CDW Corporation

What they do

CDW procures hardware, software, and cloud products from OEMs and publishers and delivers integrated IT solutions—including on-premise, cloud, hybrid infrastructure, digital experience, and security—through approximately 10,500 customer-facing sellers, specialists, and engineers. It is vendor- and consumption-model neutral, positioning itself as a trusted adviser across the full technology lifecycle.

Revenue drivers

• Commercial segment — Primarily serves US private-sector businesses with more than 250 employees, plus Healthcare and Financial Services customers. Q2 2026 net sales of $3.97B, up 9.2% YoY, driven by data storage, servers, notebooks, and software.
• Government segment — Focuses on US federal, state, and local government agencies. Q2 2026 net sales of $848M, up 13.6% YoY.
• Small Business segment — Serves US private-sector customers with up to 250 employees. Contributed to the overall US business, which represented ~90% of total net sales in 2025.
• Other (UK & Canada) — Combined net sales of $2.7B in 2025. These operating segments do not meet reportable segment thresholds and are reported as 'Other'.

Recent performance

For Q2 2026 (ended June 30, 2026), CDW reported net sales of $6.57B, up 10.0% YoY on a comparable 64 selling days. Gross profit was $1.32B (margin 20.1%, down from 20.8% a year ago), operating income $428.6M (margin 6.5%), net income $274.4M, and diluted EPS $2.15. Non-GAAP net income per diluted share was $2.91, up 11.9% YoY. Growth was led by demand in data storage, servers, notebooks, software, and networking products.

Strategy

CDW aims to exceed US IT addressable market growth by 200–300 basis points on a constant-currency basis, leveraging its diversified portfolio, vendor neutrality, and services-led capabilities. Management emphasizes balancing growth investments (particularly in infrastructure modernization, cloud, and AI-enabled solutions) with operational efficiency and disciplined capital allocation. The company seeks to capture evolving technology demand as customers move from AI exploration to scaling practical use cases, relying on CDW's integration expertise across the full technology stack.

Risks

• Vendor partner dependence — CDW's authorization agreements with OEMs, software publishers, and cloud providers are primarily short-term and terminable at will; changes in terms, funding, or termination could adversely affect results.
• Intense competition — The IT reseller and solutions market is highly fragmented, with thousands of competitors; CDW could lose market share if it fails to differentiate or if vendor partners sell directly to end users.
• Cybersecurity and data breaches — A failure to protect CDW's IT systems or customer data from cyber threats could result in reputational damage, legal liability, and loss of business.
• Supply chain disruptions — Heightened demand related to AI workloads may cause capacity limitations and cost increases from suppliers, potentially delaying product availability and raising costs.

Outlook

Management expects continued strong demand for infrastructure solutions as customers invest in modernization, cloud, and AI. CDW remains confident in its ability to outgrow the US IT addressable market by 200–300 bps on a constant-currency basis. The company will maintain a disciplined approach to working capital, capital allocation, and expense management while investing in growth opportunities.