CDW Corporation (NASDAQ: CDW) has reported its first-quarter 2024 financial results, revealing a 4.5% decrease in net sales compared to the same period in 2023. The company's net sales for the quarter ending March 31, 2024, amounted to $4,872.7 million, down from $5,103.1 million in 2023. This decrease was also reflected in the performance of its various segments, with the corporate segment net sales down 3.1%, small business segment net sales down 7.4%, and public segment net sales down 4.9%.
Despite the decline in net sales, CDW managed to achieve a gross profit margin of 21.8% in the first quarter of 2024, showing an improvement from 21.3% in 2023. The company's gross profit for the period was $1,063.3 million, down 2.4% from $1,089.4 million in the first quarter of 2023. This increase in gross profit margin was primarily driven by a more favorable contribution of netted down revenue from software as a service, partially offset by lower product margins due to a higher mix of notebooks and mobile devices.
Operating income for the first quarter of 2024 was reported at $328.0 million, marking a 7.7% decrease from $355.3 million in the same period in 2023. Similarly, non-GAAP operating income also experienced a decline, amounting to $403.5 million, down 7.1% from $434.3 million in 2023. Operating income margin and non-GAAP operating income margin were 6.7% and 8.3%, respectively, for the first quarter of 2024, compared to 7.0% and 8.5% for the same period in 2023.
Net income for the first quarter of 2024 was $216.1 million, down 6.1% from $230.1 million in 2023. The company's non-GAAP net income also experienced a decline, amounting to $260.8 million, down 6.4% from $278.7 million in the first quarter of 2023. This decrease in net income was also reflected in the diluted earnings per share, which amounted to $1.59 in the first quarter of 2024, down 5.2% from $1.68 in 2023. Similarly, non-GAAP net income per diluted share was reported at $1.92, down 5.5% from $2.03 in 2023.
CDW's performance in the first quarter of 2024 was impacted by weaker-than-expected IT market conditions, with caution, concern, and complexity adversely affecting customers' capital investment decisions and elongating customer decision-making. The company remains focused on optimizing its cash flow generation through effective management of its working capital, providing strategic flexibility across its capital priorities including strategic M&A and share repurchases.
The market has reacted to these announcements by moving the company's shares -9.1% to a price of $219.81. For the full picture, make sure to review CDW's 8-K report.
