CDW Corp

Previous wording

•Customers are evaluating the complex technology landscape in order to balance priorities and focus on solutions that lead to business optimization, cost management and security risk management, among other factors, resulting in a more measured approach to their IT spending. We have orchestrated solutions that leverage security, software, hybrid and cloud offerings to help customers achieve their objectives.

Current wording

•Customers are evaluating the complex technology landscape in order to balance priorities and focus on solutions that lead to business optimization, cost management and security risk management, among other factors, resulting in a more measured approach to their IT spending. We have orchestrated solutions that leverage security, software, artificial intelligence, hybrid and cloud offerings to help customers achieve their objectives.

Previous wording

•Changes and uncertainty related to spending policies, budget priorities, timing and funding levels are key factors influencing the purchasing levels of government, healthcare and education customers. As the duration and ongoing impact of current economic conditions remain uncertain, current and future budget priorities and funding levels for government, healthcare and education customers may be adversely affected, leading to lower IT spend.

Current wording

•Changes and uncertainty related to spending policies, budget priorities, timing and funding levels are key factors influencing the purchasing levels of government, healthcare and education customers. As the duration and ongoing impact of current economic conditions, including the US government shutdown, remain uncertain, current and future budget priorities and funding levels for government, healthcare and education customers may be adversely affected, leading to lower IT spend.

Previous wording

(1)Defined as Net sales divided by the number of selling days. There were 64 selling days for both the three months ended June 30, 2025 and 2024. There were 127 and 128 selling days for the six months ended June 30, 2025 and 2024, respectively.

Current wording

(1)Defined as Net sales divided by the number of selling days. There were 64 selling days for both the three months ended September 30, 2025 and 2024. There were 191 and 192 selling days for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

Results of operations, including Gross profit margin and Operating income margin, expressed as Gross profit and Operating income as a percentage of Net sales, respectively, for the three and six months ended June 30, 2025 and 2024 are below. For additional information on Net sales, Gross profit and Operating income by segment, see the “Segment Results of Operations.”

Current wording

Results of operations, including Gross profit margin and Operating income margin, expressed as Gross profit and Operating income as a percentage of Net sales, respectively, for the three and nine months ended September 30, 2025 and 2024 are below. For additional information on Net sales, Gross profit and Operating income by segment, see the “Segment Results of Operations.”

Previous wording

Net sales increased $553 million, or 10.2%, with higher Net sales across all operating segments. The increase was primarily due to customer demand for notebooks/mobile devices, software, netcomm products and data storage and servers. While economic uncertainty persists, certain end-markets experienced improved customer spending during the quarter.

Current wording

Net sales increased $221 million, or 4.0%, with higher Net sales across all operating segments. The increase was primarily due to increased customer demand for netcomm products, notebooks/mobile devices, desktops, software and services, partially offset by a decrease in data storage and servers. Broadly, while economic and geopolitical uncertainty persists, certain end-markets continued to experience improved customer spending during the period.

Previous wording

Selling and administrative expenses increased $71 million, or 9.5%, primarily due to higher performance-based compensation, transformation and other related costs, workplace optimization costs and amortization expense on acquisition-related intangible assets.

Current wording

Selling and administrative expenses increased $93 million, or 12.9%, primarily due to higher performance-based compensation, transformation and other related costs and amortization expense on acquisition-related intangible assets.

Previous wording

Income tax expense decreased$5 million, or 5.0%. The effective income tax rate, expressed by calculating the income tax expense as a percentage of Income before income taxes, was 25.7%and 26.0% for thethree months ended June 30, 2025 and 2024, respectively. The decrease in the effective income tax rate was primarily due to higher excess tax benefits on equity-based compensation.

Current wording

Income tax expense decreased $13 million, or 11.5%. The effective income tax rate, expressed by calculating the income tax expense as a percentage of Income before income taxes, was 25.3% and 26.0% for thethree months ended September 30, 2025 and 2024, respectively. The decrease in the effective income tax rate was primarily attributable to the anticipated benefit from federal tax credits.

Previous wording

Net sales increased $880 million, or 8.5%, with higher Net sales across all operating segments. The increase was primarily due to customer demand for notebooks/mobile devices, software, desktops and services. While economic uncertainty continues to persist, certain end-markets experienced improved customer spending during the period.

Current wording

Net sales increased$1,100 million, or 7.0%, with higher Net sales across all operating segments. The increase was primarily due to customer demand for notebooks/mobile devices, software, desktops, netcomm products and services. Broadly, while economic and geopolitical uncertainty persists, certain end-markets continued to experience improved customer spending during the period.

Previous wording

Gross profit increased $117 million, or 5.2%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 70 basis points which is attributed to decreased rate and increased mix in certain hardware categories.

Current wording

Gross profit increased $172 million, or 5.0%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 40 basis points which is attributed to decreased rate and increased mix in certain hardware categories.

Previous wording

Selling and administrative expenses increased $97 million, or 6.5%, primarily due to higher performance-based compensation, transformation and other related costs, amortization expense on acquisition-related intangible assets and workplace optimization costs, partially offset by lower coworker-related costs.

Current wording

Selling and administrative expenses increased $190 million, or 8.6%, primarily due to higher performance-based compensation, transformation and other related costs and amortization expense on acquisition-related intangible assets.

Previous wording

Interest expense, net includes interest expense and interest income. Interest expense, net increased $5 million, or 8.6%, primarily due to lower interest income earned on cash balances and a higher fixed interest rate on unsecured senior notes, partially offset by a lower variable interest rate on the senior unsecured term loan.

Current wording

Interest expense, net includes interest expense and interest income. Interest expense, net increased $11 million, or 6.9%, primarilydue to lower interest income earned on cash balances and a higher fixed interest rate on unsecured senior notes, partially offset by a lower variable interest rate on the senior unsecured term loan.

Previous wording

Income tax expense increased$14 million, or 8.6%. The effective income tax rate, expressed by calculating the income tax expense as a percentage of Income before income taxes, was 25.8%and 24.2% for the six months ended June 30, 2025 and 2024, respectively. The increase in the effective income tax rate was primarily attribut able to lower excess tax benefits on equity-based compensation.

Current wording

Income tax expense increased $1 million, or 0.3%. The effective income tax rate, expressed by calculating the income tax expense as a percentage of Income before income taxes, was 25.6%and 24.9% for the nine months ended September 30, 2025 and 2024, respectively. The increase in the effective income tax rate was primarily attributable to lower excess tax benefits on equity-based compensation, partially offset by the anticipated benefit from federal tax credits.

Previous wording

(1)There were 64 selling days for both the three months ended June 30, 2025 and 2024. There were 127 and 128 selling days for the six months ended June 30, 2025 and 2024, respectively. Average daily sales is defined as Net sales divided by the number of selling days.

Current wording

(1)There were 64 selling days for both the three months ended September 30, 2025 and 2024. There were 191 and 192 selling days for the nine months ended September 30, 2025 and 2024, respectively. Average daily sales is defined as Net sales divided by the number of selling days.

Previous wording

Small Business segment Net sales increased $48 million, or 12.6%, primarily due to an increase in notebooks/mobile devices, software and desktops.

Current wording

Small Business segment Net sales increased $54 million, or 14.2%, primarily due to an increase in notebooks/mobile devices, software and desktops.

Previous wording

Public segment Net sales increased $48 million, or 2.2%, primarily due to an increase in software in the healthcare and government sales channels, partially offset by a decrease in hardware, primarily notebooks/mobile devices and collaboration, in the education sales channel.

Current wording

Public segment Net sales increased $14 million, or 0.6%, primarily due to an increase in services in the government and healthcare sales channels and software in the education sales channel, partially offset by a decrease in hardware in the education sales channel.

Previous wording

Public segment Operating income decreased $7 million, or 1.9%, primarily due to higher payroll costs, including performance-based compensation, and an increased provision for expected credit losses.

Current wording

Public segment Operating income decreased $8 million, or 3.5%, primarily due to higher payroll costs, including performance-based compensation, and higher transformation and other related costs, partially offset by higher Gross profit dollars.

Previous wording

Net sales in Other, increased $70 million, or 11.6%, primarily due to an increase in notebooks/mobile devices within the UK and Canada operations.

Current wording

Net sales in Other increased $58 million, or 9.1%, primarily due to an increase in hardware within the UK and Canada operations, partially offset by a decrease in software within the Canada and UK operations.

Previous wording

Corp orate segment Gross profit dollars increased $77 million, or 7.5%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 80 bps, to 23.0%, which is attributed to decreased rate in certain hardware categories, primarily data storage and servers and increased mix into notebooks/mobile devices.

Current wording

Corp orate segment Gross profit dollars increased $88 million, or 5.7%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 70 bps, to 23.0%, which is attributed to decreased rate in certain hardware categories and mixing into lower margin hardware categories.

Previous wording

Corporate segment Operating income increased $89 million, or 23.7%, primarily due to higher Gross profit dollars and lower coworker-related costs, partially offset by increased amortization expense on acquisition-related intangible assets and higher performance-based compensation.

Current wording

Corporate segment Operating income increased $75 million, or 12.9%, primarily due to higher Gross profit dollars, partially offset by higher performance-based compensation and increased amortization expense on acquisition-related intangible assets.

Previous wording

Small Business segment Gross profit increased $6 million, or 3.2%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 130 bps, to 21.9%, which is attributed to lower contribution of netted down revenue relative to the prior year.

Current wording

Small Business segment Gross profit increased $17 million, or 6.2%, primarily due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 100 bps, to 22.2%, which is attributed to lower contribution of netted down revenue.

Previous wording

Small Business segment Operating income decreased $1 million, or 1.0%, primarily due to higher payroll costs, including performance-based compensation, and an increased provision for expected credit losses, partially offset by higher Gross profit dollars.

Current wording

Public segment Operating income decreased $15 million, or 2.6%, primarily due to higher performance-based compensation and an increased provision for expected credit losses, partially offset by higher Gross profit dollars.

Previous wording

Net sales in Other, increased $119 million, or 9.7%, primarily due to an increase in notebooks/mobile devices within UK and Canada operations.

Current wording

Net sales in Other increased $178 million, or 9.5%, primarily due to an increase in notebooks/mobile devices, desktops and services within UK and Canada operations.

Previous wording

Other Gross profit dollars increased $21 million, or 17.7%, primarily due to higher Net sales and Gross profit margin. Gross profit margin increased 110 bps, to 21.1%, which is attributed to higher contribution of netted down revenue relative to the prior year.

Current wording

Other Gross profit dollars increased $52 million, or 14.3%, primarily due to higher Net sales and Gross profit margin. Gross profit margin increased 80 bps, to 20.4%, which is attributed to higher contribution of netted down revenue and increased rate in certain hardware categories.

Previous wording

Other Operating income increased $32 million, or 65.1%, primarily due to higher Gross profit dollars and lower transformation and other related costs, partially offset by higher performance-based compensation within the UK and Canada operations.

Current wording

Other Operating income increased $43 million, or 52.1%, primarily due to higher Gross profit dollars and lower transformation and other related costs, partially offset by higher performance-based compensation within the UK operations.

Previous wording

We have included reconciliations of our non-GAAP financial measures to the most comparable US GAAP financial measures for the three and six months ended June 30, 2025 and 2024 below.

Current wording

We have included reconciliations of our non-GAAP financial measures to the most comparable US GAAP financial measures for the three and nine months ended September 30, 2025 and 2024 below.

Previous wording

(1)There were 64 selling days for both the three months ended June 30, 2025 and 2024. There were 127 and 128 selling days for the six months ended June 30, 2025 and 2024, respectively. Average daily sales is defined as Net sales divided by the number of selling days.

Current wording

(1)There were 64 selling days for both the three months ended September 30, 2025 and 2024. There were 191 and 192 selling days for the nine months ended September 30, 2025 and 2024, respectively. Average daily sales is defined as Net sales divided by the number of selling days.

Previous wording

We finance our operations and capital expenditures with cash from operations and borrowings under our variable rate senior unsecured revolving loan facility (the “Revolving Loan Facility”). As of June 30, 2025, we had $1.2 billion of availability for borrowings under our Revolving Loan Facility. Our liquidity and borrowing plans are established to align with our financial and strategic planning processes and ensure we have the necessary funding to meet our operating commitments, which primarily include the purchase of inventory, payroll and general expenses. We also take into consideration our overall capital allocation strategy, which includes dividend payments, assessment of debt levels, acquisitions and share repurchases. We believe we have adequate sources of liquidity and funding available for at least the next year; however, there are a number of factors that may negatively impact our available sources of funds. The amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan, general economic conditions and working capital management.

Current wording

We finance our operations and capital expenditures with cash from operations and borrowings under our variable rate senior unsecured revolving loan facility (the “Revolving Loan Facility”). As of September 30, 2025, we had $1.3 billion of availability for borrowings under our Revolving Loan Facility. Our liquidity and borrowing plans are established to align with our financial and strategic planning processes and ensure we have the necessary funding to meet our operating commitments, which primarily include the purchase of inventory, payroll and general expenses. We also take into consideration our overall capital allocation strategy, which includes dividend payments, assessment of debt levels, acquisitions and share repurchases. We believe we have adequate sources of liquidity and funding available for at least the next year; however, there are a number of factors that may negatively impact our available sources of funds. The amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan, general economic conditions and working capital management.

Previous wording

During the six months ended June 30, 2025, we repurchased 2.0 million shares of our common stock for $350 million under the previously announced share repurchase program. For additional information on our share repurchase program, see “Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds.”

Current wording

During the nine months ended September 30, 2025, we repurchased 2.9 million shares of our common stock for $500 million under the previously announced share repurchase program. For additional information on our share repurchase program, see “Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds.”

Previous wording

On August 6, 2025, we announced that our Board of Directors declared a quarterly cash dividend on our common stock of $0.625 per share. The dividend will be paid on September 10, 2025 to all stockholders of record as of the close of business on August 25, 2025.

Current wording

On November 4, 2025, we announced that our Board of Directors declared a quarterly cash dividend on our common stock of $0.630 per share. The dividend will be paid on December 10, 2025 to all stockholders of record as of the close of business on November 25, 2025.

Previous wording

Net cash provided by operating activities decreased $147 million for the six months ended June 30, 2025 compared to June 30, 2024. This decrease is primarily attributable to Accounts receivable and Merchandise inventory, partially offset by Accounts payable-trade and Other. The decrease from Accounts Receivable was primarily due to higher sales activity in the first half of 2025 and timing of collections, including multi-year transactions. The decrease from Merchandise inventory is primarily due to customer-driven stocking positions as a result of higher demand. The increase from Accounts payable-trade is primarily due to higher sales activity in the first half of 2025 and timing of payments, including multi-year transactions. The increase from Other is primarily due to higher vendor receivables in 2024.

Current wording

Net cash provided by operating activities decreased $161 million for the nine months ended September 30, 2025 compared to September 30, 2024. This decrease is primarily attributable to Accounts receivable, partially offset by Merchandise inventory. The decrease from Accounts receivable was primarily due to higher sales activity in 2025 and timing of collections. The increase from Merchandise inventory is primarily due to sale of inventory on hand.

Previous wording

The cash conversion cycle decreased to 16 days at June 30, 2025, compared to 17 days at June 30, 2024. The overall decrease was driven by DPO offset by DSO. Both DPO and DSO increased due to multi-year transactions and the timing of payments and collections, respectively. If customers continue to shift their software purchases to multi-year arrangements, unbilled receivables are expected to increase, resulting in a higher DSO. This customer shift in purchasing is expected to increase accounts payable and DPO as the timing of payments due to vendors is aligned with the collections due from customers. Additionally, netted down revenue results in an increase to both DSO and DPO as the corresponding receivables and payables reflect the gross amounts due from customers and due to vendors while the corresponding sales and cost of sales are reflected on a net basis within Net sales.

Current wording

In order to manage our working capital and operating cash needs, we monitor our cash conversion cycle, defined as days of sales outstanding (DSO) in accounts receivable plus days of supply in inventory (DIO) minus days of purchases outstanding (DPO) in accounts payable, based on a rolling three-month average. Netted down revenue results in an increase to both DSO and DPO as the corresponding receivables and payables reflect the gross amounts due from customers and due to vendors while the corresponding sales and cost of sales are reflected on a net basis within Net sales. Additionally, as customers continue to shift to multi-year software purchases, unbilled receivables and DSO are expected to increase. This customer shift in purchasing is also expected to increase accounts payable and DPO, as the timing of vendor payments aligns with customer collections. Components of our cash conversion cycle are as follows:

Previous wording

(3)Represents the rolling three-month average of the combined balance of Accounts payable-trade, excluding cash overdrafts, and Accounts payable-inventory financing at the end of the period divided by average Cost of sales for the same three-month period.

Current wording

(3)Represents the rolling three-month average of the combined balance of the current portion of Accounts payable-trade, excluding cash overdrafts, and Accounts payable-inventory financing at the end of the period divided by average Cost of sales for the same three-month period.

Previous wording

Net cash provided by investing activities increased $215 million for the six months ended June 30, 2025 compared to June 30, 2024. This increase was primarily driven by the maturity of a certificate of deposit in the second quarter of 2025.

Current wording

Net cash provided by investing activities increased $430 million for the nine months ended September 30, 2025 compared to September 30, 2024. This increase was primarily driven by 2024 cash outflow to purchase a certificate of deposit and 2025 cash inflow due to maturity of the certificate of deposit.

Previous wording

Net cash used in financing activities increased $200 million for the six months ended June 30, 2025 compared to June 30, 2024. This increase was primarily driven by higher repayments on debt and share repurchases, partially offset by an increase in Net change in accounts payable-inventory financing for the six months ended June 30, 2025 compared to June 30, 2024.

Current wording

Net cash used in financing activities increased $698 million for the nine months ended September 30, 2025 compared to September 30, 2024. This increase was primarily driven by long-term debt issuance in 2024 and repayment of long-term debt in 2025, partially offset by extinguishment of long-term debt in 2024.

Previous wording

Each series of our outstanding unsecured senior notes (the “Notes”) are issued by CDW LLC and CDW Finance Corporation (the “Issuers”) and are guaranteed by Parent and certain of CDW LLC’s direct and indirect, 100% owned, domestic subsidiaries (the “Guarantor Subsidiaries” and, together with Parent, the “Guarantors”). All guarantees by Parent and the Guarantor Subsidiaries are joint and several, and full and unconditional; provided that guarantees by the Guarantor Subsidiaries are subject to certain customary release provisions contained in the indentures governing the Notes.

Current wording

Each series of our outstanding unsecured senior notes (the “Notes”) is issued by CDW LLC and CDW Finance Corporation (the “Issuers”) and is guaranteed by Parent and certain of CDW LLC’s direct and indirect, 100% owned, domestic subsidiaries (the “Guarantor Subsidiaries” and, together with Parent, the “Guarantors”). All guarantees by Parent and the Guarantor Subsidiaries are joint and several, and full and unconditional; provided that guarantees by the Guarantor Subsidiaries are subject to certain customary release provisions contained in the indentures governing the Notes.

Previous wording

The following tables set forth Balance Sheet information as of June 30, 2025 and December 31, 2024, and Statement of Operations information for the six months ended June 30, 2025 and for the year ended December 31, 2024. The financial information includes the accounts of the Issuers and the accounts of the Guarantors (the “Obligor Group”). The financial information of the Obligor Group is presented on a combined basis and the intercompany balances and transactions between the Obligor Group have been eliminated.

Current wording

The following tables set forth Balance Sheet information as of September 30, 2025 and December 31, 2024, and Statement of Operations information for the nine months ended September 30, 2025 and for the year ended December 31, 2024. The financial information includes the accounts of the Issuers and the accounts of the Guarantors (the “Obligor Group”). The financial information of the Obligor Group is presented on a combined basis and the intercompany balances and transactions between the Obligor Group have been eliminated.

Previous wording

Important factors that could cause actual results or events to differ materially from our expectations, or cautionary statements, are disclosed under the section entitled “Trends and Key Factors Affecting our Financial Performance” above, the section entitled “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2024 and from time to time in our subsequent Quarterly Reports on Form 10-Q and our other US Securities and Exchange Commission (“SEC”) filings and public communications. These factors include, among others, inflationary pressures; level of interest rates; CDW’s relationships with vendor partners, wholesale distributors and terms of their agreements; continued innovations in technology by CDW’s vendor partners; the use or capabilities of artificial intelligence; substantial competition that could reduce CDW’s market share; the continuing development, maintenance and operation of CDW’s information technology systems; potential breaches of data security and failure to protect our information technology systems from cybersecurity threats; potential failures to provide high-quality services to CDW’s customers; potential losses of any key personnel, significant increases in labor costs or ineffective workforce management; potential service failures or disruptions related to outsourcing arrangements with certain of CDW’s business processes; potential adverse occurrences at one of CDW’s primary facilities or third-party data centers, including as a result of climate change; increases in the cost of commercial delivery services or disruptions of those services; CDW’s exposure to accounts receivable and inventory risks; future acquisitions or alliances; fluctuations in CDW’s operating results; fluctuations in foreign currency; global and regional economic and political conditions, including the impact of pandemics and armed conflicts; decreases, delays or changes in spending on technology products and services, including impacts of adverse changes in government spending and funding policies and federal procurement policies; potential interruptions of the flow of products from suppliers including uncertainty over global trade policies and the financial impact of related tariffs; potential failures to comply with Public segment contracts or applicable laws and regulations; current and future legal proceedings, investigations and audits, including intellectual property infringement claims; changes in laws, including regulations or interpretations thereof, and including evolving laws and regulations and regulatory overhaul during any changes in federal administration, or the potential failure to meet stakeholder expectations on environmental sustainability and corporate responsibility matters; CDW’s level of indebtedness; restrictions imposed by agreements relating to CDW’s indebtedness on its operations and liquidity; failure to maintain the ratings assigned to CDW’s debt securities by rating agencies; changes in, …

Excerpt shortened here; the source contains the full paragraph.

Current wording

Important factors that could cause actual results or events to differ materially from our expectations, or cautionary statements, are disclosed under the section entitled “Trends and Key Factors Affecting our Financial Performance” above, the section entitled “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2024 and from time to time in our subsequent Quarterly Reports on Form 10-Q and our other US Securities and Exchange Commission (“SEC”) filings and public communications. These factors include, among others: