Insight Enterprises(NSIT) - 2025 Q3 - Quarterly Results

Financial Performance - Consolidated net sales for Q3 2025 were $2.0 billion, a decrease of 4% year over year, with hardware net sales increasing by 1%[2] - Consolidated net earnings decreased by 12% year over year to $50.9 million, primarily due to higher interest expenses[2] - Adjusted earnings from operations increased by 5% year over year to $126.4 million, representing 6.3% of net sales[13] - Diluted earnings per share for the quarter was $1.62, up 7% year over year, while adjusted diluted earnings per share increased by 11% to $2.43[2] - North America net sales decreased by 5% year over year to $1.6 billion, with product net sales down 6%[8] - EMEA net sales increased by 2% year over year to $319.8 million, while APAC net sales remained flat at $58.8 million[8] - Total net sales for Q3 2025 were $2,003,845, a decrease of 4% compared to $2,087,886 in Q3 2024[25] - Product sales decreased by 6% to $1,577,772 in Q3 2025 from $1,673,779 in Q3 2024, while service sales increased by 3% to $426,073[25] - Net earnings for Q3 2025 were $50,947, down 12% from $58,208 in Q3 2024, with diluted earnings per share decreasing by 42% to $1.62[25] - GAAP consolidated net earnings for Q3 2025 were $50,947 thousand, down from $58,208 thousand in Q3 2024, representing a decrease of 2.5% as a percentage of net sales[47] Profitability Metrics - Gross profit remained flat at $434.2 million, while gross margin expanded by 100 basis points to 21.7%[7] - Gross profit for Q3 2025 was $434,195, slightly up from $432,085 in Q3 2024, resulting in a gross margin increase of 100 basis points to 21.7%[25] - The company anticipates gross profit to be slightly down from 2024, with a gross margin of approximately 21%[15] - GAAP consolidated EFO for Q3 2025 was $93,067, compared to $92,851 in Q3 2024, reflecting a slight increase of 0.2%[41] - Adjusted non-GAAP consolidated EFO for Q3 2025 was $126,448, up from $120,117 in Q3 2024, representing a growth of 2.8%[41] - Adjusted non-GAAP EBITDA for Q3 2025 was $137,008 thousand, an increase from $128,772 thousand in Q3 2024, reflecting a growth of 1.6% as a percentage of net sales[47] Expenses and Costs - Selling and administrative expenses rose by 1% to $332,907 in Q3 2025, while severance and restructuring expenses decreased by 37%[25] - The company reported acquisition and integration-related expenses of $2,831 in Q3 2025, a significant increase of over 100% compared to $695 in Q3 2024[25] - GAAP selling and administrative expenses for Q3 2025 were $332,907 thousand, slightly up from $329,996 thousand in Q3 2024, with GAAP expenses as a percentage of net sales increasing to 16.7% from 15.9%[47] - Adjusted non-GAAP selling and administrative expenses decreased to $307,747 thousand in Q3 2025 from $311,968 thousand in Q3 2024, with adjusted expenses as a percentage of net sales rising to 15.4% from 14.9%[47] - Interest expense for Q3 2025 increased to $25,387 thousand from $19,184 thousand in Q3 2024, marking a rise of 32.5%[47] - Income tax expense for Q3 2025 was $19,711 thousand, compared to $16,910 thousand in Q3 2024, reflecting an increase of 16.5%[47] - Transformation costs for Q3 2025 were $2,929 thousand, down from $5,068 thousand in Q3 2024, indicating a reduction in restructuring efforts[47] Cash Flow and Assets - Cash flows provided by operating activities were $249.1 million for the quarter[7] - Cash and cash equivalents increased to $547,017 as of September 30, 2025, compared to $259,234 at the end of 2024[37] - Accounts receivable, net, rose to $5,479,567 as of September 30, 2025, from $4,172,104 at the end of 2024, indicating a significant increase of 31.2%[37] - Total current assets increased to $6,504,283 as of September 30, 2025, compared to $4,844,622 at the end of 2024, representing a growth of 34.2%[37] - The company reported a net cash provided by operating activities of $150,057 for the nine months ended September 30, 2025, compared to $417,731 in the same period of 2024[39] - The company experienced an increase in accounts payable of $1,100,776 for the nine months ended September 30, 2025, compared to $374,166 in the same period of 2024[39] Future Outlook - For the full year 2025, the company expects adjusted diluted earnings per share to be between $9.60 and $9.90[15] - The company anticipates continued challenges due to inflation and higher interest rates, impacting future financial performance and operational results[29] - Average stockholders' equity for the twelve months ended September 30, 2025, was $1,662,814 thousand, compared to $1,746,223 thousand in 2024, showing a decrease of 4.8%[50] - Adjusted non-GAAP consolidated EFO for the twelve months ended September 30, 2025, was $487,176 thousand, compared to $521,631 thousand for the same period in 2024, indicating a decline in performance[50] - Adjusted non-GAAP ROIC from GAAP consolidated EFO for the twelve months ended September 30, 2025, was 9.24%, down from 14.24% in 2024[50] Regional Performance - EMEA total net sales increased by 2% to $319,758 in Q3 2025, driven by a 30% increase in service sales[27] - APAC total net sales remained stable at $58,785 in Q3 2025, with service sales growing by 4%[27] - North America segment GAAP EFO for Q3 2025 was $83,631, compared to $80,836 in Q3 2024, reflecting a growth of 2.2%[43] - EMEA segment adjusted non-GAAP EFO for Q3 2025 was $10,526, an increase from $8,080 in Q3 2024, representing a growth of 30.3%[45] - APAC segment adjusted non-GAAP EFO for Q3 2025 was $6,057, compared to $5,487 in Q3 2024, indicating an increase of 10.4%[45]