AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Distribution scale and vendor incentives are real benefits, but no comparative cost gap, exclusivity or other durable structural advantage is established.
durability · — · Existing contractual commitment is bounded; supplier discretion and technological change leave the durability of any broader advantage unestablished.
customer dependency · — · Service contracts and renewal support demonstrate customer engagement, but do not establish dependence on CDW or material switching costs across the business.
erosion resilience · — · Profitable growth provides operating evidence of resilience, but cannot establish resistance to erosion of an unidentified structural advantage.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · 1/4 · Observed lower hardware gross profit rates in 2025 and first-half 2026, together with disclosed experienced price sensitivity, indicate fragile pricing economics. This is indirect evidence: mix and procurement economics prevent attribution solely to customer selling prices.
retention · 2/4 · Non-cancelable service obligations and renewal support demonstrate some continuing engagement, and demand grew across segments. Evidence is mixed because the disclosed obligation balance declined and neither renewal rates nor repeat-customer cohorts are supplied; aggregate growth is only indirect retention evidence.
margin resilience · 2/4 · First-half 2026 gross profit and operating income rose despite lower gross margin, but operating income grew materially slower than sales. This demonstrates partial profit-dollar resilience, with weakening rates and no proof that pricing caused the resilience.
contractual freedom · — · Price discretion appears as an accounting indicator, not a disclosure establishing the extent of CDW's actual customer price-setting rights. Vendor agreement discretion describes supplier power and cannot substitute for customer pricing terms.
Predictability85
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 50.00
- Revenue growth volatility (pp)
- 9.03
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 1.13
Financial strength38
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 40.37
- netDebtEbitGrade
- 39.46
- interestCoverageGrade
- 37.67
- currentRatioGrade
- 34.11
- Debt / FCF (x)
- 5.17
- Net debt / operating income (x)
- 3.03
- Current ratio (x)
- 1.18
- cashInterestPaid
- 234.30
- cashInterestCoverage
- 5.14
Capital allocation97
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 22.48
- 3-year average dilution (%)
- -0.97
- 3-year average SBC / revenue (%)
- 0.37
- cashConversionGrade
- 100.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · 2025 operating cash generation comfortably exceeded capital expenditures. First-half 2026 operating cash flow then fell to $219.7 million from $443.1 million amid working-capital investment, while revolving borrowing and repurchases increased. Covenant compliance supports financing control, but this combination and missing acquisition-return evidence limit the assessment.
incentive alignment · 3/4 · Actual 2025 grants allocated 60% of long-term incentives to three-year adjusted cash-flow and EPS performance awards; the 2023 awards vested against cumulative performance goals. Hedging and pledging are prohibited. Non-GAAP exclusions and a strategic annual-bonus component weaken precision, and complete executive ownership evidence is absent. These are adopted arrangements, not assumed future vesting outcomes.
execution · 2/4 · Sales grew across operating segments and first-half 2026 operating income increased. The 2025 incentive operating-income measure reached 99.95% of target, but that is an adjusted compensation measure. Slower profit growth, margin pressure and weaker cash conversion make overall execution mixed; claimed strategic gains are not independently quantified.
governance · 3/4 · Annual director elections, independent key committees, majority voting, proxy access and substantive lead independent director powers provide demonstrated governance safeguards. The combined chair and CEO role limits separation of oversight. No credit is given for adoption of the proposed written-consent amendment.
Evidence
The following table represents the total transaction price for the remaining performance obligations as of December 31, 2025, related to non-cancelable managed and professional service contracts whereby the Company is acting as the principal and the duration is longer than 12 months, which is expected to be recognized over future periods.
Revenue recognition / December 2025 service performance obligations · Filed 20/02/2026
Within 1 Year Years 1-2 Years 2-3 Thereafter Remaining performance obligations $ 147.6 $ 74.8 $ 30.0 $ 9.3 5.
Revenue recognition / December 2025 remaining obligations table · Filed 20/02/2026
The following table represents the total transaction price for the remaining performance obligations as of June 30, 2026, related to non-cancelable managed and professional services contracts whereby the Company is acting as the principal and the duration is longer than 12 months, which is expected to be recognized over future periods.
Revenue recognition / June 2026 service performance obligations · Filed 05/08/2026
Within 1 Year Years 1-2 Years 2-3 Thereafter Remaining performance obligations $ 128.2 $ 53.8 $ 18.7 $ 5.1 4.
Revenue recognition / June 2026 remaining obligations table · Filed 05/08/2026
In addition to helping our customers determine the best software solutions for their needs, we help them manage their software agreements, including warranties and renewals.
Business / software agreement and renewal support · Filed 05/08/2026
We operate in a highly competitive industry and compete with resellers, manufacturers who sell directly to customers, large service providers and system integrators, communications service providers, cloud providers, e-commerce companies, and office supply retailers, among others.
Risk factors / competing business categories · Filed 20/02/2026
71 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (dollars in millions, except per share data, unless otherwise noted) Geographic Areas and Revenue Mix Year Ended December 31, 2025 Corporate Small Business Public Other Total Geography(1) United States $ 9,371.7 $ 1,699.9 $ 8,524.8 $ 24.8 $ 19,621.2 Rest of World 70.7 26.8 10.4 2,695.0 2,802.9 Total Net sales $ 9,442.4 $ 1,726.7 $ 8,535.2 $ 2,719.8 $ 22,424.1 Major Product and Services Hardware $ 6,402.6 $ 1,342.0 $ 6,336.0 $ 1,990.0 $ 16,070.6 Software 2,053.7 275.4 1,483.1 390.8 4,203.0 Services 923.9 91.0 697.4 323.4 2,035.7 Other(2) 62.2 18.3 18.7 15.6 114.8 Total Net sales $ 9,442.4 $ 1,726.7 $ 8,535.2 $ 2,719.8 $ 22,424.1 Sales by Customer Channel Corporate $ 9,442.4 $ — $ — $ — $ 9,442.4 Small Business — 1,726.7 — — 1,726.7 Government — — 2,589.5 — 2,589.5 Education — — 3,109.6 — 3,109.6 Healthcare — — 2,836.1 — 2,836.1 Other — — — 2,719.8 2,719.8 Total Net sales $ 9,442.4 $ 1,726.7 $ 8,535.2 $ 2,719.8 $ 22,424.1 Timing of Revenue Recognition Transferred at a point in time where CDW is principal $ 7,893.3 $ 1,495.1 $ 7,422.1 $ 2,286.1 $ 19,096.6 Transferred at a point in time where CDW is agent 840.6 166.3 559.9 156.4 1,723.2 Transferred over time where CDW is principal 708.5 65.3 553.2 277.3 1,604.3 Total Net sales $ 9,442.4 $ 1,726.7 $ 8,535.2 $ 2,719.8 $ 22,424.1 (1)Net sales by geography is generally based on the ship-to address with the exception of certain services that may be performed at, or on behalf of, multiple locations.
Segment notes / revenue mix and recognition timing · Filed 20/02/2026
We operate two distribution centers in North America and one distribution center in the UK, which combined provide more than 1 million square feet in size.
Business / distribution infrastructure · Filed 20/02/2026
Leveraging our distribution and logistics capabilities, we handle and ship approximately 22 million units annually on an aggregate basis from our distribution centers.
Business / annual distribution shipments · Filed 20/02/2026
The Company receives incentives from vendors related to cooperative advertising, volume rebates, bid programs, price protection, and other programs.
Accounting policies / vendor incentives received · Filed 20/02/2026
These incentives generally relate to written vendor agreements with specified performance requirements and are generally recorded as adjustments to Cost of sales or Merchandise inventory, depending on the nature of the incentive.
Accounting policies / vendor agreement performance requirements · Filed 20/02/2026
From time to time, vendor partners may terminate or limit our right to sell some or all of their products or change the terms and conditions or reduce or discontinue the incentives that they offer us.
Risk factors / supplier authorization and incentive discretion · Filed 20/02/2026
These wholesale distributors provide logistics management and supply-chain services for us, as well as for our vendor partners.
Business / wholesale distributor logistics services · Filed 20/02/2026
Leveraging our distribution and logistics capabilities, we handle and ship approximately 35 million units annually on an aggregate basis from our distribution centers.
Business / 2023 annual distribution shipments · Filed 26/02/2024
While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors.
Competition / technology disruption · Filed 20/02/2026
Gross profit margin decreased 50.0 basis points, to 23.3%, due to decreased rates in certain hardware categories, primarily data storage and servers.
2025 Corporate results / lower hardware gross profit rates · Filed 20/02/2026
Gross profit margin decreased 60 basis points to 20.5%, primarily driven by mix into and lower margin in certain hardware categories.
First-half 2026 results / gross margin decline and hardware mix · Filed 05/08/2026
3 Table of Contents CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (dollars and shares in millions, except per share amounts) (unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net sales $ 6,572.2 $ 5,976.6 $ 12,252.0 $ 11,175.7 Cost of sales 5,252.4 4,735.4 9,742.2 8,812.2 Gross profit 1,319.8 1,241.2 2,509.8 2,363.5 Selling and administrative expenses 891.2 821.0 1,705.2 1,581.9 Operating income 428.6 420.2 804.6 781.6 Interest expense, net (60.2) (56.8) (115.5) (113.9) Other income (expense), net 4.5 1.5 2.8 1.2 Income before income taxes 372.9 364.9 691.9 668.9 Income tax expense (98.5) (93.7) (182.1) (172.8) Net income $ 274.4 $ 271.2 $ 509.8 $ 496.1 Net income per common share: Basic $ 2.16 $ 2.06 $ 3.98 $ 3.76 Diluted $ 2.15 $ 2.05 $ 3.97 $ 3.73 Weighted-average common shares outstanding: Basic 127.0 131.6 128.0 132.1 Diluted 127.4 132.4 128.4 132.9 The accompanying notes are an integral part of the Consolidated Financial Statements.
Consolidated statements of operations / first-half 2026 comparisons · Filed 05/08/2026
This evaluation includes, but is not limited to, assessing indicators such as whether: (i) we are primarily responsible for fulfilling the promise to provide the specified goods or service, (ii) we have inventory risk before the specified good or service has been transferred to a customer, and (iii) we have discretion in establishing the price for the specified good or service.
Revenue accounting / price discretion as a principal-agent indicator · Filed 20/02/2026
Free cash flow and Adjusted free cash flow Year Ended December 31, (dollars in millions) 2025 2024 Net cash provided by operating activities $ 1,205.2 $ 1,277.3 Capital expenditures (117.1) (122.6) Free cash flow 1,088.1 1,154.7 Net change in accounts payable - inventory financing (2.6) (75.7) Adjusted free cash flow(1) $ 1,085.5 $ 1,079.0 (1)Defined as Net cash provided by operating activities less Capital expenditures, adjusted to include cash flows from financing activities that relate to the purchase of inventory.
Liquidity / 2025 and 2024 operating cash flow and capital expenditures · Filed 20/02/2026
Cash Flows Cash flows from operating, investing, and financing activities are as follows: Six Months Ended June 30, (dollars in millions) 2026 2025 Net cash provided by operating activities $ 219.7 $ 443.1 Net cash (used in) provided by investing activities (58.8) 154.6 Net cash used in financing activities (406.2) (649.2) Effect of exchange rate changes on cash, cash equivalents, and restricted cash (10.5) 25.0 Net decrease in cash, cash equivalents, and restricted cash $ (255.8) $ (26.5) 33 Table of Contents Operating Activities Cash flows from operating activities are as follows: Six Months Ended June 30, (dollars in millions) 2026 2025 Change Net income $ 509.8 $ 496.1 $ 13.7 Adjustments for the impact of non-cash items(1) 207.6 176.6 31.0 Net income adjusted for the impact of non-cash items 717.4 672.7 44.7 Changes in assets and liabilities: Accounts receivable (1,054.0) (450.1) (603.9) Merchandise inventory (418.3) (147.3) (271.0) Accounts payable-trade 896.2 384.7 511.5 Other assets and liabilities 78.4 (16.9) 95.3 Net cash provided by operating activities $ 219.7 $ 443.1 $ (223.4) (1)Includes items such as depreciation and amortization, deferred income taxes, provision for credit losses, and equity-based compensation expense.
Liquidity / first-half 2026 cash flow and working capital · Filed 05/08/2026
This decrease was primarily driven by repayment of long-term debt in 2025 and proceeds from borrowings under the Revolving Loan Facility in 2026, partially offset by higher share repurchases in 2026.
Financing activities / revolving borrowings and higher repurchases · Filed 05/08/2026
Debt June 30, 2026 December 31, 2025 Maturity Date Interest Rate Amount Amount Credit Facility Senior unsecured revolving loan facility December 2030 Variable $ 175.0 $ — Term Loan Senior unsecured term loan facility December 2030 Variable 634.5 634.5 Unsecured Senior Notes 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% 600.0 600.0 Senior notes due 2031 December 2031 3.569% 1,000.0 1,000.0 Senior notes due 2034 August 2034 5.550% 600.0 600.0 Total unsecured senior notes 5,000.0 5,000.0 Receivable financing liability 25.9 15.3 Other long-term obligations 3.5 5.5 Unamortized debt issuance costs and discount (21.9) (25.5) Current maturities of long-term debt (1,008.9) (1,007.5) Total long-term debt $ 4,808.1 $ 4,622.3 As of June 30, 2026, the Company is in compliance with the covenants under its credit agreements and indentures.
Debt note / balances, maturities and covenant compliance · Filed 05/08/2026
For 2025, the annual long-term incentive grant was delivered in the form of PSUs and RSUs, with the following key elements to drive Company performance and align with stockholder interests: PSUs ● 60% of target long-term incentive opportunity ● 2025-2027 performance period with 0% - 200% payout curve (threshold payout of 25% of target) ● Eligible to vest at the end of the performance period based upon attainment of (1) cumulative annual adjusted FCF and (2) cumulative annual adjusted EPS performance goals, each calculated independently as described below and weighted equally RSUs ● 40% of target long-term incentive opportunity ● Value fluctuates based on CDW’s stock price ● Eligible to vest in 1/3 annual increments 2025 Long-Term Incentive Program Pay for Performance Alignment For 2025, the Company’s long-term incentive program was entirely at-risk as the values of the awards fluctuate based on our stock price performance.
Compensation discussion / granted 2025 long-term incentive structure · Filed 10/04/2026
The 2023 PSUs vested based on the attainment of cumulative performance goals relating to adjusted FCF and adjusted EPS during the 2023-2025 performance period, with each goal weighted equally in the determination of the vesting level.
Compensation discussion / actual 2023 PSU vesting conditions · Filed 10/04/2026
38 2026 Proxy Statement Table of Contents Compensation Discussion and Analysis For 2025, the Compensation Committee established the following goals and payout levels under the 2025 SMIP: ● The Compensation Committee chose non-GAAP operating income (weighted at 75%) and achievement of specified strategic objectives (weighted at 25%) as the 2025 SMIP performance goals, as compared to non-GAAP operating income (weighted at 100%) and a market share governor under the 2024 SMIP design.
Compensation discussion / 2025 annual incentive measures · Filed 10/04/2026
Strategic Themes Strategic Objectives Accelerate Strategic Services & Solutions Integrate Mission Cloud, Streamline and Scale Services, Accelerate Strategic Capabilities Amplify our Go-To-Market Capabilities Evolve our Go-to-Market Capabilities, Accelerate our Digital Roadmap, Gain Market Share Enable our Transformation Leverage New Operational Capabilities, Execute on Process and Platform Roadmap, Develop Future Ready Talent 2026 Proxy Statement 39 Table of Contents Compensation Discussion and Analysis 2025 SMIP Results and Payouts Based on the methodology described above, our 2025 non-GAAP operating income measured for SMIP purposes was $1,988.2 million, which was 99.95% of target for the non-GAAP operating income component of the SMIP.
Compensation discussion / incentive operating-income target achievement · Filed 10/04/2026
Annual election of all directors Lead Independent Director All of our directors, other than the Chair of our Board, are independent and the independent directors regularly meet in executive session 100% independent Audit, Compensation, and Nominating and Corporate Governance Committees All of our Audit Committee members qualify as “audit committee financial experts” under SEC rules 15-year Board term limit to promote Board refreshment Stockholder right to call special meetings Our Board has approved a management proposal to allow stockholders to act by written consent (Proposal 4 in this proxy statement) Proxy access right Majority vote to elect directors with resignation policy Restrictions on other board service by directors Annual Board and Audit, Compensation, and Nominating and Corporate Governance Committee evaluations No supermajority vote requirements No stockholder rights plan or poison pill 10 2026 Proxy Statement Table of Contents PROXY SUMMARY Executive Compensation Highlights CEO Pay for Performance Our executive compensation program is focused on driving sustained meaningful profitable growth and stockholder value creation.
Proxy summary / existing governance safeguards and proposed written consent · Filed 10/04/2026
The responsibilities of the Lead Independent Director, which are described in the Company’s Corporate Governance Guidelines, include, among others: RESPONSIBILITY DESCRIPTION Board Meetings Preside at all meetings of the Board at which the Chair is not present, including all executive sessions of the independent directors Executive Sessions Has the authority to call meetings of the independent directors Facilitate Discussion Facilitate discussion and open dialogue among the independent directors during Board meetings, executive sessions, and outside of board meetings Liaison for Independent Directors Serve as a liaison between the independent directors and the Chair, and where appropriate, between the independent directors and management Agendas Review, advise on, and ultimately approve the scheduling of Board meetings, and the agenda items and materials for each Board meeting as proposed by the Chair Information Work with the Chair to facilitate timely and appropriate information flow to the Board Communicating with Stockholders Serve as a contact for and may represent the Board in communications with stockholders and other stakeholders who wish to communicate with independent directors 14 2026 Proxy Statement Table of Contents Corporate Governance Chair of the Board Christine A.
Corporate governance / lead independent director authority · Filed 10/04/2026
Christine A. Leahy Chair, President, and Chief Executive Officer April 10, 2026 2026 Proxy Statement 1 Table of Contents When: Thursday, May 21, 2026 7:30 a.m.
Proxy letter / combined chair and chief executive positions · Filed 10/04/2026
29 Table of Contents Non-GAAP operating income and Non-GAAP operating income margin Three Months Ended June 30, (dollars in millions) 2026 Percentage of Net Sales 2025 Percentage of Net Sales Operating income, as reported $ 428.6 6.5 % $ 420.2 7.0 % Amortization of intangibles(1) 42.4 42.4 Equity-based compensation 28.1 23.5 Transformation initiatives(2) 9.9 17.4 Acquisition and integration expenses 1.6 2.0 Workplace optimization(3) 44.2 12.7 Other adjustments 1.2 1.5 Non-GAAP operating income $ 556.0 8.5 % $ 519.7 8.7 % Six Months Ended June 30, (dollars in millions) 2026 Percentage of Net Sales 2025 Percentage of Net Sales Operating income, as reported $ 804.6 6.6 % $ 781.6 7.0 % Amortization of intangibles(1) 85.1 85.2 Equity-based compensation 50.2 44.0 Transformation initiatives(2) 18.2 31.1 Acquisition and integration expenses 2.6 4.9 Workplace optimization(3) 44.2 12.8 Other adjustments 3.0 4.1 Non-GAAP operating income $ 1,007.9 8.2 % $ 963.7 8.6 % (1)Includes amortization expense for acquisition-related intangible assets, primarily customer relationships, customer contracts, and trade names.
Non-GAAP reconciliation / compensation and optimization adjustments · Filed 05/08/2026
Net sales increased $1,076 million, or 9.6%, with higher Net sales across all operating segments.
First-half 2026 results / growth across operating segments · Filed 05/08/2026
With respect to the strategic objectives component, the achievements included, among other items, year-over-year growth in our strategic capabilities, execution of a new sales model to support our go-to-market capabilities, market share gains, and the development and retention of key talent deemed necessary to support our transformation.
Compensation discussion / issuer-reported strategic achievements · Filed 10/04/2026
These are highly fragmented markets served by thousands of IT resellers and solutions providers.
Business / fragmented markets and reseller population · Filed 21/02/2025
No hedging, pledging, or short sales of our securities
Executive compensation practices / hedging, pledging and short-sale prohibitions · Filed 10/04/2026
Supply chain pressures have and could in the future cause us to experience changes in average selling prices and our gross margins on certain products as customers have become and could in the future become more price sensitive.
Risk factors / experienced price sensitivity and selling-price changes · Filed 20/02/2026
