Key Highlights

• Q3 2026 net sales reached $6,754.5 million, a 17.7% increase from $5,737.4 million in Q3 2025.

• Non-GAAP Net Income per diluted share grew 20.4% year-over-year to $3.26, compared to $2.71 in the prior-year quarter.

• Commercial segment net sales increased 20.8%, led by a 73.2% surge in Financial Services customer sales.

• The company declared a quarterly Cash Dividend of $0.680 per common share, payable on December 10, 2026.

CDW Corporation(NASDAQ:CDW), one of the largest multi-brand technology solutions providers in the United States, reported third quarter 2026 results on November 4, 2026, with net sales of $6,754.5 million. This marked a 17.7% increase from the $5,737.4 million reported in the same quarter a year earlier, driven primarily by Demand in data storage, servers, notebooks and mobile devices, and software categories.

Revenue Performance Across Segments

The Commercial segment led the Revenue performance with net sales of $3,979 million, 20.8% higher than the prior year. Within Commercial, Financial Services customer net sales surged 73.2%, while Corporate customer sales increased 16.8% and Healthcare customer sales rose 9.3%. The Government segment contributed $913 million in net sales, up 9.9% year-over-year, while the Education segment posted $982 million, an increase of 7.5%.

CDW's international operations in the UK and Canada, reported as the "Other" segment, generated $880 million in net sales, representing a 26.0% increase from the prior year. On a constant currency basis, total net sales grew 17.8% in the quarter.

Profitability and Margins

Gross profit for the quarter was $1,385.3 million, a 10.3% increase from $1,255.5 million in Q3 2025. However, Gross Profit Margin declined to 20.5% from 21.9% in the year-ago period, which the company attributed to product mix shifting toward certain lower-margin categories.

Operating income on a GAAP basis was $489.5 million, up 10.4% from $443.3 million a year earlier. Non-GAAP Operating Income reached $619.8 million, reflecting 16.8% growth, with non-GAAP Operating Margin holding steady at 9.2% year-over-year. Selling and administrative expenses rose 10.3% to $896 million, driven by higher performance-based incentives, workplace optimization costs, and acquisition-related expenses.

Net income increased 6.5% to $309.8 million, or $2.46 per diluted share, compared to $291.0 million, or $2.21 per diluted share, in Q3 2025. On a non-GAAP basis, net income grew 14.8% to $410.2 million, or $3.26 per diluted share, up from $357.2 million, or $2.71 per diluted share, in the prior-year period. The effective income tax rate increased to 26.9% from 25.3%, driven by lower tax credits and higher non-deductible expenses.

Capital Returns and Financial Position

CDW's Board of Directors approved a quarterly cash dividend of $0.680 per common share, payable on December 10, 2026, to shareholders of record as of November 25, 2026. Weighted-average diluted shares outstanding declined to 126 million from 132 million in Q3 2025, reflecting the company's ongoing share repurchase activity.

Interest expense, net, increased 19.8% to $66 million in the quarter, primarily due to higher average borrowings under the company's senior unsecured revolving Loan Facility and lower interest income on cash balances.

What It All Means

CDW's Q3 2026 results reflect a period of elevated demand for enterprise IT solutions, particularly in data infrastructure and AI-related deployments. The 17.7% top-line growth rate was broad-based across all customer segments and geographies, though the compression in gross margin to 20.5% from 21.9% indicates that the product mix is shifting as customers invest heavily in infrastructure hardware. Non-GAAP Earnings Per Share growth of 20.4% benefited from both operational performance and a reduced share count. The company has previously stated its aim to outpace U.S. IT addressable market growth by 200 to 300 basis points on a constant currency basis.