Good morning. My name is Cree, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Insight Enterprises first quarter 2021 operating results conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star and the number one on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. I would now like to turn the conversation to Ms. Glynis Bryan, CFO. Thank you. Welcome everyone, and thank you for joining the Insight Enterprises earnings conference call. Today, we will be discussing the company's operating results for the quarter ended March 31st, 2021. I'm Glynis Bryan, Chief Financial Officer of Insight, and joining me is Ken Lamneck, President and Chief Executive Officer. If you do not have a copy of the press release and the accompanying slide presentation that was posted this morning and filed with the Securities and Exchange Commission on Form 8-K, you will find them on our website at insight.com, under our Investor Relations section. Today's call, including the question and answer period, is being webcast live and can be accessed by the investor relations page of our website at insight.com. An archive copy of this conference call will be available approximately two hours after completion of the call and will remain on our website for a limited time. This conference call and the associated webcast contain time-sensitive information that is accurate only as of today, May 6th, 2021. This call is a property of Insight Enterprises. Any redistribution, retransmission, or rebroadcast of this call in any form without the express written consent of Insight Enterprises is strictly prohibited. In today's conference call, we will refer to non-GAAP financial measures as we discuss the first quarter 2021 financial results. When referring to non-GAAP measures, we will refer to such measures as adjusted. Non-GAAP measures to be discussed on today's call include adjusted selling and administrative expenses, also referred to as adjusted SG&A, adjusted earnings from operations, adjusted earnings before interest, taxes, depreciation, amortization, and stock-based compensation expense, also referred to as adjusted EBITDA, adjusted diluted earnings per share, including the benefit of the note hedge on our convertible debt, and adjusted return on invested capital. You will find a reconciliation of these adjusted measures to our actual GAAP results included in either the press release or the accompanying slide presentation issued earlier today. Also, please note that unless highlighted as constant currency, all amounts and growth rates are discussed in U.S. dollar terms. As a reminder, all forward-looking statements that are made during this conference call are subject to risks and uncertainties that could cause our actual results to differ materially. These risks are discussed in today's press release and in greater detail on our most recently filed periodic report and subsequent filings with the SEC. With that, I will now turn the call over to Ken, and if you're following along with the slide presentation, we will begin on slide four. Ken? Hello, everyone. Thank you for joining us today to discuss our first quarter 2021 operating results. In the first quarter with the launch of COVID-19 vaccines, parts of the world began to awaken from a long quarantine and economic pause. With renewed optimism for a stronger 2021, demand improved in the quarter. Clients continued to focus on business agility and continuity by leveraging cloud solutions for certain workloads. Our clear strategy and deep expertise delivering digital solutions to clients of all sizes allowed us to grow our sales of cloud SaaS and Infrastructure as a Service high double digits in the quarter, which drove cloud gross profit to 21% of our total gross profit, up more than 300 basis points year-over-year. In addition, hardware bookings trends improved throughout the quarter. Given the current supply constraints and long lead times, we're working with clients to assess their 2021 device refresh needs and employee hiring plans to get orders placed and in the queue for fulfillment in 2021. As a result, we exited the first quarter with elevated backlog and are pleased to see the pipeline for future sales build to healthy levels. I'm happy to report that our business returned to top-line growth year-over-year in the first quarter, fueled by low single-digit growth in corporate and enterprise clients and strong growth in public sector, particularly K-12. Margins and consistent gross margins year-over-year, combined with operating leverage, drove adjusted earnings from operations up 3% and adjusted return on invested capital to 13.1%, up from 12.6% in the first quarter last year. Our performance for the quarter sets a good base for what we expect will be a strong year. We're happy with our team's operational execution in the first quarter, and our financial results are on track towards our 2021 commitments. Through a combination of organic investment, strategic M&A, and a culture of innovation over the last five years plus, we've transformed Insight into a leading global intelligent technology solution provider with a focus on integrated solutions, which are digital innovation solutions to help customers navigate their digital transformation journey and improve their business end to end. Data center and cloud services solutions to help businesses modernize and secure critical platforms to transform IT. Thirdly, modern workforce solutions that help organizations keep their employees connected, productive, and secure. Underpinning these solution areas is our strength in supply chain optimization, providing clients with the critical products and services that they need. The world has grown digitally dependent, and every successful business is now a technology business at its core. Just 10 or even five years ago, the pandemic might have completely crippled communities and markets. Instead, both private and public sector clients were resilient during the past year, quickly adopting and leveraging digital and cloud tools to better manage their business remotely and against the backdrop of increased cyber risk. Digital transformation is the heart of what we do for our clients, and our track record of innovation over the last three decades marks our own evolution into solutions integrator capable of providing end-to-end expertise to envision, develop, deploy, and manage modern IT solutions at scale. With stay-at-home policies or hybrid work models in place, companies want the ability to access and secure their data via the cloud. With limited internal resources to assist in migration of servers, applications, and data, companies need a partner who can not only get from point A to point B, but also can provide expert input as it relates to assessments, landscape definition, architecture, and cloud consumption. For example, our cloud and data center transformation team was tasked with helping a credit union, which faced the challenges of office restrictions, migrate to the public cloud. Our team deployed their expertise in cloud solutions and went to work on a strategy that simplified data protection and produced tangible benefits. They analyzed the credit union's landscape, identified dependencies, mapped a migration journey, and integrated a disaster recovery migration plan. As a result, two data centers were combined and consolidated and migrated to the cloud. Both recovery point and recovery time metrics showed improvement, and there was increased access and security via the cloud. Furthermore, Insight will also provide ongoing managed support on this continued migration to the cloud. The comprehensive methodology recommended by the Insight team on data replication and disaster recovery increased the short and long-term return on investment for the credit union. As we help companies shift to public cloud and modernize their infrastructure, we're also engaged in improving data security. Whether our clients need to implement new security measures for their business or enhance security measures already in place, our connected workforce team has the expertise to provide solutions tailored to the needs of our client. For example, one of our clients who's a professional service provider for the government segment needed help identifying and implementing a security solution to meet new government compliance requirements. In addition to compliance, they also wanted to reduce costs and improve their security baselines, including end-user awareness of things like phishing. Our team implemented an architecture that included professional services and ongoing managed services that address remediation, management, and maintenance of controls to meet security and compliance requirements. The managed services are a holistic solution that address not only technical components of security, but also focus on end-user training and adoption of enlightened security practices. The important takeaway for this example is that our connected workforce team helps clients develop a technology strategy that provides the best end-user experience, execute against it, and maintain it to allow their business to reach and sustain their goals. Our team's approach is to focus on providing capabilities that address three major business shifts: anywhere operations, improving employee experience, and empowering IT. At Insight, we offer the solutions that propel our clients' workforce forward, no matter how they work. Because of our client-focused approach and ability to execute a comprehensive portfolio of managed workplace solutions, we are positioned in Gartner's 2021 Magic Quadrant for Managed Workplace Services for the fifth consecutive year. We're proud to be recognized once again by Gartner for the service solutions we're providing to help our clients' businesses run smarter. Our cloud and data center transformation and connected workforce teams illustrate how our client-focused solutions are key to achieving our long-term priorities and driving value for our stakeholders. As a reminder, our long-term priorities are to, one, innovate in order to capture market share in high-growth areas. Second, to develop and deliver solutions that drive better business outcomes for our clients. Third, expand and scale our business with strategic clients and end markets. Lastly, continue to optimize the client experience and our execution through relentless focus on operational excellence. These long-term priorities align to deliver on our short and long-term financial commitments. We are pleased with our execution in the first quarter and remain optimistic about the market recovery strengthening over the balance of this year. We're maintaining our outlook for 2021 from our previously issued guidance, which reflects continued progress towards these goals, as well as our long-term goals that we outlined at our Investor Day in late 2019. The last year has reinforced our belief that the IT industry is resilient and demands for IT solutions will continue to evolve during economic downturns and recoveries. Across the markets where we do business for 2021, industry analysts expect mid-single-digit growth across hardware, software, and services sales. The recovery on a macro level has seen positive indicators in global markets. We expect the time and extent of the recovery to vary across our different clients and end markets. Coming into 2021, we had elevated backlog, and that trend has continued throughout this quarter. Supply constraints due to chip and display shortages are now expected to continue through the balance of the year. We continue to see healthy hardware booking trends that are up significantly year-over-year so far in the second quarter. When combined with already elevated backlog, we feel confident that we will see seasonally higher hardware sales in Q2 and over the balance of the year compared to the first quarter. The market is growing once again, and we expect this will accelerate in the back half of this year. This acceleration will drive stronger top-line growth in the back half of 2021 compared to what we expect to see in the first half of 2021. Strategically, we believe we are well-positioned to compete in the areas our clients need most, namely improved workforce experience, modernizing their data centers, and realizing the opportunity to go digital. Organizationally, we continue to try to optimize our resources to best position our solutions in the marketplace, including investing in our sales and technical teams to ensure we can lead with solutions in core end markets, and enhancing our scalable IT systems and processes, including our e-commerce platforms targeted at mid-market and those supporting as-a-service consumption models. We plan to continue to invest in these critical areas with the goal to deliver a great client experience while also optimizing our infrastructure to scale for future growth. Recently, we were recognized as Forbes as one of the best employers for diversity in 2021, ranking number 140 out of 500. The annual list covers 25 industry sectors. Insight is ranked the highest of five Arizona companies making the rankings. We've also been recognized as a great place to work and best place to work in various locations in North America, EMEA, and in Australia. We're well-positioned to help our clients solve complex IT challenges. We believe that the strategic investments we made in go-to-market solution areas over the last several years, as well as investments in our solution and technical talent, position us well to achieve our business goals. As you're aware, we announced this morning that I will be retiring. This has been a difficult decision for me as I care deeply about Insight and our incredible teammates. We have accomplished a lot in my time at Insight and are excited about our trajectory. We have a strong and talented management team and an engaged workforce who believe and continue to execute the strategy that we outlined in our Investor Day in 2019, and Insight is very well positioned for the future. The board has hired a top-tier search firm, and the company has undertaken a thoughtful process to evaluate internal and external candidates. This is a critical search for Insight, and I'll be working with the board to identify the new CEO. I commit to continuing to lead this team as CEO until the right successor is appointed. Thanks to all of you for your interest in Insight over the years. I'll now hand the call back over to Glynis to cover the details of our financial performance. Thank you, Ken. In the first quarter of 2021, we executed well against our strategic and financial priorities, gaining share in key categories, improving our profitability, while also investing in strategic areas to support our future growth. For the consolidated company, our net sales in the first quarter were $2.2 billion, up 2% compared to the first quarter of 2020, driven by net increases in software and services net sales. Gross margin was 15.1%, and SG&A expenses were down 2% in constant currency and up 1% in U.S. dollars. As a percent of net sales, adjusted SG&A was 12%, down 10 basis points year-over-year and in line with our expectations for the quarter. As a percent of net sales, SG&A on a GAAP basis was 12.4%, also down 10 basis points year-over-year. For the full year, we expect adjusted SG&A as a percent of net sales will be 11.7%. Adjusted earnings from operations was $68 million, up 3% year-over-year, compared to a 27% increase on a GAAP basis, and adjusted diluted earnings per share was $1.30 and $1.18 per share on a GAAP basis. Adjusted diluted earnings per share exclude, among other things, severance and restructuring expenses and the gain on the sale of real estate in Q1 2021 of $8 million. Moving on to the results of our operating segments, we're starting with North America on slide 13. In North America, net sales were $1.7 billion in the first quarter, down 1% year-to-year, due primarily to lower hardware sales as a result of supply constraints and extended product lead times driving higher backlogs. Gross profit of $263 million in North America was down slightly year-to-year, and gross margin of 15.3% was flat compared to prior year. North America's adjusted SG&A decreased 1% year-to-year due to overall reductions in discretionary spending, partially offset by increases in executive compensation as well as variable compensation due to new variable compensation plans implemented January 1st. SG&A as a percentage of net sales on a GAAP basis was 12.5% in the first quarter. For the full year of 2021, we expect adjusted SG&A as a percent of net sales will be 11.3%. Adjusted earnings from operations decreased 2% year-over-year to $54 million for the quarter. On a GAAP basis, earnings from operations increased 27% year-over-year to $54 million. In EMEA, net sales in the first quarter increased 5% in constant currency. Gross profit also increased 3% in constant currency, and when combined with the operating leverage from lower SG&A growth, this led to adjusted earnings from operations, which increased 15% in constant currency to $11 million. Moving on to slide 15. In APAC, net sales of $59 million and gross profit of $12 million in the first quarter increased 2% and 10%, respectively, year-over-year in constant currency due to higher sales in hardware and services in the region, which led to adjusted earnings from operations of $3 million in the quarter, up 21% in constant currency. Moving on to our tax rate. Our effective tax rate for the first quarter of 2021 was 23.8% compared to 20.3% in the prior year quarter. In the prior year, the lower effective tax rate was due primarily to the remeasurement of acquired net operating losses to be carried back to higher tax years under the CARES Act. Turning to our cash flow, in the first quarter of 2021, we generated $43 million of cash flow from operations compared to $93 million during the same period last year. The decrease year-over-year is primarily due to working capital investments, including investments in inventory to support specific client engagements and additional short-term demands. As previously disclosed, we expect cash flow will normalize in 2021 as our business grows. For the full year of 2021, we expect cash flow from operations will be between $200 and $250 million. In the first quarter of 2021, we invested approximately $8 million in capital expenditures, mainly related to technology and facility investments. We also received $27 million in net proceeds from the sale of three buildings in Tempe and our property in Woodbridge, Illinois. Today, we have the majority of our $1.2 billion ABL facility available and have ample capacity to fund future growth. At the end of the first quarter, we had a cash balance of $139 million, of which $119 million was resident in our foreign subsidiary, compared to a prior cash balance of $63 million. We had $417 million of outstanding debt, including our senior convertible notes at the end of the quarter, down from total debt of $751 million in the prior year. As we exited the quarter with a leverage position at 1.1 x debt to cash flow or EBITDA, which is well within our level of comfort. Under our ABL agreement, our primary compliance covenant is a fixed charge coverage ratio, which includes trailing 12-month EBITDA coverage over capital expenditures, taxes, and interest and cash interest. As of March 31st, we're at 4x against a minimum requirement of 1x, and we are confident we can support our capital requirements and liquidity needs. Next, I wanted to notify you that this week our board of directors approved an authorization to repurchase up to $125 million of our common stock, including $25 million that was previously authorized in February of 2020. Subject to market conditions, we will commence this program during 2021. However, the guidance we're maintaining does not include the impact of this program as we will monitor the market conditions over the coming weeks. We plan to update you on our second quarter earnings call regarding our progress and expected EPS impact for the year. As Ken mentioned, we're maintaining our previously issued guidance for 2021. We expect to deliver net sales growth between 4% and 8%. We also expect diluted earnings per share for the full year of 2021 to be between $6.60 and $6.80. This outlook assumes interest expense between $25 and $28 million, an effective tax rate of 25%-26% for the full year of 2021, capital expenditures of $75 million-$85 million, including the build-out of our new corporate headquarters, and an average share count for the year of approximately 36 million shares. This outlook excludes acquisition-related intangible expense of approximately $32 million, the non-cash convertible debt discount and issuance costs reported as part of interest expense of approximately $12 million, and assumes no acquisition-related or severance or restructuring expenses. To assist with your modeling, we have posted a schedule on our website on the Investor Relations page, which shows the expected amortization expense and the non-cash convertible debt discount and issuance costs by quarter for 2021. I will now turn the call back over to Ken. Thank you, Glynis Bryan. In addition to the awards mentioned previously, we issued our third annual corporate citizen report in February, sharing how our environmental, social, and governance practices positively impact our teammates, clients, and communities. This year's report emphasizes our continued actions to support a team-oriented workplace of diversity, equality, and inclusion, and highlights how our values of hunger, heart, and harmony align with our investments in environmental and sustainable initiatives. Most importantly, we put people first. We don't think of ourselves as individuals, but as teammates. We take care of each other, our clients, and our communities. We trust in each other and take pride in what we can collectively achieve. I once again want to thank our teammates across the world for everything they do for Insight, our clients, partners, and each other. I'm privileged to be part of such a diverse and talented team. That concludes my comments. Thank you again for joining us today. We'll now open the line up for your questions. If you would like to ask a question, please press star, then the number one on your telephone keypad. Your first question comes from the line of Adam Tindle with Raymond James. Okay, thanks. Good morning, and congrats, Ken. Well-earned retirement. The industry will certainly miss you, and we'll miss you as well. I wanted to maybe just start on the comment that you made about expecting acceleration in the back half of the year that will drive stronger top-line growth. As I go into this question, I'm sure you won't miss this part of your job, but there's a fear from investors that devices are going to slow in the back half of the year, and it's a big part of IT spend. Maybe just match that with why you're expecting acceleration in the back half of the year, the categories or verticals that give you confidence, and if Glynis wants to weigh in on a sense of magnitude for that for our model. Is Q3 and Q4 going to be over that 4%-8% full year revenue growth while Q2 is under? Just help us shape our models. Thanks. Yeah. Thanks so much, Adam Tindle, and thanks for the commentary and certainly your support and guidance throughout my tenure here. A couple of the reasons why, of course, we believe the second half will accelerate. One is, I think, from an economic point of view, as well as, of course, as you know, the compares are much, much easier as you get to Q2, Q3, and Q4. That's certainly just the math that works there. From a device point of view that you touched on, certainly we've experienced elevated backlog. Our backlog is up low single digits from Q3 to Q4. That continued to be up low single digits from Q4 to Q1, and that trend is continuing now into Q2. There is certainly good indications of demand. Booking rates are up again substantially from where they were a year ago. I think all those align very well to the kind of growth that we're seeing. Now, we will see constraints, of course, with the semiconductor chip shortages that we're all experiencing in the industry. I do believe in all the indications we have, the OEMs are still going to ship more units this year than they certainly did last year. I think we won't be able to get everything we want by any means, but it certainly will be acceleration. We also believe that as clients now start to get back to offices. I do think that definitely impacts how infrastructure spend will be done. While we did see improvements as we talked about in our corporate and enterprise client base, we saw positive growth in the quarter, which was really good news because we hadn't seen that in a bit. We think that starts to accelerate even further as we get into the second half of the year. I think as the semblance of people start to come back to their work environments in a hybrid fashion, I do believe that that will definitely help accelerate a lot of the private infrastructure that has definitely been much more muted over the past four quarters. A lot of that is because people are now in place to be able to look at the equipment, test the equipment, and so forth. A lot of those things, I think, factored, but I think the economic backdrop certainly favors that. Certainly, the vaccines coming out, certainly what the U.K. and the U.S. has experienced already, that starts to, of course, really evolve into Canada and the EMEA here in the coming months. I do think that the economies and IT spend will certainly improve in the second half. Glynis, let me throw it over to you to see if you wanted to add anything. I think Matt. Sorry, Adam. Horrible. Sorry about that. I think that if you look at, we grew 2% in Q1. We anticipate that we're going to be growing in the 4%-8% range for the full year. The statistics now coming out from the various agencies would indicate mid-single-digit growth for the sector. We anticipate we'll do slightly better than that. The comparisons Ken mentioned are lower in the second half of the year, and we also, as Ken outlined, anticipate that there's going to be easing of some of the constraints, and we'll have more access to products as we go through the year. yes, we expect that in the second half of the year, we will see higher than the, at least the 8%, the 4%-8% range in terms of growth in the second half of the year. Got it. Not necessarily Okay in Q2, but in the second half, for sure. Understood. That's helpful. Just as a follow-up, I wanted to ask on gross margin. It was down year-over-year for the first time in a while, albeit slightly, and certainly weathered better than others out there in terms of your main competitors. I wanted to ask about vendor rebates and incentives. Ken, maybe the state of those right now, it seems like they wouldn't need to incentive much because there's no supply anyway, and I'm wondering if you're seeing that. Secondly, how you think about those once supply comes back. Do those return to normal rebate levels, or could we potentially hit a new normal on gross margin for the company? Yeah. I'll comment and let Glynis Bryan add in, Adam Tindle. Yeah, we were down 10 basis points, as you saw, for gross margin. A lot of that, again, driven by the acceleration that we talked about with hardware carrying lower gross margin than the rest of our business. Some of the acceleration there, I think, drove that. I think that's the certainly main factor that we're going to. Glynis Bryan, I don't know if you wanted to add anything towards that or not. No, I think what we had said back in February, and I think we maintain now, is that margins or gross margins will be roughly flat for 2021. Partly because we anticipate that hardware as a percentage of the total will be greater than it was in 2020, when we had more cloud-based 100% margins as a greater percentage of our total. With the improvement in hardware that we anticipate in the second half of the year, we believe that our gross margins will be flattish on a year-over-year basis. I would view Q1 as being flattish. Got it. Okay, maybe just one final one, bigger picture. Ken, what are the key attributes that you and the Board are going to be looking for in a successor? If you could maybe stack rank a couple things. Is it vendor experience, global experience, large acquisitions, cloud? Yeah, I think all of those are pieces. First and foremost, of course, we're looking for a very solid leader. That's first on top of the list. We think we've got the right elements in place. We have the right strategy in place. I think all of the above type of experiences that you mentioned, of course, are going to be important ingredients to that. We're excited about that. I think it'll be a very thoughtful process, and we have, as I mentioned, a few really good internal candidates and a good slate thus far of external candidates that we're just in the process of starting to engage with. Nothing, I think, out of the norm of what you'd expect. Got it. It'll be big shoes to fill. Congrats again. Thank you. Thanks, Adam. The next question is from Matt Sheerin with Stifel. Yes, thanks. Good morning. I just wanted a follow-up on Adam's question just regarding your outlook for acceleration in the second half. In the second quarter, it looks like you're going to have pretty easy comps. I think last year you were down like mid-teens on a pro forma basis year over year, 8% sequentially, and you're typically up sequentially at least a little bit in the June quarter. Is there anything preventing you from growing at least modestly sequentially, constraints or that outlook in terms of the infrastructure spend, is that more skewed toward the back half? We will grow sequentially going into the Q2. Didn't mean to suggest that we would not be growing sequentially going into Q2. We still have some supply constraints as it relates to more devices as opposed to the infrastructure stuff. We will continue to grow. Our Q2 is normally a heavy software quarter for us because of the Microsoft year-end that's in June. Some of that gets netted, so it kind of meets the top-line growth, but we would anticipate that we're going to perform well from an overall software perspective. Hardware will be a little bit more muted just because of supply constraints, but we still expect to expand to see sequential growth from the first quarter. Okay. That's helpful. Then Ken, as you talk about the opportunities on the infrastructure side, the hybrid side, in the bookings, could you quantify, I think you said your backlog was up a little bit, but that's on the client device. In terms of the real solutions projects, could you quantify how strong that's looking? Yeah, I would say that we certainly had growth in first quarter, in that space. Again, we anticipate with the projects we're seeing, with the backlog and bookings that we're starting to see come to reality, that certainly increases. Again, more favored towards the second half of the year as people come again back more in a hybrid work environment back on site. We think that helps the acceleration and of course, the economic aspects do improve certainly in the second half. The compares, of course, as you mentioned, get easier as well. We're definitely seeing good activity in that area. As we talk to, and as you talk to the OEMs, Cisco and Dell EMC, NetApp and Pure Storage, I think you'll see a similar sort of story in that vein as well. that's why we come to that conclusion that the second half will be certainly stronger from an infrastructure point of view, meaning a hybrid infrastructure point of view in the second half of the year. Okay. lastly, on the public sector, you talked about strength there in the education market, and we've seen multiple strong quarters of demand. Is there still legs left there in terms of that cycle, in the education and public sector markets? Yeah, I think there definitely is. Of course, we're not nearly as heavily skewed towards that segment of our business as one of our competitors is, so it's a much smaller part of our business. We did see continued growth, but I think, the main aspect, I think what we're all seeing, of course, what the pandemic drove, and I think which is obvious, is that, I think on average, it used to be there was for the average household, one PC per household. I think now what you're seeing, of course, it's one PC per person per household, due to the education requirements that are necessary for distance learning. I do think that there's a huge proliferation as we've seen with Chromebooks primarily, in that market set. I think that's going to continue now that you're going to have refresh cycles that will be probably, certainly more accelerated, with the numbers that you're seeing out there. The fact that there's a lot of wear and tear on those with students. I do think that that's going to continue. Now, is there a surge going on now and last quarter or the next and this quarter and maybe into Q2? Yes. There's no question that won't continue at that accelerated pace, but the baseline has improved pretty dramatically when you look at the numbers of units. If you just take the refresh sort of cycles of that's going to certainly increase the base pretty substantially for the education market. Okay, great. All right. Thanks a lot, Ken. Your next question is from Anthony Lebiedzinski. Yes, good morning, and congratulations on your pending. My first question is in regards to the supply chain constraints that are out there, just wondering, you look at the issues that are going on now, versus quarter end, have things improved or gotten worse or about the same? Can you just give us some more color on that, please? Yeah, Anthony, thanks for your question. Yeah, I would say they're about the same. We're very close to this, as you can imagine. We're very on top of this with the likes of Apple, Lenovo, Dell, HP of course, where most of that is occurring. I would say that they're managing it. They're getting better visibilities. I would say it's pretty much basically about the same. We anticipate that those constraints will certainly occur through the rest of this calendar year, and then there'll certainly be. There's obviously capacity coming online, but that typically takes a few quarters to three quarters to really start being fulfilled. I think we'll see that into certainly the rest of this year and into the first part of next year potentially. Got it. Okay, thanks. You gave us some color on the public sector. Just wondering if you could give us some additional color on some of your other vertical markets. What are you seeing there? Yes. Again, as we said, we're seeing that our enterprise and corporate and commercial clients, we did see positive growth, for the first time in a while in those sectors. That was really good news to see, from a business point of view. Again, we continue to see booking rates improve very nicely, as well as, of course, as we talked about backlog improving. That's what gives us the confidence with the ongoing sort of trajectory that we see in the business. Got it. Okay. The last question from me. As far as, overall there's more discussion from the companies about inflation. Just wondering, are you seeing that, whether wage inflation or other costs increasing, and how you're doing as managing that? Yeah, we're not seeing that yet, Anthony. Of course, there's a tremendous amount of talk about it, and has been for the last couple of months. We're not seeing that impact the business yet at this stage. Certainly mindful of that and what that could mean. There's no question we will see price increases on devices because of the semiconductor shortages, as obviously those prices are increasing for the OEMs, so those will be passed through. Now for us, that's a positive situation because it's higher ASPs for us, and we do have systems to make sure that gets immediately passed through to our clients. I don't think that's basically an increase in pricing that might be viewed inflationary, but that's really just due to the constraints more than anything else. To your main question on inflation, not really seeing that impact any sort of clients or any discussion around that yet. Got it. All right, well, thank you. Good luck. Thank you. Your next question is from Paul Coster with JPMorgan. Hi, this is Paul Chung on for Coster. Thanks for taking my questions. Ken, congrats on your retirement. You've seen a material amount of shareholder value creation under your leadership, so congrats on that. Just on the competitive landscape, are you gaining market share, particularly against smaller players as your size kind of enables you to work relatively better through supply constraints? Just how do you think the industry evolves from kind of lessons learned during the pandemic, and do you expect kind of more consolidation in this space? Yeah, a lot in that question there, Paul. First off, thanks for the thoughts there. Yeah, I would say from a couple areas that we're seeing from our smaller competitors, they're a very resilient group of people, there's no question. Their businesses are pivoting. There's no question that I think the trends that we've seen in some of the data sets we've seen, where the larger players, the top sort of 10, 15 players in the industry, are certainly growing significantly faster, almost 2x what the smaller players are growing, and that's just the data that would show that. That doesn't mean they're going away. That means those smaller players are pivoting to becoming more managed service providers and looking at different parts of the business. I do think that it's becoming more and more difficult for smaller players to continue to play in the supply chain aggregation game. I think the systems, the tools that are required now are much different than they were a few years back. I think that does play to the larger companies who can invest in really strong IT platforms, strong e-commerce engines, strong digital marketing-type capabilities. I think that's been playing out, and I think that will continue. I think that is leading, of course, to more consolidation. I think you're seeing that across the landscape in many, many facets, and I think that's only gonna continue, and that's a very natural thing that occurs as industries continue to mature and grow. I think that's definitely happening. As far as lessons learned, I think they're the obvious ones for us. I think companies are realizing that at the heart of the pandemic really was the reliance on IT. IT was the solution for them, right? As we said in our script, five, 10 years ago, would've been really difficult for this. When you look at the advent of the level of machines that we have for devices that are relatively inexpensive to allow people to work remotely, the scalability of the networks that's occurring, the application of things like Cisco Webex and Teams, which really help the collaboration front, all play really strongly. I think for IT, I think overall the pandemic has been a good thing in the fact that more and more companies realize that at the heart of it, they've got to become much more digital as a company in order for them to succeed. I think we'll see some of the remnants of this, of course, continue, right? I think we all agree that the workforce won't be the same going forward. We're believers that it'll be hybrid, but there'll certainly be more work from anywhere type of activities that will continue to migrate. I think those are some of the obvious lessons learned. I think overall, it just shows how resilient people are to get the job done. Got you. Thanks for that. Glynis, as we think about free cash flow for the year, I assume we should expect pretty strong seasonal 4Q kind of similar to last year and then some drag in the second half. What are some of the puts and takes as we navigate kind of through the year, and that could drive some upside to maybe your cash from operations? Thank you. That's a tricky question, Paul. Part of it, I think, is that as we navigate in the second half of the year, we anticipate that we're gonna have more hardware purchases, and that typically would be a drag on our cash flow performance in the second half of the year. We do anticipate that we will have better performance around software, which typically helps us from an overall cash flow perspective. I think that combination is really what's gonna drive the cash flow performance that we would see in the second half of the year. As well as the improvements that we're seeing in our collections from an overall AR perspective and reductions in our DSO, and we've done a good job of expanding on the payable side with the facilities and the inventory financing facilities that we use. I think continued use of those will also drive to the cash flow performance that we're anticipating in the second half of the year. Okay, great. Thank you. Your next question comes from Vincent Colicchio with Barrington Research. Yeah. Ken, what areas of your business are you experiencing market share gains? Yeah. Thanks, Vincent, for the question. No question on the software side, where we get good data sets from the publishers and so forth. No question we're gaining share when you look at cloud, when you look at Azure consumption from Microsoft, when you look at what we're doing with the likes of companies like VMware. No question that we're certainly gaining. That's a big area of focus for us as a company. certainly good data sets that point to the fact that we are companies like Adobe. We're definitely doing well on the software front. On the hardware front, it depends upon the specific situation. A little bit hard in these kind of very constrained environments to gain share, and your goal really is to make sure you don't lose any share during these environments, and that you're getting the right allocation of products to support your client needs. Of course, the other big segment, of course, is on server storage, networking side of the business. Networking is going well for us. Some areas of focus for us in server and storage, where I think we've given up a little bit of share in those areas. That would be sort of a summary of how we see the business. When are you assuming that your people get back to the office in your guidance? Yeah, good question. We told our teammates that, of course, we'll give them a month's notice for that. Of course, it depends upon where you are in the world. Certainly in Australia and New Zealand, the offices are fully open and have been for a while. Certainly we're seeing that in Hong Kong and Singapore. Certainly China, our offices in China have been open for a long, long time. Europe is a different situation. The U.K., of course, looking much more positive than the rest of Europe. I think that's going to take a few more months. I wouldn't expect Europe to really get back to more of the offices until sort of the late summer, maybe September's timeframe, based upon what we're seeing. The U.S., we've got our offices open. They're little sort of voluntary basis, but we do believe that as we get into July, that that will become a much more sort of hybrid sort of situation where we will be having our main larger offices open. Again, we'll follow all the CDC guidelines and so forth. Canada, similar to Europe, right? A little bit more constrained, certainly with lockdowns, but vaccines coming out pretty quickly. Our anticipation, again, would be that sort of in the July timeframe that we'd see certainly much more activity back to offices. We're hearing the same sort of situation with our clients as well, when you look at what their plans are. Certainly you being in the financial community know the financial community is leading this, right? You've seen what Goldman and JPMorgan have said in regards to offices opening in June and a lot more activity. We think that's positive as we get back to more of a hybrid sort of environment. Thanks for answering my questions. Yeah. One other question, Adam, and I apologize, I missed your question on the rebates. I wrote it down, but didn't get to it in the verbal response. On the rebate front, we're actually not seeing any degradation there. We're seeing great support continued from our partners, and the investments, they know how important our activities are to their portfolio. We are not seeing degradations in regards to any of the rebate sort of programs that we have in place. We think, obviously, as we come out of that, the economy gets stronger and lines go up, that those will always be very similar to what they were. During the pandemic, we didn't see any of our partners really retract from that situation at all. That continues to be pretty stable for us. Could I just clarify one question that I thought we would get that we didn't get? As you think about SG&A, we've given guidance out there that as we anticipate, we will get to 11.7% SG&A as a percentage of sales, adjusted SG&A as a percentage of sales for the year. In the first half of the year, our SG&A is higher than that 11.7%, and in the second half of the year, slightly lower than that 11.7%. You should anticipate in Q2 that SG&A will be higher than 11.7%, and it will come down in the second half of the year to get to that outcome. That's it.