Q3 2025 CDW Corp Earnings Call Transcript
Key Points
- CDW Corp (CDW) reported consolidated net sales of $5.7 billion, up 4% from the previous year, demonstrating strong execution in a complex environment.
- The company achieved a gross profit of $1.3 billion, marking a 5% increase year-over-year, with notable strength in cloud, software, and services.
- Small Business segment delivered double-digit growth in both top line and gross profit, driven by cloud and client device solutions.
- Government net sales increased by 8%, with state and local sectors showing impressive double-digit growth, offsetting declines in federal sales.
- CDW Corp (CDW) continues to embed AI across its operations, enhancing productivity and efficiency, and offering enterprise-grade AI solutions to customers.
- Non-GAAP operating income decreased by 1% to $531 million, indicating pressure on operating margins.
- Education net sales declined by 9%, primarily due to an expected decrease in K-12 sales.
- The company faces potential funding shortfalls in healthcare, particularly from clients relying on Medicare payments.
- The federal segment experienced challenges due to the government shutdown, impacting sales and pipeline development.
- CDW Corp (CDW) anticipates continued frictional impacts in the Government and Education segments, with potential economic uncertainties affecting future performance.
Good morning, all, and thank you for joining us for the CDW Third Quarter Earnings Call. My name is Carlie and I'll be coordinating the call today. (Operator Instructions) I'd now like to hand over to our host, Steve O'Brien with Investor Relations. Floor is yours.
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Thank you, Carlie. Good morning, everyone. Joining me today to review our third quarter 2025 results are Chris Leahy, our Chair and Chief Executive Officer; and Al Miralles, our Chief Financial Officer. Our earnings release was distributed this morning and is available on our website, investor.cdw.com, along with the supplemental slides that you can use to follow along during the call.
I'd like to remind you that certain comments made in this presentation are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. Those statements are subject to a number of risks and uncertainties that could cause actual results to differ materially. Additional information concerning these risks and
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