NSIT - Earnings call transcript Q1 2020 | Insight Enterprises, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Insight Enterprises First Quarter 2020 Operating Results Conference Call. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Ms. Glynis Bryan, Chief Financial Officer. Thank you. ahead. go Please

Glynis Bryan

XXXX. everyone, Enterprises Welcome, discussing you joining March for Company's Thank conference and call. Insight XX, ended the earnings results be Today, the operating you. for thank we the will

me I'm Glynis Bryan, Lamneck, Financial Officer Officer. and Executive is and Chief of President Ken Insight; Chief joining

website is after being on at Investor insight.com. copy can it do and of will and Securities the filed a completion earnings insight.com Form available you that conference find our of at accessed website Commission Relations copy will archived X-K, you via be of the our Investor the question-and-answer for call webcast the If time. Today's have was live the release on a on and limited An with including and the call, not call period, Relations posted remain our hours page website morning under two of Exchange this will be approximately section. the

webcast of conference property of only XXXX. retransmission the strictly express any and is This form call call May call this Enterprises. is consent This without contain the Any of of time-sensitive today, or written as redistribution, Insight is Insight in X, accurate Enterprises that information rebroadcast prohibited. the associated

adjusted non-GAAP call, in today's In to financial will from conference today's invested and capital. as the adjusted financial When call, return operations, per measures results. share we to measures to discuss refer referring non-GAAP earnings we diluted will on refer XXXX first earnings we quarter

earlier the accompanying to included of a actual find measures press slide today. GAAP and in reconciliation will release You the our presentation issued non-GAAP results these

are dollar as and all highlighted amounts growth currency, terms. rates in discussed Also, please note unless U.S. constant

subsequent core our the change or to exclude to acquisition results PCM year-to-year in reference organic August on our XXXX. performance will XX, any the Additionally, business

subject will All press made reports release to forward-looking most this conference annual statements the on subsequently results statements These you actual periodic differ greater are our me be materially. report forward-looking to call in filed XX-K and during that discussed cause uncertainties in on that let and Form could filed with detail Finally, today's are that remind SEC. in our risks are made recently risks about and today's call.

turn With Ken over that, along I will begin following Slide presentation, call X. if the you're Ken? we to now slide the on and with will

Ken Lamneck

Hello, thank our to everyone, for first joining us quarter you operating results. and today discuss XXXX

began by the by others response to quarter, As first the the accelerate inspired impressed care swift were the workers we commitment globe the and to unrelenting crisis responders. across and officials government COVID-XX health health help first in by by

home positions navigated also we work our protective the teammates when to XX,XXX crisis, step Insight, while presented the with supporting they At rapidly than on environment. safety from we was measures the as our clients' our successfully teammates quickly, same to time, ultimated deployed health focused IT needs first more and our at their we At and Very families. immediate this business facilities. core changing focus globe the operating on of across

our shelter-in-place constraints continued although quarter. our demand chip to The on future the plans and mid-single IT business, these times demand compete our uncertain evolved core business supply companies year-over-year in for to sales performance strategic position solutions in future. experienced work as focused drove solutions quarters collaboration as digits we well optimize and throughout deployed Lastly, sales recovers workforce were market as for hardware mandates. increased demand This home up by increased the manufacturers. by their the delayed from to to respond in certain to We our

evaluate enable support in generally Health to care remote and new trends. to institutions the students. and workforce streams pulled mid-market, technologies learning mid-March. with planned demand their businesses. as began experienced to we to defend And moved to clients their for business hospitality consistent macro in their trends in in need revenue they to and enable what cruise as schools lines intake future perceived was industry, be shift back projects By quickly our commonly on Airlines, procedures productive to hospital

of area, called challenging its We our industry good, Insight's spread connected expertise by detect help faced helps devices both and robust our and is the business believe sensors, the IT deploy developed clients coronavirus prevent prevent quarter, operate challenges infrastructure detect across In solution. were A example digital with process. One and included that areas. through solution many solution and screening the first times. clients critical our symptoms and which new the help solution innovation platform that on can

camera accessibility is platform solution own leverages advanced as the the and and as a and handwashing for internally connected temperature machine thermal safe standards. edge both for automated self Insight environment stations distancing usage for workflow, management to for help social sanitizing Linux connected its predictive our management to allowing insights to models for availability container-based provide handwashing processing nice work employee alerting offering to with facilities orchestration, a using down platform, vision PaaS clients. smart and face solution well detection, The data architecture support cloud

platform, [indiscernible], our themselves with platform solution, and safer. IoT become in tools stand-alone data connected prevent environment powerful to are make and but with clients These little full and a there tools their of detect and no able help and are our help

our response clients April, with into with area IT solution critical workforce and also solutions connected the supported COVID-XX. to March During

and were provided over up work visits. included consisting support up stand XX,XXX stations businesses, were with over agencies, for in support set devices hospitals facilities, for home care the hotspots for virtual of COVID-XX This and and across XXX mobile handheld urgent workstations from pre-converted of were kits to delivered U.S., laptops devices government devices and deployed the webcams were schools doctor handheld

every again our in do for We them and clients I are to thank for day. how time. they clients team all to global proud of Insight extraordinary our engaged support our for this want

to X. Moving Slide on

areas remainder client our and the we're data key to believe we X that solution expertise, with look area those in innovation. to given and and digital our chain we will center transformation XXXX, connected cloud of on supply optimization, workforce, driven demand compete be by of As the positioned focus areas,

them is through where supply IT impacted of first are to their We chain. procure client Clients products. cost-efficient chain can been supply The reduce we COVID-XX. efficient processes focus have clients by trying area solution quality costs optimization help as our business provide for to area, our

access managed services. through Clients or cycle by products and management e-commerce platforms life can our these asset our software leveraging

modernize and two, it by IT related clients can environments; save Additionally, to their current in clients to we infrastructure helping are them to money spend the transformation the enables journey world. to they make digital compete ensure internal helping digital

focused clients on our business is area second continuity. The are

including our Leveraging clients. workforce solutions endpoints midsized experience global and can rapidly the cloud through and their well to environments, large services, is across Insight or even Insight-delivered collaboration connected client workforce with management improve solution to managed to employee user with for modern that Our support leverage can productivity this. efficient footprints. clients deployment wrapped in clients across small, scale of area our We've positioned invested enable globally solutions

of our area is third focus securing. for The clients

cyber clients this services high, solution their targets to and escalate risk and moved including solutions, help in are this our and could see workforce environment. offerings our core criminals mitigate risk set security connected our and areas. transformation cloud We data to increasingly managed in cyber clients will businesses a environments, as systems to security exposed As and an from remote Criminal continue more activity they've increased to their all-time have perspective. working is of

COVID-XX From and a grow solutions. Cloud technology the be marketplace. marketplace. standpoint, key XXXX we These impact think respond its the continues to in in leaders as category offerings, include and cloud clients there will to a software-as-a-service several as to infrastructure-as-a-service

both months and gross XX% March remote managed professional hardware has consolidated an cloud offerings area profit offerings. been For gross ending of profit. XX XX, and software solutions the and through also of services, services our Security generated was strength,

And finally, solutions. collaboration

example, points. For and Teams and with devices secure Microsoft access Webex wireless Cisco endpoint

us head strong balance areas year. throughout solutions, our to relationships, with the serve the believe services clients of expertise combined partner and in these We we as our in positions well

Moving on in to in economy. unprecedented our I'm reflect our solid report quarter performance pleased to that results Slide X. this first time

at XX points Gross a PCM addition our in net record were profit to PCM Consolidated the including billion, year-over-year first Company, the XX business. margin points sales basis expansion $XXX XX.X%, $X.X up year-over-year. quarter, of the basis includes expanded the new gross the business first margin consolidated for million for was XX% quarter for Specifically full of period, our core XX% year-over-year. of and which in up

on and a modest were Adjusted year-over-year were year-over-year, and up basis, million, earnings per expense, operations selling from was earnings restructuring X% year-to-year, to was diluted expenses earnings $XXX in acquisition-related PCM addition including administrative diluted GAAP Consolidated operations related the million. investments driven of of to $XX And share by $X.XX. and earnings up the were core business. acquisition severance higher the expenses from $XX the down GAAP basis, adjusted year-over-year. XX% million, PCM. XX% per amortization And and On up a $X.XX, share

X. Slide Turning to

for quarter presented by each year, with to line to Our segments first internal of our challenge the and earnings rise the see demand COVID-XX. our the operating pleased we're results in and expectations were into coming

and In bring the plans our together. PCM businesses first to quarter, execute Insight to the we continued integration

$XX of with year over our expect the IT remaining of run exit migrations two more We the plans to currently than million the the year disclosed clients $XX have expect We're end $XX our approximately on complete of to client ahead million expectation rate PCM third the integration commitment quarter. and migrated our previously million to remaining savings onto by totally working first XX% also annualized in years. accelerate of systems to and

participation we how but We their taking have IT COVID-XX PCM to well visibility of services While our in down compared help to in demand to businesses, we may We of market and impact the IT, our some are with products quarters. our from March. to QX this the short decline now on discretionary their demand see trends over we the work accelerate clients emerge begin the of as in contraction support begin QX, to next as integration bookings extent currently the liquidity. to full will economy areas shelter coming to to evaluate their environment. respond place, plans not for quarters several overall global we're steps clients and to current as the the late the shelter-in-place that while IT run, need and expect April In over do will with optimize operating costs profitability will reduce significantly our do in concern,

high earnings conditions adjusted per annual and As we're share suspending our we COVID-XX a and move forward. sales as this degree monitor issued of uncertainty, the evolving guidance rapidly market of and result we'll previously

an organization the well. execution and to situation of part times. to the recession stronger, XXXX difficult be in in that's demonstrated We've well to I'm believe weathered clients, great today capabilities a resiliency healthier to company proud as well. current our we're and and I innovation very bring weather with positioned We're

our Glynis on will call I provide hand financial the over details performance. to now more to

Glynis Bryan

Thank you, Ken.

we're earlier, these quarter noted execution Ken in first times. the our As unprecedented global pleased in with team's

On ABL QX under and the have access about the on we Slide we quarter accounts receivable revolving in $XX We that quarter cash ABL, $XXX we $XXX paid the team We strong outstanding eligible of X, and ABL million, access facility. of us million and with billion healthy by our and our had hand. availability ending guide balance a under with first outstanding to sheet maximum debt $XXX XXXX. we're cash the the million under and generated facing notes us to believe convertible the the have the macro and $X.X support in uncertainty flow down with right through to million strong to ended capital

than comfortable our agreement our cash EBITDA. of X.X with position also the debt We're During comfortable leverage debt to quarter, our current covenant flows X/XX. or as less with at under we're performance times

Our primary coverage and which expenditures, compliance over covenant interest. EBITDA under trailing taxes is a includes agreement, capital XX ratio months our cash ABL fixed charge coverage

a on believe X leveraged March of minimum we're requirement. XXst, We today. we're time at times As X.X reasonably

cash cycle pay we sales on more meaning which receive In inverted, when than shorter allows flow clients, is partners cash drive declining. terms us we from are our our addition, our to

balances. our of million a down our annual for expect priority As guided $XXX we be debt and exceed to in XXXX flow will to result, in could cash XXXX range generation $XXX million, pay our cash previously

cash headquarters we year the of Lastly, flows. start also build-out corporate our until will defer of impacting, environment resulting later and any as new monitor the further on the repurchases we demand impact this our

operating XX% by in segments. our on growth Moving North XX QX first In quarter, increased Slide XX% America, business. in Hardware were our up sales year-over-year, including and sales core billion year-over-year. to $X.X X% results net the

client declined transaction the and first quarter Software double-digit the year-over-year the year-over-year XX% sales of including core of year. X% due a a quarter, cloud in significant single and services enterprise sales with sales last in large business increased growth sales Insight-delivered to Services of services PCM. in in first

of million addition XX% earnings to $XXX of mix year-over-year, basis and improved to up year-over-year PCM XX% the expenses in XX% year-over-year administrative the margin of and to the amortization North increased America PCM. XX.X%, increased profit the acquisition. XX America selling was increased cloud due services from Gross points business $XX and Adjusted sales the in and million North reflecting quarter. expense, excluding gross for operations

and our in our working Ken to to business As we're XXXX. accelerate the discretionary expenses plans across integration noted, reduce

a $XX annualized North rate to to $XX million, PCM-related our this cost our in $XX expect million in this out, million review, million. XXXX, synergies also X-year of $XX $XX realize which as original million plan of million of of As segment. XXXX to to to compared synergies with America we now run $XX against result in will million commitment operating allow $XX between will Ken pointed us exit occur most of to our between Further,

consulting And addition in vNext, Slide to XX% practice sales the we net the end same last in on $XXX constant also the in million, and And constant the year, February. was as up core and discuss business from at X% required constant growth the quarter million, in $XX year-over-year was $X from single-digit the the digital earnings EMEA, currency. PCM profit first including Gross EMEA down France in in second X% period grew currency. in in of quarter XX, of adjusted operations million, currency

sales. XX% quarter XX. prior while year-over-year mix sales services higher of Slide expanded currency, profit in from currency. Moving controlled earnings year due The the from million. to margin drive of growth team gross on and on the in to $XX operations X% Gross Net helped XX% which constant grew APAC also to in increased in first margin grew currency constant adjusted the cloud constant expenses,

noted, per expectations due to above results Ken Diluted the As share came our our first in slightly the the quarter were expectations consistent quarter. our consolidated taxes. earnings for for quarter for with first lower

to on Moving now. taxes

was of rate quarter. was effective passed XX.X% rate lower Act. years tax first to be the the due XX.X% primarily back in for higher net prior could Our of compared as XXXX the tax the CARES quarter to under remeasurements operating losses The year acquired recently that rate effective tax carried to

last fourth million capital our partly first This details COVID-related quarter, compared Slide the in $XX the from on is the performance receipts of matters. late XX. In to delayed increased due $XXX working operations the PCM decrease year-over-year generated primarily of cash business to and clients quarter the to our Turning cash requirements due quarter of XXXX, first of flow cash million to year.

first in February. quarter of to $X capital XXXX, and In deployed France million acquire invested vNext $X million the expenditures in in we

million We sale also received our in net one from of proceeds $XX of buildings. the

Lastly, $XX repurchase million the of common used shares stock we first quarter. our to in

end in resident end All $XXX of a approximately quarter, to of of which to $XX And our as of million $XX earlier, subsidiaries. at prior led million our cash million the year noted cash of and at the of was quarter. I million outstanding first this balance foreign facility debt revolving was of This outstanding debt $XXX notes. and million the convertible under credit $XXX of compares the

the healthy our Slide during while taking preserve competitive year, to If improve. we're transition conditions market through the downturn emerge to the we to head balance profitability positioning steps business our XX, of as we as and

delivery operational across on around the rightsized integration demand, natural the the service, ahead and PCM hires our goals sales and assessing side, to accelerated plans employee synergy put through volume We're we of platforms back trends, cost year. Specifically and office we've and to we've the will our for of spending and flow current existing that have discretionary reduced our allowing replacement expected us in business. attrition context

enhanced around and our we clients. for our top risk discipline continue clients We've addition, new will current clients procedures a the credit assessed implemented In of vertical to credit segments. our to net review review industry by client portfolio, granted in including and

will down cash our be investments we priority. and to as of Finally, of across use judicious capital available about our cash, deferring a pay cash debt discretionary -- using use

balance Our healthy. sheet is

emerge we us as recovers. We economic to operate compete uncertain the to all help in have will believe access these and strong to steps these times, economy capital

now back comments. closing his for Ken will to I the turn call

Ken Lamneck

better Thank in Analyst order fall, Day long-term intelligent to priorities share that you, solutions last relentless to business include: to experience end to through client our which and scaling and strategic such and our continuing continuing and We cloud drive focus Glynis. our capture markets; as our the discussed remain optimize areas, excellence. clients; delivering in lastly, high-growth the outcomes committed developing and at innovate expanding to clients our operational business for and on execution edge;

pressing capital in when our will our that And expertise the needs our For during access and this the and the to XXXX, in on the strong will believe to support COVID resilient areas have meet the to us IT team, most requirements rebounds be a we challenged economy. economy overall these we We solution the global operating given adverse allow balance remainder believe the environment confident crisis current sheet impact times. future. we're and market a of clients'

our the safe, across and you forward our you globe us summer. our later for joining you the in look all their again teammates with talking we for to again thank and Be of to support partners our Thank company, and clients. today,

my comments, your That open for we'll and questions. your concludes up line now

Operator

Adam Thank go [Operator Instructions] line with you. James. question first Your the from is Please Tindle of ahead. Raymond

is line open. Your

Adam Tindle

specifically just to to have has supply borrowers good most are level market I seems demand, start chain decrease like And to a all alone, Ken, on of with stabilization of customers closest seeing areas the thanks. wanted lot the morning. rallied. in to in spoken But and are Okay, March. the versus not improvement expected April trends. you're or companies different of significantly. that Largely, worsening the comments slight it The OEM

to understand between trying just you're and I'm in demand weakness specifically more home a in So it there maybe late areas is work March? that the that specifically, seeing two? accelerated difference And things be the why is would waning? in already weakness that worse were Or from

Ken Lamneck

April. When backlog couldn't daily to look we current products business experienced certainly, Thanks, we in as down of know basis. is certainly we all of course, wanted, a late booking Yes. as March we're supply we, the at The of things demand side get high of on the seeing that the our said, are QX of look we course, out most us, QX that just example, of because that COVID. constraints at device due trends Yes. the into on to course, of all had seeing, Adam. environment, we mostly run significantly we coming the bookings, because we're the we elevated an rates, from that due And

and the are left deliver Dell's, the make of really Lenovo's, I'm Apple's, in of was so quarter end doing that to can gearing the good sorry, that they forth, fulfilled QX, the will We be in as over QX. this that a by sure job to within QX in up demand the believe QX manufacturers, that HP's much from the

that of take think So itself. we care will

the from much at certainly, that much how how longer the We're concerned due into higher they're course, is a an question is positive the year the of But that demand we're being COVID-XX, ASPs. and really was which more of because trend second the in notebooks, because not is desktops seeing, of there happens what as as uncertain is half elevated over regard no that term far is will still device there's is to for half us second sure of fulfilled bleed now the moving to world and time.

There's term. And shorter cycle notebooks. notebooks better for to attached course, is longer of the refresh

is So was now, technologies. more it a of And that favor for term XX-XX industry a of in all about longer we of is positive towards the as in think much notebooks. moves desktop and as notebooks that us course, split world you than the moved know,

projects the center and On of the pushed business, probably side degree. reevaluated being see data of certainly course, being do some to we

would order believe client to to, these get them really preserve will become all to they more companies that, save experiences infrastructure expect, try you of basically, wherever come trying that, well, when economy helps of as become their course, modernize the in that them which with course, We they're for as much Because they where a the to their clients. and cash can. to in become have costs look enables digital of As do clearer companies. their to starts to in to digital, back digital situation is more

offerings, it we're So is that off well do they acceleration, are public do course, which of. in but push And think positioned for there's then to certainly in we that, can run. cloud know, here to think of we of going short the the advantage that, course, we take as that long, something

you me further stop see that. and you points add have if let just there any wanted to to So then

Adam Tindle

on a helpful. the maybe word just magnitude Yes, see to I wanted of could bit color that's significantly. we little more get the if

that think XX% of about the competitors ballpark seeing? down Is to companies north lot I XX%, XX%. kind a you're that are private talking and of of

Ken Lamneck

say would slightly we're north Yes. the of We certainly XX%, seeing. number is certainly,

Adam Tindle

little day? second next this starting that on seeing you a but recover day it's the than any call, is early to decline the improvement and monitoring Is then worse bit seeing, talked a of And a little derivative where kind previous day you probably helpful. constantly. you Very there, are to basis about Or bit? are is

Ken Lamneck

that. Yes. Still to on early tell

is A it but XX% certainly in we're software. than experiencing. closely, more north hardware watching little So of what again, we're,

Adam Tindle

big and this Got that Why in changes an Ken, see picture a why more about? out just you're industry lot players. consolidated? that's What fragmented structurally or about the to think structural know emerge you you are zooming it. industry. you talk not? thinking landscape A of We Do question. very just unfolds? how competitive with a Maybe we changing smaller as

Ken Lamneck

Yes.

I think certainly, continue. we'll

We have been consolidation. as are. from been resilient experiencing But consolidating the know. small side, they're far you bunch. they ourselves, We've effort resilient competitors, I the certainly so that some really as a as distribution came of part I how know

So we'd never take them for granted.

do going that world structurally Although experience whole we're things are the some no through. digital to changing question there's become where I going from in the this see industry that is more

it in Everybody in made we've this are because recognized invest just in how players I small investments marketing that do big investments in engines. probably digital. made more to point to for favors digital e-commerce time. our things at big important the has it's difficult think players real we've is engines, become larger Those

and the So do move. does of industry. larger I resiliency the But they the in players the never shift favor competitors I smaller underestimate think would and of some how that again,

plays So our to whole to to us, advantages we what digitization going we'll certainly invest effort our are that clients we're as certainly think out. see demand. and it's But in continue going how that

Adam Tindle

for could on any? guess know that can things sense mix if times, touch Glynis to you the the either that or One DSO metrics at us one give health or the a distort about the just That be, the kind year-over-year. just I going some wanted of expectations you was there. what I provide cash receivables, But touch flow. sense. on question and health talked you for up on to would XX Helen. other aging last of I of and debt, days that of of if maybe then bad can Makes

Glynis Bryan

Thank Good question, you. Adam.

requested is delinquency terms, we just expectation So payment what our clients. our have We perspective. by the in a extended portfolio QX, clients of degradation it and towards about have by that the don't expect, experienced do any from we or either end say enacted I would

thing So matter, a But an a a had position, higher impact little the QX. than as due of to on past in that at other Insight. is on course, bit of receivables PCM QX we're here accustomed have they balance their business, the

may year, will impacting So beginning the that think us. year. And on in we throughout that expected continue that this the we at the is our have that fourth quarter, we I guidance in, said that, still gave of when QX

a in of of our mechanism large and in portfolio from and portfolio. XXXX, So recovered go see for took have look average, we to PCM. we corporate our portfolio of place second had or portfolio kind XXXX, at you XXXX. not And the that today, a the some business But at we X back degradation any then if smaller, mid-market back that of degradation QX monitor receivables if but that enterprise we in charge clients in have the in given that on smaller, the then larger distribution we have, you don't overall received look seeing the our We significant anticipate we to we client didn't deterioration then. we that and the quarter you

get be crisis judicious So the monitoring come prudent in them the the on that in around way do the instance. process with through with the hierarchy we have pretty a they receivables, of all payment approved what very extending strategy has to terms our comfortable to volume now. us they them us profitability clients time to place around do and we that prudent with feel of based a on business for basis helping up business could a But and

Operator

with Your Stifel. of Matt is the next line question Sheerin from

Matt Sheerin

morning. and you Thank good Yeah.

you the the of for but of couple revenue Could contribution give a the you in you you PCM questions could me. that? Just growth, number PCM about us if I talked core give have quarter? think us

Ken Lamneck

we've talked as thanks we've question. Matt, businesses. about, It's because challenging integrated Yes. the pretty the for

lot of organization. -- one clients, one a some are And team, there now lot, a joint. not it's but all course, of sales certainly there So those that were -- were it's that sales were clients

those So we've books all so assigned forth. account and

the as through flowing one. that's So system all

So breaking sort that But not in of unfortunately, to visibility. which number do, we overall out wanted all possible. you get trying give grow lose as did indicated, quarter. to a is to is the the what business precise But core that the us for integrate we business that to we quickly, it granularity, we magnitude certainly as

Matt Sheerin

I you're just Okay. Adam's on demand just regarding And that. appreciate following question what up and then seeing.

of also it it down the But with quarter, clients the like June there's June services. like in are have the sounds some orders terms your overall sounds sounds but situated products most at-home, like In into it right the backlog of themselves quarter. and moving

the any is, heading out I have your device the even given part that larger extent to play of in continue to the you out get September sense have the So of that be visibility? What's quarter you rush out already may quarter, out. then may can pushed played how projects worse the is client this of that guess and this question seen

Ken Lamneck

Yes.

I so the much lot think a of it, Matt, depends shelter-in-place. upon

to back play Ohio current work. Germany is we're to Arizona that think continues way. could starting to seeing work. is coming and I if think in back loosening the up. are out situation, will to back work. start Certainly, coming I that that that shortly Austria come

normalcy to this, release a I more think start states bit been today, business, the get back start think shelter-in-place. a to I strictly little we into the As it's whereas

business. somehow demand all to know, as been of know, period that and And pushed. I that's in delayed and watching, because probably time a long as think thing change we you certainly of the do could that have a impacting these we're that for picture, So your biggest difficult projects without the IT, lot

for So I be catalyst key to watch. that'll think the us

Matt Sheerin

about I gross at June, we appreciate quarter. the March you you contribution? then up about business margin giving and flat with think of in mix kind that? be in guidance, should strong And should a specific had And very margin, gross on just but or basis about still the thinking that the think PCM year-over-year it the you're we of What Okay. when looking not

Glynis Bryan

margin. We would gross in still to there's envision improvement that with be going some PCM,

year, entire XX-plus all I year, guidance coming basis gave of them think the anticipated over being PCM. points improvement as when we equal from said the we for maybe we full

ours that are in QX we at than netting. software big quarter margins through lots higher also we see still So would anticipate Remember, and still that our coming rate a that is and QX. of would their

in as So us that QX. too, helps well,

Matt Sheerin

change one those be you guess, near-term worst the I is missing is that could would in that programs? revenue terms you with that of a potential OEM that, itself negative rebate, Yes. Or if are of kind renegotiating before rebate of for been, various your evens thing programs the Ken, out? have within process lower. partners

Ken Lamneck

Matt. correct, No, think Yes. you're I

has to certainly the course, think and certainly is been them, has tied No of is but that, volume. Much partner volume. been, we're working there with agreeable an very I to of community element question.

So very we volume If as significantly down certainly supplier where the course, partners that will you their the the obtain impact channel, the a is of rebates become seen then, that whole approaches. of know. we've in would flexible reimbursement lot does affect or it

Operator

JPMorgan. with is question from next Your Coster Paul Instructions] [Operator

Paul Coster

extra to and trends talked kind given you'd have you SaaS trying a innovation out landscape and boost all and collaboration a I are certain the given things just really there Ken, of around that been call by think of you bit changed cloud these the have are And about IT to work-from-home-phenomenon? understand, that so momentum Or and and permanently? like and little service on. and was security digital

Ken Lamneck

question, Paul. Good Yes.

across no a of SaaS that I an few think there's areas. both seen and the in got view, The there's cloud, course, IaaS the of point question, board. acceleration we've

well, Microsoft very saw as positive. results You

So and even no and grow be going probably continue momentum to to faster. question that, that is gain

The to meetings. and collaboration There's, different collaboration four them. relying communicate all given on on you're probably collaboration, platforms different we're on we five day, mentioned, any conduct of solutions course, that

Teams, Webex, as, very critical well in it using were certainly, many Microsoft to wasn't marketplace. we and very, see So them strong Cisco And but will continue doing I it, think their that really business. incredibly the companies

good. mentioned an they I of go higher powered to now earlier, realize essential And that as of is the I forward. think movement part towards home sure notebooks course, they it's business make experience at their And as

they're You're forth. like little accessories, at their notebooks people home see, when so think, more to going better adding attach I to displays headsets and using certainly, to them things and

forward. be impetus think certainly So going to I an going that's

up the as And I dramatically, we critical attacks for day. cyber is see phishing then security, The are everybody. mentioned, attacks single every

a well investment trend continue. longer-term as will I is in certainly security that So the think

just run, for I I you So or think, well. short the all areas not will, think but that, term as as indicated, here for the longer

Paul Coster

A 'XX, that this follow-up. you'll that, is one In burned the exploit this 'XX, from you around. obviously and navigated time downturn,

Ken Lamneck

Yes.

of business across us making implications global might its all a it's, And of than us it's clients, bigger to your a a for sort have what a This is little of on a problem us. there to positioned that's if being economy. where enterprise it's the others, business And going and health kind larger because the recurrence more any because strong, balance clients. affecting larger crisis, in in even been course, understand both these lot is and the crisis could certainly of sure be. well of favoring is effect fall, consistent of enterprise the of for than that's sheet I harder be certainly that impact This, is of actually a which is one recessions. that of long-lasting of the our think for course, one financial small sort is it's this probably of the concentration long-term

certainly definitely, on probably helps will But So that through we bigger I get business impacts us be yes, forward. bit as this. going the a small think

long lasts, But all we're course. watching of depends on all this it monitoring that. So and how

Paul Coster

that material? think this connected already you've for do Lastly, sounds but interesting, it that a you developed put Have you pipeline it can offering? be platform really together,

Ken Lamneck

kind be still warehouses Yes. actually. very probably certainly update we're parks, But of big any that that be rates that that We've any C-level juncture. solutions any next order all And have determined. be at folks for type in that are that's theme seeing these basically it an that'll in interest stadiums, interested us now we're very people quarter. seen concentration very, whether this concentration, seeing and so How to certainly tremendous be gives to have. be have we'll it forth, of tremendous interest of access and interest companies, whether there's organizations whether it Anywhere it people

excited pretty that. about So

Operator

our as call concludes Q&A concludes portion today's This today's This of call. well.

you please participating for So go and Thank today. ahead disconnect.

Insight Enterprises (NSIT) 9 May 202020 Q1 Earnings call transcript