CDW Corp Files Q3 2024 10-Q Report

TL;DR

CDW Corp's Q3 2024 10-Q is in. Check financials.

AI Summary

CDW Corp filed its 10-Q for the period ending September 30, 2024. The filing covers the third quarter and the first nine months of the fiscal year. Key financial data and operational details for CDW Corp are presented in this report.

Why It Matters

This filing provides investors with the latest financial performance and operational status of CDW Corp, crucial for understanding the company's trajectory and making informed investment decisions.

Risk Assessment

Risk Level: low — This is a routine quarterly filing providing standard financial information.

Key Players & Entities

• CDW Corp (company) — Filer of the 10-Q report
• 20240930 (date) — End of the reporting period
• 20241030 (date) — Filing date
• VH Holdings, Inc. (company) — Former name of CDW Corp

FAQ

Key Financial Figures

• $0.01 — ich registered Common stock, par value $0.01 per share CDW Nasdaq Global Select Mark

Filing Documents

• cdw-20240930.htm (10-Q) — 1791KB
• cdw-2024930x10qxex311.htm (EX-31.1) — 10KB
• cdw-2024930x10qxex312.htm (EX-31.2) — 10KB
• cdw-2024930x10qxex321.htm (EX-32.1) — 3KB
• cdw-2024930x10qxex322.htm (EX-32.2) — 3KB
• cdw-20240930_g1.jpg (GRAPHIC) — 673KB
• 0001402057-24-000182.txt ( ) — 8685KB
• cdw-20240930.xsd (EX-101.SCH) — 33KB
• cdw-20240930_cal.xml (EX-101.CAL) — 53KB
• cdw-20240930_def.xml (EX-101.DEF) — 107KB
• cdw-20240930_lab.xml (EX-101.LAB) — 444KB
• cdw-20240930_pre.xml (EX-101.PRE) — 284KB
• cdw-20240930_htm.xml (XML) — 1468KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements: Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023 3 Consolidated Statements of Operations for the Three and Nine Months Ended Se ptember 30, 2024 and 2023 4 Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2024 and 2023 5 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 6 Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended September 30, 2024 and 2023 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 9

Management ' s Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management ' s Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 35

Controls and Procedures

Item 4. Controls and Procedures 35

OTHER INFORMATION

PART II OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 36

Risk Factors

Item 1A. Risk Factors 36

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 36

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 36

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 36

Other Information

Item 5. Other Information 36

Exhibits

Item 6. Exhibits 37 SIGNATURES 38 Table of Contents

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (dollars and shares in millions, except per share amounts) September 30, 2024 December 31, 2023 Assets (unaudited) Current assets: Cash and cash equivalents $ 946.7 $ 588.7 Short-term investments 211.7 — Accounts receivable, net of allowance for credit losses of $ 37.5 and $ 28.8 , respectively 4,894.0 4,567.5 Merchandise inventory 682.5 668.1 Miscellaneous receivables 520.1 470.5 Prepaid expenses and other 406.6 410.2 Total current assets 7,661.6 6,705.0 Operating lease right-of-use assets 129.2 128.8 Property and equipment, net 193.1 195.5 Goodwill 4,424.5 4,413.4 Other intangible assets, net 1,259.7 1,369.7 Other assets 708.6 472.2 Total Assets $ 14,376.7 $ 13,284.6 Liabilities and Stockholders' Equity Current liabilities: Accounts payable-trade $ 3,179.9 $ 2,881.0 Accounts payable-inventory financing 357.0 430.9 Current maturities of long-term debt 423.2 613.1 Contract liabilities 474.7 487.4 Accrued expenses and other current liabilities: Compensation 247.1 303.0 Advertising 148.4 119.9 Sales and income taxes 64.9 52.4 Other 563.4 554.3 Total current liabilities 5,458.6 5,442.0 Long-term liabilities: Debt 5,607.5 5,031.8 Deferred income taxes 145.1 171.4 Operating lease liabilities 158.7 164.0 Other liabilities 657.5 432.9 Total long-term liabilities 6,568.8 5,800.1 Commitments and contingencies (Note 9) Stockholders' equity: Preferred stock, $ 0.01 par value, 100.0 shares authorized; no shares issued or outstanding for both periods — — Common stock, $ 0.01 par value, 1,000.0 shares authorized; 133.2 and 134.1 shares outstanding, respectively 1.3 1.3 Paid-in capital 3,807.2 3,691.3 Accumulated deficit ( 1,350.9 ) ( 1,525.5 ) Accumulated other comprehensive loss ( 108.3 ) ( 124.6 ) Total stockholders' equity 2,349.3 2,042.5 Total Liabilities and Stockholders' Equity $ 14,376.7 $ 13,284.6 The accompanying notes are an int

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) 1. Description of Business and Summary of Significant Accounting Policies Description of Business CDW Corporation ("Parent"), a Fortune 500 company and member of the S&P 500 Index, is a leading multi-brand provider of information technology ("IT") solutions to small, medium and large business, government, education and healthcare customers in the United States ("US"), the United Kingdom ("UK") and Canada. The Company's broad array of offerings ranges from discrete hardware and software products to integrated IT solutions and services that include on-premise and cloud capabilities across hybrid infrastructure, digital experience and security. Throughout this report, the terms the "Company" and "CDW" refer to Parent and its subsidiaries. Parent has two 100% owned subsidiaries, CDW LLC and CDW Finance Corporation. CDW LLC is an Illinois limited liability company that, together with its 100% owned subsidiaries, holds all material assets and conducts all business activities and operations of the Company. CDW Finance Corporation is a Delaware corporation formed for the sole purpose of acting as co-issuer of certain debt obligations and does not hold any material assets or engage in any business activities or operations. Basis of Presentation The accompanying unaudited interim Consolidated Financial Statements as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 (the "Consolidated Financial Statements") have been prepared in conformity with accounting principles generally accepted in the United States of America ("US GAAP") and the rules and regulations of the US Securities and Exchange Commission (the "SEC") for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to the rules

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) periods within fiscal years beginning after December 15, 2024. Entities are required to apply the amendments on a retrospective basis. The Company is currently evaluating the impact this ASU will have on its disclosures. 3. Accounts Receivable and Contract Balances Accounts Receivable The following table details the total accounts receivable recognized and the related classification on the Consolidated Balance Sheets: September 30, 2024 December 31, 2023 Accounts receivable, current (1) $ 4,894.0 $ 4,567.5 Accounts receivable, noncurrent (2) 639.4 337.5 Total accounts receivable $ 5,533.4 $ 4,905.0 (1) Accounts receivable, current are presented within Accounts receivable, net of allowance for credit losses on the Consolidated Balance Sheets. (2) Accounts receivable, noncurrent are presented within Other assets on the Consolidated Balance Sheets. From time to time, the Company transfers certain accounts receivable, without recourse, to third-party financial companies as a method to reduce the Company's credit exposure and accelerate cash collections. Such transfers are recognized as a sale and the related accounts receivable are derecognized from the Consolidated Balance Sheet upon receipt of payment from the third-party financing company. During the nine months ended September 30, 2024 and 2023, the Company sold approximately $ 337 million and $ 382 million of accounts receivable, respectively. Contract Balances Contract assets and liabilities represent the difference in the timing of revenue recognition from receipt of cash from customers. Contract assets represent revenue recognized on performance obligations satisfied or partially satisfied for which the Company has no unconditional right to consideration. Contract liabilities consist of payments received from customers, or such consideration that is contractually due, in advance of

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) receives extended payment terms and agrees to pay the financial institutions a stated amount of confirmed invoices from its designated suppliers. The Company does not incur any interest or other incremental expenses associated with these agreements as balances are paid when they are due. Additionally, the Company has no involvement in establishing the terms or conditions of the arrangements between its suppliers and the financial institutions. The amounts outstanding under these agreements as of September 30, 2024 and December 31, 2023 were $ 357 million and $ 431 million, respectively, and are separately presented as Accounts payable-inventory financing on the Consolidated Balance Sheets. The majority of such outstanding amounts relates to a floorplan sub-facility that is incorporated in the Company's Revolving Loan Facility, as defined within Note 5 (Debt). A portion of the Company's availability under the Revolving Loan Facility is reserved to cover the obligation to pay the financial institution. For additional information regarding the Revolving Loan Facility, see Note 5 (Debt). 5. Debt September 30, 2024 December 31, 2023 Maturity Date Interest Rate Amount Amount Credit Facility Senior unsecured revolving loan facility December 2026 Variable $ — $ — Term Loan Senior unsecured term loan facility December 2026 Variable 634.5 634.5 Unsecured Senior Notes Senior notes due 2024 December 2024 5.500 % 183.5 575.0 Senior notes due 2025 May 2025 4.125 % 211.1 600.0 Senior notes due 2026 December 2026 2.670 % 1,000.0 1,000.0 Senior notes due 2028 April 2028 4.250 % 600.0 600.0 Senior notes due 2028 December 2028 3.276 % 500.0 500.0 Senior notes due 2029 February 2029 3.250 % 700.0 700.0 Senior notes due 2030 March 2030 5.100 % 600.0 — Senior notes due 2031 December 2031 3.569 % 1,000.0 1,000.0 Senior notes due 2034 August 2034 5.550 %

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) Credit Facility The Company has a variable rate senior unsecured revolving loan facility (the "Revolving Loan Facility") from which it may draw tranches denominated in US dollars, British pounds or Euros. The interest rate is based on Secured Overnight Financing Rate ("SOFR") plus a spread adjustment and a margin based on the Company's senior unsecured rating. The Revolving Loan Facility is used by the Company for borrowings, issuances of letters of credit and floorplan financing. As of September 30, 2024, the Company could have borrowed up to an additional $ 1.3 billion under the Revolving Loan Facility. As of September 30, 2024, the Revolving Loan Facility had $ 346 million reserved for the floorplan sub-facility. Term Loan The senior unsecured term loan facility (the "Term Loan Facility") has a variable interest rate. The interest rate is based on SOFR plus a spread adjustment and a margin based on the Company's senior unsecured rating. No mandatory payments are required on the remaining principal amount until its maturity date on December 1, 2026. Unsecured Senior Notes The unsecured senior notes have a fixed interest rate, which is paid semi-annually. Receivable Financing The receivable financing liability relates to certain accounts receivable transferred to third-party financial institutions that did not qualify as a sale under the terms of the agreements. While the terms of such agreements are on a nonrecourse basis, the transfers of accounts receivable could not achieve certain criteria that would allow derecognition of the accounts receivable. The proceeds from these arrangements are recognized as a liability and the associated accounts receivable remains on the Consolidated Balance Sheet until the liability is settled. The Company did not execute any transfers under these agreements during the nine months ended September 30, 2024. Deb

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) The approximate fair values and related carrying values of the Company's long-term debt, including current maturities and excluding unamortized discount and unamortized debt issuance costs, were as follows: September 30, 2024 December 31, 2023 Fair value $ 5,895.2 $ 5,348.2 Carrying value $ 6,065.5 $ 5,673.3 6. Fair Value Measurements and Financial Instruments Derivative Instruments The Company may use derivative financial instruments to manage its exposure to interest rate risk. The Company does not hold or issue derivative financial instruments for trading or speculative purposes. The following sections detail the Company's derivative financial instruments. Interest Rate Collars The Company's variable interest rate

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