SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2025

Segment Information

Segment Information

Note 7–Segment Information

The internal reporting structure used by the Company’s chief operating decision maker, or CODM, to assess performance and allocate resources determines the basis for the Company’s operating segments. The Company’s operations are organized under three reporting segments—the Enterprise Solutions segment, which serves primarily medium-to-large corporations; the Business Solutions segment, which serves primarily small- to medium-sized businesses; and the Public Sector Solutions segment, which serves primarily federal, state, and local government and educational institutions. In addition, the Headquarters/Other provides services in areas such as finance, human resources, IT, marketing, and product management. Most of the operating costs associated with the Headquarters/Other functions are charged to the operating segments based on their estimated usage of the underlying functions. The Company reports these charges to the operating segments as “Allocations”. Headquarters/Other amounts that are not allocated to the operating segments are shown as reconciling items in the tables below.

The Company’s CODM is its Chief Executive Officer, and he assesses the segments’ performance by using each segments’ operating income (which includes certain corporate overhead allocations attributable to each of the segments). Net sales presented below exclude inter-segment product revenues. The CODM uses operating income for each segment in the annual budget, periodic forecasting, and quarterly results processes.

Segment information applicable to the Company’s operating segments and the related reconciliations to consolidated amounts for the three months ended March 31, 2025 and 2024 are shown below (in thousands):

	Three Months Ended March 31, 2025
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	298,003	$	258,385	$	144,658	$	701,046
Cost of sales		255,705		192,978		125,052
Personnel costs		16,170		17,775		9,586
Marketing		2,097		4,839		1,084
Allocated corporate overhead		18,290		21,476		10,738
Depreciation and amortization		192		155		23
Other segment expenses1		1,047		2,745		1,517
Operating income (loss)	$	4,502	$	18,417	$	(3,342)	$	19,577
Unallocated Headquarters/Other expenses								(5,055)
Interest income, net								3,900
Other income								76
Income before taxes							$	18,498
Segment assets	$	743,050	$	578,687	$	104,557	$	1,426,294
Headquarters/Other assets								(178,791)
Consolidated assets							$	1,247,503

	Three Months Ended March 31, 2024
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	282,659	$	255,869	$	93,497	$	632,025
Cost of sales		239,925		195,505		78,523
Personnel costs		15,469		17,963		8,291
Marketing		1,887		4,330		1,183
Allocated corporate overhead		18,382		20,508		10,254
Depreciation and amortization		205		163		23
Other segment expenses1		944		1,611		573
Operating income (loss)	$	5,847	$	15,789	$	(5,350)	$	16,286
Unallocated Headquarters/Other expenses								(2,822)
Interest income, net								4,567
Income before taxes							$	18,031
Segment assets	$	701,826	$	514,019	$	54,563	$	1,270,408
Headquarters/Other assets								(109,343)
Consolidated assets							$	1,161,065

1) Other segment expenses for each of the reportable segments include service contracts/subscriptions, professional fees, facilities operations, credit card fees, and other miscellaneous expenses.

The assets of the Company’s three operating segments presented above consist primarily of accounts receivable, net intercompany receivables, goodwill, and other intangibles, net. Assets reported under the Headquarters/Other are managed by corporate headquarters, including cash and cash equivalents, short-term investments, inventories, property and equipment, ROU assets, and intercompany balance, net. As of March 31, 2025 and 2024, total assets for the Headquarters/Other were presented net of intercompany balance eliminations of $61,063 and $15,039, respectively. The Company’s capital expenditures consist largely of IT hardware and software purchased to maintain or upgrade its management information systems. These information systems serve all of the Company’s segments, to varying degrees, and accordingly, the CODM does not evaluate capital expenditures on a segment-by-segment basis.