SEGMENT REPORTING

3 Months Ended

Jun. 30, 2024

SEGMENT REPORTING [Abstract]

SEGMENT REPORTING

16. SEGMENT REPORTING

We manage and report our operating results through four operating segments: product, professional services, managed services, and financing. Our product segment includes sales of IT products, third-party software, and third-party maintenance, software assurance, and other third-party services. Our professional services segment includes our advanced professional services, staff augmentation, project management services, cloud consulting services and security services. Our managed services segment includes our advanced managed services, service desk, storage-as-a-service, cloud hosted services, cloud managed services and managed security services. We refer to the product segment, professional services segment, and managed services segment collectively as our technology business. Our financing business segment consists of the financing of IT equipment, software, and related services to commercial enterprises, state and local governments, and government contractors.

We measure the performance of the segments within our technology business based on gross profit, while we measure our financing business segment based on operating income. We do not present asset information for our reportable segments as we do not provide asset information to our chief operating decision maker.

The following table provides reportable segment information (in thousands):

	Three Months Ended June 30,
	2024		2023
Net Sales
Product	$	457,312	$	498,166
Professional services		37,279		35,556
Managed services		40,910		31,963
Financing		9,037		8,490
Total		544,538		574,175
Gross Profit
Product		98,505		111,391
Professional services		15,455		14,724
Managed services		12,834		9,797
Financing		7,687		6,361
Total		134,481		142,273
Operating expenses
Technology business		94,903		92,414
Financing		4,109		3,527
Total		99,012		95,941
Operating income
Technology business		31,891		43,498
Financing		3,578		2,834
Total		35,469		46,332
Other income (expense), net		2,073		190
Earnings before tax	$	37,542	$	46,522
Depreciation and amortization
Technology business	$	4,819	$	4,764
Financing		-		28
Total	$	4,819	$	4,792
Interest and financing costs
Technology business	$	-	$	550
Financing		585		301
Total	$	585	$	851
Selected Financial Data - Statement of Cash Flow
Purchases of property, equipment, and operating lease equipment
Technology business	$	580	$	2,785
Financing		1,387		913
Total	$	1,967	$	3,698

The following tables provide a disaggregation of net sales by source and further disaggregates our revenue recognized from contracts with customers by timing and our position as principal or agent (in thousands):

	Three Months Ended June 30, 2024
	Product		Professional Services		Managed Services		Financing		Total
Net Sales:
Contracts with customers	$	453,802	$	37,279	$	40,910	$	1,105	$	533,096
Financing and other		3,510		-		-		7,932		11,442
Total	$	457,312	$	37,279	$	40,910	$	9,037	$	544,538
Timing and position as principal or agent:
Transferred at a point in time as principal	$	418,374	$	-	$	-	$	1,105	$	419,479
Transferred at a point in time as agent		35,428		-		-		-		35,428
Transferred over time as principal		-		37,279		40,910		-		78,189
Total revenue from contracts with customers	$	453,802	$	37,279	$	40,910	$	1,105	$	533,096

	Three Months Ended June 30, 2023
	Product		Professional Services		Managed Services		Financing		Total
Net Sales:
Contracts with customers	$	490,543	$	35,556	$	31,963	$	1,290	$	559,352
Financing and other		7,623		-		-		7,200		14,823
Total	$	498,166	$	35,556	$	31,963	$	8,490	$	574,175
Timing and position as principal or agent:
Transferred at a point in time as principal	$	452,382	$	-	$	-	$	1,290	$	453,672
Transferred at a point in time as agent		38,161		-		-		-		38,161
Transferred over time as principal		-		35,556		31,963		-		67,519
Total revenue from contracts with customers	$	490,543	$	35,556	$	31,963	$	1,290	$	559,352

TECHNOLOGY BUSINESS DISAGGREGATION OF REVENUE

The following table provides a disaggregation of our revenue from contracts with customers for our technology business by customer end market and by type (in thousands):

	Three Months Ended June 30,
	2024			2023
Customer end market:
Telecom, media & entertainment	$	117,553		$	141,335
Technology		109,106			73,403
SLED		92,096			109,405
Healthcare		75,280			86,656
Financial services		49,725			65,690
All others		91,741			89,196
Net sales		535,501			565,685
Less: revenue from financing and other		(3,510	)		(7,623	)
Total revenue from contracts with customers	$	531,991		$	558,062
Type:
Product
Networking	$	234,740		$	245,188
Cloud		137,231			172,044
Security		48,005			45,796
Collaboration		20,899			12,956
Other		16,437			22,182
Total product		457,312			498,166
Professional services		37,279			35,556
Managed services		40,910			31,963
Net sales		535,501			565,685
Less: revenue from financing and other		(3,510	)		(7,623	)
Total revenue from contracts with customers	$	531,991		$	558,062

We do not disaggregate sales by customer end market beyond the technology business.

FINANCING BUSINESS SEGMENT DISAGGREGATION OF REVENUE

We analyze our revenues within our financing business segment based on the nature of the arrangement. Our financing revenue generally consists of portfolio income, transactional gains, and post-contract earnings including month-to-month rents and the sales of off-lease equipment. All our revenues from contracts with customers within our financing business segment are from the sales of off-lease equipment.