Slides
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CDW Corporation February 4, 2026 Webcast Conference Call
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2 Fourth Quarter and Full Year 2025 Results Performance Drivers Outlook Q&A Today's Agenda
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3 Statements in this presentation that are not statements of historical fact are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements regarding the future financial performance, 2026 outlook, capital allocation priorities and growth prospects of CDW. These forward-looking statements are subject to risks and uncertainties that may cause actual results or events to differ materially from those described in such statements. Although CDW believes that its plans, intentions and other expectations reflected in or suggested by such forward- looking statements are reasonable, it can give no assurance that it will achieve those plans, intentions or expectations. Reference is made to a more complete discussion of forward-looking statements and applicable risks contained under the captions "Forward-Looking Statements" and "Risk Factors" in CDW's Annual Report on Form 10-K for the year ended December 31, 2024, and subsequent filings with the SEC. CDW undertakes no obligation to update or revise any of its forward-looking statements, whether as a result of new information, future events or otherwise, except as otherwise required by law. Forward-Looking Statements
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4 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 accounting principles generally accepted in the United States of America ("GAAP"). 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. Our non-GAAP performance measures include Non-GAAP operating income, Non-GAAP operating income margin, Non-GAAP net income, Non-GAAP net income per diluted share, and Net sales on a constant currency basis, and our non-GAAP financial condition measures include Free cash flow and Adjusted free cash flow. These non-GAAP performance measures and non-GAAP financial condition measures are collectively referred to as “non-GAAP financial measures.” The GAAP measures most directly comparable to non-GAAP operating income, non-GAAP operating income margin, non-GAAP net income, non-GAAP net income per diluted share, and net sales on a constant currency basis are operating income, operating income margin, net income, net income per diluted share, and net sales, respectively. 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. Non-GAAP operating income margin is defined as Non- GAAP operating income as a percentage of Net sales. Non-GAAP net income and Non-GAAP net income per diluted share exclude, 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, workplace optimization, and their associated income tax effects. 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. Adjusted free cash flow is defined as Free cash flow adjusted to include certain cash flows from financing activities incurred in the normal course of operations or as capital expenditures. 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. We also present non-GAAP financial condition measures as we believe they provide analysts, investors, and management with more information regarding our liquidity and capital resources. Certain non-GAAP financial measures are also used to determine certain components of performance-based compensation. Our outlook includes non-GAAP financial measures because certain reconciling items are dependent on future events that either cannot be controlled, such as currency impacts or interest rates, or reliably predicted because they are not part of our underlying performance, such as refinancing activities or acquisition and integration expenses. Non-GAAP financial measures in this presentation are denoted with an asterisk (*) when shown. For a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures, see the CDW Investor Relations website: https://investor.cdw.com/financials/quarterly-results/default.aspx. Non-GAAP Financial Measures
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5 Fourth Quarter: • Net sales of $5.5 billion • Up 6.3% on a reported basis • Up 4.6% on an average daily sales ("ADS") basis • Up 4.3% on a constant currency basis* • Gross profit of $1,254 million, up 8.6% • Gross profit margin of 22.8%, up 50 basis points • Operating income of $431 million, up 5.4% • Non-GAAP operating income* of $502 million, up 0.6% • Net income of $280 million, up 5.8% • Non-GAAP net income*of $336 million, up 0.9% • Net income per diluted share $2.14, up 8.8% • Non-GAAP net income per diluted share* $2.57, up 3.8% *Non-GAAP measure. Financial Performance Full Year: • Net sales of $22.4 billion • Up 6.8% on a reported basis and ADS basis • Up 6.6% on a constant currency basis* • Gross profit of $4,873 million, up 5.9% • Gross profit margin of 21.7%, down 20 basis points • Operating income of $1,656 million, up 0.3% • Non-GAAP operating income* of $1,997 million, up 2.6% • Net income of $1,067 million, down 1.0% • Non-GAAP net income* of $1,323 million, up 2.8% • Net income per diluted share of $8.08, up 1.3% • Non-GAAP net income per diluted share* $10.02, up 5.2%
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6 ($ in millions) Three Months Ended December 31, Year Ended December 31, 2025 2024 Percent Change(1) Average Daily Percent Change(1) 2025 2024 Percent Change(1) Corporate $ 2,369.5 $ 2,344.9 1.0 % (0.6) % $ 9,442.4 $ 8,837.2 6.8 % Small Business 457.0 380.0 20.3 18.4 1,726.7 1,523.5 13.3 Public Government 650.5 613.5 6.0 4.3 2,589.5 2,486.9 4.1 Education 639.3 557.4 14.7 12.9 3,109.6 3,167.3 (1.8) Healthcare 725.8 683.1 6.3 4.6 2,836.1 2,503.5 13.3 Total Public 2,015.6 1,854.0 8.7 7.0 8,535.2 8,157.7 4.6 Other 668.9 607.1 10.2 8.4 2,719.8 2,480.3 9.7 Total Net sales $ 5,511.0 $ 5,186.0 6.3 % 4.6 % $ 22,424.1 $ 20,998.7 6.8 % (1) There were 63 and 62 selling days for the three months ended December 31, 2025 and 2024, respectively. There were 254 selling days for both the years ended December 31, 2025 and 2024. Average Daily Sales is defined as Net sales divided by the number of selling days. Net Sales By Channel
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7 ($ in millions) Three Months Ended December 31, 2025 2024 Percent Change Net sales $ 5,511.0 $ 5,186.0 6.3 % Average daily net sales(1) $ 87.5 $ 83.6 4.6 Gross profit $ 1,254.4 $ 1,155.3 8.6 Gross profit margin 22.8 % 22.3 % Selling and administrative expenses $ 823.7 $ 746.7 10.3 Operating income $ 430.7 $ 408.6 5.4 Operating income margin 7.8 % 7.9 % Non-GAAP SG&A* $ 752.0 $ 656.1 14.6 Non-GAAP operating income* $ 502.4 $ 499.2 0.6 Non-GAAP operating income margin* 9.1 % 9.6 % Interest expense, net $ 58.5 $ 56.5 3.5 Other expense, net $ 3.1 $ 0.6 **nm Net income $ 279.5 $ 264.2 5.8 Non-GAAP net income* $ 335.6 $ 332.7 0.9 Effective tax rate 24.3 % 24.8 % Non-GAAP effective tax rate* 24.2 % 24.8 % (1) There were 63 and 62 selling days for the three months ended December 31, 2025 and 2024, respectively. Average Daily Sales is defined as Net sales divided by the number of selling days. * Non-GAAP measure. ** Not meaningful Q4 2025 Financial Results
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8 ($ in millions, except per share amounts) Three Months Ended December 31, 2025 2024 Percent Change US GAAP Net income $ 279.5 $ 264.2 5.8 % Weighted-average common shares outstanding - Diluted 130.6 134.4 Net income per diluted share $ 2.14 $ 1.97 8.8 % Non-GAAP net income* $ 335.6 $ 332.7 0.9 % Weighted-average common shares outstanding - Diluted 130.6 134.4 Non-GAAP net income per diluted share* $ 2.57 $ 2.48 3.8 % * Non-GAAP measure. Q4 2025 Earnings Per Diluted Share
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9 ($ in millions) Year Ended December 31, 2025 2024 Percent Change Net sales $ 22,424.1 $ 20,998.7 6.8 % Average daily net sales(1) $ 88.3 $ 82.7 6.8 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 % Non-GAAP SG&A* $ 2,876.7 $ 2,655.4 8.3 Non-GAAP operating income* $ 1,996.7 $ 1,947.0 2.6 Non-GAAP operating income margin* 8.9 % 9.3 % Interest expense, net $ 227.4 $ 214.5 6.0 Other expense, net $ 0.8 $ 1.4 **nm Net income $ 1,066.6 $ 1,077.8 (1.0) Non-GAAP net income* $ 1,323.0 $ 1,287.2 2.8 Effective tax rate 25.3 % 24.9 % Non-GAAP effective tax rate* 25.3 % 25.6 % (1) There were 254 selling days for both the years ended December 31, 2025 and 2024. Average Daily Sales is defined as Net sales divided by the number of selling days. * Non-GAAP measure. ** Not meaningful Full Year Financial Results
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10 ($ in millions, except per share amounts) Year Ended December 31, 2025 2024 Percent Change US GAAP Net income $ 1,066.6 $ 1,077.8 (1.0) % Weighted-average common shares outstanding - Diluted 132.1 135.2 Net income per diluted share $ 8.08 $ 7.97 1.3 % Non-GAAP net income* $ 1,323.0 $ 1,287.2 2.8 % Weighted-average common shares outstanding - Diluted 132.1 135.2 Non-GAAP net income per diluted share* $ 10.02 $ 9.52 5.2 % * Non-GAAP measure. Full Year Earnings Per Diluted Share
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11 ($ in millions) December 31, 2025 December 31, 2024 Cash and cash equivalents $ 618.7 $ 503.5 Short-term investments — 214.2 Total debt 5,629.8 5,842.8 Net debt(1) 5,011.1 5,125.1 Revolver availability 1,925.8 1,244.1 Cash plus revolver availability 2,544.5 1,747.6 (1) Defined as Total debt minus Cash and cash equivalents and Short-term investments Debt and Revolver Availability
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12 (Based on a rolling three-month average) December 31, 2025 December 31, 2024 Days of sales outstanding 95 84 Days of supply in inventory 11 13 Days purchases outstanding (90) (79) Cash conversion cycle 16 18 Cash Conversion Cycle
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13 ($ in millions) Three Months Ended December 31, Year Ended December 31, 2025 2024 2025 2024 Net cash provided by operating activities $ 433.8 $ 345.3 $ 1,205.2 $ 1,277.3 Capital expenditures (37.9) (28.6) (117.1) (122.6) Free cash flow* 395.9 316.7 1,088.1 1,154.7 Net change in accounts payable-inventory financing 21.6 (1.8) (2.6) (75.7) Adjusted free cash flow*(1) $ 417.5 $ 314.9 $ 1,085.5 $ 1,079.0 (1) Defined as Cash flows provided by operating activities less capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory. * Non-GAAP measure Free Cash Flow and Adjusted Free Cash Flow
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14 2026 Capital Allocation Priorities Target ~25% payout of Non-GAAP net income*; grow in-line with earningsIncrease Dividend annually ~1% increase in November 2025 to $2.52/share annually Target ~2.0 to 3.0 times Net Leverage Ratio; consistent with our commitment to an investment grade capital structure Maintain Net Leverage Ratio (1) Currently at 2.4x(2) Supplement organic growth with M&A Expand CDW’s strategic capabilities Twelve acquisitions over the last six years Return e xcess Adjusted FCF* after Divid ends and M&A through share repurchases Target, in aggregate with Dividend, returning 50% to 75% of Adjusted FCF* to shareholders Returned 90% of Adjusted FCF* to shareholders in 2025; Over $680M remaining on prior share repurchase authorization OBJECTIVESPRIORITIES ACTIONS 1. Defined as the ratio of total debt at period-end excluding any unamortized discount and/or premium and deferred financing costs, less cash and cash equivalents and short-term investments, to trailing twelve-month Non-GAAP operating income* plus depreciation and amortization in SG&A (excluding amortization expenses for acquisition-related intangible assets). 2. As of December 31, 2025. *Non-GAAP Measure.
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15 • 1. Certain annual outlooks are provided on a non-GAAP basis because certain reconciling items are dependent on future events that either cannot be controlled, such as currency impacts or interest rates, or reliably predicted because they are not part of CDW's underlying performance, such as refinancing activities or acquisition and integration expenses. 2. As of February 4, 2026; all growth rates are on a year-over-year constant currency basis. 3. CDW current addressable IT market. 2026 Outlook CUSTOMER SPEND U.S. IT growth plus a premium target of ~200 to 300 bps(3) • GROSS PROFIT Low single-digit growth • NON-GAAP EARNINGS PER DILUTED SHARE Mid single-digit growth (1),(2)
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16 Metric Expectations Gross profit • Mid single-digit sequential declines in Q1 lead to mid single-digit year-over-year growth • Closer to 50/50 between 1H and 2H vs historical levels (still slightly 2H weighted) • Currency expected to be neutral to growth for the year Annual depreciation and amortization expense • Approximately $300 million • Includes ~$170 million of amortization expense for acquisition-related intangible assets • Excluding acquisition-related intangibles, expected to be ~$130 million Annual interest expense, net • In range of $225 million to $230 million Non-GAAP effective tax rate* • In range of 25.5% to 26.5% Annual adjusted free cash flow* • In range of 80% to 90% on Non-GAAP net income* for the full year Capital expenditures • In range of $110 million to $120 million Cash conversion cycle • In range of high teens to low 20s *Non-GAAP measure. Modeling Thoughts
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17 Questions and Answers