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INSIGHt ENTERPRISES, INC. 公司報告
第三季度業績。
亞利桑那州錢德勒– 2024年10月31日 – Insight Enterprises, Inc. (納斯達克: NSIT)（以下簡稱「公司」）今天報告了截至2024年9月30日的季度財務業績。重點包括：
•毛利潤同比增長6%，達到43210萬美元，毛利率擴大270個點子至20.7%
•Insight Core服務的毛利潤同比增長14%
•雲毛利潤同比增長33%
•合併淨利潤年比下降3%，至5820萬美元
•調整後的息稅折舊及攤銷前（EBITDA）年度同比維持在12880萬美元不變
•每股攤薄收益爲1.52美元，同比減少6%
•每股調整稀釋盈利爲2.19美元，同比下降8%
2024年第三季度，淨銷售額同比下降8％至21億美元，而毛利潤同比增長6％至43210萬美元。毛利率擴大至27%，較上年同期增長270個點子。 相較於2023年第三季度的20.7％，運營利潤爲9290萬美元，較2023年第三季度的9190萬美元增長1％。調整後的運營利潤爲12010萬美元，與2023年第三季度的11980萬美元基本持平。2024年第三季度，綜合淨收入爲5820萬美元，佔淨銷售額的2.8％，調整後的綜合淨收入爲7700萬美元，佔淨銷售額的3.7％。當季每股攤薄收益爲1.52美元，同比下降6％，而調整後的每股攤薄收益爲2.19美元，同比下降8％。
「我們對業務的長期健康持樂觀態度；然而，第三季度未達到我們的預期，我們預計信息技術支出環境在短期內仍將保持謹慎，」總裁兼首席執行官喬伊斯·默倫表示。「我們繼續執行我們的解決方案集成策略，通過收購推動強勁的雲增長和穩固的Insight核心服務業績，」默倫表示。
由於在建築和礦業行業中的多用途使用，中型挖掘機領域在2023年佔據了巴西履帶挖掘機市場的最大份額。政府在提升農村地區互聯互通的基礎設施升級和交通項目方面的投資預計將支持巴西市場對中型挖掘機的需求。
季度業績：
•2024年第三季度合併淨銷售額爲21億美元，較2023年第三季度下降8%。產品淨銷售額同比下降11%，而服務淨銷售額同比增長10%。
•北美地區淨銷售額同比下降8%，達到17億美元；
◦控制支出，同時繼續在我們認爲對長期成功至關重要的領域進行投資。產品淨銷售額同比下降11%，至14億美元;
◦控制支出，同時繼續在我們認爲對長期成功至關重要的領域進行投資。服務淨銷售額同比增長9%，達到32540萬美元；
•歐洲、中東、非洲地區的淨銷售額同比下降12%，至31260萬美元；而
•亞太地區的淨銷售額同比增長15%，達5870萬美元。
•除匯率波動因素外，綜合淨銷售額同比下降8％，其中北美和歐洲、中東、非洲的淨銷售額同比分別下降8％和13％，而亞太地區的淨銷售額同比增長13％。
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, 亞利桑那州 85286 | 800.467.4448 | 傳真 480.760.8958 | ||||||||||
•綜合毛利潤較2023年第三季度增長6%，至43210萬美元，綜合毛利率擴大 相比去年同期，產品毛利潤下降了3％，服務毛利潤增長了13％。雲毛利潤同比增長了33％，洞察覈心服務毛利潤同比增長了14％。按業務板塊劃分，毛利潤：
•同比增長4%，達到34810萬美元（毛利率20.3%）；
•在歐洲、中東、非洲地區，同比增長了11%，達到6640萬美元（毛利率21.2%）；和
•亞太地區同比增長15%，達到1760萬美元（毛利率30.1%）。
•在排除波動的外幣匯率影響後，毛利潤合併增長了5%，同比增長，其中北美、歐洲、中東、非洲和APAC的毛利潤增長分別爲4%、9%和13%，同比增長。
•與2023年第三季度相比，運營收入增長1%，達到9290萬美元，佔淨銷售額的4.4%。按部分計算，運營收入：
•北美銷售額同比下降6％，達到8080萬美元，佔淨銷售額的4.7％；
•在歐洲、中東、非洲地區，年同比增長超過100%，達到670萬美元，佔淨銷售額的2.1%；並且
•亞太地區的銷售額同比增加了31％，達到540萬美元，相當於淨銷售額的9.1％。
•除了波動的外幣匯率影響外，合併經營收益也同比增長1%，其中歐洲、中東、非洲和亞太地區的經營收益同比增長超過100%和28%，分別，部分抵消了北美地區經營收益同比下降6%。
•2023年第三季度經營調整後盈利相對平穩，爲12010萬美元，佔淨銷售額的5.8%。按部門來看，經營調整後盈利爲：
•北美地區年同比減少3%，至10660萬美元，佔淨銷售額的6.2%；
•歐洲、中東、非洲地區的銷售年同比增長30%，達到810萬美元，佔淨銷售額的2.6%；
•亞太地區的銷售額同比增長30%，達到550萬美元，佔淨銷售額的9.3%。
•除了波動的外幣匯率影響之外，調整後的合併營運收益與2023年第三季度持平，歐洲、中東、非洲和亞太地區的調整後營運收益分別同比增長25%和28%，而北美地區的調整後營運收益同比減少2%。
•2024年第三季度合併淨利潤和每股攤薄收益分別爲5820萬美元和1.52美元，有效稅率爲22.5%。
•2024年第三季度調整後的合併淨利潤爲7700萬美元，調整後的每股攤薄收益爲2.19美元。排除外匯匯率波動的影響，調整後的每股攤薄收益同比下降8%。
在本新聞稿中討論截至2024年和2023年9月30日三個月和九個月的財務業績時，公司提及了某些根據美國通用會計準則（「GAAP」）調整的財務指標。涉及非GAAP指標時，公司將其稱爲「調整後」。有關更多信息，請參閱「非GAAP財務指標的使用」。按照GAAP準備的財務指標與非GAAP財務指標的表格對照在本新聞稿末尾。
在某些情況下，公司提到淨銷售額、毛利潤、經營收入利潤和調整後的經營收入利潤方面的變化合並以及在北美地區、歐洲、中東、非洲和亞太地區排除匯率波動的影響。此外，公司在調整後的每股稀釋收益方面也提到了在合併基礎上排除匯率波動的影響。這些也被視爲非GAAP指標。公司認爲提供排除匯率波動影響的信息，爲投資者提供關於其基本業務和經營業績的有價值的補充信息，與公司及其管理層評估公司績效的方式一致。在計算這些變化和百分比時，公司將當年金額按照適用會計準則轉換爲美元與先前年份金額作比較，先前年份金額以本地貨幣轉換爲美元，利用當前期間的加權平均匯率。排除匯率波動影響的績效指標不應被視爲制定根據GAAP編制的財務業績指標的替代品或更優的替代品。
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
The tax effect of Adjusted amounts referenced herein were computed using the statutory tax rate for the taxing jurisdictions in the operating segment in which the related expenses were recorded, adjusted for the effects of valuation allowances on net operating losses in certain jurisdictions.
GUIDANCE
For the full year 2024, we now expect Adjusted diluted earnings per share to be between $9.40 and $9.70. We also now expect to deliver mid single-digit gross profit growth and continue to expect that our gross margin will be in the 19% to 20% range.
This outlook assumes:
•interest expense of $58 to $60 million;
•an effective tax rate of approximately 25.5% for the full year;
•capital expenditures of $35 to $40 million; and
•an average share count for the full year of 35.1 million shares.
This outlook excludes acquisition-related intangibles amortization expense of approximately $70 million, assumes no acquisition or integration related expenses, transformation or severance and restructuring expenses, net and no significant change in our debt instruments or the macroeconomic environment. Due to the inherent difficulty of forecasting some of these types of expenses, which impact net earnings, diluted earnings per share and selling and administrative expenses, the Company is unable to reasonably estimate the impact of such expenses, if any, to net earnings, diluted earnings per share and selling and administrative expenses. Accordingly, the Company is unable to provide a reconciliation of GAAP to non-GAAP diluted earnings per share for the full year 2024 forecast.
CONFERENCE CALL AND WEBCAST
The Company will host a conference call and live webcast today at 9:00 a.m. ET to discuss third quarter 2024 results of operations. A live webcast of the conference call (in listen-only mode) will be available on the Company’s web site at http://investor.insight.com/, and a replay of the webcast will be available on the Company’s web site for a limited time following the call. To access the live conference call, please register in advance using the event link on the Company's web site. Upon registering, participants will receive dial-in information via email, as well as a unique registrant ID, event passcode, and detailed instructions regarding how to join the call.
USE OF NON-GAAP FINANCIAL MEASURES
The non-GAAP financial measures are referred to as “Adjusted”. Adjusted earnings from operations, Adjusted net earnings and Adjusted diluted earnings per share exclude (i) severance and restructuring expenses, net, (ii) certain executive recruitment and hiring related expenses, (iii) amortization of intangible assets, (iv) transformation costs, (v) certain acquisition and integration related expenses, (vi) gains and losses from revaluation of acquisition related earnout liabilities, (vii) certain third-party data center service outage related expenses and recoveries, and (viii) the tax effects of each of these items, as applicable. Transformation costs represent costs we are incurring to transform our business, to help us achieve our strategic objectives, including becoming a leading solutions integrator. The Company excludes these items when internally evaluating earnings from operations, tax expense, net earnings and diluted earnings per share for the Company and earnings from operations for each of the Company’s operating segments. Adjusted diluted earnings per share also includes the impact of the benefit from the note hedge where the Company’s average stock price for the third quarter of 2024 was in excess of $68.32, which is the initial conversion price of our convertible senior notes (the “Convertible Notes”). Adjusted EBITDA excludes (i) interest expense, (ii) income tax expense, (iii) depreciation and amortization of property and equipment, (iv) amortization of intangible assets, (v) severance and restructuring expenses, net, (vi) certain executive recruitment and hiring related expenses, (vii) transformation costs (viii) certain acquisition and integration related expenses, (ix) certain third-party data center service outage related expenses and recoveries, and (x) gains and losses from revaluation of acquisition related earnout liabilities. Adjusted return on invested capital (“ROIC”) excludes (i) severance and restructuring expenses, net, (ii) certain executive recruitment and hiring related expenses, (iii) amortization of intangible assets, (iv) transformation costs, (v) certain acquisition and integration related expenses, (vi) certain third-party data center service outage related expenses and recoveries, (vii) gains and losses from revaluation of acquisition related earnout liabilities, and (viii) the tax effects of each of these items, as applicable.
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
These non-GAAP measures are used by the Company and its management to evaluate financial performance against budgeted amounts, to calculate incentive compensation, to assist in forecasting future performance and to compare the Company’s results to those of the Company’s competitors. The Company believes that these non-GAAP financial measures are useful to investors because they allow for greater transparency, facilitate comparisons to prior periods and the Company’s competitors’ results and assist in forecasting performance for future periods. These non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures presented by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
FINANCIAL SUMMARY TABLE
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||
| 2024 | 2023 | change | 2024 | 2023 | change | |||||||||||||||||||||||||||||||||
| Insight Enterprises, Inc. | ||||||||||||||||||||||||||||||||||||||
| Net sales: | ||||||||||||||||||||||||||||||||||||||
| Products | $ | 1,673,779 | $ | 1,890,154 | (11%) | $ | 5,364,169 | $ | 5,803,408 | (8%) | ||||||||||||||||||||||||||||
| Services | $ | 414,107 | $ | 376,132 | 10% | $ | 1,264,864 | $ | 1,136,421 | 11% | ||||||||||||||||||||||||||||
| Total net sales | $ | 2,087,886 | $ | 2,266,286 | (8%) | $ | 6,629,033 | $ | 6,939,829 | (4%) | ||||||||||||||||||||||||||||
| Gross profit | $ | 432,085 | $ | 408,870 | 6% | $ | 1,326,378 | $ | 1,233,375 | 8% | ||||||||||||||||||||||||||||
| Gross margin | 20.7% | 18.0% | 270 bps | 20.0% | 17.8% | 220 bps | ||||||||||||||||||||||||||||||||
| Selling and administrative expenses | $ | 329,996 | $ | 309,793 | 7% | $ | 984,664 | $ | 938,037 | 5% | ||||||||||||||||||||||||||||
| Severance and restructuring expenses, net | $ | 8,543 | $ | 2,923 | > 100% | $ | 15,638 | $ | 2,955 | > 100% | ||||||||||||||||||||||||||||
| Acquisition and integration related expenses | $ | 695 | $ | 4,292 | (84%) | $ | 2,166 | $ | 4,449 | (51%) | ||||||||||||||||||||||||||||
| Earnings from operations | $ | 92,851 | $ | 91,862 | 1% | $ | 323,910 | $ | 287,934 | 12% | ||||||||||||||||||||||||||||
| Net earnings | $ | 58,208 | $ | 60,247 | (3%) | $ | 212,679 | $ | 190,701 | 12% | ||||||||||||||||||||||||||||
| Diluted earnings per share | $ | 1.52 | $ | 1.62 | (6%) | $ | 5.53 | $ | 5.13 | 8% | ||||||||||||||||||||||||||||
| Sales Mix | ** | ** | ||||||||||||||||||||||||||||||||||||
| Hardware | 54 | % | 57 | % | (13%) | 52 | % | 57 | % | (13%) | ||||||||||||||||||||||||||||
| Software | 26 | % | 26 | % | (9%) | 29 | % | 27 | % | 3% | ||||||||||||||||||||||||||||
| Services | 20 | % | 17 | % | 10% | 19 | % | 16 | % | 11% | ||||||||||||||||||||||||||||
| 100 | % | 100 | % | (8%) | 100 | % | 100 | % | (4%) | |||||||||||||||||||||||||||||
| North America | ||||||||||||||||||||||||||||||||||||||
| Net sales: | ||||||||||||||||||||||||||||||||||||||
| Products | $ | 1,391,176 | $ | 1,562,861 | (11%) | $ | 4,380,214 | $ | 4,695,751 | (7%) | ||||||||||||||||||||||||||||
| Services | $ | 325,407 | $ | 298,011 | 9% | $ | 973,548 | $ | 896,251 | 9% | ||||||||||||||||||||||||||||
| Total net sales | $ | 1,716,583 | $ | 1,860,872 | (8%) | $ | 5,353,762 | $ | 5,592,002 | (4%) | ||||||||||||||||||||||||||||
| Gross profit | $ | 348,057 | $ | 333,857 | 4% | $ | 1,052,007 | $ | 992,143 | 6% | ||||||||||||||||||||||||||||
| Gross margin | 20.3% | 17.9% | 240 bps | 19.6% | 17.7% | 190 bps | ||||||||||||||||||||||||||||||||
| Selling and administrative expenses | $ | 259,954 | $ | 244,154 | 6% | $ | 771,066 | $ | 745,259 | 3% | ||||||||||||||||||||||||||||
| Severance and restructuring expenses, net | $ | 7,242 | $ | 2,650 | > 100% | $ | 12,783 | $ | 1,052 | > 100% | ||||||||||||||||||||||||||||
| Acquisition and integration related expenses | $ | 25 | $ | 970 | (97%) | $ | 1,486 | $ | 1,127 | 32% | ||||||||||||||||||||||||||||
| Earnings from operations | $ | 80,836 | $ | 86,083 | (6%) | $ | 266,672 | $ | 244,705 | 9% | ||||||||||||||||||||||||||||
| Sales Mix | ** | ** | ||||||||||||||||||||||||||||||||||||
| Hardware | 58 | % | 62 | % | (13%) | 57 | % | 62 | % | (13%) | ||||||||||||||||||||||||||||
| Software | 23 | % | 22 | % | (5%) | 25 | % | 22 | % | 11% | ||||||||||||||||||||||||||||
| Services | 19 | % | 16 | % | 9% | 18 | % | 16 | % | 9% | ||||||||||||||||||||||||||||
| 100 | % | 100 | % | (8%) | 100 | % | 100 | % | (4%) | |||||||||||||||||||||||||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
FINANCIAL SUMMARY TABLE (CONTINUED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||||||||||
| 2024 | 2023 | change | 2024 | 2023 | change | |||||||||||||||||||||||||||||||||
| EMEA | ||||||||||||||||||||||||||||||||||||||
| Net sales: | ||||||||||||||||||||||||||||||||||||||
| Products | $ | 249,642 | $ | 300,485 | (17%) | $ | 881,464 | $ | 1,006,216 | (12%) | ||||||||||||||||||||||||||||
| Services | $ | 62,964 | $ | 53,911 | 17% | $ | 212,856 | $ | 166,910 | 28% | ||||||||||||||||||||||||||||
| Total net sales | $ | 312,606 | $ | 354,396 | (12%) | $ | 1,094,320 | $ | 1,173,126 | (7%) | ||||||||||||||||||||||||||||
| Gross profit | $ | 66,381 | $ | 59,709 | 11% | $ | 220,556 | $ | 192,644 | 14% | ||||||||||||||||||||||||||||
| Gross margin | 21.2% | 16.8% | 440 bps | 20.2% | 16.4% | 380 bps | ||||||||||||||||||||||||||||||||
| Selling and administrative expenses | $ | 57,808 | $ | 54,435 | 6% | $ | 178,377 | $ | 159,253 | 12% | ||||||||||||||||||||||||||||
| Severance and restructuring expenses | $ | 1,240 | $ | 271 | > 100% | $ | 2,639 | $ | 1,840 | 43% | ||||||||||||||||||||||||||||
| Acquisition and integration related expenses | $ | 668 | $ | 3,322 | (80%) | $ | 678 | $ | 3,322 | (80%) | ||||||||||||||||||||||||||||
| Earnings from operations | $ | 6,665 | $ | 1,681 | > 100% | $ | 38,862 | $ | 28,229 | 38% | ||||||||||||||||||||||||||||
| Sales Mix | ** | ** | ||||||||||||||||||||||||||||||||||||
| Hardware | 40 | % | 39 | % | (8%) | 35 | % | 37 | % | (10%) | ||||||||||||||||||||||||||||
| Software | 40 | % | 46 | % | (24%) | 45 | % | 49 | % | (14%) | ||||||||||||||||||||||||||||
| Services | 20 | % | 15 | % | 17% | 20 | % | 14 | % | 28% | ||||||||||||||||||||||||||||
| 100 | % | 100 | % | (12%) | 100 | % | 100 | % | (7%) | |||||||||||||||||||||||||||||
| APAC | ||||||||||||||||||||||||||||||||||||||
| Net sales: | ||||||||||||||||||||||||||||||||||||||
| Products | $ | 32,961 | $ | 26,808 | 23% | $ | 102,491 | $ | 101,441 | 1% | ||||||||||||||||||||||||||||
| Services | $ | 25,736 | $ | 24,210 | 6% | $ | 78,460 | $ | 73,260 | 7% | ||||||||||||||||||||||||||||
| Total net sales | $ | 58,697 | $ | 51,018 | 15% | $ | 180,951 | $ | 174,701 | 4% | ||||||||||||||||||||||||||||
| Gross profit | $ | 17,647 | $ | 15,304 | 15% | $ | 53,815 | $ | 48,588 | 11% | ||||||||||||||||||||||||||||
| Gross margin | 30.1% | 30.0% | 10 bps | 29.7% | 27.8% | 190 bps | ||||||||||||||||||||||||||||||||
| Selling and administrative expenses | $ | 12,234 | $ | 11,204 | 9% | $ | 35,221 | $ | 33,525 | 5% | ||||||||||||||||||||||||||||
| Severance and restructuring expenses | $ | 61 | $ | 2 | > 100% | $ | 216 | $ | 63 | > 100% | ||||||||||||||||||||||||||||
| Acquisition and integration related expenses | $ | 2 | $ | — | * | $ | 2 | $ | — | * | ||||||||||||||||||||||||||||
| Earnings from operations | $ | 5,350 | $ | 4,098 | 31% | $ | 18,376 | $ | 15,000 | 23% | ||||||||||||||||||||||||||||
| Sales Mix | ** | ** | ||||||||||||||||||||||||||||||||||||
| Hardware | 18 | % | 21 | % | (3%) | 16 | % | 19 | % | (18)% | ||||||||||||||||||||||||||||
| Software | 38 | % | 31 | % | 41% | 41 | % | 39 | % | 11% | ||||||||||||||||||||||||||||
| Services | 44 | % | 48 | % | 6% | 43 | % | 42 | % | 7% | ||||||||||||||||||||||||||||
| 100 | % | 100 | % | 15% | 100 | % | 100 | % | 4% | |||||||||||||||||||||||||||||
* Percentage change not considered meaningful
** Change in sales mix represents growth/decline in category net sales on a U.S. dollar basis and does not exclude the effects of fluctuating foreign currency exchange rates
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
FORWARD-LOOKING INFORMATION
Certain statements in this release and the related conference call, webcast and presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including those related to the impact of inflation and higher interest rates, the Company’s future financial performance and results of operations, including gross profit growth, Adjusted diluted earnings per share, gross margin, and Adjusted selling and administrative expenses, as well as the Company’s other key performance indicators, the Company’s anticipated effective tax rate, capital expenditures, and expected average share count, the Company’s expectations regarding cash flow, the Company’s expectations regarding supply constraints and shipment of backlog, future trends in the IT market, the Company’s business strategy and strategic initiatives, which are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. There can be no assurances that the results discussed by the forward-looking statements will be achieved, and actual results may differ materially from those set forth in the forward-looking statements. Some of the important factors that could cause the Company’s actual results to differ materially from those projected in any forward-looking statements include, but are not limited to, the following, which are discussed in the Company’s filings with the Securities and Exchange Commission (the “SEC”), including in the “Risk Factors” sections of the Company’s most recently filed periodic report on Form 10-K and subsequent filings with the SEC:
•actions of our competitors, including manufacturers and publishers of products we sell;
•our reliance on our partners for product availability, competitive products to sell and marketing funds and purchasing incentives, which can change significantly in the amounts made available and in the requirements year over year;
•our ability to keep pace with rapidly evolving technological advances and the evolving competitive marketplace;
•general economic conditions, economic uncertainties and changes in geopolitical conditions, including the possibility of a recession or a decline in market activity as a result of the ongoing conflicts in Ukraine and Gaza;
•changes in the IT industry and/or rapid changes in technology;
•our ability to provide high quality services to our clients;
•our reliance on independent shipping companies;
•the risks associated with our international operations;
•supply constraints for products;
•natural disasters or other adverse occurrences, including public health issues such as pandemics or epidemics;
•disruptions in our IT systems and voice and data networks;
•cyberattacks, outages, or third-party breaches of data privacy as well as related breaches of government regulations;
•intellectual property infringement claims and challenges to our registered patents, trademarks and trade names;
•potential liability and competitive risk based on the development, adoption, and use of Generative Artificial Intelligence;
•legal proceedings, client audits and failure to comply with laws and regulations;
•risks of termination, delays in payment, audits and investigations related to our public sector contracts;
•exposure to changes in, interpretations of, or enforcement trends related to tax rules and regulations;
•our potential to draw down a substantial amount of indebtedness;
•the conditional conversion feature of the Convertible Notes, which has been triggered, and may adversely affect the Company’s financial condition and operating results;
•the Company is subject to counterparty risk with respect to certain hedge and warrant transactions entered into in connection with the issuance of the Convertible Notes;
•increased debt and interest expense and the possibility of decreased availability of funds under our financing facilities;
•possible significant fluctuations in our future operating results as well as seasonality and variability in client demands;
•potential contractual disputes with our clients and third-party suppliers;
•our dependence on certain key personnel and our ability to attract, train and retain skilled teammates;
•risks associated with the integration and operation of acquired businesses, including achievement of expected synergies and benefits; and
•future sales of the Company’s common stock or equity-linked securities in the public market could lower the market price for our common stock.
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
Additionally, there may be other risks that are otherwise described from time to time in the reports that the Company files with the SEC. Any forward-looking statements in this release, the related conference call, webcast and presentation speak only as of the date on which they are made and should be considered in light of various important factors, including the risks and uncertainties listed above, as well as others. The Company assumes no obligation to update, and, except as may be required by law, does not intend to update, any forward-looking statements. The Company does not endorse any projections regarding future performance that may be made by third parties.
| CONTACT: | GLYNIS BRYAN | |||||||
| CHIEF FINANCIAL OFFICER | ||||||||
| TEL. 480.333.3390 | ||||||||
EMAIL glynis.bryan@insight.com | ||||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net sales: | |||||||||||||||||||||||
| Products | $ | 1,673,779 | $ | 1,890,154 | $ | 5,364,169 | $ | 5,803,408 | |||||||||||||||
| Services | 414,107 | 376,132 | 1,264,864 | 1,136,421 | |||||||||||||||||||
| Total net sales | 2,087,886 | 2,266,286 | 6,629,033 | 6,939,829 | |||||||||||||||||||
| Costs of goods sold: | |||||||||||||||||||||||
| Products | 1,486,271 | 1,697,543 | 4,794,125 | 5,219,720 | |||||||||||||||||||
| Services | 169,530 | 159,873 | 508,530 | 486,734 | |||||||||||||||||||
| Total costs of goods sold | 1,655,801 | 1,857,416 | 5,302,655 | 5,706,454 | |||||||||||||||||||
| Gross profit | 432,085 | 408,870 | 1,326,378 | 1,233,375 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Selling and administrative expenses | 329,996 | 309,793 | 984,664 | 938,037 | |||||||||||||||||||
| Severance and restructuring expenses, net | 8,543 | 2,923 | 15,638 | 2,955 | |||||||||||||||||||
| Acquisition and integration related expenses | 695 | 4,292 | 2,166 | 4,449 | |||||||||||||||||||
| Earnings from operations | 92,851 | 91,862 | 323,910 | 287,934 | |||||||||||||||||||
| Non-operating expense (income): | |||||||||||||||||||||||
| Interest expense, net | 16,629 | 12,013 | 43,376 | 31,766 | |||||||||||||||||||
Other expense (income), net | 1,104 | (203) | (128) | 489 | |||||||||||||||||||
| Earnings before income taxes | 75,118 | 80,052 | 280,662 | 255,679 | |||||||||||||||||||
| Income tax expense | 16,910 | 19,805 | 67,983 | 64,978 | |||||||||||||||||||
| Net earnings | $ | 58,208 | $ | 60,247 | $ | 212,679 | $ | 190,701 | |||||||||||||||
| Net earnings per share: | |||||||||||||||||||||||
| Basic | $ | 1.81 | $ | 1.85 | $ | 6.55 | $ | 5.76 | |||||||||||||||
| Diluted | $ | 1.52 | $ | 1.62 | $ | 5.53 | $ | 5.13 | |||||||||||||||
| Shares used in per share calculations: | |||||||||||||||||||||||
| Basic | 32,216 | 32,574 | 32,459 | 33,127 | |||||||||||||||||||
| Diluted | 38,331 | 37,203 | 38,445 | 37,149 | |||||||||||||||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In THOUSANDS)
(UNAUDITED)
| September 30, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 317,449 | $ | 268,730 | |||||||
| Accounts receivable, net | 3,897,481 | 3,568,290 | |||||||||
| Inventories | 151,013 | 184,605 | |||||||||
| Contract assets, net | 85,767 | 120,518 | |||||||||
| Other current assets | 208,798 | 189,158 | |||||||||
| Total current assets | 4,660,508 | 4,331,301 | |||||||||
| Long-term contract assets, net | 105,273 | 132,780 | |||||||||
| Property and equipment, net | 214,878 | 210,061 | |||||||||
| Goodwill | 888,808 | 684,345 | |||||||||
| Intangible assets, net | 448,680 | 369,687 | |||||||||
| Long-term accounts receivable | 828,465 | 412,666 | |||||||||
| Other assets | 139,831 | 145,510 | |||||||||
| $ | 7,286,443 | $ | 6,286,350 | ||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable – trade | $ | 2,683,323 | $ | 2,255,183 | |||||||
| Accounts payable – inventory financing facilities | 235,192 | 231,850 | |||||||||
| Accrued expenses and other current liabilities | 493,175 | 538,346 | |||||||||
| Current portion of long-term debt | 332,439 | 348,004 | |||||||||
| Total current liabilities | 3,744,129 | 3,373,383 | |||||||||
| Long-term debt | 754,377 | 592,517 | |||||||||
| Deferred income taxes | 72,849 | 27,588 | |||||||||
| Long-term accounts payable | 788,078 | 353,794 | |||||||||
| Other liabilities | 160,710 | 203,335 | |||||||||
| 5,520,143 | 4,550,617 | ||||||||||
| Stockholders’ equity: | |||||||||||
| Preferred stock | — | — | |||||||||
| Common stock | 318 | 326 | |||||||||
| Additional paid-in capital | 334,337 | 328,607 | |||||||||
| Retained earnings | 1,471,546 | 1,448,412 | |||||||||
Accumulated other comprehensive loss – foreign currency translation adjustments | (39,901) | (41,612) | |||||||||
| Total stockholders’ equity | 1,766,300 | 1,735,733 | |||||||||
| $ | 7,286,443 | $ | 6,286,350 | ||||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net earnings | $ | 212,679 | $ | 190,701 | |||||||
| Adjustments to reconcile net earnings to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 72,357 | 44,698 | |||||||||
| Provision for losses on accounts receivable | 7,440 | 3,754 | |||||||||
| Provision for losses on contract assets | 2,474 | — | |||||||||
| Non-cash stock-based compensation | 26,216 | 26,211 | |||||||||
| Gain on revaluation of earnout liabilities | (30,648) | — | |||||||||
| Deferred income taxes | 16,342 | (9,062) | |||||||||
| Amortization of debt issuance costs | 4,090 | 3,649 | |||||||||
| Other adjustments | (3,155) | (1,356) | |||||||||
| Changes in assets and liabilities: | |||||||||||
| (Increase) decrease in accounts receivable | (291,692) | 201,628 | |||||||||
| Decrease in inventories | 28,407 | 75,124 | |||||||||
| Decrease (increase) in contract assets | 49,798 | (1,810) | |||||||||
| Increase in long-term accounts receivable | (434,966) | (73,451) | |||||||||
| Decrease in other assets | 13,626 | 5,392 | |||||||||
| Increase (decrease) in accounts payable | 374,166 | (57,882) | |||||||||
| Increase in long-term accounts payable | 428,081 | 52,479 | |||||||||
| Decrease in accrued expenses and other liabilities | (57,484) | (46,333) | |||||||||
| Net cash provided by operating activities: | 417,731 | 413,742 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Proceeds from sale of assets | 13,751 | 15,515 | |||||||||
| Purchases of property and equipment | (32,371) | (29,070) | |||||||||
| Acquisitions, net of cash and cash equivalents acquired | (270,248) | (82,875) | |||||||||
| Net cash used in investing activities: | (288,868) | (96,430) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Borrowings on ABL revolving credit facility | 3,631,660 | 3,416,737 | |||||||||
| Repayments on ABL revolving credit facility | (3,964,940) | (3,382,444) | |||||||||
| Net borrowings (repayments) under inventory financing facilities | 3,102 | (32,451) | |||||||||
| Proceeds from issuance of senior unsecured notes | 500,000 | — | |||||||||
| Payment of debt issuance costs | (8,647) | — | |||||||||
| Repurchases of common stock | (200,020) | (217,108) | |||||||||
| Repayment of principal on the Convertible Notes | (16,895) | — | |||||||||
| Earnout and acquisition related payments | (18,297) | (10,748) | |||||||||
| Other payments | (8,486) | (9,614) | |||||||||
| Net cash used in financing activities: | (82,523) | (235,628) | |||||||||
| Foreign currency exchange effect on cash, cash equivalents and restricted cash balances | 2,660 | (1,074) | |||||||||
| Increase in cash, cash equivalents and restricted cash | 49,000 | 80,610 | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 270,785 | 165,718 | |||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 319,785 | $ | 246,328 | |||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
| Adjusted Consolidated Earnings from Operations: | ||||||||||||||||||||||||||
| GAAP consolidated EFO | $ | 92,851 | $ | 91,862 | $ | 323,910 | $ | 287,934 | ||||||||||||||||||
| Amortization of intangible assets | 18,702 | 8,648 | 50,984 | 25,243 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (6,442) | — | (30,649) | — | ||||||||||||||||||||||
| Other* | 15,006 | 19,280 | 28,714 | 30,278 | ||||||||||||||||||||||
| Adjusted non-GAAP consolidated EFO | $ | 120,117 | $ | 119,790 | $ | 372,959 | $ | 343,455 | ||||||||||||||||||
| GAAP EFO as a percentage of net sales | 4.4% | 4.1% | 4.9% | 4.1% | ||||||||||||||||||||||
| Adjusted non-GAAP EFO as a percentage of net sales | 5.8% | 5.3% | 5.6% | 4.9% | ||||||||||||||||||||||
| Adjusted Consolidated Net Earnings: | ||||||||||||||||||||||||||
| GAAP consolidated net earnings | $ | 58,208 | $ | 60,247 | $ | 212,679 | $ | 190,701 | ||||||||||||||||||
| Amortization of intangible assets | 18,702 | 8,648 | 50,984 | 25,243 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (6,442) | — | (30,649) | — | — | |||||||||||||||||||||
| Other* | 15,006 | 19,280 | 28,714 | 30,278 | ||||||||||||||||||||||
| Income taxes on non-GAAP adjustments | (8,505) | (6,496) | (14,678) | (13,729) | ||||||||||||||||||||||
| Adjusted non-GAAP consolidated net earnings | $ | 76,969 | $ | 81,679 | $ | 247,050 | $ | 232,493 | ||||||||||||||||||
| GAAP net earnings as a percentage of net sales | 2.8% | 2.7% | 3.2% | 2.7% | ||||||||||||||||||||||
| Adjusted non-GAAP net earnings as a percentage of net sales | 3.7% | 3.6% | 3.7% | 3.4% | ||||||||||||||||||||||
| Adjusted Diluted Earnings Per Share: | ||||||||||||||||||||||||||
| GAAP diluted EPS | $ | 1.52 | $ | 1.62 | $ | 5.53 | $ | 5.13 | ||||||||||||||||||
| Amortization of intangible assets | 0.49 | 0.23 | 1.33 | 0.68 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (0.17) | — | (0.80) | — | ||||||||||||||||||||||
| Other | 0.39 | 0.52 | 0.75 | 0.82 | ||||||||||||||||||||||
| Income taxes on non-GAAP adjustments | (0.22) | (0.17) | (0.38) | (0.37) | ||||||||||||||||||||||
| Impact of benefit from note hedge | 0.18 | 0.17 | 0.59 | 0.46 | ||||||||||||||||||||||
| Adjusted non-GAAP diluted EPS | $ | 2.19 | $ | 2.37 | $ | 7.02 | $ | 6.72 | ||||||||||||||||||
| Shares used in diluted EPS calculation | 38,331 | 37,203 | 38,445 | 37,149 | ||||||||||||||||||||||
Impact of benefit from note hedge | (3,258) | (2,774) | (3,269) | (2,533) | ||||||||||||||||||||||
| Shares used in Adjusted non-GAAP diluted EPS calculation | 35,073 | 34,429 | 35,176 | 34,616 | ||||||||||||||||||||||
| Adjusted North America Earnings from Operations: | ||||||||||||||||||||||||||
| GAAP EFO from North America segment | $ | 80,836 | $ | 86,083 | $ | 266,672 | $ | 244,705 | ||||||||||||||||||
| Amortization of intangible assets | 16,823 | 7,718 | 45,557 | 23,269 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (4,000) | — | (24,219) | — | ||||||||||||||||||||||
| Other* | 12,891 | 15,547 | 24,753 | 24,641 | ||||||||||||||||||||||
| Adjusted non-GAAP EFO from North America segment | $ | 106,550 | $ | 109,348 | $ | 312,763 | $ | 292,615 | ||||||||||||||||||
| GAAP EFO as a percentage of net sales | 4.7 | % | 4.6 | % | 5.0 | % | 4.4 | % | ||||||||||||||||||
| Adjusted non-GAAP EFO as a percentage of net sales | 6.2 | % | 5.9 | % | 5.8 | % | 5.2 | % | ||||||||||||||||||
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||
| Adjusted EMEA Earnings from Operations: | ||||||||||||||||||||||||||
| GAAP EFO from EMEA segment | $ | 6,665 | $ | 1,681 | $ | 38,862 | $ | 28,229 | ||||||||||||||||||
| Amortization of intangible assets | 1,805 | 822 | 5,135 | 1,642 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (2,442) | — | (6,430) | — | ||||||||||||||||||||||
| Other | 2,052 | 3,731 | 3,743 | 5,574 | ||||||||||||||||||||||
| Adjusted non-GAAP EFO from EMEA segment | $ | 8,080 | $ | 6,234 | $ | 41,310 | $ | 35,445 | ||||||||||||||||||
| GAAP EFO as a percentage of net sales | 2.1 | % | 0.5 | % | 3.6 | % | 2.4 | % | ||||||||||||||||||
| Adjusted non-GAAP EFO as a percentage of net sales | 2.6 | % | 1.8 | % | 3.8 | % | 3.0 | % | ||||||||||||||||||
| Adjusted APAC Earnings from Operations: | ||||||||||||||||||||||||||
| GAAP EFO from APAC segment | $ | 5,350 | $ | 4,098 | $ | 18,376 | $ | 15,000 | ||||||||||||||||||
| Amortization of intangible assets | 74 | 108 | 292 | 332 | ||||||||||||||||||||||
| Other | 63 | 2 | 218 | 63 | ||||||||||||||||||||||
| Adjusted non-GAAP EFO from APAC segment | $ | 5,487 | $ | 4,208 | $ | 18,886 | $ | 15,395 | ||||||||||||||||||
| GAAP EFO as a percentage of net sales | 9.1 | % | 8.0 | % | 10.2 | % | 8.6 | % | ||||||||||||||||||
| Adjusted non-GAAP EFO as a percentage of net sales | 9.3 | % | 8.2 | % | 10.4 | % | 8.8 | % | ||||||||||||||||||
| Adjusted EBITDA: | ||||||||||||||||||||||||||
| GAAP consolidated net earnings | $ | 58,208 | $ | 60,247 | $ | 212,679 | $ | 190,701 | ||||||||||||||||||
| Interest expense | 19,184 | 13,874 | 51,312 | 36,618 | ||||||||||||||||||||||
| Income tax expense | 16,910 | 19,805 | 67,983 | 64,978 | ||||||||||||||||||||||
| Depreciation and amortization of property and equipment | 7,204 | 6,902 | 21,373 | 19,455 | ||||||||||||||||||||||
| Amortization of intangible assets | 18,702 | 8,648 | 50,984 | 25,243 | ||||||||||||||||||||||
| Gain on revaluation of earnout liabilities | (6,442) | — | (30,649) | — | ||||||||||||||||||||||
| Other* | 15,006 | 19,280 | 28,714 | 30,278 | ||||||||||||||||||||||
| Adjusted non-GAAP EBITDA | $ | 128,772 | $ | 128,756 | $ | 402,396 | $ | 367,273 | ||||||||||||||||||
| GAAP consolidated net earnings as a percentage of net sales | 2.8% | 2.7% | 3.2% | 2.7% | ||||||||||||||||||||||
| Adjusted non-GAAP EBITDA as a percentage of net sales | 6.2% | 5.7% | 6.1% | 5.3% | ||||||||||||||||||||||
* Includes transformation costs of $5.1 million and $3.7 million for the three months ended September 30, 2024 and 2023, respectively and $13.0 million and $14.0 million for the nine months ended September 30, 2024 and 2023, respectively. Includes certain third-party data center service outage expenses of $8.0 million for both the three and nine months ended September 30, 2023 and related recoveries of $3.4 million for the nine months ended September 30, 2024.
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| Insight Enterprises, Inc. | 2701 E. Insight Way | Chandler, Arizona 85286 | 800.467.4448 | FAX 480.760.8958 | ||||||||||
INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Twelve Months Ended September 30, | ||||||||||||||
| 2024 | 2023 | |||||||||||||
| Adjusted return on invested capital: | ||||||||||||||
| GAAP consolidated EFO | $ | 455,771 | $ | 401,950 | ||||||||||
| Amortization of intangible assets | 61,972 | 33,320 | ||||||||||||
| Gain on revaluation of earnout liabilities | (30,649) | — | ||||||||||||
Other5 | 34,537 | 36,450 | ||||||||||||
| Adjusted non-GAAP consolidated EFO | 521,631 | 471,720 | ||||||||||||
Income tax expense1 | 135,624 | 122,647 | ||||||||||||
| Adjusted non-GAAP consolidated EFO, net of tax | $ | 386,007 | $ | 349,073 | ||||||||||
Average stockholders’ equity2 | $ | 1,746,223 | $ | 1,605,492 | ||||||||||
Average debt2 | 915,391 | 659,161 | ||||||||||||
Average cash2 | (293,184) | (183,259) | ||||||||||||
| Invested Capital | $ | 2,368,430 | $ | 2,081,394 | ||||||||||
Adjusted non-GAAP ROIC (from GAAP consolidated EFO)3 | 14.24 | % | 14.29 | % | ||||||||||
Adjusted non-GAAP ROIC (from non-GAAP consolidated EFO)4 | 16.30 | % | 16.77 | % | ||||||||||
1 Assumed tax rate of 26.0%.
2 Average of previous five quarters.
3 Computed as GAAP consolidated EFO, net of tax of $118,500 and $104,507 for the twelve months ended September 30, 2024 and 2023, respectively, divided by invested capital.
4 Computed as Adjusted non-GAAP consolidated EFO, net of tax, divided by invested capital.
5 Includes transformation costs of $15.6 million and $18.1 million for the twelve months ended September 30, 2024 and 2023, respectively. Includes certain third-party data center service outage related expenses of $8.0 million for the twelve months ended September 30, 2023 and related recoveries of $6.4 million for the twelve months ended September 30, 2024. Includes severance and restructuring costs of $18.8 million and $4.4 million for the twelve months ended September 30, 2024 and 2023, respectively.
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