On Wednesday, CDW Corp fell short of analysts’ expectations for its first-quarter results, facing challenges from reduced demand for its IT solutions as customers tightened their technology budgets. This led to a drop of approximately 5.5% in the company’s shares before the market opened.
Businesses are exercising caution with their technology spending, delaying significant upgrades due to persistent inflation and high interest rates.
Albert Miralles, CDW’s Chief Financial Officer, remarked that market conditions in the first quarter were weaker than anticipated, with factors like caution, concern, and complexity influencing customers’ decisions regarding capital investments and prolonging the decision-making process.
CDW offers IT solutions such as cloud services and cybersecurity, as well as hardware products, to enterprises and government clients in the United States, UK, and Canada.
In the first quarter, CDW reported net sales of $4.87 billion, falling short of analysts’ projections of $5 billion, according to LSEG data.
On an adjusted basis, the company earned $1.92 per share, which was below estimates of $2.15 per share.
CDW’s gross profit margin for the quarter stood at 21.8%, compared to 21.3% in the same period the previous year.