1. Sector-Wise Performance Analysis

CDW operates in multiple sectors, including Corporate, Small Business, Public (Government, Education, Healthcare), and Other. Here’s how each segment performed in Q4 2024 and the full year.

Corporate Sector

• Q4 Net Sales: $2.34 billion (↑ 2.6% YoY)
• Full-Year Net Sales: $8.84 billion (↓ 1.4% YoY)
• Key Drivers:
  • Stabilizing IT spending among enterprise clients.
  • Strong demand for cybersecurity and cloud migration services.
  • Headwinds from macroeconomic uncertainty.

Small Business Sector

• Q4 Net Sales: $380 million (↑ 2.7% YoY)
• Full-Year Net Sales: $1.52 billion (↓ 2.1% YoY)
• Key Drivers:
  • Small businesses investing in digital transformation.
  • Improved Average Daily Sales (+4.4% YoY) in Q4 indicates a turnaround.
  • Ongoing financial constraints on SMBs affecting long-term growth.

Public Sector

• Q4 Net Sales: $1.85 billion (↑ 4.4% YoY)
• Full-Year Net Sales: $8.16 billion (↓ 1.8% YoY)

Government Sub-Sector

• Q4 Net Sales: $613.5 million (↓ 7.1% YoY)
• Full-Year Net Sales: $2.49 billion (↓ 6.8% YoY)
• Key Drivers:
  • Reduced government IT spending and budget cuts.
  • Lower federal and state infrastructure investments.

Education Sub-Sector

• Q4 Net Sales: $557.4 million (↓ 3.7% YoY)
• Full-Year Net Sales: $3.17 billion (↓ 4.0% YoY)
• Key Drivers:
  • Slowdown in EdTech investments post-pandemic.
  • Budget constraints at schools and universities.

Healthcare Sub-Sector

• Q4 Net Sales: $683.1 million (↑ 27.5% YoY)
• Full-Year Net Sales: $2.50 billion (↑ 7.1% YoY)
• Key Drivers:
  • Increased investment in digital healthcare infrastructure.
  • Strong demand for data security and cloud-based healthcare solutions.

Other Segments

• Q4 Net Sales: $607.1 million (↑ 3.4% YoY)
• Full-Year Net Sales: $2.48 billion (↓ 2.9% YoY)
• Key Drivers:
  • Diversified customer base helped drive Q4 growth.
  • Full-year decline suggests macroeconomic challenges.

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2. Competitor Comparison

CDW competes with major IT distribution and cloud infrastructure providers, including TD SYNNEX ($SNX), Insight Enterprises ($NSIT), and SHI International. Below is a comparative analysis:

Company	Revenue (Q4 2024)	YoY Growth	Key Strengths	Challenges
CDW ($CDW)	$5.2B	+3.3%	Strong healthcare growth	Declining Gov/Edu sales
TD SYNNEX ($SNX)	$16.1B	-0.5%	Global supply chain	Lower hardware demand
Insight ($NSIT)	$2.5B	+5.2%	AI & cloud services growth	SMB demand volatility
SHI International	Private	N/A	Strong enterprise IT sales	Competition from larger firms

Key Takeaways from Competitor Comparison:

1. CDW’s healthcare sector outperformed peers, while government & education lagged.
2. TD SYNNEX faced broader declines but maintains a large market share.
3. Insight Enterprises is growing faster than CDW, driven by AI & cloud transformation.
4. SHI remains a strong competitor in enterprise IT, though lacks CDW’s diversified exposure.

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3. Industry Trends & Future Outlook

Growth Drivers

• AI & Cloud Investments: Enterprises are increasing investments in AI-driven analytics, cloud computing, and cybersecurity.
• Healthcare IT Boom: Healthcare technology adoption is growing rapidly, benefiting CDW.
• SMB Recovery: Small businesses are slowly increasing IT spending after a weak 2023.

Challenges & Risks

• Government & Education Slowdown: Budget cuts are impacting IT spending in public sectors.
• Macroeconomic Uncertainty: Inflation and interest rates may affect corporate IT budgets.
• Competition from Direct Cloud Providers: AWS, Microsoft, and Google Cloud are expanding direct enterprise sales.

CDW’s 2025 Outlook & Strategic Focus

• IT Spending Growth Target: U.S. IT growth +200–300 bps.
• Acquisition Strategy: Continue expanding through M&A.
• Capital Return: Increased dividends & share repurchases.

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Conclusion

CDW delivered strong Q4 results led by the healthcare sector (+27.5%), but government (-7.1%) and education (-3.7%) were weak. Compared to competitors, CDW is in a stable position but must adapt to changing public sector spending trends. The 2025 outlook remains positive, driven by AI, cloud growth, and strategic acquisitions.