Revenue Growth Drivers
Net sales increased 10.0%, driven by higher demand for data storage and servers, notebooks/mobile devices, software, and netcomm products across all segments.
Source: 10-Q Item 2 MD&A
Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
CDW's fiscal second-quarter 2026 results featured broad-based sales growth driven by strong demand for data storage, servers, and mobile devices, but product mix shifts toward lower-margin hardware compressed gross margins. Higher compensation expenses and workplace optimization costs restrained profitability, while a working capital build-up caused operating cash flow to decline sharply year-over-year.
Revenue
$6.57B
+9.97% YoY
EPS (Diluted)
$2.15
+4.88% YoY
Gross Margin
20.1%
-0.7 pts YoY
Operating Income
$428.6M
+2.00% YoY
Source: SEC XBRL
Cdw (CDW) reported Q2 FY2026 revenue of $6.57B, up 10.0% year over year. Operating margin was 6.5%, down 0.5 points from 7.0% a year earlier. CDW's fiscal Q2 FY2026 corresponds to calendar Q2 2026.
Last 4 quarters: 3 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026This filing | 2.91 | 2.83 | Beat +2.9% |
| Mar 2026 | 2.28 | 2.31 | Miss -1.2% |
| Dec 2025 | 2.57 | 2.47 | Beat +4.2% |
| Sep 2025 | 2.71 | 2.65 | Beat +2.4% |
Adjusted (non-GAAP) EPS of $2.91 versus the $2.83 analyst consensus — a +2.9% beat for Jun 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $2.15.
4 reported segments · SEC XBRL
Segment revenue totals $6.57B, which is the $6.57B of consolidated revenue on the income statement.
Profit above is reported as operating income, the measure CDW itself discloses in this filing. Each company chooses its own measure here, so these margins are not comparable with another company's.
Compiled by AI from 10-Q Item 2 of this filing
Net sales increased 10.0%, driven by higher demand for data storage and servers, notebooks/mobile devices, software, and netcomm products across all segments.
Source: 10-Q Item 2 MD&A
Gross profit margin decreased 70 basis points to 20.1%, primarily due to product mix shifting toward lower-margin hardware categories, partially offset by a higher contribution of netted-down revenue.
Source: 10-Q Item 2 MD&A
Selling and administrative expenses rose 8.6% to $891.2 million, driven by higher compensation including performance-based incentives, and $44.2 million in workplace optimization costs.
Source: 10-Q Item 2 MD&A
Government gross margin declined 320 basis points (19.3%) due to unfavorable hardware and services mix, while Education expanded 110 basis points (16.4%) from higher-margin products.
Source: 10-Q Item 2 MD&A
Year-to-date operating cash flow fell 50.4% to $219.7 million, as accounts receivable rose over $1 billion and inventory climbed $418 million, pressuring liquidity.
Source: 10-Q Item 2 MD&A
Compiled by AI from this SEC filing · 0 high, 4 medium, 1 low
Gross margin contracted 70 basis points to 20.1% in Q2, driven by a shift toward lower-margin hardware. Sustained AI-driven demand may continue this mix pressure, potentially compressing margins further if high-margin software and services do not offset.
Source: 10-Q Income Statement (XBRL)
Operating cash flow dropped 50.4% year-over-year to $219.7 million in H1 2026, as accounts receivable and inventory increased sharply. The current ratio of 1.17 highlights tightening liquidity that could constrain operational flexibility.
Source: 10-Q Cash Flow Statement (XBRL)
Total debt remained high at $5.8 billion, with net debt of $5.46 billion, and interest expense increased due to higher revolver borrowings. Debt-to-equity of 2.4 signals significant financial risk, especially if earnings growth remains subdued.
Source: 10-Q Balance Sheet (XBRL)
CDW spent $545 million on buybacks in H1 2026, contributing to a 1% decline in stockholders' equity to $2.44 billion. Continued buybacks could weaken the equity base and reduce financial flexibility.
Source: 10-Q Balance Sheet (XBRL)
Government and Education segments together represent over 27% of net sales and are sensitive to public-sector funding policies. A sharp drop in Government gross margin underscores potential pricing pressures in these channels.
Source: 10-Q Segment Breakdown (XBRL)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 6.57 $B | 5.98 $B | +9.97% |
Cost of Revenue $B | 5.25 $B | 4.74 $B | +10.92% |
Gross Profit $B | 1.32 $B | 1.24 $B | +6.33% |
Operating Income $M | 428.60 $M | 420.20 $M | +2.00% |
Net Income $M | 274.40 $M | 271.20 $M | +1.18% |
EPS (Basic) $ | 2.16 $ | 2.06 $ | +4.85% |
EPS (Diluted) $ | 2.15 $ | 2.05 $ | +4.88% |
SG&A Expense $M | 891.20 $M | 821.00 $M | +8.55% |
Answers draw on this SEC filing and the data on this page
Expected release date, analyst estimates & what to watch
CDW delivered solid Q1 FY2026 revenue growth of 9.2% to $5.68B, driven by strong top-line momentum, though gross and operating margins compressed modestly as cost of revenue grew faster than sales.
CDW delivered FY2025 revenue of $22.4B (+6.8% YoY), but net income slipped 1.0% to $1.07B as SG&A costs surged 9.0% and operating margins compressed, even as the company aggressively returned capital to shareholders via $653M in buybacks.