving the confidence in the guidance despite a tougher macro backdrop? - Management noted good momentum in hardware spend and AI interest, along with effective navigation of partner program changes [36][38] Question: Are there any demand pull-ins from customers in hardware? - Minimal pull-ins were observed in response to tariff threats, primarily related to devices, with a general movement towards leveraging AI technologies [44] Question: What are the expectations regarding vendor OEM pricing in light of tariffs? - Pricing responses vary by OEM, with some increasing prices, but generally, the pricing motion has been subdued [52][54] Question: What is the outlook for services spending through the year? - Services spending is expected to improve in the back half of the year, aligning with improved product sales [73]

Q1 2025 Financial Performance - Net sales decreased by 12% year-over-year to $21 billion[25] - Gross profit decreased by 8% year-over-year to $406 million[25] - Cloud gross profit decreased by 3% year-over-year to $103 million[25] - Insight Core Services gross profit decreased by 4% year-over-year to $73 million[25] - Earnings from operations decreased by 40% year-over-year to $60 million[25] - Adjusted earnings from operations decreased by 16% year-over-year to $102 million[25] - GAAP diluted earnings per share decreased by 87% year-over-year to $022[25] - Adjusted diluted earnings per share decreased by 13% year-over-year to $206[25] Debt and Capital Allocation - Total debt balance at March 31, 2025, was $9612 million, an increase of $796 million year-over-year[28] - The company spent $574 million on acquisitions, share repurchases, and warrant settlements[28] 2025 Outlook - The company expects low single-digit gross profit growth for the full year 2025[31] - The company anticipates a gross margin of approximately 20% for the full year 2025[31] - The company projects adjusted diluted EPS to be in the range of $970 to $1010 for the full year 2025[31]

EXHIBIT 99.1 FOR IMMEDIATE RELEASE NASDAQ: NSIT | | | - MORE - | | | | --- | --- | --- | --- | --- | | Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | • Gross profit decreased 8% year to year to $406.5 million while gross margin expanded 80 basis points to 19.3% • Cloud gross profit decreased 3% year to year • Insight Core services gross profit decreased 4% year to year • Consolidated net earnings decreased 89% year to year to $7.5 million • Adju ...

Core Viewpoint - The market anticipates a year-over-year decline in earnings for Insight Enterprises due to lower revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - Insight Enterprises is expected to report quarterly earnings of $2.03 per share, reflecting a decline of 14.4% year-over-year, and revenues are projected to be $2.16 billion, down 9.3% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised 0.86% higher in the last 30 days, indicating a slight reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for Insight Enterprises is lower than the consensus estimate, resulting in an Earnings ESP of -3.20%, indicating bearish sentiment among analysts [10][11]. Historical Performance - In the last reported quarter, Insight Enterprises exceeded the expected earnings of $2.53 per share by delivering $2.66, resulting in a surprise of +5.14%. Over the last four quarters, the company has beaten consensus EPS estimates twice [12][13]. Overall Assessment - Insight Enterprises does not appear to be a strong candidate for an earnings beat, and investors should consider other factors when making decisions regarding the stock ahead of the earnings release [16].

Core Insights - Whatfix has entered the federal sector by partnering with the US Army to support the Integrated Personnel and Pay System - Army (IPPS-A), which will serve over 1.1 million users including active, reserve, and National Guard members [1][4][5] - The collaboration aims to enhance operational efficiency and support mission-critical functions for the US Army, aligning with federal agencies' priorities for modernization and digital transformation [2][5] - Whatfix's Digital Adoption Platform (DAP) will provide real-time, context-sensitive guidance to users, addressing challenges in user proficiency and adoption of the IPPS-A system [4][7] Company Expansion - Whatfix is committed to expanding its presence in the public sector, reinforcing its role as a trusted partner in transforming large-scale government systems with digital adoption solutions [3][9] - The company recently raised $125 million in a Series E funding round, which will support its expansion into complementary DAP offerings and accelerate its mission in the public sector [9] Technology and Solutions - Whatfix's platform automates workflows and enhances HR process governance, ensuring seamless adoption of the IPPS-A system [7] - The collaboration with Insight Public Sector combines technology, infrastructure, and expertise to provide an integrated training solution for the Army's HR system [6] Industry Recognition - Whatfix is recognized as a leader in the Digital Adoption Platform space, receiving accolades from industry reports by Gartner, Forrester, IDC, and Everest Group [8] - The company has been included in the Deloitte Fast 500 list for four consecutive years, highlighting its rapid growth and impact in the industry [9]