01—Abstract
Summary
Summary of the 10-Q filed November 4, 2025. Cited figures are marked; the original filing is the authoritative source.
CDW Corporation's third-quarter 2025 10-Q shows net sales rising to $5.74 billiona for the three months ended September 30, 2025, up from $5.52 billion a year earlier, with gross profit of $1.26 billion and gross profit margin of 21.9%.
However, operating income fell to $443.3 millionb from $481.6 million, and net income declined to $291.0 million from $316.4 million, with diluted EPS of $2.21 versus $2.34. For the nine months, net sales grew to $16.91 billion and net income was $787.1 million, versus $813.6 million a year earlier. Non-GAAP operating income was $530.6 million for the quarter, compared with $534.0 million in the prior-year period.
Cash generation weakened over the nine months, with net cash provided by operating activities of $771.4 millionc versus $932.0 million, driven mainly by a $633.0 million increase in accounts receivable. The company repurchased $500.0 million of common stock and paid $246.9 million in dividends. Cash and cash equivalents were $452.9 million at quarter-end, and total debt was $5.6 billion, with $1.3 billion of availability under the Revolving Loan Facility.
The cash conversion cycle improved to 11 days from 17 days, though days of sales outstanding rose to 92 from 79. The filing also discloses an ongoing Department of Justice False Claims Act investigation, opened via a Civil Investigative Demand issued June 11, 2024, relating to bids for E-Rate Program-funded contracts.
The company says it cannot assess the probability or range of any outcome. In addition, the company implemented a new enterprise resource planning system during the third quarter, which led to changes in internal controls over financial reporting.
02—Key points
Key Highlights
- Net sales were $5.74 billion for the quarter, up from $5.52 billion, with growth across all operating segments.
- Operating income declined 8.0% to $443.3 million, and gross profit margin was 21.9% versus 21.8%.
- Diluted EPS was $2.21 versus $2.34; non-GAAP diluted EPS was $2.71 versus $2.63.
- Nine-month operating cash flow was $771.4 million, down from $932.0 million, mainly due to accounts receivable growth of $633.0 million.
- The company repurchased $500.0 million of common stock in the nine months and paid $246.9 million in dividends.
- Total unsecured debt was $5.6 billion, with $211 million of 2025 senior notes repaid at maturity in May 2025.
- The company is cooperating with a DOJ False Claims Act investigation related to E-Rate Program bids and cannot assess the outcome.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2025, CDW kept $0.05.
- Revenue$5.74B100.0%
- Cost of revenue−$4.48B78.1%
- Gross profit$1.26B21.9%
- Operating costs−$812.2M14.2%
- Operating income$443.3M7.7%
- Interest, other & tax−$152.3M2.7%
- Net income$291.0M5.1%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2025filed November 4, 2025Financial Statements
Q3 FY2025 against Q3 FY2024
| Line item | Q3 FY2025Q3 FY2024 | Change |
|---|---|---|
| Revenue | $5.74B$5.52B | +4.0% |
| Cost of Revenue | $4.48B$4.32B | +3.8% |
| Gross Profit | $1.26B$1.20B | +4.6% |
| SG&A Expenses | $812.20M$719.10M | +12.9% |
| Operating Income | $443.30M$481.60M | −8.0% |
| Net Income | $291.00M$316.40M | −8.0% |
| EPS (Basic) | $2.22$2.37 | −6.3% |
| EPS (Diluted) | $2.21$2.34 | −5.6% |
| Shares Outstanding (Basic) | 131.00M133.50M | −1.9% |
| Shares Outstanding (Diluted) | 131.80M134.90M | −2.3% |
05—Questions
Frequently Asked Questions
How did CDW perform in the third quarter of 2025?
Net sales rose to $5,737.4 million from $5,516.6 million, but operating income fell to $443.3 million from $481.6 million, and net income declined to $291.0 million from $316.4 million. Higher selling and administrative expenses, including performance-based compensation, transformation costs and acquisition-related amortization, drove the decline.
Why did operating cash flow decline in the first nine months of 2025?
Net cash provided by operating activities was $771.4 million versus $932.0 million a year earlier. The filing attributes the decrease primarily to accounts receivable, which rose due to higher sales activity and the timing of collections, partially offset by merchandise inventory.
What is the status of the DOJ investigation disclosed in the filing?
The Department of Justice issued a Civil Investigative Demand on June 11, 2024, in connection with a False Claims Act investigation concerning bids on contracts funded by the Schools and Libraries Program (E-Rate Program). The company is cooperating and states it is unable to assess the probability of any outcome or the range of possible loss.
How much did CDW return to shareholders and what is its debt position?
CDW repurchased $500.0 million of common stock and paid $246.9 million in dividends during the nine months. Total unsecured indebtedness was $5.6 billion at September 30, 2025, and the company had about $1.3 billion of availability under its Revolving Loan Facility.
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