CDW Corporation CDW reported first-quarter 2025 non-GAAP earnings per share (EPS) of $2.15, beating the Zacks Consensus Estimate of $1.96. Also, the bottom line increased approximately 12% year over year.

The company’s revenues grew 6.7% year over year to $5.199 billion. The increase in net sales was primarily driven by strong customer demand for notebooks, mobile devices, desktops, software and services. This was partially offset by a decline in several hardware categories. Robust momentum across its Corporate, Small Business, Public and International (the U.K. & Canada) business segments backed the top-line growth. Quarterly revenues also surpassed the consensus mark of $4.89 billion.

CDW Corporation Price, Consensus and EPS SurpriseCDW Corporation Price, Consensus and EPS Surprise

CDW Corporation price-consensus-eps-surprise-chart | CDW Corporation Quote

CDW began 2025 on a strong note, with the team effectively helping customers navigate a dynamic market and achieve critical goals. Management highlighted that the quarter’s performance reflects the strength of CDW’s balanced customer base and comprehensive product and solutions portfolio, supported by a customer-centric approach.

Separately, the company announced a quarterly dividend of 62.5 cents, which will be paid on June 10, 2025, to shareholders on record as of May 26.

In response to the results, CDW’s shares went up 2% in pre-market trading on May 7. In the past year, shares have declined 25.6% against the Zacks Computers-IT Services industry’s growth of 4.2%. (See the Zacks Earnings Calendar to stay ahead of market-making news.)Zacks Investment Research

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Segmental Details

Net sales of CDW’s Corporate segment amounted to $2.236 billion, increasing 6.3% on a year-over-year basis.

The Small Business segment’s net sales of $405 million rose 7.9% year over year.

The Public segment’s revenues totaled $1.878 billion, representing 10.6% growth from the year-ago quarter. The uptick was driven by a 19.5% and 11.1% surge in net sales of Healthcare customers and Education customers, respectively.

Net sales in Other (Canadian and U.K. operations) rose 9.5% to $680 million.

Margin Details

CDW’s gross profit of $1.122 billion jumped 5.5% on a year-over-year basis. Gross profit margin decreased slightly from 21.8% to 21.6% due to a higher mix of lower margin products (like notebook and mobile sales), partially offset by increased contributions from netted-down revenue within software as a service.

Non-GAAP operating income increased 10% year over year to $444 million. The non-GAAP operating margin rose to 8.5% from 8.3%.

Story Continues

Selling and administrative expenses increased 3.5% year over year to $761 million. The increase was mainly driven by lower performance-based compensation adjustments, transformation-related costs and amortization of acquisition-related intangibles, with some offset from lower coworker-related expenses.

Balance Sheet and Cash Flow

As of March 31, 2025, CDW had $471.4 million of cash and cash equivalents compared with $503.5 million as of Dec. 31, 2024.

The company had a long-term debt of $5.622 billion compared with $5.607 billion as of Dec. 31, 2024.

For the three months ended on March 31, 2025, CDW generated $287.2 million of cash flow from operating activities compared with $440 million in the year-ago period.

CDW’s Zacks Rank

CDW currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Companies in the Broader Space

Infosys INFY ended fiscal 2025 on a mixed note, with its fourth-quarter earnings surpassing the Zacks Consensus Estimate while revenues fell short of the same. For the quarter, the company reported earnings of 20 cents per share, beating the consensus mark by a penny. However, Infosys’ bottom line registered a year-over-year decline of 15.3%.

In the past year, shares of INFY have gained 3.9%.

Microsoft MSFT reported third-quarter fiscal 2025 earnings of $3.46 per share, which beat the Zacks Consensus Estimate by 8.13% and increased 17.7% on a year-over-year basis. Revenues of $70.06 billion jumped 13.3% year over year and beat the Zacks Consensus Estimate by 2.46%.

In the past six months, shares of MSFT have inched up 2.6%.

ServiceNow NOW reported first-quarter 2025 adjusted earnings of $4.04 per share, which beat the Zacks Consensus Estimate by 6.60% and increased 18.5% year over year. NOW’s revenues of $3.09 billion surpassed the consensus mark by 0.18% and increased 18.6% year over year.

Shares of NOW have soared 33.9% in the past year.

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