The world’s largest reseller said it is seeing “growing customer caution” in the UK as it unveiled a dip in Q2 sales.
NASDAQ-listed juggernaut CDW saw net sales tumble by 8.5% year on year to $5.63bn in the three months to 30 June 2023 as it admitted that economic uncertainty has led customers to cut technology spend.
Increased solutions sales did contribute to “meaningful” margin expansion during the quarter, CEO Christine Leahy stressed, however, with non-Gaap operating income rising 3% to $530m.
Growing caution in UK
The Q2 sales dip was driven by a combination of slowing corporate and SMB sales and softness in CDW’s international operations – namely in the UK and Canada.
Combined UK and Canadian sales fell 7% to $690m, with the former down “low” single digits and the latter down “low” double digits.
On an earnings call (a transcript of which can be viewed here), Leahy said the two teams “continued to execute well and sustained profitability improvements under challenging conditions”.
“We’re seeing growing customer caution in both the UK and Canada, similar to what we heard from US commercial customers a quarter ago,” she added.
Caution on client devices
Echoing recent analyst projections, Leahy said the firm “remains cautious” on the outlook for client devices, sales of which fell by double digits in Q2.
CDW is “ready to lead the market” when it comes to AI, Leahy added.
“For CDW, AI adoption feels very much like other transformative technologies of the past,” she said.
“Customers recognise the evolutionary benefits of AI, yet they face incredible complexity and choice, complexity and choice that plays to our strengths and our value proposition as a trusted partner and advisor.”