CDW Sales Jump 18% as AI Demand Lifts Q3 Results

In short: CDW, a US technology products and services company, reported a record third quarter on November 4, 2026. Net sales rose 17.7% from a year earlier to $6.75 billion, as businesses bought more servers, storage, notebooks, mobile devices, and software for AI-ready systems. Profit per share on an adjusted basis rose 20.4% to $3.26, beating analyst expectations, and CDW raised its full-year profit outlook.

What happened

CDW sells technology hardware, software, and services to businesses, schools, and government customers. Its third quarter covers July to September 2026. According to the company release, net sales were $6,755 million, compared with $5,737 million in the same quarter of 2025, an increase of 17.7%. On an average daily sales basis, the company described growth of about 18%.

The profit figures need a little care, because CDW reports two versions. Net income, the standard accounting figure, rose 6.5% to $310 million, and earnings per share on that basis rose 11.6% to $2.46, from $2.21 a year earlier. The adjusted figure, which strips out items such as acquisition costs and share-based pay, rose faster. Non-GAAP net income rose 14.8% to $410 million, and non-GAAP earnings per share rose 20.4% to $3.26, from $2.71.

Gross profit, which is sales minus the direct cost of the products sold, rose 10.3% to $1.39 billion. But gross margin, which is gross profit as a share of sales, narrowed to 20.5% from 21.9% a year earlier. In simple terms, CDW sold a lot more, but kept a slightly smaller slice of each sales dollar, partly because of the mix of products sold.

CDW also raised its outlook. It now expects full-year non-GAAP earnings per share to grow at a low double-digit rate, up from a previous expectation of high single-digit growth, and it expects gross profit to grow at a mid to high single-digit rate. The board approved an 8% increase in the quarterly dividend to $0.68 per share, payable on December 10, 2026, to shareholders of record on November 25, 2026. CDW also completed the $525 million acquisition of Lovelytics, a data and AI services firm, on September 25.

Why it matters for beginners

A single company result does not tell you what the whole stock market will do, but it can show where business spending is going. In this case, the story is demand for technology that supports artificial intelligence work: servers, storage, and software that companies need before they can run AI tools at scale. That demand helped CDW beat expectations for both sales and adjusted profit.

The margin detail is a useful beginner lesson too. Sales can jump while profit grows more slowly, if costs rise or if a company sells more lower-margin products. Here, sales rose 17.7% while standard net income rose 6.5%, and gross margin fell. Adjusted profit grew faster than standard profit, which is why it helps to check which profit figure a headline is using before drawing a conclusion.

For a beginner investor, one company is also a reminder about diversification. A single stock can beat expectations one quarter and disappoint the next, which is why many beginners learn about funds that hold a basket of companies, as explained in our guide to what an ETF is and how it differs from a stock.

What to watch next

Watch whether business technology spending stays strong in the final quarter of the year, and whether CDW meets its raised profit outlook. Watch margins as well. If sales keep growing but margins keep narrowing, profit growth could slow even if demand stays healthy. Watch the dividend payment date of December 10 for shareholders on record on November 25, and watch how the Lovelytics acquisition contributes to data and AI services revenue in coming quarters.

FAQ

What does CDW do?

CDW provides technology products and services, including hardware, software, and IT services, mainly to business, education, and government customers in the United States and other markets.

What were the headline Q3 2026 figures?

Net sales were $6.75 billion, up 17.7% from a year earlier. Standard earnings per share were $2.46, up 11.6%, and adjusted earnings per share were $3.26, up 20.4%.

Why are there two different profit per share figures?

The standard figure follows normal accounting rules. The adjusted, or non-GAAP, figure excludes certain items such as acquisition-related costs and share-based pay. Companies often highlight the adjusted figure, so beginners should check which one a report is quoting.

Does a raised outlook guarantee stronger results?

No. An outlook is management’s expectation based on current information, not a promise. Demand, costs, and customer spending can all change before the year ends.

Sources

CDW Corporation, CDW Reports Third Quarter 2026 Earnings, November 4, 2026: https://www.businesswire.com/news/home/20261104966476/en/CDW-Reports-Third-Quarter-2026-Earnings
Zacks, CDW Q3 Earnings Beat, Revenues Jump 18% Y/Y Despite Margin Compression, November 4, 2026: https://www.zacks.com/stock/news/3022886/cdw-q3-earnings-beat-revenues-jump-18-yy-despite-margin-compression

This article is for general information and education only. It is not legal or financial advice.