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What changed in CDW Corporation's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CDW Corporation's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+255 added−253 removedSource: 10-K (2026-02-20) vs 10-K (2025-02-21)

Top changes in CDW Corporation's 2025 10-K

255 paragraphs added · 253 removed · 211 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe our customers increasingly view technology purchases as integrated solutions vital to their strategies, business outcomes and missions rather than discrete product and services categories. Our hardware category includes notebooks/mobile devices (including tablets), network communications (“netcomm products”), collaboration hardware, data storage and servers, desktop computers and other hardware.
Biggest changeRisk Factors.” Our Offerings Our offerings range from discrete hardware and software products and services to complex integrated solutions including one or more of these elements. We believe our customers increasingly view technology purchases as integrated solutions vital to their strategies, business outcomes, and missions rather than discrete product and services categories.
Our migration, integration and managed services help our customers simplify cloud adoption and management, across the entire IT lifecycle. Engineers work with our customers to design cloud solutions meeting their organizational, technology and financial objectives.
Our migration, integration, and managed services help our customers simplify cloud adoption and management, across the entire IT lifecycle. Our engineers work with our customers to design cloud solutions meeting their organizational, technology, and financial objectives.
Partners We offer more than 100,000 products and services from more than 1,000 vendor partners, including well-established companies such as Adobe, APC, Apple, Amazon Web Services, Broadcom Inc., Cisco, Dell Technologies, Google, Hewlett Packard Enterprise, HP Inc., IBM, Intel, Lenovo, Microsoft, NetApp, Nutanix, Palo Alto Networks, Pure Storage and Samsung, as well as from emerging technology companies.
Partners We offer more than 100,000 products and services from more than 1,000 vendor partners, including well-established companies such as Adobe, APC, Apple, Amazon Web Services, Broadcom Inc., Cisco, Dell Technologies, Google, Hewlett Packard Enterprise, HP Inc., IBM, Intel, Lenovo, Microsoft, NetApp, Nutanix, Nvidia, Palo Alto Networks, Pure Storage, and Samsung, as well as from emerging technology companies.
Item 1. Business Our Company CDW Corporation (together with its subsidiaries, the “Company,” “CDW” or “we”), a Fortune 500 company and member of the S&P 500 Index, is a leading multi-brand provider of information technology (“IT”) solutions to business, government, education and healthcare customers in the United States (“US”), the United Kingdom (“UK”) and Canada.
Item 1. Business Our Company CDW Corporation (together with its subsidiaries, the “Company,” “CDW”, “we”, “us”, or “our”), a Fortune 500 company and member of the S&P 500 Index, is a leading multi-brand provider of information technology (“IT”) solutions to business, government, education, and healthcare customers in the United States (“US”), the United Kingdom (“UK”), and Canada.
We believe that demand for IT will outpace general economic growth in the markets we serve, fueled by new technologies, including hybrid and cloud computing and artificial intelligence, as well as growing end-user demand for security, efficiency and productivity.
We believe that demand for IT will outpace general economic growth in the markets we serve, fueled by new technologies, including hybrid and cloud computing and artificial intelligence (“AI”), as well as growing end-user demand for security, efficiency, and productivity.
In addition to purchasing products directly from our vendor partners, we purchase products from wholesale distributors for resale to our customers or for inclusion in the solutions we offer. These wholesale distributors provide logistics management and supply-chain services for us, as well as for our vendor partners.
In addition to purchasing products and certain services directly from our vendor partners, we purchase products and certain services from wholesale distributors for resale to our customers or for inclusion in the solutions we offer. These wholesale distributors provide logistics management and supply-chain services for us, as well as for our vendor partners.
We offer a broad portfolio of integrated solutions that include the following on-premise, hybrid and cloud capabilities: • Hybrid Infrastructure : We assess our customers application infrastructure need, design flexible, resilient and efficient solutions and manage the solution throughout its lifecycle.
We offer a broad portfolio of integrated IT solutions that include the following on-premise, hybrid, and cloud capabilities: • Hybrid Infrastructure : We assess our customers application infrastructure need, design flexible, resilient, and efficient solutions and manage the solution throughout its lifecycle.
Our solutions are delivered in physical, virtual and cloud-based environments through approximately 10,900 customer-facing coworkers, including sellers, highly-skilled specialists and engineers. We are a leading sales channel partner for many original equipment manufacturers (“OEMs”), software publishers, cloud providers (collectively, our “vendor partners”) and wholesale distributors, whose products we sell or include in the solutions we offer.
Our solutions are delivered in physical, virtual, and cloud-based environments through approximately 10,500 customer-facing coworkers, including sellers, highly-skilled specialists, and engineers. We are a leading sales channel partner for many original equipment manufacturers (“OEMs”), software publishers, and cloud providers (collectively, our “vendor partners”) and wholesale distributors, whose products we sell or include in the solutions we offer.
These programs are supported by integrated communication efforts targeting technology decision-makers, influencers and the general public using a combination of expert technology articles, videos, case studies, media interviews and speaking events. 8 Table of Contents As a result of our relationships with vendor partners, a significant portion of our advertising and marketing expenses is reimbursed through cooperative advertising programs.
These programs are supported by integrated communication efforts targeting technology decision-makers, influencers, and the general public using a combination of expert technology articles, videos, case studies, media interviews, and speaking events. 9 Table of Contents As a result of our relationships with vendor partners, a significant portion of our advertising and marketing expenses is reimbursed through cooperative advertising programs.
We provide a comprehensive benefits package to our coworkers, including healthcare, retirement plans with profit sharing and match, tuition assistance, parental leave policies, adoption assistance, paid time off, paid volunteer hours and philanthropic match programs based upon eligibility and location. Health and Safety We are committed to prioritizing the health and well-being of our coworkers.
We provide a comprehensive benefits package to our coworkers based on eligibility and location including healthcare, retirement plans with profit sharing and match, tuition assistance, parental leave policies, adoption assistance, paid time off, paid volunteer hours, and philanthropic match programs. Health and Safety We are committed to prioritizing the health and well-being of our coworkers.
(2) Includes items such as delivery charges to customers. 7 Table of Contents Our Internal Capabilities Human Capital Management Our long-standing values and philosophies of success are based on fostering a welcoming, respectful, accountable and fair culture where coworkers have the opportunity to thrive.
(2) Includes items such as delivery charges to customers. 8 Table of Contents Our Internal Capabilities Human Capital Management Our long-standing values and philosophies of success are based on fostering a welcoming, respectful, accountable, and fair culture where coworkers have the opportunity to thrive.
Inventory Management We operate two distribution centers in North America and one distribution center in the UK, which combined provide more than 1 million square feet in size. Leveraging our distribution and logistics capabilities, we handle and ship approximately 26 million units annually on an aggregate basis from our distribution centers.
Inventory Management We operate two distribution centers in North America and one distribution center in the UK, which combined provide more than 1 million square feet in size. Leveraging our distribution and logistics capabilities, we handle and ship approximately 22 million units annually on an aggregate basis from our distribution centers.
Our value proposition to our customers Our value proposition to our vendor partners ● Broad selection of products and multi-branded IT solutions ● Access to over 250,000 customers ● Value-added services with integration capabilities ● Large and established customer channels ● Highly-skilled specialists and engineers ● Strong distribution and implementation capabilities ● Solutions across IT lifecycle ● Customer relationships driving insight into technology roadmaps Customers We provide integrated IT solutions to over 250,000 business, government, education and healthcare customers throughout the US, UK and Canada.
Our value proposition to our customers Our value proposition to our vendor partners ● Broad selection of products and multi-branded IT solutions ● Access to over 250,000 customers ● Value-added services with integration capabilities ● Large and established customer channels ● Highly-skilled specialists and engineers ● Strong distribution and implementation capabilities ● Solutions across IT lifecycle ● Customer relationships driving insight into technology roadmaps ● Industry vertical expertise ● Industry vertical expertise Customers We provide integrated IT solutions to over 250,000 business, government, education, and healthcare customers throughout the US, UK, and Canada.
Our customer solutions can take the form of hardware, software or Software as a Service across a multitude of categories such as: endpoint security, email security, web security, intrusion prevention, identity and access 6 Table of Contents management, next-generation firewall, security service edge, security information and event management, exposure and threat management, governance, risk and compliance, data security and governance, cloud infrastructure entitlement management, virtual private network services, network access control and physical security.
Our customer solutions can take the form of hardware, software, or Software as a Service across a multitude of categories such as: endpoint security, email security, web security, intrusion prevention, identity and access management, next-generation firewall, security service edge, security information and event management, exposure and threat management, governance, risk and compliance, data security and governance, cloud infrastructure entitlement management, virtual private network services, network access control, and physical security.
Security consulting engagements include security maturity assessments, policy and procedure gap analysis, security roadmaps and health checks. • Digital Velocity: We deliver advanced digital transformation solutions that enable organizations to modernize their IT infrastructure, applications and operations. Leveraging expertise in cloud-native deployment, DevOps, artificial intelligence and automation, we help customers improve business outcomes through scalable and secure technology implementations.
Security consulting engagements include security maturity assessments, policy and procedure gap analysis, security roadmaps, and health checks. • Digital Velocity: We deliver advanced digital transformation solutions that enable organizations to modernize their IT infrastructure, applications, and operations. Leveraging expertise in cloud-native deployment, DevOps, AI, and automation, we help customers improve business outcomes through scalable and secure technology implementations.
We connect our customers’ physical devices, including laptops, desktops, IP Phones, mobile devices and print systems. We utilize collaboration solutions to unite applications via the integration of products that facilitate the use of multiple enterprise communication methods including email, persistent chat, social media, voice and video. We also host cloud-based collaboration solutions.
We connect our customers’ physical devices, including laptops, desktops, IP Phones, mobile devices, and print systems. We utilize collaboration solutions to unite applications via the integration of products that facilitate the use of multiple enterprise communication methods including email, persistent 7 Table of Contents chat, social media, voice, and video. We also host cloud-based collaboration solutions.
We also have two other operating segments: CDW UK and CDW Canada, each of which do not meet the reportable segment quantitative thresholds and, accordingly, are included in an all other category (“Other”). 4 Table of Contents In our US business, which represents approximately 90% of our Net sales, we currently have five dedicated customer channels: corporate, small business, government, education and healthcare, each of which generated $1.5 billion or greater in Net sales in 2024.
We also have two other operating segments: CDW UK and CDW Canada, each of which do not meet the reportable segment quantitative thresholds and, accordingly, are included in an all other category (“Other”). 5 Table of Contents In our US business, which represents approximately 90% of our Net sales, we currently have five dedicated customer channels: corporate, small business, government, education, and healthcare, each of which generated $1.7 billion or greater in Net sales in 2025.
Product Procurement We may purchase all or only some of the products our vendor partners offer for resale to our customers or for inclusion in the solutions we offer.
Product Procurement We may purchase all or only some of the products and services our vendor partners offer for resale to our customers or for inclusion in the solutions we offer.
We believe competitive sources of supply are available in substantially all of the product categories that we offer. Competition The market for technology products, solutions and services is highly competitive and subject to economic conditions and rapid technological changes.
We believe competitive sources of supply are available in substantially all of the product categories that we offer. 6 Table of Contents Competition The market for technology products, solutions, and services is highly competitive and subject to economic conditions and rapid technological changes.
Net sales to customers in the UK and Canada combined generated $2.5 billion in 2024. We believe this diversity of customer end-markets provides us with multiple avenues for growth and has been a key factor in our ability to weather economic and technology cycles and gain market share.
Net sales to customers in the UK and Canada combined generated $2.7 billion in 2025. We believe this diversity of customer end-markets provides us with multiple avenues for growth and has been a key factor in our ability to weather economic and technology cycles and gain market share.
We expect the competitive landscape to continue to evolve as new technologies and consumption models emerge, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions and solutions that incorporate artificial intelligence.
We expect the competitive landscape to continue to evolve as new technologies and consumption models emerge, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions, and solutions that incorporate AI.
We also have drop-shipment arrangements with many of our OEMs and wholesale distributors, which permit us to offer products to our customers without having to take physical delivery at our distribution centers. These arrangements represented approximately 54% of total North America Net sales in 2024.
We also have drop-shipment arrangements with many of our OEMs and wholesale distributors, which permit us to offer products to our customers without having to take physical delivery at our distribution centers. These arrangements represented approximately 51% of total North America Net sales in 2025.
Our website and the information contained on that site, or connected to that site, are not incorporated into and are not a part of this report. Information about our Executive Officers The following table lists the name, age as of February 21, 2025 and positions of each executive officer of the Company. Name Age Position Christine A.
Our website and the information contained on that site, or connected to that site, are not incorporated into and are not a part of this report. Information about our Executive Officers The following table lists the name, age as of February 20, 2026, and positions of each executive officer of the Company. Name Age Position Christine A.
Leahy 60 Chair of our Board of Directors since January 2023; President and Chief Executive Officer and member of our Board of Directors since January 2019; Chief Revenue Officer from July 2017 to December 2018.
Leahy 61 Chair of our Board of Directors since January 2023; President and Chief Executive Officer and member of our Board of Directors since January 2019; Chief Revenue Officer from July 2017 to December 2018. Elizabeth H.
Connelly 59 Chief Commercial Officer since October 2024; Senior Vice President, Vertical Markets, from January 2024 to October 2024; Senior Vice President, Healthcare from September 2022 to December 2023; Chief Human Resources Officer and Senior Vice President, Coworker Services from December 2018 to September 2022. Frederick J.
Connelly 60 Chief Commercial Officer and Executive Vice President since March 2025; Chief Commercial Officer from October 2024 to March 2025; Senior Vice President, Vertical Markets, from January 2024 to October 2024; Senior Vice President, Healthcare from September 2022 to December 2023; Chief Human Resources Officer and Senior Vice President, Coworker Services from December 2018 to September 2022. Frederick J.
In 2024, we generated $2.0 billion of Net sales from each of our three largest vendor partners.
In 2025, we generated over $2.0 billion of Net sales from each of our three largest vendor partners.
This culture, along with strong training and development, competitive compensation and opportunities for meaningful careers, drives business results and competitive advantage. We have approximately 15,100 coworkers across the globe, with 11,500 coworkers in the US and 3,600 coworkers in international locations.
This culture, along with strong training and development, competitive compensation, and opportunities for meaningful careers, drives business results and competitive advantage. We have approximately 14,800 coworkers across the globe, with 11,200 coworkers in the US and 3,600 coworkers in international locations.
Katherine E. Sanderson 49 Senior Vice President, Coworker Success and Chief Human Resources Officer since September 2024; Executive Vice President and Chief Human Resources Officer, R1 RCM (a healthcare technology and services company) from November 2018 to September 2024. 9 Table of Contents
Katherine E. Sanderson 50 Chief Human Resources Officer and Executive Vice President, Coworker Success since March 2025; Senior Vice President, Coworker Success and Chief Human Resources Officer from September 2024 to March 2025; Executive Vice President and Chief Human Resources Officer, R1 RCM (a healthcare technology and services company) from November 2018 to September 2024. 10 Table of Contents
Value Proposition We are positioned in the middle of the IT ecosystem where we procure products from OEMs, software publishers, cloud providers and wholesale distributors and provide added value to our customers by helping them navigate through complex options and implement the best solution for their business.
Value Proposition We are positioned in the middle of the IT ecosystem where we procure products from vendor partners and wholesale distributors and provide added value to our customers by helping them navigate through complex options and implement the best solution for their business.
Our programs include, but are not limited to leadership development trainings, unique developmental opportunities for our high-potential emerging leaders, a robust training program for new sales coworkers, technical skill development training, a 12-month apprentice-style program for aspiring engineers and coworker access to over 20,000 on-demand educational modules with new content updated frequently.
Our programs include, but are not limited to leadership development trainings, unique developmental opportunities for our high-potential emerging leaders, a robust training program for new sales coworkers, technical skill development training, AI proficiency and training resources, and coworker access to over 20,000 on-demand educational modules with new content updated frequently.
We enable our customers with artificial intelligence (“AI”) solutions that empower their end users and drive efficiency in business-critical functions.
We enable our customers with AI solutions that empower their end users and drive efficiency in business-critical functions.
Our Board understands the importance of our respectful, performance-driven culture to our ongoing success and is actively engaged with our Chair and Chief Executive Officer and our Chief Human Resources Officer across a broad range of human capital management topics.
The Board of Directors of CDW (the “Board” or “Board of Directors”) understands the importance of our respectful, performance-driven culture to our ongoing success and is actively engaged with our Chair, President, and Chief Executive Officer and our Chief Human Resources Officer across a broad range of human capital management topics.
Miralles 55 Chief Financial Officer and Senior Vice President, Enterprise Business Operations since January 2025; Senior Vice President and Chief Financial Officer from September 2021 to January 2025; Executive Vice President and Chief Financial Officer, CNA Financial Corporation (a commercial property and casualty insurance company) from February 2020 to September 2021; President, CNA Warranty from October 2019 to September 2021; Executive Vice President and Chief Risk Officer of the CNA Insurance Companies from January 2018 to October 2019.
Miralles 56 Chief Financial Officer and Executive Vice President, Enterprise Business Operations since March 2025; Chief Financial Officer and Senior Vice President, Enterprise Business Operations from January 2025 to March 2025; Senior Vice President and Chief Financial Officer from September 2021 to January 2025; Executive Vice President and Chief Financial Officer, CNA Financial Corporation (a commercial property and casualty insurance company) from February 2020 to September 2021; President, CNA Warranty from October 2019 to September 2021.
We serve our customers through sales teams focused on customer end-markets that are supported by highly-skilled specialists and engineers. Our market segmentation allows us to customize our offerings and to provide enhanced expertise in designing and implementing IT solutions that meet our customer’s specific needs. We have three reportable segments: Corporate, Small Business and Public.
We serve our customers through sales teams focused on customer end-markets that are supported by highly-skilled specialists and engineers. Our market segmentation allows us to customize our offerings and to provide enhanced expertise in designing and implementing IT solutions that meet our customers’ specific needs.
Although we believe customers increasingly view technology purchases as solutions rather than discrete product and service categories, our Net sales by major category, based upon our internal category classifications, was as follows: Year Ended December 31, 2024 2023 2022 (dollars in millions) Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Hardware: Notebooks/Mobile Devices $ 5,089.9 24.2 % $ 4,690.5 21.9 % $ 6,179.7 26.0 % Netcomm Products 2,538.2 12.1 3,185.4 14.9 2,729.7 11.5 Collaboration 1,770.6 8.4 1,909.7 8.9 2,394.8 10.1 Data Storage and Servers 2,133.8 10.2 2,240.7 10.5 2,479.0 10.4 Desktops 1,111.2 5.3 1,069.1 5.0 1,284.9 5.4 Other Hardware 2,575.4 12.3 2,607.2 12.3 3,022.9 12.7 Total Hardware 15,219.1 72.5 15,702.6 73.5 18,091.0 76.1 Software (1) 3,804.4 18.1 3,799.3 17.8 3,684.9 15.5 Services (1) 1,867.3 8.9 1,761.3 8.2 1,842.0 7.8 Other (2) 107.9 0.5 112.8 0.5 130.8 0.6 Total Net sales $ 20,998.7 100.0 % $ 21,376.0 100.0 % $ 23,748.7 100.0 % (1) Certain software and services revenue is recorded on a net basis for accounting purposes.
Although we believe customers increasingly view technology purchases as solutions rather than discrete product and service categories, our Net sales by major category, based upon our internal category classifications, was as follows: Year Ended December 31, 2025 2024 2023 (dollars in millions) Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Hardware: Notebooks/Mobile Devices $ 5,638.0 25.1 % $ 5,089.9 24.2 % $ 4,690.5 21.9 % Netcomm Products 2,687.3 12.0 2,538.2 12.1 3,185.4 14.9 Collaboration 1,757.8 7.8 1,770.6 8.4 1,909.7 8.9 Data Storage and Servers 2,151.9 9.6 2,133.8 10.2 2,240.7 10.5 Desktops 1,332.8 5.9 1,111.2 5.3 1,069.1 5.0 Other Hardware 2,502.8 11.2 2,575.4 12.3 2,607.2 12.3 Total Hardware 16,070.6 71.6 15,219.1 72.5 15,702.6 73.5 Software (1) 4,203.0 18.7 3,804.4 18.1 3,799.3 17.8 Services (1) 2,035.7 9.1 1,867.3 8.9 1,761.3 8.2 Other (2) 114.8 0.6 107.9 0.5 112.8 0.5 Total Net sales $ 22,424.1 100.0 % $ 20,998.7 100.0 % $ 21,376.0 100.0 % (1) Certain software and services revenue is recorded on a net basis for accounting purposes.
Our Corporate segment primarily serves US private sector business customers with more than 250 employees. Our Small Business segment primarily serves US private sector business customers with up to 250 employees. Our Public segment is comprised of government agencies and education and healthcare institutions in the US.
We have three reportable segments: “Corporate,” “Small Business,” and “Public.” Our Corporate segment primarily serves US private sector business customers with more than 250 employees. Our Small Business segment primarily serves US private sector business customers with up to 250 employees. Our Public segment is comprised of government agencies and education and healthcare institutions in the US.
We focus on providing high quality service to gain new customers and retain existing customers. We have built a strong sales organization and deep services and solutions capabilities over time and expect to continue to invest to enhance these capabilities.
We believe we have sustainable, competitive advantages that differentiate us in the marketplace. We focus on providing high-quality service to gain new customers and retain existing customers. We have built a strong sales organization and deep services and solutions capabilities over time and expect to continue to invest to enhance these capabilities.
To help our customers accomplish this, we have built a robust portfolio of solutions across hybrid infrastructure, digital experience, security, digital velocity and services that we provide in on-premise, hybrid or cloud-based environments.
IT is important to both business operations and to drive greater growth and productivity. To help our customers accomplish this, we have built a robust portfolio of integrated IT solutions across hybrid infrastructure, digital experience, security, digital velocity, and services that we provide in on-premise, hybrid, or cloud-based environments.
Our coworker engagement strategy utilizes periodic surveys as well as virtual listening groups to gain a real-time understanding of the coworker experience at CDW. As a result of our coworkers’ consistent engagement, we have garnered meaningful feedback and recommendations, which have led to measurable and impactful results.
Our coworker engagement strategy utilizes regular pulse surveys to gain a real-time insights of the coworker experience at CDW and enable faster action. As a result of our coworkers’ consistent engagement, we have garnered meaningful feedback and recommendations, which have led to measurable and impactful results.
While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For additional information on the risks associated with competition, see “Item 1A. Risk Factors.” We believe we have sustainable competitive advantages that differentiate us in the marketplace.
While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For additional information on the risks associated with competition, see “Item 1A.
Kulevich 59 Senior Vice President, General Counsel and Corporate Secretary since October 2017 and Interim Chief People Officer from November 2023 to September 2024. Albert J.
Kulevich 60 Chief Legal Officer, Executive Vice President, Risk and Compliance, and Corporate Secretary since March 2025; Senior Vice President, General Counsel and Corporate Secretary from October 2017 to March 2025; Interim Chief People Officer from November 2023 to September 2024.
We face competition from resellers, manufacturers who sell directly to customers, large service providers and system integrators, cloud providers, e-commerce companies, and office supply retailers, among others.
We face competition from resellers, manufacturers who sell directly to customers, large service providers and system integrators, cloud providers, hyperscaler marketplaces, e-commerce companies, and office supply retailers, among others. We also face competition from smaller, local, or regional value-added resellers that typically focus on a single solution suite or portfolio of solutions from one or two vendor partners.
Our software category includes cloud solutions, software assurance, application suites, security, virtualization, collaboration and productivity applications, operating systems and network management. Our services include advisory and design, software development, implementation, managed services and warranties. IT is important to both critical business operations and to drive greater growth and productivity.
Our hardware category includes notebooks/mobile devices (including tablets), network communications (“netcomm products”), collaboration hardware, data storage and servers, desktop computers, and other hardware. Our software category includes cloud solutions, software assurance, application suites, security, virtualization, collaboration, and productivity applications, operating systems, and network management. Our services include advisory and design, software development, implementation, managed services, and warranties.
We have cross-border relationships that enable us to serve the needs of our US, UK and Canadian-based customers in approximately 150 countries. Our strong, execution-oriented culture is underpinned by our compensation system. Our Offerings Our offerings range from discrete hardware and software products and services to complex integrated solutions including one or more of these elements.
We have cross-border relationships that enable us to serve the needs of our US, UK, and Canadian-based customers in approximately 150 countries. Our strong, execution-oriented culture is underpinned by our competitive compensation program. We believe we are well positioned to compete within this marketplace due to our competitive advantages.
We are in the process of implementing a new enterprise resource planning (“ERP”) system, along with other system transformation initiatives, that will enable us to streamline processes and enhance visibility in our key business processes. The significant system transformation initiatives, including ERP, are anticipated to be released in 2025 with incremental system transformation releases continuing in 2026.
In 2025, we implemented a new enterprise resource planning (“ERP”) system, along with the execution of other system transformation initiatives, that is resulting in more streamlined and efficient processes. We expect to continue advancing these initiatives through incremental releases in 2026. Available Information We maintain a website at www.cdw.com.
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Smaller, local or regional value-added resellers typically focus on a single solution suite or portfolio of solutions from one or two vendor partners. 5 Table of Contents We believe we are well positioned to compete within this marketplace due to our competitive advantages.
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Effective January 1, 2026, we realigned our customer-facing organization to better meet the evolving needs of our customers and end markets.
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Available Information We maintain a website at www.cdw.com.
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As a result, we will have the following three reportable segments: “Commercial,” “Government,” and “Education.” Our “Commercial” segment will be comprised of corporate, financial services, and healthcare customers in the US, each of which will represent a unique customer channel. Small business customers will be included across the customer channels within our “Commercial” segment.
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Sona Chawla 57 Chief Growth and Innovation Officer since January 2020; President, Kohl’s Corporation (an omnichannel retailer) from May 2018 to October 2019 and Chief Operating Officer, Kohl’s Corporation from November 2015 to May 2018. Elizabeth H.
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Our “Government” segment will be comprised of federal, state, and local agencies in the US. The “Education” segment will be comprised of primary, secondary, and higher education institutions in the US. CDW UK and CDW Canada will remain unchanged in this new reporting structure, in an all other category (“Other”).
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We will reflect this change in segment presentation, including the recasting of historical results, in our periodic and annual reports beginning with the period ending March 31, 2026.
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Mukesh Kumar 50 Chief Services and Solutions Officer and Executive Vice President since August 2025; President, Slalom Consulting (a technology consulting company) from October 2005 to July 2025. Albert J.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

76 edited+18 added−25 removed77 unchanged
Biggest changeOur level of indebtedness could have important consequences, including the following: • making it more difficult for us to satisfy our obligations with respect to our indebtedness; • requiring us to dedicate a substantial portion of our cash flow from operations to debt service payments on our and our subsidiaries’ debt, which reduces the funds available for working capital, capital expenditures, acquisitions and other general corporate purposes; • requiring us to comply with restrictive covenants in our senior credit facilities and indentures, which limit the manner in which we conduct our business; • making it more difficult for us to obtain financing from our vendor partners, including original equipment manufacturers, software publishers and cloud providers, and our wholesale distributors; • limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; • placing us at a competitive disadvantage compared to any of our less-leveraged competitors; • increasing our vulnerability to both general and industry-specific adverse economic conditions; and • limiting our ability to obtain additional debt or equity financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements and increasing our cost of borrowing.
Biggest changeOur indebtedness could have important consequences, including the following: • requiring us to dedicate a substantial portion of our cash flow from operations to debt service payments on our and our subsidiaries’ debt, which reduces the funds available for working capital, capital expenditures, acquisitions, and other general corporate purposes; • increasing our future borrowing costs and reducing our access to capital if major debt rating agencies lower or withdraw any rating assigned to any of our debt; • requiring us to comply with restrictive covenants (including, among other things, limitations on incurring or guaranteeing additional indebtedness and merging or consolidating with other companies or disposing of substantially all of our assets) in our senior unsecured credit facilities and indentures, which may limit the manner in which we conduct our business; • making it more difficult for us to obtain financing from our vendor partners, including OEMs, software publishers, and cloud providers, and our wholesale distributors; • limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; • placing us at a competitive disadvantage compared to any of our less-leveraged competitors; • increasing our vulnerability to both general and industry-specific adverse economic conditions; and • limiting our ability to obtain additional debt or equity financing to fund future working capital, capital expenditures, acquisitions, or other general corporate requirements and increasing our cost of borrowing.
Further, the sale, spin-off or combination of any of our key vendor partners or wholesale distributors and/or certain of their business units, including any such sale to or combination with a vendor with whom we do not currently have a commercial relationship or whose products we do not sell, or our inability to develop relationships with new and emerging vendors and vendors that we have not historically represented in the marketplace, could have an adverse impact on our business, results of operations or cash flows.
Further, the sale, spin-off, or combination of any of our key vendor partners or wholesale distributors or certain of their business units, including any such sale to or combination with a vendor with whom we do not currently have a commercial relationship or whose products we do not sell, or our inability to develop relationships with new and emerging vendors and vendors that we have not historically represented in the marketplace, could have an adverse impact on our business, results of operations, or cash flows.
AI technologies are complex and rapidly evolving, and we face significant competition in the market and from other companies regarding such technologies. Further, the responsible development and deployment of AI requires ongoing investment in research, development and governance, which could adversely affect our results of operation or cash flows.
Further, the responsible development and deployment of AI requires ongoing investment in research, development and governance, which could adversely affect our results of operation or cash flows. AI technologies are complex and rapidly evolving, and we face significant competition in the market and from other companies regarding such technologies.
Our success is dependent on the accuracy, proper utilization and continuing operation, maintenance and development of our information technology systems, including our business systems, such as our sales, customer management, financial and accounting, marketing, purchasing, warehouse management, e-commerce and mobile systems, as well as our operational platforms, including voice and data networks and power systems, which may include third-party hosted systems or systems that may utilize cloud technologies outside of our control.
Our success is dependent on the accuracy, proper utilization, and continuing operation, maintenance, and development of our information technology systems, including our business systems, such as our sales, customer management, financial and accounting, marketing, purchasing, warehouse management, and e-commerce and mobile systems, as well as our operational platforms, including voice and data networks and power systems, which may include third-party hosted systems or systems that may utilize cloud technologies outside of our control.
Further, as AI continues to evolve, malicious actors could use AI to enhance the sophistication and coordination of their attacks, which could pose significant challenges to our security defenses. Additionally, as technology vendors consolidate and aggregate applications into unified platforms, the risk and magnitude of business disruption from security breaches increases due to vendor/system concentration.
Further, as AI continues to evolve, malicious actors could use AI to enhance the sophistication and coordination of their attacks, which could pose significant challenges to our security defenses. Additionally, as technology vendors consolidate and aggregate applications into unified platforms, the risk and magnitude of business disruption from security breaches increases due to vendor and system concentration.
We may experience significant variations in our future quarterly results of operations. These fluctuations may cause the market price of our common stock to be volatile and may result from many factors, including the state of the technology industry in general, shifts in demand and pricing for hardware, software and services, the introduction of new products or upgrades.
We may experience significant variations in our future quarterly results of operations. These fluctuations may cause the market price of our common stock to be volatile and may result from many factors, including the state of the technology industry in general, shifts in demand and pricing for hardware, software, and services, and the introduction of new products or upgrades.
Increasingly, many of these assertions are brought by non-practicing entities whose principal business model is to secure patent licensing revenue, but we may also be subject to demands from inventors, competitors or other patent holders who may seek licensing revenue, lost profits and/or an injunction preventing us from engaging in certain activities, including selling certain products or services.
Increasingly, many of these assertions are brought by non-practicing entities whose principal business model is to secure patent licensing revenue, but we may also be subject to demands from inventors, competitors, or other patent holders who may seek licensing revenue, lost profits, or an injunction preventing us from engaging in certain activities, including selling certain products or services.
Other events related to international operations that could cause disruptions to our supply chain include: • the imposition of additional trade law provisions or regulations, including the adoption or expansion of trade restrictions; • the imposition of additional duties, tariffs and other charges on imports and exports, including any resulting retaliatory tariffs or charges and any reductions in the production of products subject to such tariffs and charges; • foreign currency fluctuations; and • restrictions on the transfer of funds.
Other events related to international operations that could cause disruptions to our supply chain include: • the imposition of additional trade law provisions or regulations, including the adoption or expansion of trade restrictions or sanctions; • the imposition of additional duties, tariffs, and other charges on imports and exports, including any resulting retaliatory tariffs or charges and any reductions in the production of products subject to such tariffs and charges; • foreign currency fluctuations; and • restrictions on the transfer of funds.
Moreover, media or other reports of perceived vulnerabilities in our network security or perceived lack of security within our environment, even if inaccurate, could materially adversely impact our reputation and business. The cost and operational consequences of implementing further data protection measures could also be material.
Moreover, media or other reports of perceived vulnerabilities in our network security or perceived lack of security within our environment, even if inaccurate, could materially adversely impact our reputation and business. The cost and operational consequences of implementing further data protection measures could be material.
We have privacy and data security policies, practices and controls in place that are designed to prevent security breaches; however, as newer technologies evolve, as more business is conducted over the internet and remotely, as we acquire more business operations from targets with differing cybersecurity and data protection controls and as the portfolio of the service providers we exchange confidential information, software and/or hardware with expands, we have been subject to breaches in security and are increasingly likely to be exposed to risks from breaches in security, including those arising from human error, negligence or mismanagement or from illegal or fraudulent acts, such as cyberattacks.
We have privacy and data security policies, practices, and controls in place that are designed to prevent security breaches; however, as newer technologies evolve, as more business is conducted over the internet and remotely, as we acquire more business operations from organizations with differing cybersecurity and data protection controls, and as the portfolio of the service providers we exchange confidential information, software, and hardware with expands, we have been subject to breaches in security and are increasingly likely to be exposed to risks from breaches in security, including those arising from human error, negligence, or mismanagement or from illegal or fraudulent acts, such as cyberattacks.
In addition, if we are unable to anticipate and expand our capabilities to keep pace with changes in technology and new hardware, software and services, for example by providing the appropriate training to our account managers, specialists and engineers to enable them to effectively sell and deliver such new offerings to customers, our business, results of operations or cash flows could be adversely affected.
In addition, if we are unable to anticipate and expand our capabilities to keep pace with changes in technology and new hardware, software, and services, for example by providing the appropriate training to our account managers, specialists, and engineers to enable them to effectively sell and deliver such new solutions to customers, our business, results of operations, or cash flows could be adversely affected.
Security breaches could result in legal claims or proceedings, liability or regulatory penalties under laws protecting the privacy of personal information (including those under the European Union General Data Protection Regulation and the California Privacy Rights Act), significant remediation costs as well as the loss of partners and existing or potential customers and, ultimately, damage to our brand and reputation and adversely impact our business.
Security breaches could result in legal claims or proceedings, liability, or regulatory penalties under laws protecting the privacy of personal information (including those under the European Union’s General Data Protection Regulation and the California Privacy Rights Act), significant remediation costs as well as the loss of partners and existing or potential customers and, ultimately, damage to our brand and reputation and adversely impact our business.
If we are unable to pass on to our customers future increases in the cost of commercial delivery services (including those that may result from an increase in fuel or personnel costs or a need to use higher cost delivery channels during periods of increased demand), our profitability could be adversely affected.
If we are unable to pass on to our customers future increases in the cost of commercial delivery services and transportation costs (including those that may result from an increase in fuel or personnel costs or a need to use higher cost delivery channels during periods of increased demand), our profitability could be adversely affected.
Additionally, there is increased focus by stakeholders on environmental sustainability and corporate responsibility matters, and stakeholders may disagree with the Company’s commitments and initiatives on such matters.
Additionally, there is increased focus by stakeholders on environmental sustainability and corporate responsibility matters, and other stakeholders may disagree with the Company’s commitments and initiatives on such matters.
Manufacturing interruptions or delays, including as a result of the financial instability or bankruptcy of manufacturers, significant labor disputes such as strikes, natural disasters (which may increase in number or severity as a result of climate change), political or social unrest, armed conflict, pandemics (such as the COVID-19 pandemic) or other public health crises, or other adverse occurrences affecting any of our suppliers’ facilities, could disrupt our supply chain and cause volatility in our level of inventory and delays in completion of orders and installations for our customers.
Manufacturing interruptions or delays, including as a result of the financial instability or bankruptcy of manufacturers, significant labor disputes such as strikes, natural disasters (which may increase in number or severity as a result of climate change), political or social unrest, armed conflict, pandemics or other public health crises, or other adverse occurrences affecting any of our suppliers’ facilities, could disrupt our supply chain and cause volatility in our level of inventory and delays in completion of orders and installations for our customers.
Our Gross profit fluctuates due to numerous factors, some of which may be outside of our control, including general macroeconomic conditions including inflation; pricing pressures; 15 Table of Contents changes in product costs from our vendor partners; the availability of price protection, purchase discounts and incentive programs from our vendor partners; changes in product, order size and customer mix; the risk of some items in our inventory becoming obsolete; increases in product and delivery costs that we cannot pass on to customers; and general market and competitive conditions.
Our Gross profit fluctuates due to numerous factors, some of which may be outside of our control, including general macroeconomic conditions including inflation; pricing pressures; changes in product costs from our vendor partners; the availability of price protection, purchase discounts, and incentive programs from our vendor partners; changes in product, order size, and customer mix; the risk of some items in our inventory becoming obsolete; increases in product and delivery costs that we cannot pass on to customers; and general market and competitive conditions.
There can be no assurance that the intended benefits of our investments, acquisitions and alliances will be realized, or that those benefits will offset these numerous risks or other unforeseen factors, any of which could adversely affect our business, results of operations or cash flows.
There can be no assurance that the intended benefits of our investments, acquisitions, joint ventures, and alliances will be realized, or that those benefits will offset these numerous risks or other unforeseen factors, any of which could adversely affect our business, results of operations, or cash flows.
Our global operations span a variety of legal regimes, subjecting us to numerous complex, diverse, evolving and at times potentially inconsistent or conflicting laws and regulations in a number of areas, including labor and employment, advertising, e-commerce, tax, trade, import and export controls, economic and trade sanctions, anti-corruption, data privacy and security requirements, competition, environmental, social and governance and health and safety.
Our global operations span a variety of legal regimes, subjecting us to numerous complex, diverse, evolving, and at times potentially inconsistent or conflicting laws and regulations in a number of areas, including labor and employment, advertising, 19 Table of Contents e-commerce, tax, trade, import and export controls, economic and trade sanctions, anti-corruption, data privacy and security requirements, competition, environmental, social, and governance, and health and safety.
In addition, our financial results could be adversely affected by financial adjustments required by generally accepted accounting principles in the United States of America (“US GAAP”) in connection with these types of transactions where significant goodwill or intangible assets are recorded.
In addition, our financial results could be adversely affected by financial adjustments required by generally accepted accounting principles in the United States of America in connection with these types of transactions where significant goodwill or intangible assets are recorded.
Social, ethical and safety issues relating to the use of new and evolving technologies such as artificial intelligence-based technologies, including generative AI in our hardware, software and service offerings, as well as in our internal platforms, may result in reputational harm and liability.
Social, ethical, and safety issues relating to the use of new and evolving technologies such as AI-based technologies, including generative AI in our hardware, software, and service offerings, as well as in our internal platforms, may result in reputational harm and liability.
These risks are heightened during periods of global or industry-specific economic downturn or uncertainty, during periods of rising interest rates or, in the case of public sector customers, during periods of budget constraints or budget cuts. Further, evolving product delivery models, such as multi-year subscriptions, may result in prolonged risk as customer terms extend in duration.
These risks are heightened during periods of global or industry-specific economic downturn or uncertainty, during periods of rising interest rates or, in the case of public sector customers, during periods of budget constraints, budget cuts, or a government shutdown. Further, evolving product delivery models, such as multi-year subscriptions, may result in prolonged risk as customer terms extend in duration.
These third parties or others that are a part of our supply chain could also be a source of security risk in the event of a failure to protect their own products, security systems and infrastructure and we may not be able to control the manner in which these third parties respond to any security breach.
These third parties or others that are a part of our supply chain, and their use of AI capabilities, could also be a source of security risk in the event of a failure to protect their own products, security systems and infrastructure and we may not be able to control the manner in which these third parties respond to any security breach.
In addition, some of our hardware and software vendor partners sell, and could intensify their efforts to sell, their products directly to our customers. Moreover, traditional OEMs have increased their services capabilities through mergers and acquisitions, which could potentially increase competition in the market to provide comprehensive technology solutions to customers.
In addition, some of our hardware and software vendor partners sell, and could intensify their efforts to sell their products directly to our customers. Moreover, traditional OEMs have increased their services capabilities through mergers and acquisitions, which could potentially increase competition in the market to provide 12 Table of Contents comprehensive technology solutions to customers.
A natural disaster or other adverse occurrence at any of our major data storage locations, managed services sites or third-party provider locations could negatively impact our business, results of operations or cash flows. 14 Table of Contents Increases in the cost of commercial delivery services or disruptions of those services could materially adversely impact our business.
A natural disaster or other adverse occurrence at any of our major data storage locations, managed services sites, or third-party provider locations could negatively impact our business, results of operations, or cash flows. Increases in the cost of commercial delivery services or disruptions of those services could materially adversely impact our business.
Our disclosure on these matters and our failure, or perceived failure, to meet our commitments (including with respect to climate change) or otherwise effectively address these matters may erode customer trust or confidence, particularly if such failures or perceived failures receive considerable publicity or result in litigation, and could have a negative impact on our business.
Our disclosure on these matters and our failure, or perceived failure, to meet our commitments (including with respect to sustainability) or otherwise effectively address these matters may erode customer trust or confidence, particularly if such failures or perceived failures receive considerable publicity or result in litigation and could have a negative impact on our business.
We also are dependent upon our vendor partners for the development and marketing of hardware, software and services to compete effectively with hardware, software and services of vendors whose products and services we do not currently offer or 10 Table of Contents that we are not authorized to offer in one or more customer channels.
We also are dependent upon our vendor partners for the development and marketing of hardware, software, and services to compete effectively with hardware, software, and services of vendors whose products and services we do not currently offer or that we are not authorized to offer in one or more customer channels.
We have experienced and could in the future experience product constraints due to the failure of suppliers to accurately forecast customer demand, or to manufacture sufficient quantities of product to meet customer demand (including as a result of shortages of product components), among 16 Table of Contents other reasons.
We have experienced and could in the future experience product constraints due to the failure of suppliers to accurately forecast customer demand, or to manufacture sufficient quantities of product to meet customer demand (including as a result of shortages of product components), among other reasons.
The technology industry is characterized by rapid innovation and the frequent introduction of new and enhanced hardware, software and services, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions and solutions that incorporate artificial intelligence.
The technology industry is characterized by rapid innovation and the frequent introduction of new and enhanced hardware, software, and services, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions, and solutions that incorporate AI.
Revenues from our public sector customers are derived from sales to governmental entities, educational institutions and healthcare customers through various contracts and open market sales of products and services. Sales to public sector customers are highly regulated and present risks and challenges not present in private commercial agreements.
Revenues from our public sector customers are derived from sales to governmental entities, educational institutions, and healthcare customers through various contracts and open market sales of products and services. Sales to public sector customers are highly regulated and present different risks and challenges from private commercial agreements.
We also from time to time take advantage of cost savings associated with certain opportunistic bulk inventory purchases offered by our vendor partners or we may decide to carry high inventory levels of certain products that have limited or no return privileges due to customer demand or request or to manage supply chain interruptions.
We also from time to time take advantage of discounted pricing associated with certain opportunistic bulk inventory purchases offered by our vendor partners or we may decide to carry high inventory levels of certain products that have limited or no return privileges due to customer demand or request or to manage supply chain interruptions.
When interest rates increase, our debt service obligations on the variable rate indebtedness increase even though the amount borrowed remains the same, and could negatively impact our net income absent any derivative instruments. From time to time, we may execute derivative instruments to reduce interest rate volatility, subject to acceptable terms.
When interest rates increase, our 20 Table of Contents debt service obligations on the variable rate indebtedness increase even though the amount borrowed remains the same, and could negatively impact our net income absent any derivative instruments. From time to time, we may execute derivative instruments to reduce interest rate volatility, subject to acceptable terms.
Also, once implemented, the new information technology systems, updates to existing information technology systems and related technology may not provide the intended efficiencies or anticipated benefits, or could be defective, contain a security vulnerability or improperly installed or managed, and could add costs, complications and disruptions to our ongoing operations.
Also, once implemented, the new information technology systems, updates to existing information technology systems, and related technology may not provide the intended efficiencies or 13 Table of Contents anticipated benefits, or could be defective, contain a security vulnerability, or be improperly installed or managed, and could add costs, complications, and disruptions to our ongoing operations.
Additionally, we deliver and manage mission critical software, systems and network solutions for our customers. We also offer certain services, such as implementation and installation services and repair services, to our customers through various third-party service providers engaged to perform these services on our behalf.
Additionally, we deliver and manage mission critical software, systems, and network solutions for our customers. We also offer certain services, such as implementation and installation services and repair services, to our customers through 14 Table of Contents various third-party service providers engaged to perform these services on our behalf.
Moreover, as we expand our services and solutions business and provide increasingly complex services and solutions, we may be exposed to additional operational, regulatory and other risks. We also could incur liability for failure to comply with the rules and regulations applicable to the new services and solutions we provide to our customers.
Moreover, as we expand our services and solutions business and provide increasingly complex services and solutions, including solutions that incorporate AI, we may be exposed to additional operational, regulatory, and other risks. We also could incur liability for failure to comply with the rules and regulations applicable to the new services and solutions we provide to our customers.
Issues relating to the use or capabilities of artificial intelligence, including social, ethical and safety issues, in hardware, software and services offerings may result in reputational harm, liability or increased costs.
Issues relating to the use or capabilities of AI, including social, ethical, and safety issues, in hardware, software, and services offerings may result in reputational harm, liability, or increased costs.
Political events, trade and other international disputes, geopolitical tensions, war, terrorism, natural disasters, public health issues, including pandemics such as COVID-19, industrial accidents and other business interruptions can harm or disrupt international commerce and the global economy, and could have a material adverse effect on the Company and its customers, suppliers, outsource partners, logistics providers, distributors, cellular network carriers and other channel partners.
Political events, trade, and other international disputes, geopolitical tensions, war, terrorism, natural disasters, public health issues, including pandemics, industrial accidents, significant labor disputes and other business interruptions can harm or disrupt international commerce and the global economy, and could have a material adverse effect on the Company and its customers, suppliers, outsource partners, logistics providers, distributors, cellular network carriers, and other channel partners.
Weak or unstable economic conditions generally, inflation and actions taken by central banks to counter inflation (such as those that prevailed in recent years), sustained uncertainty about global political conditions, periods of intense diplomatic or armed conflict, government spending cuts and the impact of new government policies (including the introduction of new or increased taxes, the imposition of minimum taxes or new or increased limitations on deductions, credits or other tax benefits, or any other changes to tax laws), or a tightening of credit markets, including as a result of rising interest rates or bank failures, could cause our customers and potential customers to postpone or reduce spending on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of operations or cash flows.
Weak or unstable economic conditions, inflation, and actions taken by central banks to counter inflation, sustained uncertainty about global political conditions, periods of intense diplomatic or armed conflict, government spending cuts or prolonged governmental shutdowns, and the impact of new government policies (including the introduction of new or increased taxes, the imposition of minimum taxes, or new or increased limitations on deductions, credits, or other tax benefits, or any other changes to tax laws), or a tightening of credit markets, including as a result of rising interest rates or bank failures, could cause our customers and potential customers to postpone or reduce spending on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of operations, or cash flows.
We could be exposed to additional risks if we continue to make strategic investments or acquisitions or enter into alliances. We may continue to pursue transactions, including strategic investments, acquisitions or alliances, in an effort to extend or complement our existing business.
We could be exposed to additional costs and risks if we continue to make strategic investments or acquisitions or enter into joint ventures or alliances. We may continue to pursue transactions, including strategic investments, acquisitions, joint ventures, or alliances, in an effort to extend or complement our existing business.
Substantial competition could reduce our market share and significantly harm our financial performance. We compete with resellers, manufacturers who sell directly to customers, large service providers and system integrators, communications service providers, cloud providers, e-commerce companies and office supply retailers, among others.
Substantial competition could reduce our market share and significantly harm our financial performance. We operate in a highly competitive industry and compete with resellers, manufacturers who sell directly to customers, large service providers and system integrators, communications service providers, cloud providers, e-commerce companies, and office supply retailers, among others.
An adverse change or anticipated change in government spending or funding policies (such as budget cuts or limitations), shifts in budget priorities, reductions in revenue levels or significant government shutdowns could cause our customers to reduce or delay their purchases or to terminate or not renew their contracts with us, which could adversely affect our business, results of operations or cash flows.
An adverse change or anticipated change in government spending or funding policies (such as budget cuts or limitations or funding delays), shifts in budget priorities, 17 Table of Contents changes in purchasing protocols, reductions in revenue levels, or significant or prolonged government shutdowns could cause our customers to reduce or delay their purchases or to terminate or not renew their contracts with us, which could adversely affect our business, results of operations, or cash flows.
The DOJ requested information relating to bids the Company submitted for contracts funded in whole or in part by the Schools and Libraries Program (E-Rate Program). We also are subject to audits by various partners, group purchasing organizations and customers, including government agencies, relating to purchases and sales under various contracts.
The DOJ requested information relating to bids the Company submitted for contracts funded in whole or in part by the Schools and Libraries Program (E-Rate Program). We also are subject to audits by various partners, GPOs, and customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts.
Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly. Certain of our borrowings, primarily borrowings under our senior credit facilities, are at variable rates of interest and expose us to interest rate risk. As of December 31, 2024, we had $635 million of variable rate debt outstanding.
Additionally, certain of our borrowings, primarily borrowings under our senior unsecured credit facilities, are at variable rates of interest and expose us to interest rate risk, which under certain conditions could cause our debt service obligations to increase significantly. As of December 31, 2025, we had $635 million of variable rate debt outstanding.
To the extent the value of goodwill or identifiable intangible assets becomes impaired, we may be required to incur material charges relating to the impairment of those assets. Our future operating results may fluctuate significantly, which may result in volatility in the market price of our stock and could impact our ability to operate our business effectively.
To the extent the value of goodwill or identifiable intangible assets becomes impaired, we may be required to incur material charges relating to the impairment of those assets. 16 Table of Contents Our future operating results may fluctuate significantly due to the volatility and rapidly changing state of the technology industry, which may result in volatility in the market price of our stock and could impact our ability to operate our business effectively.
We extend credit to our customers for a significant portion of our sales. We are subject to the risk that our customers may not pay for the products they have purchased or may pay at a slower rate than we have historically experienced.
We are subject to the risk that our customers may not pay for the products they have purchased or may pay at a slower rate than we have historically experienced.
As of December 31, 2024, we had $5.8 billion of total debt outstanding and $355 million of obligations outstanding under our inventory financing agreements, and the ability to borrow an additional $1.2 billion under our senior unsecured revolving loan facility (the “Revolving Loan Facility”).
As of December 31, 2025, we had $5.6 billion of total debt outstanding and $353 million of obligations outstanding under our inventory financing agreements, and the ability to borrow an additional $1.9 billion under our senior unsecured revolving loan facility (the “Revolving Loan Facility”).
Additionally, such adverse change in government spending policies, shifts in budget priorities or reductions in revenue levels could impact cash collections from contracts which could adversely affect our business, results of operations or cash flows. The interruption of the flow of products from suppliers could disrupt our supply chain.
Additionally, such adverse change in government spending policies, shifts in budget priorities, or reductions in revenue levels could impact cash collections from contracts which could adversely affect our business, results of operations, or cash flows.
If we purchase inventory in anticipation of customer demand that does not materialize, or if customers reduce, delay or decommit from orders, and if we were unable to return the inventory to a vendor partner, we would be exposed to an increased risk of inventory obsolescence.
If we purchase inventory in anticipation of customer demand that does not materialize, or if customers reduce, delay, or decommit from orders, and if we were unable to return the inventory to a vendor partner, we would be exposed to an increased risk of inventory obsolescence which could adversely affect our business, results of operations, or cash flows.
It may require significant time and expense to upgrade and integrate such systems and controls, and if we are unable to do so in a timely manner, or at all, failures or breaches of such systems could harm our reputation, business and results of operations due to failure to comply with customer, partner, legal or regulatory obligations. 12 Table of Contents Breaches of data security and the failure to protect our information technology systems from cybersecurity threats could adversely impact our business.
It may require significant time and expense to upgrade and integrate such systems and controls, and if we are unable to do so in a timely manner, or at all, failures or breaches of such systems could harm our reputation, business, and results of operations due to failure to comply with customer, partner, legal, or regulatory obligations.
Any determination to pay dividends on, or repurchase, shares of our common stock in the future will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions (including in current or future agreements governing our indebtedness), restrictions imposed by applicable law, tax considerations and other factors our Board of Directors deems relevant.
While we expect to continue to pay a quarterly cash dividend on our common stock, any determination to pay dividends in the future will be at the discretion of our Board of Directors and depends upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions (including in current or future agreements governing our indebtedness), restrictions imposed by applicable law, tax considerations, and other factors our Board of Directors deems relevant.
In addition, these matters could lead to increased costs or interruptions of our normal business operations. Litigation, infringement claims, governmental proceedings and investigations, audits or indemnification claims involve uncertainties and the eventual outcome of any such matter could adversely affect our business, results of operations or cash flows.
Litigation, infringement claims, governmental proceedings and investigations, audits, or indemnification claims involve uncertainties and the eventual outcome of any such matter could adversely affect our business, results of operations, or cash flows.
As a public company, we also are subject to increasingly complex public disclosure, corporate governance and accounting requirements that increase compliance costs and require significant management focus. 18 Table of Contents Risks Related to Our Indebtedness Our level of indebtedness could adversely affect our business.
As a public company, we also are subject to increasingly complex public disclosure, corporate governance, and accounting requirements that increase compliance costs and require significant management focus. Risks Related to Our Indebtedness Our level of indebtedness and obligations pursuant to the agreements and instruments reflecting our indebtedness could adversely affect our business, results of operations, and cash flows.
Additionally, strikes, inclement weather, natural disasters or other service interruptions by such shippers or periods of increased demand on delivery services, such as those we have experienced during the COVID-19 pandemic, could materially adversely affect our ability to deliver or receive products on a timely basis. We are exposed to accounts receivable and inventory risks.
Additionally, strikes, inclement weather, natural disasters, or other service interruptions by such shippers or periods of increased demand on delivery services could materially adversely affect our ability to deliver or receive products on a timely basis. We are exposed to accounts receivable and inventory risks. We extend credit to our customers for a significant portion of our sales.
If the warehouse and distribution equipment or operations at one of our distribution centers or such facilities or operations of our outsource partners were to be seriously damaged or disrupted by a natural disaster, which may increase in number or severity as a result of climate change, or other adverse occurrence, including disruption related to political or social unrest, we could utilize another distribution center or third-party distributors to ship products to our customers.
If the warehouse and distribution equipment or operations at one of our distribution centers or such facilities or operations of our outsource partners were to be seriously damaged, such as in a fire, or disrupted by a natural disaster, which may increase in number or severity as a result of climate change, or other adverse occurrence, including disruption related to political or social unrest, we could experience significant interruptions in our services and may incur material incremental operating costs.
We generally ship hardware products to our customers by FedEx, United Parcel Service and other commercial delivery services and invoice customers for delivery charges.
We generally ship hardware products to our customers by third party commercial delivery services and invoice customers for delivery charges.
In addition, we are subject to indemnification claims under various contracts. Current and future litigation, infringement claims, governmental proceedings and investigations, audits or indemnification claims that we face may result in substantial costs and expenses and significantly divert the attention of our management regardless of the outcome.
Current and future litigation, infringement claims, governmental proceedings and investigations, audits, or indemnification claims that we face may result in substantial costs and expenses and significantly divert the attention of our management regardless of the outcome. In addition, these matters could lead to increased costs or interruptions of our normal business operations.
If any of the foregoing were to occur, our reputation with our customers, our brand and our business, results of operations or cash flows could be adversely affected. 13 Table of Contents If we lose any of our key personnel, are unable to attract and retain the talent required for our business, our labor costs significantly increase or our approach to workforce management is ineffective, our business could be disrupted and our financial performance could suffer.
If we lose any of our key personnel, are unable to attract and retain the talent required for our business, our labor costs significantly increase, or our approach to workforce management is ineffective, our business could be disrupted, and our financial performance could suffer.
Additionally, third parties, such as data center colocation and hosted solution partners, provide services to us and also provide services as a component of our services delivery to customers and to customer systems.
In connection with our services business, some of our coworkers have access to our customers’ confidential data and other information. Additionally, third parties, such as data center colocation and hosted solution partners, provide services to us and also provide services as a component of our services delivery to customers and to customer systems.
The deterioration of the earnings from, or other available assets of, our subsidiaries for any reason could also limit or impair their ability to pay dividends or other distributions to us. Item 1B. Unresolved Staff Comments None.
The agreements governing the indebtedness of our subsidiaries impose restrictions on our subsidiaries’ ability to pay dividends or other distributions to us. The deterioration of the earnings from, or other available assets of, our subsidiaries for any reason could also limit or impair their ability to pay dividends or other distributions to us.
Legal and Regulatory Risks The failure to comply with our public sector contracts or applicable laws and regulations could result in, among other things, termination, fines or other liabilities, and changes in procurement regulations could adversely impact our business, results of operations or cash flows.
In addition, our exports are subject to regulations, some of which may be inconsistent, and noncompliance with these requirements could have a negative effect on our business, results of operations, or cash flows. 18 Table of Contents Legal and Regulatory Risks The failure to comply with our public sector contracts or applicable laws and regulations could result in, among other things, termination, fines, or other liabilities, and changes in procurement regulations could adversely impact our business, results of operations, or cash flows.
Increased focus and potential government regulation of AI may also increase the burden and cost of compliance in this area, subjecting us to brand or reputational harm, competitive harm and/or legal liability. Failure to address AI issues by us or others in our industry could undermine public confidence in AI and slow adoption of AI in our products and services.
Such increased focus and potential government regulation of AI may also increase the burden and cost of compliance in this area, subjecting us to brand or reputational harm, competitive harm, and legal liability.
Our business involves the handling, storage and transmission of proprietary information and sensitive or confidential data, including personal information of coworkers, customers, partners and others, which we must do in compliance with applicable law. In connection with our services business, some of our coworkers have access to our customers’ confidential data and other information.
Breaches of data security and the failure to protect our information technology systems from cybersecurity threats could adversely impact our business. Our business involves the handling, storage, and transmission of proprietary information and sensitive or confidential data, including personal information of coworkers, customers, partners, and others, which we must do in compliance with applicable law.
For example, we may be subject to increased costs and use of operational resources associated with complying with a myriad of new environmental, social and governance related laws and regulations.
For example, we may be subject to increased costs and use of operational resources associated with complying with a myriad of new, changing, and sometimes conflicting environmental, social, and governance related laws and regulations. If we fail to comply with new laws, regulations, treaties, or reporting requirements, our reputation and business could be adversely impacted.
However, this may not be sufficient to avoid interruptions in our service and may not enable us to meet all of the needs of our customers and could cause us to incur incremental operating costs.
While 15 Table of Contents we could utilize another distribution center or third-party distributors to ship products to our customers, this also may not be sufficient to avoid interruptions in our service and may not enable us to meet all of the needs of our customers and could cause us to incur incremental operating costs.
In addition, the adoption of new or modified procurement regulations and other requirements may increase our compliance costs and reduce our gross margins, which could have a negative effect on our business, results of operations or cash flows. 17 Table of Contents We are exposed to risks from legal proceedings and audits, including intellectual property infringement claims, which may result in substantial costs and expenses or interruption of our normal business operations.
In addition, the adoption of new or modified procurement regulations and other requirements may increase our compliance costs and reduce our gross margins, which could have a negative effect on our business, results of operations, or cash flows.
In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies, including companies in our industry. In the past, securities class action litigation has followed periods of market volatility.
In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies, including companies in our industry. These fluctuations have often been unrelated to or disproportionately impacted by the operating performance of these companies.
We are a holding company that does not conduct any business operations of our own. As a result, we are largely dependent upon cash dividends and distributions and other transfers from our subsidiaries to meet our obligations. The agreements governing the indebtedness of our subsidiaries impose restrictions on our subsidiaries’ ability to pay dividends or other distributions to us.
We cannot assure that we will enter into such derivative instruments in the future or that such instruments will be effective. In addition, we are a holding company that does not conduct any business operations of our own. As a result, we are largely dependent upon cash dividends and distributions and other transfers from our subsidiaries to meet our obligations.
We expect the competitive landscape to continue to evolve as new technologies and consumption models emerge, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions and solutions that incorporate artificial intelligence.
These factors, in addition to competitive pressures resulting from the fragmented nature of our industry, could affect our sales, profit margins, and earnings. We expect the competitive landscape to continue to evolve as new technologies and consumption models emerge, such as cloud-based and other “as a service” solutions, hyper-converged infrastructure, embedded software solutions, and solutions that incorporate AI.
We cannot assure you we will enter into such derivative instruments in the future or that such instruments will be effective. Risks Related to Ownership of Our Common Stock Our common stock price may be volatile and may decline regardless of our operating performance, and holders of our common stock could lose a significant portion of their investment.
Risks Related to Ownership of Our Common Stock Our common stock price may be volatile and may decline regardless of our operating performance, and holders of our common stock could lose a significant portion of their investment. The market price and trading volumes for our common stock may be volatile.
We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, employment, tort and other litigation.
We are exposed to risks from legal proceedings and audits, including intellectual property infringement claims, which may result in substantial costs and expenses or interruption of our normal business operations. We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, employment, tort, and other litigation.
In our industry, such intellectual property claims have become more frequent as the complexity of technological products and the intensity of competition in our industry have increased.
In our industry, such intellectual property claims have become more frequent as the complexity of technological products and the intensity of competition in our industry have increased. Furthermore, increased use of AI by the Company, third-party outsource partners, or our vendor partners could lead to more frequent intellectual property claims against us.
If we use, enable or offer solutions that draw controversy due to their perceived or actual impact on society, we may experience brand or reputational harm, competitive harm and/or legal liability.
As we invest in, use, enable, or offer solutions that draw controversy due to their perceived or actual impact on society and the environment, we may experience brand or reputational harm, competitive harm, and legal liability. The rapid development and deployment of tools that leverage AI is also causing governments to consider and implement regulation of AI.
If we do not pay dividends in the future, realization of a gain on your investment will depend entirely on the appreciation of the price of our common stock, which may never occur. We are a holding company and rely on dividends, distributions and other payments, advances and transfers of funds from our subsidiaries to meet our obligations.
If we do not pay dividends or continue to repurchase shares of our common stock in the future, realization of a gain on an investment in our common stock will depend entirely on the appreciation of the price of our common stock, which may never occur due to the potential volatility of the market price of our common stock.
If such a reduction in prices occurs and we are unable to attract new customers and sell increased quantities of products, our sales growth and profitability could be adversely affected. 11 Table of Contents The success of our business depends on the continuing development, maintenance and operation of our information technology systems.
This would require us to sell a greater number of products to achieve the same level of Net sales and Gross profit. If such a reduction in prices occurs and we are unable to attract new customers and sell increased quantities of products, our sales growth and profitability could be adversely affected.
If we were involved in securities litigation, we could incur substantial costs, and our resources and the attention of management could be diverted from our business. 20 Table of Contents In the future, we may also issue our securities in connection with investments or acquisitions.
In the past, securities class action litigation has followed periods of market volatility. If we were involved in securities litigation, we could incur substantial costs, and our resources and the attention of management could be diverted from our business.
Additionally, as minimum wage rates increase or related laws and regulations change, we have and may need to continue to increase not only the wage rates of our minimum wage coworkers, but also the wages paid to our other hourly or salaried coworkers.
If our compensation package is not viewed as being competitive, our ability to attract, retain, and motivate key personnel could be adversely affected. Additionally, as minimum wage rates increase or related laws and regulations change, we have and may need to continue to increase the wages paid to our hourly or salaried coworkers as wage rates and salaries become pressured.
Certain of the hardware, software and services we offer increasingly utilize AI, and, as with many innovations, AI presents risks and challenges that could affect its adoption, and therefore our business.
As with many innovations, AI presents risks and challenges that could affect its adoption and usage, and therefore our business. If we are unable to effectively and timely capitalize on the growth opportunities made available by the adoption of AI to drive our scale and efficiency, our business, results of operations, or cash flows could be adversely impacted.
Removed
This would require us to sell a greater number of products to achieve the same level of Net sales and Gross profit.
Added
In rapidly evolving categories such as cloud-based 11 Table of Contents solutions, AI, and software “as a service” solutions, our dependence on our vendor partners for innovation can add additional complexity as vendor channel strategies and authorization models may change more frequently.
Removed
When made public or otherwise known to us, we attempt to remediate or mitigate these vulnerabilities following guidance provided by the software vendor, and/or appropriate authorities, and before the vulnerability is successfully used in a cyberattack against our systems.
Added
We are increasingly utilizing AI in our business, including interactions with our coworkers, customers, and vendor partners and in the hardware, software, and services we offer, and we also plan to further invest resources to embed AI capabilities throughout our operations and enterprise to drive scale and efficiency.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe CISO has extensive 21 Table of Contents background in that role at an enterprise level and has over 20 years of experience in the field of cybersecurity.
Biggest changeThe CISO has an extensive background in their role at an enterprise level and has over 20 years of experience in the field of cybersecurity.
For more information regarding risks relating to information technology and cybersecurity, see “Item 1A. Risk Factors.” The Audit Committee is primarily responsible for overseeing our enterprise risk management process on behalf of the Board of Directors, including cybersecurity risks.
For more information regarding risks relating to IT and cybersecurity, see “Item 1A. Risk Factors.” The Audit Committee of the Board is primarily responsible for overseeing our enterprise risk management process on behalf of the Board of Directors, including cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties As of December 31, 2024, we owned or leased a total of 2.3 million square feet of space, primarily in the US, UK and Canada. We own two properties: a 513,240 square foot distribution center in North Las Vegas, Nevada, and a combined office and a 442,400 square foot distribution center in Vernon Hills, Illinois.
Biggest changeWe own two properties: a 513,240 square foot distribution center in North Las Vegas, Nevada, and a combined office and a 442,400 square foot distribution center in Vernon Hills, Illinois. In addition, we conduct sales, services, and administrative activities in various locations primarily in the US, UK, and Canada.
Leases covering our currently occupied leased properties expire at varying dates, all within the next 11 years. We anticipate no difficulty in retaining occupancy through lease renewals, month-to-month occupancy or replacing the leased properties with equivalent properties. We believe that suitable additional or substitute leased properties will be available as required.
We anticipate no difficulty in retaining occupancy through lease renewals, month-to-month occupancy, or replacing the leased properties with equivalent properties. We believe that suitable additional or substitute leased properties will be available as required.
In addition, we conduct sales, services and administrative activities in various locations primarily in the US, UK and Canada. We believe our facilities are well maintained, suitable for our business and occupy sufficient space to meet our operating needs. As part of our normal business, we regularly evaluate sales center performance and site suitability.
We believe our facilities are well maintained, suitable for our business and occupy sufficient space to meet our operating needs. As part of our normal business, we regularly evaluate sales center performance and site suitability. Leases covering our currently occupied leased properties expire at varying dates, all within the next 10 years.
Added
Item 2. Properties As of December 31, 2025, we owned or leased a total of 1.8 million square feet of space in the US, serving all of our reportable segments. Additionally, we leased a total of 0.4 million square feet of space outside of the US, primarily in the UK, and Canada.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, intellectual property, employment, tort and other litigation matters. For additional information regarding legal proceedings, refer to Note 16 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements.
Biggest changeItem 3. Legal Proceedings We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, intellectual property, employment, tort, and other litigation matters. For additional information regarding legal proceedings, refer to Note 16 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements. 22 Table of Contents

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOn February 5, 2025, we announced that our Board of Directors authorized a $750 million increase to our share repurchase program (which was incremental to the approximately $588 million remaining as of December 31, 2024 under the $750 million authorization announced on February 7, 2024) under which we may repurchase shares of our common stock from time to time in privately negotiated transactions, open market purchases or other transactions as permitted by securities laws and other legal requirements.
Biggest changeOn February 5, 2025, we announced that our Board of Directors authorized a $750 million increase to our share repurchase program under which we may repurchase shares of our common stock from time to time in privately negotiated transactions, open market purchases, or other transactions as permitted by securities laws and other legal requirements.
This peer group was selected based on a review of publicly available information about these companies and our determination that they met one or more of the following criteria: (i) similar size in terms of revenue and/or enterprise value (one-third to three times our revenue or enterprise value); (ii) operates in a business-to-business distribution environment; (iii) members of the technology industry; (iv) similar customers ( i.e. , business, government, healthcare, and education); (v) companies that provide services and/or solutions; (vi) similar margins; (vii) comparable percentage of international sales; (viii) frequently identified as a peer by the other peer companies or Institutional Shareholder Services Inc.; or (ix) identified by the Company as a competitor.
This peer group was selected based on a review of publicly available information about these companies and our determination that they met one or more of the following criteria: (i) similar size in terms of revenue or enterprise value (one-third to three times our revenue or enterprise value); (ii) operates in a business-to-business distribution environment; (iii) members of the technology industry; (iv) similar customers ( i.e. , business, government, healthcare, and education); (v) companies that provide services or solutions; (vi) similar margins; (vii) comparable percentage of international sales; (viii) frequently identified as a peer by the other peer companies or Institutional Shareholder Services Inc.; or (ix) identified by the Company as a competitor.
Our peer group index for 2024 consists of the following companies: Accenture plc, Arrow Electronics, Inc., Avnet, Inc., Best Buy Company, Inc., CGI Group Inc., Cognizant Technology Solutions Corporation, DXC Technology Company, Flex Ltd., Genuine Parts Company, Henry Schein, Inc., Hewlett Packard Enterprise Company, Insight Enterprises, Inc., Jabil, Inc., LKQ Corporation, TD SYNNEX Corporation, W.W.
Our peer group index for 2025 consists of the following companies: Accenture plc, Arrow Electronics, Inc., Avnet, Inc., Best Buy Company, Inc., CGI Group Inc., Cognizant Technology Solutions Corporation, DXC Technology Company, Flex Ltd., Genuine Parts Company, Henry Schein, Inc., Hewlett Packard Enterprise Company, Insight Enterprises, Inc., Jabil, Inc., LKQ Corporation, TD SYNNEX Corporation, W.W.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on the Nasdaq Global Select Market since June 27, 2013 under the symbol “CDW.” Holders As of February 18, 2025, there were 5 holders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on the Nasdaq Global Select Market since June 27, 2013, under the symbol “CDW.” Holders As of February 17, 2026, there were 5 holders of record of our common stock.
The following graph compares the cumulative total shareholder return, calculated on a dividend reinvested basis, on $100 invested at the closing of the market on December 31, 2019 through and including the market close on December 31, 2024, with the cumulative total return for the same time period of the same amount invested in the Standard & Poor’s 500 Stock 23 Table of Contents (“S&P 500”) Index, the S&P 500 Information Technology Index and a peer group index.
The following graph compares the cumulative total shareholder return, calculated on a dividend reinvested basis, on $100 invested at the closing of the market on December 31, 2020, through and including the market close on December 31, 2025, with the cumulative total return for the same time period of the same amount invested in the Standard & Poor’s 500 Stock 24 Table of Contents (“S&P 500”) Index, the S&P 500 Information Technology Index, and a peer group index.
The number of beneficial stockholders is substantially greater than the number of holders of record because a portion of our common stock is held through brokerage firms. Dividends On February 5, 2025, we announced that our Board of Directors declared a quarterly cash dividend on our common stock of $0.625 per share.
The number of beneficial stockholders is substantially greater than the number of holders of record because a portion of our common stock is held through brokerage firms. Dividends On February 4, 2026, 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 March 11, 2025 to all stockholders of record as of the close of business on February 25, 2025.
The dividend will be paid on March 10, 2026, to all stockholders of record as of the close of business on February 25, 2026.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” Issuer Purchases of Equity Securities Information relating to the Company’s purchases of its common stock during the three months ended December 31, 2024 is as follows: Period Total Number of Shares Purchased (in millions) Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program (in millions) Maximum Dollar Value of Shares that May Yet be Purchased Under the Plan or Program (1) (in millions) October 1 through October 31, 2024 0.1 $ 216.91 0.1 $ 720.4 November 1 through November 30, 2024 0.3 185.98 0.3 659.7 December 1 through December 31, 2024 0.4 177.39 0.4 587.6 Total 0.8 0.8 (1) The amounts presented in this column are the remaining total authorized value to be spent after each month’s repurchases.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” Issuer Purchases of Equity Securities Information relating to the Company’s purchases of its common stock during the three months ended December 31, 2025, is as follows: Period Total Number of Shares Purchased (in millions) Average Price Paid per Share Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program (in millions) Maximum Dollar Value of Shares that May Yet be Purchased Under the Plan or Program (1) (in millions) October 1 through October 31, 2025 0.2 $ 155.34 0.2 $ 810.3 November 1 through November 30, 2025 0.6 143.05 0.6 728.2 December 1 through December 31, 2025 0.3 143.46 0.3 684.6 Total 1.1 1.1 (1) The amounts presented in this column are the remaining total authorized value to be spent after each month’s repurchases.
December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 CDW Corp $ 100 $ 93 $ 147 $ 129 $ 167 $ 129 S&P 500 100 116 148 119 148 182 S&P 500 Information Technology 100 142 190 135 211 286 CDW Peers 100 116 163 128 162 173 Recent Sales of Unregistered Securities None.
December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 December 31, 2025 CDW Corp $ 100 $ 157 $ 138 $ 178 $ 138 $ 110 S&P 500 100 127 102 127 157 182 S&P 500 Information Technology 100 133 95 148 201 248 CDW Peers 100 141 111 140 149 141 Recent Sales of Unregistered Securities None.
Added
As of December 31, 2025, the Company has approximately $685 million remaining under the program.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

73 edited+19 added−14 removed44 unchanged
Biggest changeThe payment of any future dividends will be at the discretion of our Board of Directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions (including in current or future agreements governing our indebtedness), restrictions imposed by applicable law, tax considerations and other factors that our Board of Directors deems relevant. 32 Table of Contents Cash Flows Cash flows from operating, investing and financing activities are as follows: Year Ended December 31, (dollars in millions) 2024 2023 Net cash provided by operating activities $ 1,277.3 $ 1,598.7 Investing Activities: Capital expenditures (122.6) (148.2) Purchases of short-term investments (211.1) — Acquisitions of businesses, net of cash acquired (323.9) (76.4) Other (1.6) (5.0) Cash flows used in investing activities (659.2) (229.6) Financing Activities: Net change in accounts payable - inventory financing (75.7) (23.7) Other cash flows from financing activities (611.2) (1,075.0) Cash flows used in financing activities (686.9) (1,098.7) Effect of exchange rate changes on cash, cash equivalents and restricted cash (12.2) 3.1 Net (decrease) increase in cash, cash equivalents and restricted cash $ (81.0) $ 273.5 Operating Activities Cash flows from operating activities are as follows: Year Ended December 31, (dollars in millions) 2024 2023 Change Net income $ 1,077.8 $ 1,104.3 $ (26.5) Adjustments for the impact of non-cash items (1) 362.2 375.6 (13.4) Net income adjusted for the impact of non-cash items 1,440.0 1,479.9 (39.9) Changes in assets and liabilities: Accounts receivable (2) (559.4) (54.5) (504.9) Merchandise inventory (3) 61.1 139.0 (77.9) Accounts payable-trade (4) 443.8 (55.4) 499.2 Other (5) (108.2) 89.7 (197.9) Net cash provided by operating activities $ 1,277.3 $ 1,598.7 $ (321.4) (1) Includes items such as depreciation and amortization, deferred income taxes, provision for credit losses and equity-based compensation expense.
Biggest changeCash Flows Cash flows from operating, investing, and financing activities are as follows: Year Ended December 31, (dollars in millions) 2025 2024 Net cash provided by operating activities $ 1,205.2 $ 1,277.3 Net cash provided by (used in) investing activities 70.2 (659.2) Net cash used in financing activities (1,184.5) (686.9) Effect of exchange rate changes on cash, cash equivalents, and restricted cash 20.3 (12.2) Net increase (decrease) in cash, cash equivalents, and restricted cash $ 111.2 $ (81.0) Operating Activities Cash flows from operating activities are as follows: Year Ended December 31, (dollars in millions) 2025 2024 Change Net income $ 1,066.6 $ 1,077.8 $ (11.2) Adjustments for the impact of non-cash items (1) 424.9 362.2 62.7 Net income adjusted for the impact of non-cash items 1,491.5 1,440.0 51.5 Changes in assets and liabilities: Accounts receivable (1,166.5) (559.4) (607.1) Merchandise inventory 48.2 61.1 (12.9) Accounts payable-trade 815.4 443.8 371.6 Other assets and liabilities 16.6 (108.2) 124.8 Net cash provided by operating activities $ 1,205.2 $ 1,277.3 $ (72.1) (1) Includes items such as depreciation and amortization, deferred income taxes, provision for credit losses, and equity-based compensation expense.
Netted down revenue results in an increase in 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.
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.
We believe our non-GAAP performance measures provide analysts, investors and management with useful information regarding the underlying operating performance of our business, as they remove the impact of items that management believes are not reflective of underlying operating performance. Management uses these measures to evaluate period-over-period performance as management believes they provide a more comparable measure of the underlying business.
We believe our non-GAAP financial measures provide analysts, investors, and management with useful information regarding the underlying operating performance of our business, as they remove the impact of items that management believes are not reflective of underlying operating performance. Management uses these measures to evaluate period-over-period performance as management believes they provide a more comparable measure of the underlying business.
Critical Accounting Policies and Estimates The preparation of the Consolidated Financial Statements in accordance with US GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities in the Consolidated Financial Statements and accompanying notes.
Critical Accounting Policies and Estimates The preparation of the Consolidated Financial Statements in accordance with GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses, as well as related disclosure of contingent assets and liabilities in the Consolidated Financial Statements and accompanying notes.
Non-GAAP measures used by management may differ from similar measures used by other companies, even when similar terms are used to identify such measures.
Non-GAAP financial measures used by management may differ from similar measures used by other companies, even when similar terms are used to identify such measures.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Unless otherwise indicated or the context otherwise requires, as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the terms “we,” “us,” “the Company,” “our,” “CDW” and similar terms refer to CDW Corporation and its subsidiaries.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Unless otherwise indicated or the context otherwise requires, as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the terms “we,” “us,” “the Company,” “our,” “CDW,” and similar terms refer to CDW Corporation and its subsidiaries.
Average daily sales is defined as Net sales divided by the number of selling days. (2) Represents the effect of translating Net sales for the year ended December 31, 2023 of CDW UK and CDW Canada at the average exchange rates applicable in 2024.
Average daily sales is defined as Net sales divided by the number of selling days. (2) Represents the effect of translating Net sales for the year ended December 31, 2024, of CDW UK and CDW Canada at the average exchange rates applicable in 2025.
Our solutions are delivered in physical, virtual and cloud-based environments through approximately 10,900 customer-facing coworkers, including sellers, highly-skilled specialists and engineers. We are a leading sales channel partner for many original equipment manufacturers, software publishers, cloud providers (collectively, our “vendor partners”) and wholesale distributors, whose products we sell or include in the solutions we offer.
Our solutions are delivered in physical, virtual, and cloud-based environments through approximately 10,500 customer-facing coworkers, including sellers, highly-skilled specialists, and engineers. We are a leading sales channel partner for many original equipment manufacturers (“OEMs”), software publishers, and cloud providers (collectively, our “vendor partners”) and wholesale distributors, whose products we sell or include in the solutions we offer.
However, since our last quantitative analysis, our past estimates of fair value would not have indicated an impairment when revised to include subsequent years’ actual results. We completed our annual impairment analysis during the fourth quarter of 2024.
However, since our last quantitative analysis, our past estimates of fair value would not have indicated an impairment when revised to include subsequent years’ actual results. We completed our annual impairment analysis during the fourth quarter of 2025.
(2) Includes the financial results for our other operating segments, CDW UK and CDW Canada, which do not meet the reportable segment quantitative thresholds. (3) Includes Headquarters’ function costs that are not allocated to the segments.
(2) Includes the financial results for our other operating segments, CDW UK and CDW Canada, which do not meet the reportable segment quantitative thresholds. (3) Includes headquarters function costs that are not allocated to the segments.
Revenue Recognition We sell some of our products and services as part of bundled contract arrangements containing multiple performance obligations, which may include a combination of different products and services. Significant judgment may be required when 35 Table of Contents determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together.
Revenue Recognition We sell some of our products and services as part of bundled contract arrangements containing multiple performance obligations, which may include a combination of different products and services. Significant judgment may be required when determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together.
Financial measures include both US GAAP, the accounting principles generally accepted in the United States of America, and Non-GAAP, which excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with US GAAP.
Financial measures are presented both in accordance with the accounting principles generally accepted in the United States of America (“GAAP”), and non-GAAP, which excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP.
The estimates used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions and other factors. Changes in these estimates and assumptions could materially affect the 36 Table of Contents determination of fair value and goodwill impairment for each reporting unit.
The estimates used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions, and other factors. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit.
(2) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts and trade names. (3) Includes cost related to strategic transformation initiatives focused on optimizing various operations and systems. 30 Table of Contents (4) Includes costs related to workforce reductions and charges related to the reduction of our real estate lease portfolio.
(2) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts, and trade names. (3) Includes costs related to strategic transformation initiatives focused on optimizing various operations and systems. (4) Includes costs related to workforce reductions and charges related to the reduction of our real estate lease portfolio.
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. • Technology trends drive customer purchasing behaviors in the market.
As the duration and ongoing impact of current economic conditions remain uncertain, including any US government shutdowns, current and future budget priorities and funding levels for government, healthcare and education customers may be adversely affected, leading to lower IT spend. • Technology trends drive customer purchasing behaviors in the market.
We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Historically, we have not made significant changes to the methods for determining these estimates as our actual results have not differed materially from our estimates.
We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances and in accordance with GAAP. Historically, we have not made significant changes to the methods for determining these estimates as our actual results have not differed materially from our estimates.
Net sales on a constant currency basis is defined as Net sales excluding the impact of foreign currency 29 Table of Contents translation on Net sales. Free cash flow is defined as Net cash provided by operating activities less capital expenditures.
Net sales on a constant currency basis is defined as Net sales excluding the impact of foreign currency translation on Net sales. Free cash flow is defined as Net cash provided by operating activities less capital expenditures.
Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions and services that include on-premise and cloud capabilities across hybrid infrastructure, digital experience and security. We have three reportable segments: Corporate, Small Business and Public. Our Corporate segment primarily serves US private sector business customers with more than 250 employees.
Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions and services that include on-premise and cloud capabilities across hybrid infrastructure, digital experience, and security. We have three reportable segments: “Corporate,” “Small Business,” and “Public.” Our Corporate segment primarily serves US private sector business customers with more than 250 employees.
We have included reconciliations of our non-GAAP financial measures to the most comparable US GAAP financial measures for the years ended December 31, 2024 and 2023 below.
We have included reconciliations of our non-GAAP financial measures to the most comparable GAAP financial measures for the years ended December 31, 2025 and 2024 below.
(3) Defined as days of sales outstanding related to the current portion of Accounts receivable and certain receivables due from vendors, plus days of supply in Merchandise inventory, minus days of purchases outstanding related to the current portion of Accounts payable and Accounts payable- 26 Table of Contents inventory financing, based on a rolling three-month average.
(2) Defined as days of sales outstanding related to the current portion of Accounts receivable and certain receivables due from vendors, plus days of supply in Merchandise inventory, minus days of purchases outstanding related to the current portion of Accounts payable-trade and Accounts payable-inventory financing, based on a rolling three-month average.
Components of our cash conversion cycle are as follows: December 31, (in days) 2024 2023 Days of sales outstanding (DSO) (1) 84 77 Days of supply in inventory (DIO) (2) 13 13 Days of purchases outstanding (DPO) (3) (79) (73) Cash conversion cycle 18 17 (1) Represents the rolling three-month average of the balance of the current portion of Accounts receivable, net at the end of the period, divided by average daily Net sales for the same three-month period.
Components of our cash conversion cycle are as follows: December 31, (in days) 2025 2024 Days of sales outstanding (DSO) (1) 95 84 Days of supply in inventory (DIO) (2) 11 13 Days of purchases outstanding (DPO) (3) (90) (79) Cash conversion cycle 16 18 (1) Represents the rolling three-month average of the balance of the current portion of Accounts receivable, net at the end of the period, divided by average daily Net sales for the same three-month period.
The dividend will be paid on March 11, 2025 to all stockholders of record as of the close of business on February 25, 2025.
The dividend will be paid on March 10, 2026, to all stockholders of record as of the close of business on February 25, 2026.
Free cash flow and Adjusted free cash flow Year Ended December 31, (dollars in millions) 2024 2023 Net cash provided by operating activities $ 1,277.3 $ 1,598.7 Capital expenditures (122.6) (148.2) Free cash flow 1,154.7 1,450.5 Net change in accounts payable - inventory financing (75.7) (23.7) Adjusted free cash flow (1) $ 1,079.0 $ 1,426.8 (1) Defined as Net cash provided by operating activities less capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory.
Free cash flow and Adjusted free cash flow Year Ended December 31, (dollars in millions) 2025 2024 Net cash provided by operating activities $ 1,205.2 $ 1,277.3 Capital expenditures (117.1) (122.6) Free cash flow 1,088.1 1,154.7 Net change in accounts payable - inventory financing (2.6) (75.7) Adjusted free cash flow (1) $ 1,085.5 $ 1,079.0 (1) Defined as Net cash provided by operating activities less Capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory.
This analysis requires judgment whereby we perform an analysis of the estimated number of days of sales in-transit to customers at the end of each reporting period based on a weighted-average analysis of commercial delivery terms that include drop-shipment arrangements. Changes in delivery patterns may result in a different number of business days estimated to make this adjustment.
This analysis requires judgment whereby we perform an analysis of the estimated number 37 Table of Contents of days of sales in-transit to customers at the end of each reporting period based on a weighted-average analysis of commercial delivery terms that include drop-shipment arrangements.
Non-GAAP operating income and Non-GAAP operating income margin Year Ended December 31, (dollars in millions) 2024 Percentage of Net Sales 2023 Percentage of Net Sales Percent Change Operating income, as reported $ 1,651.3 7.9 % $ 1,680.9 7.9 % (1.8) % Amortization of intangibles (1) 150.9 154.4 Equity-based compensation 64.7 93.7 Transformation initiatives (2) 34.8 27.1 Acquisition and integration expenses 12.2 30.0 Workplace optimization (3) 25.4 47.7 Other adjustments 7.7 5.3 Non-GAAP operating income $ 1,947.0 9.3 % $ 2,039.1 9.5 % (4.5) % (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts and trade names.
Non-GAAP operating income and Non-GAAP operating income margin Year Ended December 31, (dollars in millions) 2025 Percent of Net Sales 2024 Percent of Net Sales Operating income, as reported $ 1,655.6 7.4 % $ 1,651.3 7.9 % Amortization of intangibles (1) 169.8 150.9 Equity-based compensation 83.6 64.7 Transformation initiatives (2) 57.9 34.8 Acquisition and integration expenses 7.6 12.2 Workplace optimization (3) 16.2 25.4 Other adjustments 6.0 7.7 Non-GAAP operating income $ 1,996.7 8.9 % $ 1,947.0 9.3 % (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts, and trade names.
We have orchestrated solutions by leveraging security, software and hybrid and cloud offerings to help customers achieve their objectives. 25 Table of Contents • Changes and uncertainty related to spending policies, budget priorities, timing and funding levels, including stimulus packages, are key factors influencing the purchasing levels of government, healthcare and education customers.
We have orchestrated solutions that leverage security, software, artificial intelligence (“AI”), and hybrid and cloud offerings to help customers achieve their objectives. • 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.
The uncertainty in the current economic environment resulted in, and may continue to result in, a delay, pause or reduction of investments in technology by our customers. • 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, resulting in a more measured approach to their IT spending.
The uncertainty in the current economic environment has impacted and may continue to impact the timing of our customers’ investments in technology. • 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.
Current technology trends are focused on delivering greater flexibility and efficiency, as well as designing and managing IT securely. These trends are driving customer adoption of cloud, artificial intelligence, software defined architectures and hybrid on-premise and off-premise combinations.
Current technology trends are focused on delivering greater flexibility and efficiency, as well as designing and managing IT securely, while balancing product availability creating an inflationary environment. These trends are driving customer adoption of cloud, AI, software defined architectures and hybrid on-premise and off-premise combinations.
Net sales on a constant currency basis Year Ended December 31, (dollars in millions) 2024 2023 Percent Change (1) Net sales, as reported $ 20,998.7 $ 21,376.0 (1.8) % Foreign currency translation (2) — 32.5 Net sales, on a constant currency basis $ 20,998.7 $ 21,408.5 (1.9) % (1) There were 254 selling days for both the years ended December 31, 2024 and 2023.
Net sales on a constant currency basis Year Ended December 31, (dollars in millions) 2025 2024 Percent Change (1) Net sales, as reported $ 22,424.1 $ 20,998.7 6.8 % Foreign currency translation (2) — 33.4 Net sales, on a constant currency basis $ 22,424.1 $ 21,032.1 6.6 % (1) There were 254 selling days for both the years ended December 31, 2025 and 2024.
For additional information on Net sales, Gross profit and Operating income by segment, see the “Segment Results of Operations.” Year Ended December 31, (dollars in millions) 2024 2023 Percent Change Net sales $ 20,998.7 $ 21,376.0 (1.8) % Cost of sales 16,396.3 16,723.6 (2.0) Gross profit 4,602.4 4,652.4 (1.1) Gross profit margin 21.9% 21.8% Selling and administrative expenses 2,951.1 2,971.5 (0.7) Operating income 1,651.3 1,680.9 (1.8) Operating income margin 7.9% 7.9% Interest expense, net (214.5) (226.6) (5.3) Other expense, net (1.4) (4.1) *nm Income before income taxes 1,435.4 1,450.2 (1.0) Income tax expense (357.6) (345.9) 3.4 Net income $ 1,077.8 $ 1,104.3 (2.4) % *nm - Not meaningful The year ended December 31, 2024 compared with the year ended December 31, 2023 Net sales decreased $377 million, or 1.8%, with lower Net sales across all operating segments.
For additional information on Net sales, Gross profit, and Operating income by segment, see the “Segment Results of Operations.” Year Ended December 31, (dollars in millions) 2025 2024 Percent Change Net sales $ 22,424.1 $ 20,998.7 6.8 % Cost of sales 17,550.7 16,396.3 7.0 Gross profit 4,873.4 4,602.4 5.9 Gross profit margin 21.7% 21.9% Selling and administrative expenses 3,217.8 2,951.1 9.0 Operating income 1,655.6 1,651.3 0.3 Operating income margin 7.4% 7.9% Interest expense, net (227.4) (214.5) 6.0 Other expense, net (0.8) (1.4) *nm Income before income taxes 1,427.4 1,435.4 (0.6) Income tax expense (360.8) (357.6) 0.9 Net income $ 1,066.6 $ 1,077.8 (1.0) % *nm - not meaningful The year ended December 31, 2025 compared with the year ended December 31, 2024 Net sales increased $1,425 million, or 6.8%, with higher Net sales across all operating segments.
Operating income by segment, in dollars and as a percentage of Net sales by segment, and the year-over-year percentage change are as follows: Year Ended December 31, 2024 2023 (dollars in millions) Operating Income Operating Income Margin Operating Income Operating Income Margin Operating Income Dollar Change Percent Change in Operating Income Segments: (1) Corporate $ 879.5 10.0 % $ 846.8 9.5 % $ 32.7 3.9 % Small Business 181.0 11.9 177.3 11.4 3.7 2.1 Public 745.9 9.1 735.0 8.8 10.9 1.5 Other (2) 112.1 4.5 142.1 5.6 (30.0) (21.1) Headquarters (3) (267.2) nm* (220.3) nm* (46.9) 21.3 Total Operating income $ 1,651.3 7.9 % $ 1,680.9 7.9 % $ (29.6) (1.8) % *nm - Not meaningful 28 Table of Contents (1) Segment operating income includes the segment’s direct operating income, allocations for certain Headquarters’ costs, allocations for income and expenses from logistics services, certain inventory adjustments and volume rebates and cooperative advertising from vendors.
(3) Gross profit margin represents segment Gross profit as a percentage of segment Net sales. 30 Table of Contents Operating income by segment for the comparative periods are as follows: Year Ended December 31, 2025 2024 (dollars in millions) Operating Income Percentage of Segment Net Sales Operating Income Percentage of Segment Net Sales Dollar Change Percent Change Segments: (1) Corporate $ 889.3 9.4 % $ 879.5 10.0 % $ 9.8 1.1 % Small Business 203.2 11.8 181.0 11.9 22.2 12.3 Public 750.3 8.8 745.9 9.1 4.4 0.6 Other (2) 154.2 5.7 112.1 4.5 42.1 37.6 Headquarters (3) (341.4) nm* (267.2) nm* (74.2) 27.8 Total Operating income $ 1,655.6 7.4 % $ 1,651.3 7.9 % $ 4.3 0.3 % *nm - not meaningful (1) Segment operating income includes the segment’s direct operating income, allocations for certain headquarters function costs, allocations for income and expenses from logistics services, certain inventory adjustments and volume rebates, and cooperative advertising from vendors.
Our liquidity and borrowing plans are established to align with our financial and strategic planning processes and ensure we have the nece ssary funding to meet our operating commitments, which primarily include the purchase of inventory, payroll and general expenses.
As of December 31, 2025, we had $1.9 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 nece ssary funding to meet our operating commitments, which primarily include the purchase of inventory, payroll, and general expenses.
For the definitions, discussion of management’s use of Non-GAAP measures and reconciliations to the most directly comparable US GAAP measure, see “Results of Operations - Non-GAAP Financial Measure Reconciliations.” The results of certain key business metrics for the comparative periods are as follows: Year Ended December 31, (dollars in millions, except per share amounts) 2024 2023 Net sales $ 20,998.7 $ 21,376.0 Gross profit $ 4,602.4 $ 4,652.4 Gross profit margin 21.9 % 21.8 % Operating income $ 1,651.3 $ 1,680.9 Operating income margin 7.9 % 7.9 % Non-GAAP operating income $ 1,947.0 $ 2,039.1 Non-GAAP operating income margin 9.3 % 9.5 % Net income $ 1,077.8 $ 1,104.3 Non-GAAP net income $ 1,287.2 $ 1,346.2 Net income per diluted share $ 7.97 $ 8.10 Non-GAAP net income per diluted share $ 9.52 $ 9.88 Average daily sales (1) $ 82.7 $ 84.2 Net debt (2) $ 5,125.1 $ 5,056.2 Cash conversion cycle (in days) (3) 18 17 Net cash provided by operating activities $ 1,277.3 $ 1,598.7 Adjusted free cash flow (4) $ 1,079.0 $ 1,426.8 (1) Defined as Net sales divided by the number of selling days.
For the definitions, discussion of management’s use of non-GAAP measures and reconciliations to the most directly comparable GAAP measure, see “Results of Operations - Non-GAAP Financial Measure Reconciliations.” The results of certain key business metrics for the comparative periods are as follows: Year Ended December 31, (dollars in millions, except per share amounts) 2025 2024 Net sales $ 22,424.1 $ 20,998.7 Gross profit $ 4,873.4 $ 4,602.4 Gross profit margin 21.7 % 21.9 % Operating income $ 1,655.6 $ 1,651.3 Operating income margin 7.4 % 7.9 % Non-GAAP operating income $ 1,996.7 $ 1,947.0 Non-GAAP operating income margin 8.9 % 9.3 % Net income $ 1,066.6 $ 1,077.8 Non-GAAP net income $ 1,323.0 $ 1,287.2 Net income per diluted share $ 8.08 $ 7.97 Non-GAAP net income per diluted share $ 10.02 $ 9.52 Average daily sales (1) $ 88.3 $ 82.7 (1) Defined as Net sales divided by the number of selling days.
Recent Accounting Pronouncements See the information set forth in Note 2 (Recent Accounting Pronouncements) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
Commitments and Contingencies The information set forth in Note 16 (Commitments and Contingencies) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
The decrease was primarily driven by the Notes issuance in 2024, partially offset by the repayments of long-term debt. For additional information regarding the inventory financing and debt, see Note 7 (Inventory Financing Agreements) and Note 8 (Debt) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
For additional information regarding the inventory financing and debt, see Note 7 (Inventory Financing Agreements) and Note 8 (Debt) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
Issuers and Guarantors of Debt Securities Each series of our outstanding unsecured senior notes (collectively, 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”).
Issuers and Guarantors of Debt Securities Each series of our outstanding unsecured senior notes (collectively, the “Notes”) are issued by CDW LLC and CDW Finance Corporation (the “Issuers”) and are guaranteed by Parent (the “Guarantor”).
(5) The change is primarily due to higher Miscellaneous receivables and Prepaid expenses and other in 2024. 33 Table of Contents In order to manage our working capital and operating cash needs, we monitor our cash conversion cycle, defined as days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average.
The decrease from Accounts receivable and the increase from Accounts payable-trade was primarily due to higher sales activity in 2025 and timing of collections and payments. 35 Table of Contents 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.
The trends are further driven by the evolution of the IT consumption model to more “as a service” offerings, including software as a service and infrastructure as a service, in addition to ongoing managed and professional service arrangements. Technology trends are likely to evolve as customers prioritize spend that will produce the most important outcomes for their business.
The trends are further driven by the evolution of the IT consumption model to more “as a service” solutions, including software as a service and infrastructure as a service, in addition to ongoing managed and professional service arrangements.
For the sale of professional services, we recognize the revenue over time given that our customers simultaneously receive and consume the benefits from these services as they are performed.
Changes in delivery patterns may result in a different number of business days estimated to make this adjustment. For the sale of professional services, we recognize the revenue over time given that our customers simultaneously receive and consume the benefits from these services as they are performed.
The higher effective income tax rate for the year ended December 31, 2024 as compared to the prior year was primarily attributable to lower excess tax benefits on equity-based compensation. 27 Table of Contents Segment Results of Operations Net sales by segment, in dollars and as a percentage of total Net sales, and the year-over-year dollar and percentage change in Net sales by segment are as follows: Year Ended December 31, 2024 2023 (dollars in millions) Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Dollar Change Percent Change (1) Corporate $ 8,837.2 42.1 % $ 8,960.8 41.9 % $ (123.6) (1.4) % Small Business 1,523.5 7.3 1,556.0 7.3 (32.5) (2.1) Public: Government 2,486.9 11.8 2,669.1 12.5 (182.2) (6.8) Education 3,167.3 15.1 3,298.3 15.4 (131.0) (4.0) Healthcare 2,503.5 11.9 2,338.3 10.9 165.2 7.1 Total Public 8,157.7 38.8 8,305.7 38.8 (148.0) (1.8) Other 2,480.3 11.8 2,553.5 12.0 (73.2) (2.9) Total Net sales $ 20,998.7 100.0 % $ 21,376.0 100.0 % $ (377.3) (1.8) % (1) There were 254 selling days for both the years ended December 31, 2024 and 2023.
T he increase in e ffective income tax rate was primarily attributable to lower excess tax benefits on equity-based compensation. 29 Table of Contents Segment Results of Operations Net sales by segment for the comparative periods are as follows: Year Ended December 31, 2025 2024 (dollars in millions) Net Sales Percentage of Total Net Sales Net Sales Percentage of Total Net Sales Dollar Change Percent Change (1) Corporate $ 9,442.4 42.1 % $ 8,837.2 42.1 % $ 605.2 6.8 % Small Business 1,726.7 7.7 1,523.5 7.3 203.2 13.3 Public: Government 2,589.5 11.6 2,486.9 11.8 102.6 4.1 Education 3,109.6 13.9 3,167.3 15.1 (57.7) (1.8) Healthcare 2,836.1 12.6 2,503.5 11.9 332.6 13.3 Total Public 8,535.2 38.1 8,157.7 38.8 377.5 4.6 Other (2) 2,719.8 12.1 2,480.3 11.8 239.5 9.7 Total Net sales $ 22,424.1 100.0 % $ 20,998.7 100.0 % $ 1,425.4 6.8 % (1) There were 254 selling days for both the years ended December 31, 2025 and 2024.
Income tax expense was $358 million for the year ended December 31, 2024, compared to $346 million for the year ended December 31, 2023. The effective income tax rate, expressed by calculating income tax expense as a percentage of Income before income taxes, was 24.9% and 23.9% for 2024 and 2023, respectively.
Income tax expense increased $3 million, or 0.9%. The effective income tax rate, expressed by calculating income tax expense as a percentage of Income before income taxes , was 25.3% and 24.9% for 2025 and 2024, respectively.
Key Business Metrics We monitor a number of financial and non-financial measures and ratios on a regular basis in order to track the progress of our business and make adjustments as necessary.
Technology trends are likely to evolve and customers will prioritize spend that will produce the most important outcomes for their business. 27 Table of Contents Key Business Metrics We monitor a number of financial and non-financial measures and ratios on a regular basis in order to track the progress of our business and make adjustments as necessary.
Seasonality While we have not historically experienced seasonality throughout the year, sales in our Public segment have historically been higher in the second and third quarter than in other quarters primarily due to the buying patterns of education and government customers.
Seasonality While we have not historically experienced seasonality throughout the year, sales in our Public segment have historically been higher in the second and third quarter than in other quarters primarily due to the buying patterns of education and government customers. 33 Table of Contents Liquidity and Capital Resources Overview 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”).
Non-GAAP net income and Non-GAAP net income per diluted share Year Ended December 31, 2024 Year Ended December 31, 2023 (dollars and shares in millions, except per share amounts) Income before income taxes Income tax expense (1) Net income Income before income taxes Income tax expense (1) Net income Net Income Percent Change US GAAP, as reported $ 1,435.4 $ (357.6) $ 1,077.8 $ 1,450.2 $ (345.9) $ 1,104.3 (2.4) % Amortization of intangibles (2) 150.9 (39.2) 111.7 154.4 (40.2) 114.2 Equity-based compensation 64.7 (26.7) 38.0 93.7 (47.6) 46.1 Transformation initiatives (3) 34.8 (9.1) 25.7 27.1 (7.1) 20.0 Acquisition and integration expenses 12.2 (2.1) 10.1 30.0 (7.8) 22.2 Workplace optimization (4) 25.4 (6.6) 18.8 47.7 (12.4) 35.3 Other adjustments 6.9 (1.8) 5.1 5.3 (1.2) 4.1 Non-GAAP $ 1,730.3 $ (443.1) $ 1,287.2 $ 1,808.4 $ (462.2) $ 1,346.2 (4.4) % Net income per diluted share, as reported $ 7.97 $ 8.10 Non-GAAP net income per diluted share $ 9.52 $ 9.88 Shares used in computing US GAAP and Non-GAAP net income per diluted share 135.2 136.3 (1) Income tax on non-GAAP adjustments includes excess tax benefits associated with equity-based compensation.
(3) Includes costs related to workforce reductions and charges related to the reduction of our real estate lease portfolio. 32 Table of Contents Non-GAAP net income and Non-GAAP net income per diluted share Year Ended December 31, 2025 2024 (dollars and shares in millions, except per share amounts) Income before income taxes Income tax expense (1) Net income Income before income taxes Income tax expense (1) Net income GAAP, as reported $ 1,427.4 $ (360.8) $ 1,066.6 $ 1,435.4 $ (357.6) $ 1,077.8 Amortization of intangibles (2) 169.8 (44.1) 125.7 150.9 (39.2) 111.7 Equity-based compensation 83.6 (19.1) 64.5 64.7 (26.7) 38.0 Transformation initiatives (3) 57.9 (15.0) 42.9 34.8 (9.1) 25.7 Acquisition and integration expenses 7.6 (2.0) 5.6 12.2 (2.1) 10.1 Workplace optimization (4) 16.2 (4.2) 12.0 25.4 (6.6) 18.8 Other adjustments 7.8 (2.1) 5.7 6.9 (1.8) 5.1 Non-GAAP $ 1,770.3 $ (447.3) $ 1,323.0 $ 1,730.3 $ (443.1) $ 1,287.2 Net income per diluted share, as reported $ 8.08 $ 7.97 Non-GAAP net income per diluted share $ 10.02 $ 9.52 Shares used in computing GAAP and Non-GAAP net income per diluted share 132.1 135.2 (1) Income tax on non-GAAP adjustments includes excess tax benefits associated with equity-based compensation.
Operating income decreased $30 million, or 1.8%, to $1,651 million for the year ended December 31, 2024, compared to $1,681 million for the year ended December 31, 2023. Interest expense, net decreased $12 million, or 5.3%, primarily due to increased interest income earned on higher average cash balances.
Operating inco me increased $4 million, or 0.3%, to $1,656 million for the year ended December 31, 2025, compared to $1,651 million for the year ended December 31, 2024. Interest expense, net includes interest expense and interest income. Interest expense, net increased $13 million, or 6.0%, primarily due to lower interest income earned on cash balances.
These non-GAAP performance measures and non-GAAP financial condition measures are collectively referred to as “non-GAAP financial measures.” Non-GAAP operating income excludes, among other things, charges related to the amortization of acquisition-related intangible assets, equity-based compensation and the associated payroll taxes, acquisition and integration expenses, transformation initiatives and workplace optimization.
The GAAP measure most directly comparable to Free cash flow and Adjusted free cash flow is Net cash provided by operating activities. Non-GAAP operating income excludes, among other things, charges related to the amortization of acquisition-related intangible assets, equity-based compensation and the associated payroll taxes, acquisition and integration expenses, transformation initiatives, and workplace optimization.
(2) Includes costs related to strategic transformation initiatives focused on optimizing various operations and systems. (3) Includes costs related to workforce reductions and charges related to the reduction of our real estate lease portfolio.
(2) Includes costs related to strategic transformation initiatives focused on optimizing various operations and systems.
Dividends A summary of 2024 dividend activity for our common stock is as follows: Dividend Amount Declaration Date Record Date Payment Date $ 0.620 February 6, 2024 February 26, 2024 March 12, 2024 0.620 April 30, 2024 May 24, 2024 June 11, 2024 0.620 July 30, 2024 August 26, 2024 September 10, 2024 0.625 October 29, 2024 November 25, 2024 December 10, 2024 $ 2.485 O n February 5, 2025, we announced that our Board of Directors declared a quarterly cash dividend on our common stock of $0.625 per share.
For additional information about our share repurchase program, refer to Note 12 (Stockholders’ Equity) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report. 34 Table of Contents Dividends A summary of 2025 dividend activity for our common stock is as follows: Dividend Amount Declaration Date Record Date Payment Date $ 0.625 February 4, 2025 February 25, 2025 March 11, 2025 0.625 May 6, 2025 May 26, 2025 June 10, 2025 0.625 August 5, 2025 August 25, 2025 September 10, 2025 0.630 November 3, 2025 November 25, 2025 December 10, 2025 $ 2.505 O n February 4, 2026, we announced that our Board of Directors declared a quarterly cash dividend on our common stock of $0.630 per share.
Non-GAAP Financial Measure Reconciliations Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial condition that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with US GAAP.
Other Operating income increased $42 million, or 37.6%, primarily due to higher Gross profit dollars, partially offset by higher performance-based compensation within the UK and Canada operations. 31 Table of Contents Non-GAAP Financial Measure Reconciliations Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial condition that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP.
Trends and Key Factors Affecting our Financial Performance We believe the following key factors may have a meaningful impact on our business performance, influencing our ability to generate sales and achieve our targeted financial and operating results: • General economic conditions are a key factor affecting our results as they can impact our customers’ willingness and ability to spend on information technology.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, compared with the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 21, 2025. 26 Table of Contents Trends and Key Factors Affecting our Financial Performance We believe the following key factors may have a meaningful impact on our business performance, influencing our ability to generate sales and achieve our targeted financial and operating results: • General economic conditions are a key factor affecting our results as they can impact our customers’ willingness and ability to spend on IT.
Critical estimates utilized in valuing customer relationships include estimated forecasted future revenue and EBITDA margin growth rates, customer attrition rates and market-participant discount rates. The assumptions we apply in forecasting future revenue and customer attrition rates is based on analysis of historical data, assessment of current and anticipated market conditions, estimated growth rates, and management plans.
Critical estimates utilized in valuing customer relationships include estimated forecasted future revenue and EBITDA margin growth rates, customer attrition rates, and market-participant discount rates.
Results of Operations 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 years ended December 31, 2024 and 2023 are below.
(3) Defined as Net cash provided by operating activities less Capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory. 28 Table of Contents Results of Operations 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 years ended December 31, 2025 and 2024 are below.
There were 254 selling days for both the years ended December 31, 2024 and 2023. (2) Defined as Total debt minus Cash and cash equivalents and Short-term investments.
There were 254 selling days for both the years ended December 31, 2025 and 2024.
Investing Activities Net cash used in investing activities increased $430 million in 2024 compared to 2023. This increase was primarily due to the acquisition of Mission Cloud Services, Inc. and purchases of short-term investments in 2024. Financing Activities Net cash used in financing activities decreased $412 million in 2024 compared to 2023.
Investing Activities Net cash provided by investing activities increased $729 million for the year ended December 31, 2025 compared to December 31, 2024. This increase was primarily driven by 2024 cash outflows to acquire Mission Cloud Services, Inc. and the purchase of short-term investments, compared to the 2025 cash inflow due to maturity of the short-term investments.
These amounts are classified separately as Accounts payable-inventory financing on the Consolidated Balance Sheets. We do not incur any interest expense or other incremental expenses associated with these agreements as balances are paid when they are due.
We do not incur any interest expense or other incremental expenses associated with these agreements as balances are paid when they are due. For additional information, see Note 7 (Inventory Financing Agreements) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
The cash conversion cycle increased to 18 days at December 31, 2024, compared to 17 days at December 31, 2023. The overall increase was primarily driven by an increase in DSO due to multi-year transactions and timing of collections. This was partially offset by an increase in DPO due to multi-year transactions and timing of payments.
The cash conversion cycle decreased to 16 days at December 31, 2025, compared to 18 days at December 31, 2024. The improvement was primarily due to DIO, which declined by 2 days as a result of lower average stocking positions. DSO and DPO both increased due to an increase in netted down revenue and multi-year transactions.
The year ended December 31, 2024 compared with the year ended December 31, 2023 Corporate segment Net sales decreased $124 million, or 1.4%, primarily due to a decrease in netcomm products, partially offset by an increase in notebooks/mobile devices and software. Corporate segment Gross profit dollars decreased $28 million, or 1.3%, although partially offset by increased netted down revenue.
The year ended December 31, 2025 compared with the year ended December 31, 2024 Corporate segment Net sales increased $605 million, or 6.8%, primarily due to increased customer demand primarily in software, notebooks/mobile devices, netcomm products, and desktops.
We also have two other operating segments: CDW UK and CDW Canada, each of which do not meet the reportable segment quantitative thresholds and, accordingly, are included in an all other category (“Other”). We are vendor, technology and consumption model unbiased, with a solutions portfolio including more than 100,000 products and services from more than 1,000 leading and emerging brands.
We also have two other operating segments: CDW UK and CDW Canada, each of which do not meet the reportable segment quantitative thresholds and, accordingly, are included in an all other category (“Other”). Effective January 1, 2026, we realigned our customer-facing organization to better meet the evolving needs of our customers and end markets.
For additional information regarding our debt and refinancing activities, see Note 8 (Debt) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report. Inventory Financing Agreements We have entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions to enhance working capital.
Inventory Financing Agreements We have entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions to enhance working capital. These amounts are classified separately as Accounts payable-inventory financing on the Consolidated Balance Sheets.
Long-Term Debt and Financing Arrangements During the third quarter of 2024, we completed the issuance of $600 million aggregate principal amount of 5.100% Senior Notes due 2030 and $600 million aggregate principal amount of 5.550% Senior Notes due 2034 (collectively, the “Notes”).
Long-Term Debt and Financing Arrangements During the second quarter of 2025, we repaid the $211 million remaining aggregate principal amount of the 4.125% Senior Notes due 2025 at maturity.
Gross profit by segment, in dollars and Gross profit margin by segment, defined as Gross profit dollars as a percentage of Net sales by segment, and the year-over-year percentage change are as follows: Year Ended December 31, 2024 2023 (dollars in millions) Gross Profit Gross Profit Margin Gross Profit Gross Profit Margin Gross Profit Dollar Change Percent Change in Gross Profit Segments: Corporate $ 2,099.5 23.8 % $ 2,127.8 23.7 % $ (28.3) (1.3) % Small Business 352.9 23.2 361.7 23.2 (8.8) (2.4) Public 1,659.2 20.3 1,667.5 20.1 (8.3) (0.5) Other (1) 490.8 19.8 495.4 19.4 (4.6) (0.9) Total Gross profit $ 4,602.4 21.9 % $ 4,652.4 21.8 % $ (50.0) (1.1) % (1) Includes the financial results for our other operating segments, CDW UK and CDW Canada, which do not meet the reportable segment quantitative thresholds.
Gross profit by segment for the comparative periods are as follows: Year Ended December 31, 2025 2024 (dollars in millions) Gross Profit Gross Profit Margin (3) Gross Profit Gross Profit Margin (3) Dollar Change Percent Change Segments: (1) Corporate $ 2,201.9 23.3 % $ 2,099.5 23.8 % $ 102.4 4.9 % Small Business 393.8 22.8 352.9 23.2 40.9 11.6 Public 1,722.3 20.2 1,659.2 20.3 63.1 3.8 Other (2) 555.4 20.4 490.8 19.8 64.6 13.2 Total Gross profit $ 4,873.4 21.7 % $ 4,602.4 21.9 % $ 271.0 5.9 % (1) Segment gross profit includes the segment’s direct gross profit, allocations for gross profit from logistics services, and allocations for certain inventory adjustments, volume rebates, and cooperative advertising from vendors.
For additional information about our share repurchase program, refer to Note 12 (Stockholders’ Equity) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report.
Subsequent Events The information set forth in Note 18 (Subsequent Events) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report is incorporated herein by reference.
We may from time to time repurchase one or more series of our outstanding unsecured senior notes, depending on market conditions, contractual commitments, our capital needs and other factors. Repurchases of our senior notes may be made by open market or privately negotiated transactions and may be pursuant to Rule 10b5-1 plans or otherwise.
As of December 31, 2025, we had total unsecured indebtedness of $5.6 billion, and we were in compliance with the covenants under our credit agreements and indentures. We may from time to time repurchase one or more series of our outstanding unsecured senior notes, depending on market conditions, contractual commitments, our capital needs, and other factors.
Gross profit margin, expressed as a percentage of Net sales, increased 10 basis points to 21.9% primarily driven by a higher contribution of netted down revenue, primarily software as a service, partially offset by lower product margin due to mix and rate in notebooks/mobile devices.
Small Business segment Gross profit dollars increased $41 million, or 11.6%, due to higher Net sales, partially offset by lower gross profit margin. Gross profit marg in decreased 40.0 basis points, to 22.8%, due to mixing into certain lower margin hardware categories, primarily notebooks/mobile devices, partially offset by a higher contribution of netted down revenue.
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.
In 2025, all guarantees by CDW LLC’s direct and indirect, 100% owned domestic subsidiaries were released pursuant to the customary release provisions in the applicable indentures; as a result, Parent is now the sole remaining guarantor of the Notes. All guarantees by Parent are joint and several, and full and unconditional.
If customers continue to shift their software purchases to multi-year arrangements, unbilled receivables will continue to grow, which is offset by the growth in accounts payable to match the timing of collections due from customers with the payments due to vendors.
Additionally, as customers continue to shift to multi-year software purchases, unbilled receivables and DSO are expected to continue 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.
Most notably netcomm products decreased across all sales channels and collaboration products decreased within the Education sales channel, partially offset by an increase in notebooks/mobile devices across all channels. Public segment Gross profit dollars decreased $8 million, or 0.5%. Gross profit margin increased 20 bps, to 20.3%, primarily due to increased netted down revenue.
Public segment Net sales increased $378 million, or 4.6%, primarily due to an increased customer demand in software and services across all customer channels, notebooks/mobile devices in the education and healthcare customer channels. Public segment Gross profit doll ars increased $63 million, or 3.8%, due to higher Net sales. Gross profit margin remained relatively consistent at 20.2%.
For a discussion of results for the year ended December 31, 2023, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 26, 2024.
For a discussion of results for the year ended December 31, 2024, see “Item 7.
Average daily sales is defined as Net sales divided by the number of selling days.
Average daily sales is defined as Net sales divided by the number of selling days. (2) Includes the financial results for our other operating segments, CDW UK and CDW Canada, which do not meet the reportable segment quantitative thresholds.
Small Business segment Net sales decreased $33 million, or 2.1%, primarily due to a decline across all hardware categories, partially offset by an increase in services. Small Business segment Gross profit dollars decreased $9 million, or 2.4%. Gross profit margin remained consistent at 23.2%.
Corporate segment Gros s profit dollars increased $102 million, or 4.9%, due to higher Net sales, partially offset by lower gross profit margin. Gross profit margin decreased 50.0 basis points, to 23.3% , due to decreased rates in certain hardware categories, primarily data storage and servers.
For additional information, see Note 7 (Inventory Financing Agreements) to the accompanying Consolidated Financial Statements included in Part II, Item 8 of this report. Share Repurchase Program During 2024, we repurchased 2.4 million shares of our common stock for $500 million under the previously announced share repurchase program.
Share Repurchase Program During 2025, we repurchased 4.0 million shares of our common stock for $653 million under the previously announced share repurchase program.
Selling and administrative expenses decreased $20 million, or 0.7%, primarily due to lower performance-based compensation, including equity-based compensation, consistent with lower attainment against certain financial measures, and lower workforce optimization costs, partially offset by a higher provision for expected credit losses and transformation and other related costs in the current year.
Gross profit margin decreased 20 basis points, to 21.7%, primarily driven by decreased rates in certain hardware categories. Selling and administrative expenses increased $267 million, or 9.0%, primarily due to higher performance-based compensation, transformation related costs, and coworker-related costs.
The Notes and the related guarantees are the Issuers’ and the Guarantors’ senior unsecured obligations and are: • structurally subordinated to all existing and future indebtedness and other liabilities of our non-guarantor subsidiaries and • rank equal in right of payment with all of the Issuers’ and the Guarantors’ existing and future unsecured senior debt. 34 Table of Contents The following tables set forth Balance Sheet information as of December 31, 2024 and December 31, 2023, and Statement of Operations information for the years ended December 31, 2024 and 2023 for the accounts of the Issuers and the accounts of the Guarantors (the “Obligor Group”).
The Notes and the related guarantees are the Issuers’ and the Guarantor’s senior unsecured obligations and are: • structurally subordinated to all existing and future indebtedness and other liabilities of our non-guarantor subsidiaries and • rank equal in right of payment with all of the Issuers’ and the Guarantor’s existing and future unsecured senior debt. 36 Table of Contents Given that Parent, the sole Guarantor of the notes, is a holding company that does not conduct business operations of its own and depends on cash dividends, distributions, and other transfers from its subsidiaries to meet its obligations, we concluded that providing summarized financial information of the Issuers and Guarantor on an unconsolidated basis, excluding the non-guarantor subsidiaries, would not provide meaningful information to investors.
Removed
Macroeconomic uncertainty persists as a result of the inflationary environment and the corresponding level of interest rates driven by monetary policy.
Added
As a result, we will have the following three reportable segments: “Commercial,” “Government,” and “Education.” Our “Commercial” segment will be comprised of corporate, financial services, and healthcare customers in the US, each of which will represent a unique customer channel. Small business customers will be included across the customer channels within our “Commercial” segment.
Removed
(4) Defined as Net cash provided by operating activities less capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory.
Added
Our “Government” segment will be comprised of federal, state, and local agencies in the US. The “Education” segment will be comprised of primary, secondary, and higher education institutions in the US. CDW UK and CDW Canada will remain unchanged in this new reporting structure, in an all other category (“Other”).
Removed
The decrease was primarily due to a decrease in netcomm, partially offset by an increase in notebooks/mobile devices. Continued economic uncertainty and the complex technology landscape has led customers to be cautious and measured in their approach to technology spending, leading to a decline in Net sales.
Added
We will reflect this change in segment presentation, including the recasting of historical results, in our periodic and annual reports beginning with the period ending March 31, 2026. We are vendor, technology, and consumption model unbiased, with a solutions portfolio including more than 100,000 products and services from more than 1,000 leading and emerging brands.
Removed
Gross profit decreased $50 million, or 1.1%, primarily due to lower Net sales across all operating segments.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA hypothetical 10% change between the US dollar and the currencies from our international operations would have no material impact on our results for the years ended December 31, 2024 and 2023. 37 Table of Contents
Biggest changeA hypothetical 10% change between the US dollar and the currencies from our international opera tion s would have no material impact on our results fo r the years ended December 31, 2025 and 2024. 39 Table of Contents
Based on our floating rate debt and derivative instruments outstanding at December 31, 2024 and 2023, a 100 basis point change would have no material impact on our results. Foreign Currency Risk We transact business in foreign currencies other than the US dollar, primarily the British pound and the Canadian dollar, which exposes us to foreign currency exchange rate fluctuations.
Based on our floating rate debt and derivative instruments outstanding at December 31, 2025 and 2024, a 100 basis point change would have no material impact on our results. Foreign Currency Risk We transact business in foreign currencies other than the US dollar, primarily the British pound and the Canadian dollar, which exposes us to foreign currency exchange rate fluctuations.

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