From BigGo Finance · BigGo Finance · · 2m
CDW Raises Full-Year EPS Outlook to Low Double-Digit Growth
CDW boosts full-year EPS growth to low double-digit as AI infrastructure demand lifts sales 18% to record $6.8 billion.
In brief
CDW boosts full-year EPS growth to low double-digit as AI infrastructure demand lifts sales 18% to record $6.8 billion. CDW raised its full-year 2026 EPS outlook to low double-digit growth after AI infrastructure demand increased sales 18% year over year to $6.8 billion. Originally reported by BigGo Finance.
CDW Q3 2026 Results
![[CDW Q3 2026 Earnings Call] CDW Raises Full-Year EPS Outlook to Low Double-Digit Growth as AI Infrastructure Demand Lifts Sales 18% to Record $6.8 Billion](https://img.biggo.com/VU_eseA9pe-HpkMSK5NvVluqNrGwwKlDmjoF_pU9OqQ/fit/1720/0/sm/0/aHR0cHM6Ly9pbWcuYmdvLm9uZS9uZXdzLWltYWdlL2Vhcm5pbmdzX2NhcmQvMjAyNi0xMS9VU19DRFdfMjAyNi0xMS0wNF8xNzkzODA0MzQxLndlYnA.webp)
CDW reported record third-quarter 2026 net sales of $6.8 billion, up 18% year over year on average daily basis.
AI Infrastructure Demand Drives Growth
Enterprise and financial services customers invested heavily in AI-ready infrastructure, boosting sales 18% year over year.
Strong Financial Performance
Gross profit rose 10.3% to $1.4 billion, non-GAAP EPS surged 20.4% to $3.26, and adjusted free cash flow exceeded $500 million.
Full-Year Outlook Raised
CDW raised full-year gross profit growth to mid-to-high single digits and non-GAAP EPS growth to low double-digit range.
Dividend and Acquisition Announced
CDW increased quarterly dividend 8% to $0.68 per share and completed $525 million acquisition of data and AI services firm Lovelytics.
Margin Pressure from Mix Shift
Gross margin contracted 140 basis points to 20.5% due to shift toward large infrastructure projects with higher hardware content.
CEO Chris Leahy on AI Strategy
CEO Chris Leahy stated customers are prioritizing infrastructure modernization and AI adoption for AI-ready infrastructure.
CFO Al Miralles on Margin Dynamics
CFO Al Miralles pushed back on like-for-like margin compression, attributing gross margin decline to strong enterprise and financial services customers.
AI Infrastructure Sales Surge
Hardware sales jumped 21%, data storage and servers more than doubled year over year, software grew 14%.
Services Segment Returns to Growth
Services segment returned to growth at 2%, earlier than expected, despite professional services being impacted by deployment timing.
Capital Returns Accelerate
CDW returned $892 million to shareholders year-to-date, 114% of adjusted free cash flow, exceeding 2026 target of 50%-75%.
Q&A Highlights on AI Demand
Analysts questioned AI-driven demand durability, with CEO stating data explosion and cybersecurity risks ensure long-term strength.
Lovelytics Acquisition Impact
Lovelytics acquisition expected to be accretive to gross margins, with professional services business contributing rich margins.
Bottom Line: AI Infrastructure Cycle
CDW capitalizes on early infrastructure phase of enterprise AI adoption with confidence in demand cycle room to run.
What to remember
CDW raised its full-year 2026 EPS outlook to low double-digit growth after AI infrastructure demand increased sales 18% year over year to $6.8 billion.
