Services shine in CDW's first-quarter results

Sales for customized engineering services — and for its Canadian operations — helped offset slower sales to the solution provider's traditional SMB customer set.
Written by Heather Clancy, Contributor on

Well-known technology services company CDW reported a 4 percent increase in revenue for the first quarter of 2013 — reaching net sales of $2.4 billion — but its cloud and datacenter services division posted an even faster growth rate.

CDW's Advanced Services business (which includes its Canadian operations) grew by 16 percent during the period. With about $161 million in sales, it is still just 6.7 percent of the company's overall sales, but is becoming a more important source of growth potential.

"Today's IT market is more complex than ever," said Thomas Richards, chairman and chief executive of CDW, which is headquartered in Vernon Hills, Illinois. "The combination of our national presence, intimate knowledge of customers' needs, highly skilled technology specialists and engineers, and broad solutions suite helps our more than 250,000 customers across the US and Canada navigate this market, and makes us a very effective channel partner to more than 1,000 well-established and emerging brands."

CDW's managed services offerings — including various cloud infrastructure solutions — are expanding quickly, as the solution provider moves beyond its legacy as a reseller of IT gear for small and midsized businesses (SMBs). Just this week, the company added a Tier III, carrier-neutral datacenter in Milwaukee, Wisconsin, to help customers create private cloud environments.

Outside of that services division, CDW reported a strong performance among midsized and large accounts, according to the press release detailing its first-quarter results. Corporate sales were $1.4 billion, compared with $1.36 billion, which represents an increase of 3 percent.

The company recorded net income of $28.3 million for the first quarter of 2013, compared with $10.9 million in the same period a year earlier.

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