10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to            

Commission File Number:  0-25092

INSIGHT ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

Delaware	86-0766246
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

6820 South Harl Avenue, Tempe, Arizona 85283

(Address of principal executive offices) (Zip Code)

(480) 333-3000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common stock, par value $0.01	NSIT	The NASDAQ Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes   ☒   No   ☐  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes   ☒   No   ☐  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes   ☐   No   ☒  

The number of shares outstanding of the issuer’s common stock as of November 1, 2019 was 35,256,041.

INSIGHT ENTERPRISES, INC.

QUARTERLY REPORT ON FORM 10-Q

Three Months Ended September 30, 2019

TABLE OF CONTENTS

		Page
PART I -	Financial Information
Item 1 –	Financial Statements:
	Consolidated Balance Sheets (unaudited) – September 30, 2019 and December 31, 2018	1
	Consolidated Statements of Operations (unaudited) – Three and Nine Months Ended September 30, 2019 and 2018	2
	Consolidated Statements of Comprehensive Income (unaudited) – Three and Nine Months Ended September 30, 2019 and 2018	3
	Consolidated Statements of Stockholders’ Equity (unaudited) – Three and Nine Months Ended September 30, 2019 and 2018	4
	Consolidated Statements of Cash Flows (unaudited) – Nine Months Ended September 30, 2019 and 2018	6
	Notes to Consolidated Financial Statements (unaudited)	7
Item 2 –	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3 –	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4 –	Controls and Procedures	43
PART II -	Other Information
Item 1 –	Legal Proceedings	44
Item 1A –	Risk Factors	44
Item 2 –	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3 –	Defaults Upon Senior Securities	47
Item 4 –	Mine Safety Disclosures	47
Item 5 –	Other Information	47
Item 6 –	Exhibits	48
Signatures		50

INSIGHT ENTERPRISES, INC.

Forward-Looking Information

References to “the Company,” “Insight,” “we,” “us,” “our” and other similar words refer to Insight Enterprises, Inc. and its consolidated subsidiaries, unless the context suggests otherwise.  Certain statements in this Quarterly Report on Form 10-Q, including statements in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of this report, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements may include: expectations regarding net sales, gross profit, gross margin, operating expenses, earnings from operations, non-operating income and expenses, net earnings or cash flows, cash needs and the payment of accrued expenses and liabilities; expectations about future benefits relating to the PCM, Inc. (“PCM”) acquisition; the expected effects of seasonality on our business; expectations of further consolidation in the Information Technology (“IT”) industry; our intentions concerning the payment of dividends; our acquisition strategy; projections of capital expenditures; the sufficiency of our capital resources, the availability of financing and our needs and plans relating thereto; the estimated effect of new accounting principles and expected dates of adoption; the effect of indemnification obligations; projections about the outcome of ongoing tax audits; expectations regarding future employee termination benefits; estimates regarding future asset-retirement activities; adequate provisions for and our positions and strategies with respect to ongoing and threatened litigation; our expectations regarding the use of cash flow from operations for working capital, to pay down debt, repurchase shares of our common stock, make capital expenditures and fund acquisitions; our expectations regarding stock-based compensation and future income tax expense; our compliance with leverage ratio requirements; our exposure to off-balance sheet arrangements; statements of belief; and statements of assumptions underlying any of the foregoing.  Forward-looking statements are identified by such words as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will,” “may” and variations of such words and similar expressions and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified.  Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements.  There can be no assurances that results described in forward-looking statements will be achieved, and actual results could differ materially from those suggested by the forward-looking statements.  Some of the important factors that could cause our actual results to differ materially from those projected in any forward-looking statements include, but are not limited to, the following, which are discussed in “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, in “Cautionary Note Regarding Forward-looking Statements” in the Company’s Current Report on Form 8-K filed on June 24, 2019 and in “Risk Factors” in Part II, Item 1A of this report:

• actions of our competitors, including manufacturers and publishers of products we sell;

• our reliance on our partners for product availability, competitive products to sell and marketing funds and purchasing incentives, which can change significantly in the amounts made available and the requirements year over year;

• changes in the IT industry and/or rapid changes in technology;

• risks associated with the integration and operation of acquired businesses, including PCM;

• possible significant fluctuations in our future operating results as well as seasonality and variability of customer demands;

• the risks associated with our international operations;

• general economic conditions, economic uncertainties and changes in geopolitical conditions;

• increased debt and interest expense and decreased availability of funds under our financing facilities;

• the security of our electronic and other confidential information;

• disruptions in our IT systems and voice and data networks;

• failure to comply with the terms and conditions of our commercial and public sector contracts;

INSIGHT ENTERPRISES, INC.

• legal proceedings, including PCM related litigation, client audits and failure to comply with laws and regulations;

• accounts receivable risks, including increased credit loss experience or extended payment terms with our clients;

• our reliance on independent shipping companies;

• our dependence on certain key personnel;

• natural disasters or other adverse occurrences;

• exposure to changes in, interpretations of, or enforcement trends related to tax rules and regulations;

• intellectual property infringement claims and challenges to our registered trademarks and trade names;

• unexpected costs or liabilities in connection with the acquisition of PCM;

• the Company’s inability to achieve expected synergies and operating efficiencies as a result of the acquisition of PCM, whether within the expected time frames, without undue difficulty, cost or expense, or at all;

• the Company’s ability to successfully integrate PCM’s operations into its own, whether within expected time frames, without undue difficulty, cost or expense, or at all;

• the level of revenues following the acquisition of PCM, which may be lower than expected;

• operating costs, customer loss and business disruptions arising from the acquisition of PCM (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers), which may be greater than expected;

• cyber attacks or breaches of data privacy and security regulations;

• uncertainties surrounding the acquisition of PCM;

• the outcome of any legal proceedings related to the acquisition of PCM;

• other adverse economic, business, and/or competitive factors;

• risks that the acquisition of PCM distracts management of the Company or PCM or disrupts current plans and operations;

• the Company’s ability to retain key PCM and Company employees;

• the senior convertible notes (the “notes”) are effectively subordinated to the Company’s secured debt and are structurally subordinated to any liabilities of our subsidiaries, other than the subsidiary guarantor;

• the debt may restrict the Company’s future operations and impair its ability to meet business obligations under the notes;

• the conditional conversion feature of the notes, if triggered, may adversely affect the Company’s financial condition and operating results;

• the accounting method for convertible debt securities that may be settled in cash, such as the notes, could have a material effect on the Company’s reported financial results;

• future sales of the Company’s common stock or equity-linked securities in the public market could lower the market price for our common stock and adversely impact the trading price of the notes; and

• the Company is subject to counterparty risk with respect to the convertible note hedge transactions.

Additionally, there may be other risks that are otherwise described from time to time in the reports that we file with the Securities and Exchange Commission (the “SEC”).  Any forward-looking statements in this report should be considered in light of various important factors, including the risks and uncertainties listed above, as well as others.  We assume no obligation to update, and, except as may be required by law, do not intend to update, any forward-looking statements.  We do not endorse any projections regarding future performance that may be made by third parties.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

INSIGHT ENTERPRISES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)

	September 30, 2019			December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	140,549		$	142,655
Accounts receivable, net of allowance for doubtful accounts    of $10,243 and $10,462, respectively		2,320,681			1,931,736
Inventories		219,932			148,503
Other current assets		120,972			115,683
Total current assets		2,802,134			2,338,577
Property and equipment, net of accumulated depreciation and    amortization of $255,916 and $331,700, respectively		169,996			72,954
Goodwill		358,384			166,841
Intangible assets, net of accumulated amortization of    $65,922 and $52,942, respectively		350,342			112,179
Deferred income taxes		3,027			7,967
Other assets		298,477			77,429
	$	3,982,360		$	2,775,947
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable—trade	$	1,220,678		$	978,104
Accounts payable—inventory financing facilities		207,658			304,130
Accrued expenses and other current liabilities		254,677			190,733
Current portion of long-term debt		1,142			1,395
Deferred revenue		67,819			62,300
Total current liabilities		1,751,974			1,536,662
Long-term debt		835,714			195,525
Deferred income taxes		58,665			683
Other liabilities		233,369			56,088
		2,879,722			1,788,958
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value, 3,000 shares authorized;    no shares issued		—			—
Common stock, $0.01 par value, 100,000 shares authorized;    35,251 shares at September 30, 2019 and 35,482 shares at    December 31, 2018 issued and outstanding		353			355
Additional paid-in capital		353,069			323,622
Retained earnings		798,147			704,665
Accumulated other comprehensive loss – foreign currency    translation adjustments		(48,931	)		(41,653	)
Total stockholders’ equity		1,102,638			986,989
	$	3,982,360		$	2,775,947

See accompanying notes to consolidated financial statements.

1

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net sales:
Products	$	1,668,880		$	1,548,273		$	4,729,887		$	4,724,888
Services		243,667			199,453			704,147			606,202
Total net sales		1,912,547			1,747,726			5,434,034			5,331,090
Costs of goods sold:
Products		1,519,240			1,415,808			4,315,464			4,319,181
Services		117,112			97,004			318,454			272,355
Total costs of goods sold		1,636,352			1,512,812			4,633,918			4,591,536
Gross profit		276,195			234,914			800,116			739,554
Operating expenses:
Selling and administrative expenses		223,215			184,095			613,767			561,739
Severance and restructuring expenses, net		2,662			683			3,712			2,709
Acquisition related expenses		5,896			188			9,059			282
Earnings from operations		44,422			49,948			173,578			174,824
Non-operating (income) expense:
Interest income		(393	)		(330	)		(930	)		(653	)
Interest expense		8,087			6,132			17,511			17,249
Net foreign currency exchange (gain) loss		(391	)		539			(10	)		19
Other (income) expense, net		(147	)		393			868			1,019
Earnings before income taxes		37,266			43,214			156,139			157,190
Income tax expense		10,134			11,060			39,682			40,554
Net earnings	$	27,132		$	32,154		$	116,457		$	116,636
Net earnings per share:
Basic	$	0.76		$	0.91		$	3.27		$	3.27
Diluted	$	0.76		$	0.89		$	3.23		$	3.24
Shares used in per share calculations:
Basic		35,512			35,468			35,631			35,622
Diluted		35,868			35,957			36,027			36,012

See accompanying notes to consolidated financial statements.

2

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2019			2018		2019			2018
Net earnings	$	27,132		$	32,154	$	116,457		$	116,636
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		(8,903	)		657		(7,278	)		(9,774	)
Total comprehensive income	$	18,229		$	32,811	$	109,179		$	106,862

See accompanying notes to consolidated financial statements.

3

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(unaudited)

	Common Stock						Treasury Stock						Additional Paid-in			Accumulated Other Comprehensive			Retained			Total Stockholders'
	Shares			Par Value			Shares			Amount			Capital			Loss			Earnings			Equity
Balances at June 30, 2018		35,459		$	355			—		$	—		$	315,619		$	(34,695	)	$	625,470		$	906,749
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		17			—			—			—			(270	)		—			—			(270	)
Stock-based compensation expense		—			—			—			—			3,716			—			1			3,717
Foreign currency translation adjustments, net of tax		—			—			—			—			—			657			—			657
Net earnings		—			—			—			—			—			—			32,154			32,154
Balances at September 30, 2018		35,476		$	355			—		$	—		$	319,065		$	(34,038	)	$	657,625		$	943,007
Balances at June 30, 2019		35,781		$	358			—		$	—		$	325,263		$	(40,028	)	$	793,990		$	1,079,583
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		11			—			—			—			(266	)		—			—			(266	)
Stock-based compensation expense		—			—			—			—			4,098			—			—			4,098
Equity component of convertible senior notes, net of deferred tax of $14,819 and issuance costs of $1,700		—			—			—			—			44,731			—			—			44,731
Issuance of warrants related to convertible senior notes		—			—			—			—			34,440			—			—			34,440
Purchase of note hedge related to convertible senior notes, net of deferred tax of $16,047		—			—			—			—			(50,278	)		—			—			(50,278	)
Repurchase of common stock		—			—			(541	)		(27,899	)		—			—			—			(27,899	)
Retirement of treasury stock		(541	)		(5	)		541			27,899			(4,919	)		—			(22,975	)		—
Foreign currency translation adjustments, net of tax		—			—			—			—			—			(8,903	)		—			(8,903	)
Net earnings		—			—			—			—			—			—			27,132			27,132
Balances at September 30, 2019		35,251		$	353			—		$	—		$	353,069		$	(48,931	)	$	798,147		$	1,102,638

See accompanying notes to consolidated financial statements.

4

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (continued)

(in thousands)

(unaudited)

	Common Stock						Treasury Stock						Additional Paid-in			Accumulated Other Comprehensive			Retained			Total Stockholders'
	Shares			Par Value			Shares			Amount			Capital			Loss			Earnings			Equity
Balances at December 31, 2017		35,829		$	358			—		$	—		$	317,155		$	(24,264	)	$	550,220		$	843,469
Cumulative effect of accounting change		—			—			—			—			—			—			7,176			7,176
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		288			3			—			—			(3,198	)		—			—			(3,195	)
Stock-based compensation expense		—			—			—			—			10,763			—			1			10,764
Repurchase of common stock		—			—			(641	)		(22,069	)		—			—			—			(22,069	)
Retirement of treasury stock		(641	)		(6	)		641			22,069			(5,655	)		—			(16,408	)		—
Foreign currency translation adjustments, net of tax		—			—			—			—			—			(9,774	)		—			(9,774	)
Net earnings		—			—			—			—			—			—			116,636			116,636
Balances at September 30, 2018		35,476			355			—			—			319,065			(34,038	)		657,625			943,007
Balances at December 31, 2018		35,482		$	355			—		$	—		$	323,622		$	(41,653	)	$	704,665		$	986,989
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes		310			3			—			—			(6,422	)		—			—			(6,419	)
Stock-based compensation expense		—			—			—			—			11,895			—			—			11,895
Equity component of convertible senior notes, net of deferred tax of $14,819 and issuance costs of $1,700		—			—			—			—			44,731			—			—			44,731
Issuance of warrants related to convertible senior notes		—			—			—			—			34,440			—			—			34,440
Purchase of note hedge related to convertible senior notes, net of deferred tax of $16,047		—			—			—			—			(50,278	)		—			—			(50,278	)
Repurchase of common stock		—			—			(541	)		(27,899	)		—			—			—			(27,899	)
Retirement of treasury stock		(541	)		(5	)		541			27,899			(4,919	)		—			(22,975	)		—
Foreign currency translation adjustments, net of tax		—			—			—			—			—			(7,278	)		—			(7,278	)
Net earnings		—			—			—			—			—			—			116,457			116,457
Balances at September 30, 2019		35,251		$	353			—		$	—		$	353,069		$	(48,931	)	$	798,147		$	1,102,638

See accompanying notes to consolidated financial statements.

5

INSIGHT ENTERPRISES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Nine Months Ended September 30,
	2019			2018
Cash flows from operating activities:
Net earnings	$	116,457		$	116,636
Adjustments to reconcile net earnings to net cash provided by    operating activities:
Depreciation and amortization of property and equipment		15,506			16,018
Amortization of intangible assets		13,590			11,399
Provision for losses on accounts receivable		2,695			2,572
Amortization of debt discount and issuance costs		2,322			—
Loss on extinguishment of debt		352			—
Write-downs of inventories		3,281			2,410
Write-off of property and equipment		—			367
Non-cash stock-based compensation		11,895			10,764
Deferred income taxes		2,501			2,964
Changes in assets and liabilities:
Decrease in accounts receivable		68,057			222,047
(Increase) decrease in inventories		(17,946	)		24,373
(Increase) decrease in other assets		(99,681	)		31,555
Decrease in accounts payable		(39,191	)		(201,147	)
(Decrease) increase in deferred revenue		(1,148	)		11,326
Increase (decrease) in accrued expenses and other liabilities		89,905			(4,043	)
Net cash provided by operating activities		168,595			247,241
Cash flows from investing activities:
Purchases of property and equipment		(16,922	)		(13,046	)
Proceeds from sale of foreign entity		—			479
Acquisitions, net of cash and cash equivalents acquired		(664,287	)		(74,938	)
Net cash used in investing activities		(681,209	)		(87,505	)
Cash flows from financing activities:
Borrowings on senior revolving credit facility		242,936			569,232
Repayments on senior revolving credit facility		(242,936	)		(686,732	)
Borrowings on ABL revolving credit facility, net of initial lender fees		986,754			—
Repayments on ABL revolving credit facility		(454,544	)		—
Borrowings on accounts receivable securitization financing facility		2,364,500			2,662,000
Repayments on accounts receivable securitization financing facility		(2,558,500	)		(2,576,000	)
Repayments under Term Loan A		—			(9,844	)
Repayments under other financing agreements		(183	)		(2,312	)
Payments on finance lease obligations		(980	)		(1,002	)
Net repayments under inventory financing facilities		(96,472	)		(81,911	)
Proceeds from issuance of convertible senior notes		341,250			—
Proceeds from issuance of warrants		34,440			—
Purchase of note hedge related to convertible senior notes		(66,325	)		—
Payment of debt issuance costs		(1,180	)		(270	)
Payment of payroll taxes on stock-based compensation    through shares withheld		(6,419	)		(3,195	)
Repurchases of common stock		(27,899	)		(22,069	)
Net cash provided by (used in) financing activities		514,442			(152,103	)
Foreign currency exchange effect on cash, cash equivalents and    restricted cash balances		(3,960	)		(2,434	)
(Decrease) increase in cash, cash equivalents and restricted cash		(2,132	)		5,199
Cash, cash equivalents and restricted cash at beginning of period		144,293			107,445
Cash, cash equivalents and restricted cash at end of period	$	142,161		$	112,644

See accompanying notes to consolidated financial statements.

6

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1.Basis of Presentation and Recently Issued Accounting Standards

We empower organizations of all sizes with Insight Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter.  Our company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment	Geography
North America	United States and Canada
EMEA	Europe, Middle East and Africa
APAC	Asia-Pacific

Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services.  Our offerings in the remainder of our EMEA and APAC segments consist of largely software and certain software-related services.  

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly our financial position as of September 30, 2019 and our results of operations for the three and nine months ended September 30, 2019 and 2018 and cash flows for the nine months ended September 30, 2019 and 2018.  The consolidated balance sheet as of December 31, 2018 was derived from the audited consolidated balance sheet at such date.  The accompanying unaudited consolidated financial statements and notes have been prepared in accordance with the rules and regulations promulgated by the SEC and consequently do not include all of the disclosures normally required by United States generally accepted accounting principles (“GAAP”).  

The results of operations for interim periods are not necessarily indicative of results for the full year, due in part to the seasonal nature of our business.  These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the related notes thereto, in our Annual Report on Form 10-K for the year ended December 31, 2018.  Our results of operations include the results of PCM, Inc. (“PCM”) from its acquisition date of August 30, 2019 and Cardinal Solutions Group, Inc. (“Cardinal”) from its acquisition date of August 1, 2018.  

The consolidated financial statements include the accounts of Insight Enterprises, Inc. and its wholly owned subsidiaries.  All significant intercompany balances and transactions have been eliminated in consolidation.  

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements.  Additionally, these estimates and assumptions affect the reported amounts of net sales and expenses during the reporting period.  Actual results could differ from those estimates.  On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

7

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Recently Issued Accounting Standards

In June 2016, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standard Update (“ASU”) No. 2016-13, “Financial Instruments – Credit Losses.”  The new standard is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held at each reporting date.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.

In April 2019, the FASB issued ASU No. 2019-04, “Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments.”  The new standard provides changes for how a company considers expected recoveries and contractual extensions or renewal options when estimating expected credit losses.  The new standard is effective with the adoption of  ASU No. 2016-13.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.    

Effective January 1, 2019, we adopted the FASB ASU No. 2016-02—Leases (Topic 842) using the effective date transition method. This approach provides a method for recording existing leases at adoption without restating comparative periods. We elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification.  In addition, we made an accounting policy election not to separate non-lease components from lease components for all existing classes of underlying assets with the exception of land and buildings.  We also made an accounting policy election to not record right of use (“ROU”) assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.

Adoption of the new standard resulted in the recording of additional net operating lease ROU assets and lease liabilities of $65,922,000 and $70,512,000, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities reflected existing accrued and prepaid rent balances that were reclassified to the operating lease ROU asset at January 1, 2019. The standard did not materially impact our consolidated net earnings and had no impact on cash flows.  

There have been no other material changes in or additions to the recently issued accounting standards as previously reported in Note 1 to our Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2018 that affect or may affect our current financial statements.

2. Leases

We lease office space, distribution centers, land, vehicles and equipment. Lease agreements with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.   

Certain lease agreements include one or more options to renew, with renewal terms that can extend the lease term from one to five years or more. The exercise of lease renewal options is at our sole discretion. Some agreements also include options to purchase the leased property. The estimated life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.  

8

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Certain of our lease agreements include rental payments adjusted periodically for inflation.  Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Significant Leases Accounting Policy

We determine if a contract or arrangement is, or contains, a lease at inception.  Balances related to operating leases are included in other assets, other current liabilities, and other liabilities in our consolidated balance sheet.  Balances related to financing leases are included in property and equipment, current portion of long-term debt, and long-term debt in our consolidated balance sheet.  ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.  

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.  As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.  We use the implicit rate when readily determinable.  The operating lease ROU asset includes any prepaid lease payments and additional direct costs and excludes lease incentives.  Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.  

The following table provides information about the financial statement classification of our lease balances reported within the consolidated balance sheets as of September 30, 2019 and January 1, 2019 (in thousands):

Leases	Classification	September 30, 2019		January 1, 2019
Assets
Operating lease assets	Other assets	$	78,621	$	65,922
Finance lease assets	Property and equipment(a)		1,178		1,693
Total lease assets		$	79,799	$	67,615
Liabilities
Current
Operating lease liabilities	Accrued expenses and other current liabilities	$	19,502	$	15,788
Finance lease liabilities	Current portion of long-term debt		1,143		1,399
Non-current
Operating lease liabilities	Other liabilities		64,018		54,724
Finance lease liabilities	Long-term debt		670		1,521
Total lease liabilities		$	85,333	$	73,432

(a) Recorded net of accumulated amortization of $515,000 as of September 30, 2019 and there is no accumulated amortization as of January 1, 2019.

9

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table provides information about the financial statement classification of our lease expenses reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Lease cost	Classification	Three months ended September 30, 2019		Nine months ended September 30, 2019
Operating lease cost (a) (b)	Selling and administrative expenses	$	5,197	$	14,965
Finance lease cost
Amortization of leased      assets	Selling and administrative expenses		171		515
Interest on lease liabilities	Interest expense, net		22		72
Total lease cost		$	5,390	$	15,552

(a) Includes immaterial amounts recorded to cost of goods sold.

(b) Excludes short-term and variable lease costs, which are immaterial.

Future minimum lease payments under non-cancelable leases as of September 30, 2019 are as follows (in thousands):

	Operating leases			Finance leases			Total
Remainder of 2019	$	6,008		$	310		$	6,318
2020		21,144			1,150			22,294
2021		17,812			432			18,244
2022		14,470			—			14,470
2023		8,984			—			8,984
After 2023		25,486			—			25,486
Total lease payments		93,904			1,892			95,796
Less:  Interest		(10,384	)		(79	)		(10,463	)
Present value of lease liabilities	$	83,520		$	1,813		$	85,333

Operating lease payments include $13.4 million related to options to extend lease terms that are reasonably certain of being exercised.

The following table provides information about the remaining lease terms and discount rates applied as of September 30, 2019:

	September 30, 2019
Weighted average remaining lease term (years)
Operating leases		6.19
Finance leases		1.69
Weighted average discount rate (%)
Operating leases		3.65
Finance leases		4.85

10

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table provides other information related to leases for the nine months ended September 30, 2019 (in thousands):

	Nine months ended September 30, 2019
Cash paid for amounts included in the measurement of lease    liabilities:
Operating cash flows from operating leases	$	14,527
Leased assets obtained in exchange for new operating lease liabilities		5,901

Operating Leases pre-Topic 842 adoption:

We have non-cancelable operating leases with third parties, primarily for administrative and distribution center space and computer equipment.  Our facilities leases generally provide for periodic rent increases and many contain escalation clauses and renewal options.  We recognize rent expense on a straight-line basis over the lease term.  Rental expense for these third-party operating leases was $20,114,000, $19,126,000 and $14,444,000 in 2018, 2017 and 2016, respectively, and is included in selling and administrative expenses.

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

Amounts in the table above exclude approximately $1.6 million in 2019 in non-cancellable rental income.

11

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

3. Sales Recognition

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined by their related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	1,020,083	$	137,416	$	9,243	$	1,166,742
Software		295,730		186,839		19,569		502,138
Services		199,349		31,453		12,865		243,667
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Major Client Groups
Large Enterprise / Corporate	$	1,110,817	$	277,536	$	17,811	$	1,406,164
Public Sector		165,085		59,174		6,178		230,437
Small and Medium-Sized Businesses		239,260		18,998		17,688		275,946
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,448,385	$	336,600	$	35,979	$	1,820,964
Net revenue recognition (Agent)		66,777		19,108		5,698		91,583
	$	1,515,162	$	355,708	$	41,677	$	1,912,547

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	953,431	$	147,497	$	6,041	$	1,106,969
Software		259,602		168,603		13,099		441,304
Services		158,426		29,080		11,947		199,453
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Major Client Groups
Large Enterprise / Corporate	$	986,665	$	265,430	$	10,715	$	1,262,810
Public Sector		141,895		62,720		6,255		210,870
Small and Medium-Sized Businesses		242,899		17,030		14,117		274,046
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,322,391	$	326,671	$	26,638	$	1,675,700
Net revenue recognition (Agent)		49,068		18,509		4,449		72,026
	$	1,371,459	$	345,180	$	31,087	$	1,747,726

12

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,704,212	$	451,892	$	25,740	$	3,181,844
Software		907,683		560,073		80,287		1,548,043
Services		551,215		113,092		39,840		704,147
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Major Client Groups
Large Enterprise / Corporate	$	3,159,269	$	819,156	$	47,903	$	4,026,328
Public Sector		418,583		246,583		47,428		712,594
Small and Medium-Sized Businesses		585,258		59,318		50,536		695,112
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,969,411	$	1,051,101	$	127,129	$	5,147,641
Net revenue recognition (Agent)		193,699		73,956		18,738		286,393
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,724,916	$	505,844	$	22,518	$	3,253,278
Software		828,231		551,920		91,459		1,471,610
Services		465,458		104,086		36,658		606,202
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Major Client Groups
Large Enterprise / Corporate	$	2,945,880	$	836,865	$	37,770	$	3,820,515
Public Sector		388,109		273,821		67,134		729,064
Small and Medium-Sized Businesses		684,616		51,164		45,731		781,511
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,857,104	$	1,093,110	$	133,542	$	5,083,756
Net revenue recognition (Agent)		161,501		68,740		17,093		247,334
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090

The following table provides information about receivables, contract assets and contract liabilities as of September 30, 2019 and December 31, 2018 (in thousands):

	September 30,		December 31,
	2019		2018
Current receivables, which are included in “Accounts    receivable, net”	$	2,320,681	$	1,931,736
Non-current receivables, which are included in “Other assets”		150,455		38,157
Contract assets, which are included in “Other current assets”		117		892
Contract liabilities, which are included in “Deferred revenue”    and “Other liabilities”		72,501		82,117

13

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Changes in the contract assets and the contract liabilities balances during the nine months ended September 30, 2019 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at December 31, 2018	$	892		$	82,117
Reclassification of the beginning contract liabilities    to revenue, as the result of performance obligations satisfied		—			(47,831	)
Cash received in advance and not recognized as revenue		—			45,660
Reclassification of the beginning contract assets to receivables, as    the result of rights to consideration becoming unconditional		(892	)		—
Contract assets recognized, net of reclassification to receivables		117			—
Business Combination		—			(7,445	)
Balances at September 30, 2019	$	117		$	72,501

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2019 that are expected to be recognized in the future (in thousands):

	Services
Remainder of 2019	$	40,161
2020		70,395
2021		23,815
2022		8,273
2023 and thereafter		3,781
Total remaining performance obligations	$	146,425

With the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, remaining performance obligations that have original expected durations of one year or less are not included in the table above.  Amounts not included in the table above have an average original expected duration of eight months.  Additionally, for our time and material services contracts, whereby we have the right to consideration from a client in an amount that corresponds directly with the value to the client of our performance completed to date, we recognized revenue in the amount to which we have a right to invoice as of September 30, 2019 and do not disclose information about related remaining performance obligations in the table above.  Our time and material contracts have an average expected duration of 13 months.

The majority of our backlog historically has been and continues to be open cancelable purchase orders.  We do not believe that backlog as of any particular date is predictive of future results, therefore we do not include performance obligations under open cancelable purchase orders, which do not qualify for revenue recognition, in the table above.

14

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

4. Net Earnings Per Share (“EPS”)

Basic EPS is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each period.  Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method.  Dilutive potential common shares include outstanding restricted stock units (“RSUs”). A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Numerator:
Net earnings	$	27,132	$	32,154	$	116,457	$	116,636
Denominator:
Weighted average shares used to    compute basic EPS		35,512		35,468		35,631		35,622
Dilutive potential common shares due to    dilutive RSUs, net of tax effect		356		489		396		390
Weighted average shares used to compute    diluted EPS		35,868		35,957		36,027		36,012
Net earnings per share:
Basic	$	0.76	$	0.91	$	3.27	$	3.27
Diluted	$	0.76	$	0.89	$	3.23	$	3.24

For the three and nine months ended September 30, 2019, 3,000 and 56,000, respectively, of our RSUs were not included in the diluted EPS calculations because their inclusion would have been anti-dilutive.  These share-based awards could be dilutive in the future.  There were 5,000 and 13,000 anti-dilutive RSUs for the three and nine months ended September 30, 2018, respectively.  

5. Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations

Debt

Our long-term debt consists of the following (in thousands):

	September 30, 2019			December 31, 2018
Senior revolving credit facility	$	—		$	—
ABL revolving credit facility		553,000			—
Accounts receivable securitization financing facility		—			194,000
Convertible senior notes due 2025		282,043			—
Finance leases and other financing obligations		1,813			2,920
Total		836,856			196,920
Less: current portion of long-term debt		(1,142	)		(1,395	)
Long-term debt	$	835,714		$	195,525

On August 30, 2019, we entered into a credit agreement (the “credit agreement”) providing for a senior secured revolving credit facility (the “ABL facility”), which has an aggregate U.S. dollar equivalent maximum borrowing amount of $1,200,000,000, including a maximum borrowing capacity that could be used for borrowing ,in certain foreign currencies of $150,000,000.  While the

15

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

ABL facility has a stated maximum amount, the actual availability under the ABL facility is limited by specified percentages of eligible accounts receivable and certain eligible inventory, in each case as set forth in the credit agreement.  From time to time and at our option, we may request to increase the aggregate amount available for borrowing under the ABL facility by up to an aggregate of the U.S. dollar equivalent of $500,000,000, subject to customary conditions, including receipt of commitments from lenders.  The ABL facility is guaranteed by certain of our material subsidiaries and is secured by a lien on certain of our assets and certain of each other borrower’s and each guarantor’s assets.  The interest rates applicable to borrowings under the ABL facility are based on the average aggregate excess availability under the ABL facility as set forth on a pricing grid in the credit agreement.  The ABL facility matures on August 30, 2024.  As of September 30, 2019, eligible accounts receivable and inventory were sufficient to permit access to the full $1,200,000,000 facility amount, of which $553,000,000 was outstanding.  

The ABL facility contains customary affirmative and negative covenants and events of default.  If a default occurs (subject to customary grace periods and materiality thresholds) under the credit agreement, certain actions may be taken, including, but not limited to, possible termination of commitments and required payment of all outstanding principal amounts plus accrued interest and fees payable under the credit agreement.  

On August 30, 2019, we repaid in full and terminated our then existing senior revolving credit facility (the “revolving facility”). The revolving facility had an aggregate U.S. dollar equivalent maximum borrowing amount of $350,000,000, including a maximum borrowing capacity that could be used for borrowing in certain foreign currencies of $50,000,000.

On August 30, 2019, we repaid in full and terminated our accounts receivable securitization financing facility (the “ABS facility”).  The ABS facility had a maximum aggregate borrowing availability of $250,000,000, subject to limitations based on the quantity and quality of the underlying accounts receivable.  

Convertible Senior Notes due 2025

On August 15, 2019, we issued $300,000,000 aggregate principal amount of convertible senior notes (the “notes”) that mature on February 15, 2025. On August 23, 2019, we issued an additional $50,000,000 aggregate principal amount of the notes pursuant to the exercise in full by the initial purchasers of the notes of their option to purchase additional notes.  The notes bear interest at an annual rate of 0.75% payable semiannually, in arrears, on February 15^th and August 15^th of each year. The notes are general unsecured obligations of Insight and are guaranteed on a senior unsecured basis by Insight Direct USA, Inc., a wholly owned subsidiary of Insight.  

Holders of the notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding June 15, 2024, under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2019 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price of our common stock per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; (3) if we call any or all of the notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after June 15, 2024 until the close of

16

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

business on the second scheduled trading day immediately preceding the maturity date, the holders may convert their notes at any time, regardless of the foregoing circumstances.

Upon conversion, we will pay or deliver cash, shares of our common stock or a combination of the two, at our discretion. The conversion rate will initially be 14.6376 shares of common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $68.32 per share of common stock). The conversion rate is subject to change in certain circumstances and will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date or following our issuance of a notice of redemption, the conversion rate is subject to an increase for a holder who elects to convert their notes in connection with those events or during the related redemption period in certain circumstances.

If we undergo a fundamental change, the holders may require us to repurchase for cash all or any portion of their notes at a fundamental change repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. As of September 30, 2019, none of the criteria for a fundamental change or a conversion rate adjustment had been met.

The maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, would be 6,788,208.

We may redeem for cash all or any portion of the notes, at our option, on or after August 20, 2022 if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes.  

The notes are subject to certain customary events of default and acceleration clauses.  As of September 30, 2019, no such events have occurred.

The notes consist of the following balances reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

Liability:
Principal	$	350,000
Less: debt discount and issuance costs, net of accumulated accretion		(67,957	)
Net carrying amount	$	282,043
Equity, net of deferred tax	$	44,731

The remaining life of the debt discount and issuance cost accretion is approximately 5.375 years.  The effective interest rate on the liability component of the notes is 4.325%.

The following table summarizes the equity components of the notes included in additional paid-in capital reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

	Embedded Conversion Option		Embedded Conversion Option - Debt Issuance Costs			Deferred Tax			Total
Convertible Senior Notes due 2025	$	61,250	$	(1,700	)	$	(14,819	)	$	44,731

17

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes the interest expense components resulting from the notes reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Interest expense	Three months ended September 30, 2019		Nine months ended September 30, 2019
Contractual coupon interest	$	328	$	328
Amortization of debt discount	$	1,235	$	1,235
Amortization of debt issuance costs	$	163	$	163

Convertible Note Hedge and Warrant Transaction

In connection with the issuance of the notes, we entered into certain convertible note hedge and warrant transactions (the “Call Spread Transactions”) with respect to the Company’s common stock.

The convertible note hedge consists of an option to purchase up to 5,123,160 common stock shares at a price of $68.32 per share. The hedge expires on February 15, 2025 and can only be concurrently executed upon the conversion of the notes. We paid approximately $66,325,000 for the convertible note hedge transaction.

Additionally, we sold warrants to purchase 5,123,160 shares of common stock at a price of $103.12 per share. The warrants expire on May 15, 2025 and can only be exercised at maturity.  The Company received aggregate proceeds of approximately $34,440,000 for the sale of the warrants.

The Call Spread Transactions have no effect on the terms of the notes and reduce potential dilution by effectively increasing the initial conversion price of the notes to $103.12 per share of the Company’s common stock.

Inventory Financing Facilities

On July 10, 2019, we entered into an unsecured inventory financing facility with a maximum availability for vendor purchases of $200,000,000 with MUFG Bank Ltd (“MUFG”).  On August 30, 2019, we terminated our existing inventory financing facility with Wells Fargo Capital Finance, LLC (“Wells Fargo”) and entered into a new unsecured inventory financing facility with Wells Fargo with an aggregate availability for vendor purchases under the facility of $250,000,000 thereunder.  As of September 30, 2019, our combined inventory financing facilities had a total maximum capacity of $450,000,000, of which $207,658,000 was outstanding at September 30, 2019.  The inventory financing facilities will remain in effect until they are terminated by any of the parties.  If balances are not paid within stated vendor terms, they will accrue interest at prime plus 2.00% or prime plus 1.25% with respect to the MUFG facility and Wells Fargo facility, respectively.  Amounts outstanding under these facilities are classified separately as accounts payable – inventory financing facilities in the accompanying consolidated balance sheets.

Finance Lease and Other Financing Obligations

Our finance lease obligations totaled $1,813,000 and $2,920,000 as of September 30, 2019 and December 31, 2018, respectively.     

The current and long-term portions of our finance leases are included in the current and long-term portions of long-term debt in the table above and in our consolidated balance sheets as of September 30, 2019 and December 31, 2018.  Further, see Note 2 for additional information.    

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

6. Restricted Cash

Amounts included in restricted cash represent those required to be set aside by a contractual agreement with a lessor related to certain leased office space in foreign jurisdictions.  The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the nine months ended September 30, 2019 and 2018 (in thousands):

	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	140,549	$	142,655
Restricted cash included in other current assets		—		8
Restricted cash included in other non-current assets		1,612		1,630
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	142,161	$	144,293

	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	111,055	$	105,831
Restricted cash included in other current assets		17		46
Restricted cash included in other non-current assets		1,572		1,568
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	112,644	$	107,445

7.Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
North America	$	3,102	$	2,837	$	8,965	$	8,172
EMEA		860		754		2,544		2,234
APAC		136		126		386		358
Total Consolidated	$	4,098	$	3,717	$	11,895	$	10,764

As of September 30, 2019, total compensation cost related to nonvested RSUs not yet recognized is $29,920,000, which is expected to be recognized over the next 1.33 years on a weighted-average basis.  

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes our RSU activity during the nine months ended September 30, 2019:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at January 1, 2019		1,020,930		$	36.10
Granted(a)		414,405			56.15
Vested, including shares withheld to cover taxes		(423,909	)		33.87	$	14,357,798	(b)
Forfeited		(60,129	)		42.52
Nonvested at September 30, 2019(a)		951,297			45.42	$	52,977,730	(c)

^(a) Includes 84,602 RSUs subject to remaining performance conditions.  The number of RSUs subject to performance conditions are based on the Company achieving 97% of its 2019 targeted financial results.  These RSUs will be awarded at 100% this annual period due to the completion of a significant acquisition in the period.  

^(b) The aggregate fair value of vested RSUs represents the total pre-tax fair value, based on the closing stock price on the day of vesting, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.  

^(c) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $55.69 as of September 30, 2019, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

8. Income Taxes

Our effective tax rate for the three and nine months ended September 30, 2019 was 27.2% and 25.4%, respectively.  For the three months ended September 30, 2019, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit, higher taxes on earnings in foreign jurisdictions, and the effect of non-deductible acquisition-related expenses partially offset by the recognition of tax benefits related to research and development activities.  For the nine months ended September 30, 2019, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit, higher taxes on earnings in foreign jurisdictions, and the effect of non-deductible acquisition-related expenses partially offset by tax benefits on the settlement of employee share-based awards and the recognition of tax benefits related to research and development activities.  

Our effective tax rate for the three and nine months ended September 30, 2018 was 25.6% and 25.8%, respectively.  For the three and nine months ended September 30, 2018, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit.

As of September 30, 2019 and December 31, 2018, we had approximately $8,666,000 and $6,849,000, respectively, of unrecognized tax benefits.  Of these amounts, approximately $417,000 and $313,000, respectively, related to accrued interest.  In the future, if recognized, the liability associated with uncertain tax positions would affect our effective tax rate.  We do not believe there will be any changes over the next 12 months that would have a material effect on our effective tax rate.  

Several of our subsidiaries are currently under audit for tax years 2012 through 2017.  Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months, which could increase or decrease the balance of our gross unrecognized tax benefits.  However, based on the status of the various examinations in multiple jurisdictions, an estimate of the range

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INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

of reasonably possible outcomes cannot be made at this time, but the estimated effect on our income tax expense and net earnings is not expected to be significant.  

9. Share Repurchase Program

On February 13, 2018, our Board of Directors authorized the repurchase of up to $50,000,000 of our common stock.  

During the nine months ended September 30, 2019, we repurchased 541,117 shares of our common stock on the open market at a total cost of approximately $27,899,000 (an average price of $51.56 per share).  During the comparative nine months ended September 30, 2018, we repurchased 641,211 shares of our common stock on the open market at a total cost of approximately $22,069,000 (an average price of $34.42 per share).  All shares repurchased were retired.      

10. Commitments and Contingencies

Contractual

In the ordinary course of business, we issue performance bonds to secure our performance under certain contracts or state tax requirements.  As of September 30, 2019, we had approximately $3,739,000 of performance bonds outstanding.  These bonds are issued on our behalf by a surety company on an unsecured basis; however, if the surety company is ever required to pay out under the bonds, we have contractually agreed to reimburse the surety company.

Management believes that payments, if any, related to these performance bonds are not probable at September 30, 2019.  Accordingly, we have not accrued any liabilities related to such performance bonds in our consolidated financial statements.

Employment Contracts and Severance Plans

We have employment contracts with, and severance plans covering, certain officers and management teammates under which severance payments would become payable in the event of specified terminations without cause or terminations under certain circumstances after a change in control.  In addition, vesting of outstanding nonvested RSUs would accelerate following a change in control.  If severance payments under the current employment agreements or plan payments were to become payable, the severance payments would generally range from three to twenty-four months of salary.

Indemnifications

From time to time, in the ordinary course of business, we enter into contractual arrangements under which we agree to indemnify either our clients or third-party service providers from certain losses incurred relating to services performed on our behalf or for losses arising from defined events, which may include litigation or claims relating to past performance.  These arrangements include, but are not limited to, the indemnification of our clients for certain claims arising out of our performance under our sales contracts, the indemnification of our landlords for certain claims arising from our use of leased facilities and the indemnification of the lenders that provide our credit facilities for certain claims arising from their extension of credit to us.  Such indemnification obligations may not be subject to maximum loss clauses.

Management believes that payments, if any, related to these indemnifications are not probable at September 30, 2019.  Accordingly, we have not accrued any liabilities related to such indemnifications in our consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

We have entered into separate indemnification agreements with certain of our executive officers and with each of our directors.  These agreements require us, among other requirements, to indemnify such officers and directors against expenses (including attorneys’ fees), judgments and settlements incurred by such individual in connection with any action arising out of such individual’s status or service as our executive officer or director (subject to exceptions such as where the individual failed to act in good faith or in a manner the individual reasonably believed to be in, or not opposed to, the best interests of the Company) and to advance expenses incurred by such individual with respect to which such individual may be entitled to indemnification by us.  There are no pending legal proceedings that involve the indemnification of any of the Company’s directors or officers.

Contingencies Related to Third-Party Review

From time to time, we are subject to potential claims and assessments from third parties.  We are also subject to various governmental, client and partner audits.  We continually assess whether or not such claims have merit and warrant accrual.  Where appropriate, we accrue estimates of anticipated liabilities in the consolidated financial statements.  Such estimates are subject to change and may affect our results of operations and our cash flows.

Legal Proceedings

From time to time, we are party to various legal proceedings incidental to the business, including preference payment claims asserted in client bankruptcy proceedings, indemnification claims, claims of alleged infringement of patents, trademarks, copyrights and other intellectual property rights, employment claims, claims of alleged non-compliance with contract provisions, and claims related to alleged violations of laws and regulations.  We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are appropriate.  If accruals are not appropriate, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made.  Although litigation is inherently unpredictable, we believe that we have adequate provisions for any probable and estimable losses.  It is possible, nevertheless, that our consolidated financial position, results of operations or liquidity could be materially and adversely affected in any particular period by the work required pursuant to any legal proceedings or the resolution of any legal proceedings during such period.  Legal expenses related to the defense of any legal proceeding or the negotiations, settlement, rulings and advice of outside legal counsel in connection with any legal proceeding are expensed as incurred.

In connection with the acquisition of PCM, the Company has effectively assumed responsibility for PCM litigation matters, including various disputes related to PCM’s acquisition of certain assets of En Pointe Technologies in 2015.  The seller of En Pointe Technologies and related  entities providing various post-closing support functions to PCM have asserted claims regarding the sufficiency of earnout payments paid by PCM under the asset purchase agreement and the unwinding of the support functions post-closing.  PCM has rejected and vigorously responded to those claims and is pursuing various counterclaims.  The disputes are being heard by multiple courts and arbitrators in several different jurisdictions including California, Delaware and Pakistan.  The Company cannot determine with certainty the costs or outcome of these matters.  However, the Company is not involved in any pending or threatened legal proceedings, including the PCM litigation matters, that it believes would reasonably be expected to have a material adverse effect on its business, financial condition or results of operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

11.Segment Information

We operate in three reportable geographic operating segments: North America; EMEA; and APAC with PCM being included in our North America and EMEA segments.  Our offerings in North America and certain countries in EMEA and APAC include IT hardware, software and services.  Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

The following table summarizes net sales by offering for North America, EMEA and APAC for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	North America				EMEA				APAC
	Three Months Ended September 30,				Three Months Ended September 30,				Three Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	1,020,083	$	953,431	$	137,416	$	147,497	$	9,243	$	6,041
Software		295,730		259,602		186,839		168,603		19,569		13,099
Services		199,349		158,426		31,453		29,080		12,865		11,947
	$	1,515,162	$	1,371,459	$	355,708	$	345,180	$	41,677	$	31,087
	North America				EMEA				APAC
	Nine Months Ended September 30,				Nine Months Ended September 30,				Nine Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	2,704,212	$	2,724,916	$	451,892	$	505,844	$	25,740	$	22,518
Software		907,683		828,231		560,073		551,920		80,287		91,459
Services		551,215		465,458		113,092		104,086		39,840		36,658
	$	4,163,110	$	4,018,605	$	1,125,057	$	1,161,850	$	145,867	$	150,635

All significant intercompany transactions are eliminated upon consolidation, and there are no differences between the accounting policies used to measure profit and loss for our segments or on a consolidated basis.  Net sales are defined as net sales to external clients.  None of our clients exceeded ten percent of consolidated net sales for the three or nine months ended September 30, 2019 or 2018.

A portion of our operating segments’ selling and administrative expenses arise from shared services and infrastructure that we have historically provided to them in order to realize economies of scale and to use resources efficiently.  These expenses, collectively identified as corporate charges, include senior management expenses, internal audit, legal, tax, insurance services, treasury and other corporate infrastructure expenses.  Charges are allocated to our operating segments, and the allocations have been determined on a basis that we consider to be a reasonable reflection of the utilization of services provided to or benefits received by the operating segments.  

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following tables present our results of operations by reportable operating segment for the periods indicated (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,315,813	$	324,255	$	28,812	$	1,668,880
Services		199,349		31,453		12,865		243,667
Total net sales		1,515,162		355,708		41,677		1,912,547
Costs of goods sold:
Products		1,195,020		297,789		26,431		1,519,240
Services		101,498		10,028		5,586		117,112
Total costs of goods sold		1,296,518		307,817		32,017		1,636,352
Gross profit		218,644		47,891		9,660		276,195
Operating expenses:
Selling and administrative expenses		170,993		44,568		7,654		223,215
Severance and restructuring expenses		2,449		213		—		2,662
Acquisition-related expenses		5,896		—		—		5,896
Earnings from operations	$	39,306	$	3,110	$	2,006	$	44,422

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,213,033	$	316,100	$	19,140	$	1,548,273
Services		158,426		29,080		11,947		199,453
Total net sales		1,371,459		345,180		31,087		1,747,726
Costs of goods sold:
Products		1,108,658		290,071		17,079		1,415,808
Services		83,474		7,875		5,655		97,004
Total costs of goods sold		1,192,132		297,946		22,734		1,512,812
Gross profit		179,327		47,234		8,353		234,914
Operating expenses:
Selling and administrative expenses		134,792		42,206		7,097		184,095
Severance and restructuring expenses		253		430		—		683
Acquisition-related expenses		188		—		—		188
Earnings from operations	$	44,094	$	4,598	$	1,256	$	49,948

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,611,895	$	1,011,965	$	106,027	$	4,729,887
Services		551,215		113,092		39,840		704,147
Total net sales		4,163,110		1,125,057		145,867		5,434,034
Costs of goods sold:
Products		3,290,555		926,712		98,197		4,315,464
Services		272,245		29,021		17,188		318,454
Total costs of goods sold		3,562,800		955,733		115,385		4,633,918
Gross profit		600,310		169,324		30,482		800,116
Operating expenses:
Selling and administrative expenses		452,441		139,365		21,961		613,767
Severance and restructuring expenses		3,260		328		124		3,712
Acquisition-related expenses		9,059		—		—		9,059
Earnings from operations	$	135,550	$	29,631	$	8,397	$	173,578

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,553,147	$	1,057,764	$	113,977	$	4,724,888
Services		465,458		104,086		36,658		606,202
Total net sales		4,018,605		1,161,850		150,635		5,331,090
Costs of goods sold:
Products		3,242,903		971,232		105,046		4,319,181
Services		230,487		25,370		16,498		272,355
Total costs of goods sold		3,473,390		996,602		121,544		4,591,536
Gross profit		545,215		165,248		29,091		739,554
Operating expenses:
Selling and administrative expenses		402,638		137,383		21,718		561,739
Severance and restructuring expenses		1,034		1,545		130		2,709
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	141,261	$	26,320	$	7,243	$	174,824

The following is a summary of our total assets by reportable operating segment (in thousands):

	September 30, 2019			December 31, 2018
North America	$	3,729,338		$	2,660,886
EMEA		596,657			611,338
APAC		101,829			98,959
Corporate assets and intercompany eliminations, net		(445,464	)		(595,236	)
Total assets	$	3,982,360		$	2,775,947

We recorded the following pre-tax amounts, by reportable operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Depreciation and amortization of property and    equipment:
North America	$	4,371	$	4,131	$	12,114	$	12,587
EMEA		1,013		1,052		2,980		3,053
APAC		140		123		412		378
		5,524		5,306		15,506		16,018
Amortization of intangible assets:
North America		5,765		3,949		13,037		10,670
EMEA		67		71		205		216
APAC		114		165		348		513
		5,946		4,185		13,590		11,399
Total	$	11,470	$	9,491	$	29,096	$	27,417

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

12.Acquisitions

PCM

On August 30,2019, we completed our acquisition of PCM, acquiring 100 percent of the issued and outstanding shares of PCM for a cash purchase price of $745,562,000, which included cash and cash equivalents acquired of $84,637,000 and the payment of PCM’s outstanding debt. PCM is a provider of multi-vendor technology offerings, including hardware, software and services to small, mid-sized and corporate/enterprise commercial clients, state, local and federal governments and educational institutions across the United States, Canada and the United Kingdom.  Based in El Segundo, California, PCM has 40 office locations globally and more than 4,000 teammates.  We believe that this acquisition allows us to help existing PCM clients in positioning their businesses for future growth, transforming and securing their data platforms, creating modern and mobile experiences for their workforce and optimizing the procurement of technology.  The addition of PCM complements our supply chain optimization solution offering, adding scale and clients in the mid-market and corporate space in North America.

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):  

Purchase price net of cash and cash equivalents acquired				$	660,925
Fair value of net assets acquired:
Current assets	$	542,642
Identifiable intangible assets - see description below		251,400
Property and equipment		96,959
Other assets		32,373
Current liabilities		(367,613	)
Long-term liabilities, including deferred taxes		(86,996	)
Total fair value of net assets acquired					468,765
Excess purchase price over fair value of net assets acquired ("goodwill")				$	192,160

Under the acquisition method of accounting, the total purchase price as shown in the table above was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.  The excess of the purchase price over fair value of net assets acquired was recorded as goodwill.  

The estimated fair values of current assets and liabilities (other than deferred revenue and related deferred costs) are based upon their historical costs on the date of acquisition due to their short-term nature.  The estimated fair values of the majority of property and equipment are also based upon historical costs as they approximate fair value.  Certain long-term assets, including PCM’s IT systems, will be written down to the estimated fair value based on the economic benefit expected to be realized from the assets following the acquisition.  

The preliminary estimated fair value of identified intangible assets of $251,400,000 consists primarily of customer relationships, trade names and non-compete agreements, which are valued at $238,900,000, $8,400,000 and $4,100,000, respectively.  These estimated values will be determined using the multiple-period excess earnings method, the relief from royalty method and the lost income method, respectively.  The identifiable intangible assets resulting from the acquisition has been amortized using the straight-line method over the following estimated useful lives: customer relationships – 12-15 years; trade names – 1 year; non-compete agreements – 2-3 years.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Amortization expense recognized relating to the acquired identifiable intangible assets for the period from the acquisition date through September 30, 2019 was $2,130,000.

Goodwill of $192,160,000, which was recorded in our North America and EMEA operating segments, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from PCM.  The goodwill is not amortized and will be tested for impairment annually in the fourth quarter of our fiscal year.  The addition of the PCM technical employees to our team and the opportunity to grow our business are the primary factors making up the goodwill recognized as part of the transaction.  None of the goodwill is tax deductible.  

The purchase price allocation is preliminary and was allocated using information currently available.  Further information may lead to an adjustment of the purchase price allocation.  

We have consolidated the results of operations for PCM since its acquisition on August 30, 2019.  Consolidated net sales and gross profit for the three and nine months ended September 30, 2019 each include $172,468,000 and $27,753,000, respectively, from PCM.  

The following table reports pro forma information as if the acquisition of PCM had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Three Months Ended September 30,				Nine Months Ended September 30,
		2019		2018		2019		2018
Net sales	As reported	$	1,912,547	$	1,747,726	$	5,434,034	$	5,331,090
	Pro forma	$	2,322,828	$	2,257,769	$	6,910,356	$	6,928,539
Net earnings	As reported	$	27,132	$	32,154	$	116,457	$	116,636
	Pro forma	$	24,678	$	31,876	$	115,321	$	114,250
Diluted earnings per share	As reported	$	0.76	$	0.89	$	3.23	$	3.24
	Pro forma	$	0.69	$	0.89	$	3.20	$	3.17

Cardinal

Effective August 1, 2018, we acquired 100 percent of the issued and outstanding shares of Cardinal, a digital solutions provider based in Cincinnati, Ohio, with offices across the Midwest and Southeast United States, for a cash purchase price, net of cash acquired, of approximately $78,400,000, including final working capital and tax gross up adjustments.  Cardinal provides technology solutions to digitally transform organizations through their expertise in mobile applications development, Internet of Things and cloud enabled business intelligence.  We believe that this acquisition strengthens our services capabilities and will bring value to our clients within our digital innovation services solution offering.

The fair value of net assets acquired was approximately $42,360,000, including $27,540,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight line method over the estimated economic life of ten years.  We finalized the fair value assumptions for identifiable intangible assets acquired in the fourth quarter of 2018.  Goodwill acquired approximated $36,040,000 which was recorded in our North America operating segment.  The goodwill is tax deductible.  The working capital adjustment in the amount of $762,000 was finalized in the fourth quarter of 2018 and paid in January 2019.  Additionally, we finalized the purchase price allocation when the tax gross up adjustment of $2,600,000 was agreed upon in April 2019.  This resulted in a reduction of the previously recorded purchase price of $400,000 in the second quarter of 2019.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Changes in Goodwill and Intangible Assets

Other than the goodwill and intangible assets recorded in conjunction with the acquisitions of Cardinal and PCM, the only other change in consolidated goodwill and intangible assets as of September 30, 2019 compared to the balance as of December 31, 2018 resulted from foreign currency translation adjustments associated with the balances in our EMEA and APAC operating segments.

13.Subsequent Event

On November 1, 2019 we completed the purchase of real estate in Chandler, Arizona for approximately $48,000,000 that we intend to use as our global corporate headquarters.  The property contains a building and some infrastructure in place that we will complete readying for our use over the next year.  We intend to sell our current properties in Tempe, Arizona.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with the consolidated financial statements and the related notes that appear elsewhere in this Quarterly Report on Form 10-Q.  We refer to our customers as “clients,” our suppliers as “partners” and our employees as “teammates.”  Additionally, any references to our “legacy” business exclude PCM’s results subsequent to the acquisition.

Quarterly Overview

Today, every business is a technology business.  We empower organizations of all sizes with Intelligent Technology Solutions^TM and services to maximize the business value of information technology (“IT”) in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions, we help clients innovate and optimize their operations to run smarter. Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services.  Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

During the third quarter of 2019, we restructured our debt facilities, terminating our then existing senior revolving credit and accounts receivable securitization financing facilities and entered into a credit agreement providing for a senior secured revolving credit facility with an aggregate U.S. dollar equivalent maximum borrowing amount of $1.2 billion.  Additionally, we issued $350.0 million aggregate principal amount of convertible senior notes and, in connection with the issuance of the notes, we entered into certain convertible note hedge and warrant transactions with respect to our common stock.  Also, during the quarter, we completed the acquisition of PCM, Inc. (“PCM”), effective August 30, 2019, for a cash purchase price of $745.6 million, inclusive of cash and cash equivalents acquired of $84.6 million and the payment of PCM’s outstanding debt.  Details about our debt arrangements and the acquisition of PCM can be found in Notes 5 and 12, respectively, to the Consolidated Financial Statements in Part I, Item 1 of this report.

On a consolidated basis, for the three months ended September 30, 2019:

• Net sales of $1.91 billion increased 9% compared to the three months ended September 30, 2018, primarily due to the addition of PCM.  This reflects an increase in all categories of net sales.  Excluding the effects of fluctuating foreign currency exchange rates, net sales increased 11% compared to the third quarter of 2018.

• Gross profit of $276.2 million increased 18% compared to the three months ended September 30, 2018, up 19% year over year, excluding the effects of fluctuating foreign currency exchange rates.

• Gross margin improved approximately 100 basis points to 14.4% of net sales in the three months ended September 30, 2019.  This increase reflects a change in sales mix towards higher margin net sales categories, including cloud solutions and services provided by Cardinal and PCM compared to the same period in the prior year.

• Earnings from operations decreased 11% year to year to $44.4 million in the third quarter of 2019 compared to $49.9 million in the third quarter of 2018.  Excluding the effects of fluctuating foreign currency exchange rates, earnings from operations decreased 10% year to year.

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• Net earnings and diluted earnings per share were $27.1 million and $0.76, respectively, for the third quarter of 2019.  This compares to net earnings of $32.2 million and diluted earnings per share of $0.89 for the third quarter of 2018.

Throughout the “Quarterly Overview” and “Results of Operations” sections of this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” we refer to changes in net sales, gross profit, selling and administrative expenses and earnings from operations on a consolidated basis and in North America, EMEA and APAC excluding the effects of fluctuating foreign currency exchange rates.  In computing the changes in amounts and percentages, we compare the current period amount as translated into U.S. dollars under the applicable accounting standards to the prior period amount in local currency translated into U.S. dollars utilizing the weighted average translation rate for the current period.

Details about segment results of operations can be found in Note 11 to the Consolidated Financial Statements in Part I, Item 1 of this report.

Our discussion and analysis of financial condition and results of operations is intended to assist in the understanding of our consolidated financial statements, including the changes in certain key items in those consolidated financial statements from period to period and the primary factors that contributed to those changes, as well as how certain critical accounting estimates affect our consolidated financial statements.

Critical Accounting Estimates

Our consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”).  For a summary of significant accounting policies, see Note 1 to the Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2018.  The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, net sales and expenses.  We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results, however, may differ from estimates we have made.  Members of our senior management have discussed the critical accounting estimates and related disclosures with the Audit Committee of our Board of Directors.  

There have been no changes to the items disclosed as critical accounting estimates in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2018.  

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Results of Operations

The following table sets forth certain financial data as a percentage of net sales for the three months ended September 30, 2019 and 2018:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Costs of goods sold		85.6			86.6			85.3			86.1
Gross profit		14.4			13.4			14.7			13.9
Selling and administrative expenses		11.6			10.5			11.3			10.5
Severance and restructuring expenses and acquisition-related expenses		0.5			—			0.3			0.1
Earnings from operations		2.3			2.9			3.1			3.3
Non-operating expense, net		0.4			0.4			0.3			0.3
Earnings before income taxes		1.9			2.5			2.8			3.0
Income tax expense		0.5			0.7			0.7			0.8
Net earnings		1.4	%		1.8	%		2.1	%		2.2	%

We experience some seasonal trends in our sales of IT hardware, software and services.  Software sales are typically seasonally higher in our second quarter.  Business clients, particularly larger enterprise businesses in the United States, tend to spend more in our fourth quarter and less in our first quarter.  Sales to the federal government in the United States are often stronger in our third quarter, while sales in the state and local government and education markets are stronger in our second quarter.  Sales to public sector clients in the United Kingdom are often stronger in our first quarter.  These trends create overall seasonality in our consolidated results such that net sales and profitability are expected to be higher in the second and fourth quarters of the year.

Our gross profit across the business is, and will continue to be, impacted by partner incentives, which can change significantly in the amounts made available and the related product or services sales being incentivized by the partner.  Incentives from our largest partners are significant and changes in the incentives could impact our results of operations to the extent we are unable to adapt our sales strategies to optimize performance under the revised programs.   

Net Sales.  Net sales for the three months ended September 30, 2019 increased 9% year over year to $1.91 billion compared to the three months ended September 30, 2018.  Net sales for the nine months ended September 30, 2019 increased 2% year over year to $5.43 billion compared to the nine months ended September 30, 2018.  Our net sales by operating segment were as follows for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,				%			Nine Months Ended September 30,				%
	2019		2018		Change			2019		2018		Change
North America	$	1,515,162	$	1,371,459		10	%	$	4,163,110	$	4,018,605		4	%
EMEA		355,708		345,180		3	%		1,125,057		1,161,850		(3	%)
APAC		41,677		31,087		34	%		145,867		150,635		(3	%)
Consolidated	$	1,912,547	$	1,747,726		9	%	$	5,434,034	$	5,331,090		2	%

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Our net sales by offering category for North America for the three and nine months ended September 30, 2019 and 2018 were as follows (dollars in thousands):

	Three Months Ended September 30,				%			Nine Months Ended September 30,				%
Sales Mix	2019		2018		Change			2019		2018		Change
Hardware	$	1,020,083	$	953,431		7	%	$	2,704,212	$	2,724,916		(1	%)
Software		295,730		259,602		14	%		907,683		828,231		10	%
Services		199,349		158,426		26	%		551,215		465,458		18	%
	$	1,515,162	$	1,371,459		10	%	$	4,163,110	$	4,018,605		4	%

  Net sales in North America increased 10%, or $143.7 million, for the three months ended September 30, 2019 compared to the three months ended September 30, 2018, primarily driven by the addition of PCM.  Net sales of hardware, software and services increased 7%, 14% and 26%, respectively, year over year.  The net changes for the three months ended September 30, 2019 were the result of the following:

• The increase in hardware net sales was due primarily to the addition of PCM.

• The increase in software net sales was due to the addition of PCM, partially offset by continued client migration of software applications to cloud solutions which are recorded net in services net sales.

• The increase in services net sales was due to the addition of PCM, higher sales of cloud solutions and an increase in Insight delivered services, attributable to our acquisition of Cardinal.

Net sales in North America increased 4%, or $144.5 million, for the nine months ended September 30, 2019 compared to the nine months ended September 30, 2018, primarily driven by the addition of PCM.  Net sales of software and services were up 10% and 18%, respectively, year over year, partially offset by a decrease in hardware net sales of 1%, year to year.  The net changes for the first nine months of 2019 were the result of the following:

• The decrease in hardware net sales was due primarily to lower volume sales to large enterprise and corporate clients, partially offset by the addition of PCM.

• The increase in software net sales was primarily the result of a significant transaction during the first quarter of 2019 with a large enterprise client, in our legacy business, with no comparable transaction in the same quarter in the prior year.  The increase was also due to the addition of PCM.  The increase was partially offset by continued client migration of software applications to cloud solutions which are recorded net in services net sales.

• The increase in services net sales was due to higher sales of cloud solutions, increase in vendor rebates and an increase in Insight delivered services, attributable to our acquisitions of Cardinal and PCM.  

Our net sales by offering category for EMEA for the three and nine months ended September 30, 2019 and 2018 were as follows (dollars in thousands):  

	Three Months Ended September 30,				%			Nine Months Ended September 30,				%
Sales Mix	2019		2018		Change			2019		2018		Change
Hardware	$	137,416	$	147,497		(7	%)	$	451,892	$	505,844		(11	%)
Software		186,839		168,603		11	%		560,073		551,920		1	%
Services		31,453		29,080		8	%		113,092		104,086		9	%
	$	355,708	$	345,180		3	%	$	1,125,057	$	1,161,850		(3	%)

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Net sales in EMEA increased 3%, or $10.5 million, in the three months ended September 30, 2019 compared to the three months ended September 30, 2018.  Excluding the effects of fluctuating foreign currency exchange rates, net sales in EMEA increased 9%, year over year.  Net sales of hardware declined 7% year to year, while net sales of software and services increased 11% and 8%, respectively, year over year.  The net changes for the three months ended September 30, 2019 were the result of the following:

• The decrease in hardware net sales was due primarily to lower volume sales of networking solutions to large enterprise and corporate clients.

• The increase in software net sales was due to higher volume of sales to large enterprise and corporate clients and to public sector clients.

• The increase in services net sales was due primarily to higher sales of cloud solutions and higher volume of Insight delivered services.

Net sales in EMEA decreased 3%, or $36.8 million, in the first nine months of 2019 compared to the first nine months of 2018.  Excluding the effects of fluctuating foreign currency exchange rates, net sales in EMEA increased 3%, year over year.  Net sales of hardware declined 11%, respectively, year to year, while net sales of software and services increased 1% and 9%, respectively, year over year.  The net changes for the first nine months of 2019 were the result of the following:

• The decrease in hardware net sales was due primarily to lower volume sales of networking solutions to large enterprise and corporate clients and to public sector clients.

• The increase in software net sales was due to sales to large enterprise and corporate clients and to public sector clients.

• The increase in services net sales was due primarily to higher sales of cloud solutions, increased software referral fees and higher volume sales of Insight delivered services.  

Our net sales by offering category for APAC for the three and nine months ended September 30, 2019 and 2018 were as follows (dollars in thousands):

	Three Months Ended September 30,				%			Nine Months Ended September 30,				%
Sales Mix	2019		2018		Change			2019		2018		Change
Hardware	$	9,243	$	6,041		53	%	$	25,740	$	22,518		14	%
Software		19,569		13,099		49	%		80,287		91,459		(12	%)
Services		12,865		11,947		8	%		39,840		36,658		9	%
	$	41,677	$	31,087		34	%	$	145,867	$	150,635		(3	%)

Net sales in APAC increased 34%, or $10.6 million, in the third quarter of 2019 compared to the third quarter of 2018.  Excluding the effects of fluctuating foreign currency exchange rates, net sales in APAC increased 40%, year over year.  Net sales of hardware, software and services increased by 53%, 49% and 8%, respectively, year over year.  The increase for the three months ended September 30, 2019 were the result of the following:

• The increase in hardware net sales was primarily due to higher volume sales to large enterprise and corporate clients.

• The increase in software net sales was primarily due to higher volume sales to large enterprise clients.

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• The increase in services net sales was due to higher volume of referral fees and warranty.  

Net sales in APAC decreased 3%, or $4.8 million, in the first nine months of 2019 compared to the first nine months of 2018.  Excluding the effects of fluctuating foreign currency exchange rates, net sales in APAC increased 4%, year over year.  Net sales of software declined 12%, year to year, partially offset by an increase in hardware and services net sales of 14% and 9%, respectively, year over year.  The net changes for the first nine months of 2019 were the result of the following:

• The increase in hardware net sales was a result of higher volume sales to large enterprise and corporate clients.

• The decrease in software net sales was primarily due to lower volume sales to public sector clients.

• The increase in services net sales was due to higher volume of referral fees, higher volume of sales of cloud solutions and an increase in Insight delivered services.

The percentage of net sales by category for North America, EMEA and APAC were as follows for the three and nine months ended September 30, 2019 and 2018:

	North America						EMEA						APAC
	Three Months Ended September 30,						Three Months Ended September 30,						Three Months Ended September 30,
Sales Mix	2019			2018			2019			2018			2019			2018
Hardware		67	%		69	%		39	%		43	%		22	%		20	%
Software		20	%		19	%		52	%		49	%		47	%		42	%
Services		13	%		12	%		9	%		8	%		31	%		38	%
		100	%		100	%		100	%		100	%		100	%		100	%
	North America						EMEA						APAC
	Nine Months Ended September 30,						Nine Months Ended September 30,						Nine Months Ended September 30,
Sales Mix	2019			2018			2019			2018			2019			2018
Hardware		65	%		68	%		40	%		44	%		18	%		15	%
Software		22	%		21	%		50	%		48	%		55	%		61	%
Services		13	%		11	%		10	%		8	%		27	%		24	%
		100	%		100	%		100	%		100	%		100	%		100	%

Gross Profit.  Gross profit increased 18%, or $41.3 million, in the three months ended September 30, 2019, compared to the three months ended September 30, 2018, with gross margin increasing approximately 100 basis points to 14.4% for the three months ended September 30, 2019 compared to 13.4% for the three months ended September 30, 2018.  Gross profit increased 8%, or $60.6 million, in the nine months ended September 30, 2019 compared to the nine months ended September 30, 2018, with gross margin increasing approximately 80 basis points to 14.7% for the first nine months of 2019 compared to 13.9% for the first nine months of 2018.  

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Our gross profit and gross profit as a percentage of net sales by operating segment were as follows for the three and nine months ended September 30, 2019 and 2018 (dollars in thousands):

	Three Months Ended September 30,										Nine Months Ended September 30,
	2019		% of Net Sales			2018		% of Net Sales			2019		% of Net Sales			2018		% of Net Sales
North America	$	218,644		14.4	%	$	179,327		13.1	%	$	600,310		14.4	%	$	545,215		13.6	%
EMEA		47,891		13.5	%		47,234		13.7	%		169,324		15.1	%		165,248		14.2	%
APAC		9,660		23.2	%		8,353		26.9	%		30,482		20.9	%		29,091		19.3	%
Consolidated	$	276,195		14.4	%	$	234,914		13.4	%	$	800,116		14.7	%	$	739,554		13.9	%

North America’s gross profit for the three months ended September 30, 2019 increased $39.3 million, or 22%, compared to the three months ended September 30, 2018.  As a percentage of net sales, gross margin increased approximately 130 basis points to 14.4% for the third quarter of 2019.  The year over year improvement in gross margin was primarily attributable to the following:

• An increase in services net sales, typically transacted at higher margins than product net sales, which contributed 99 basis points of the margin expansion combined with an increase in product margin, which includes partner funding and freight, of 36 basis points.

• The increase in margin from services net sales during the current quarter resulted from a higher volume of Insight delivered services, a higher volume of cloud solutions that are recorded net.

• The increase in product margin is primarily the result of sales of software at higher margins than in the same period in the prior year and the addition of PCM.    

North America’s gross profit for the nine months ended September 30, 2019 increased $55.1 million, or 10%, compared to the nine months ended September 30, 2018.  As a percentage of net sales, gross margin increased approximately 80 basis points to 14.4% for the first nine months of 2019.  The year over year improvement in gross margin was primarily attributable to the following:

• An increase in services net sales, which contributed 85 basis points of the margin expansion, partially offset by a net decrease in product margin, which includes partner funding and freight, of 5 basis points.

• The increase in margin from services net sales during the first nine months of 2019 resulted from a higher volume of Insight delivered services and a higher volume of cloud solutions that are recorded net, combined with higher services vendor reimbursement fees.

• The decrease in product margin is primarily the result of a reduction in partner funding compared to the same period in the prior year.    

EMEA’s gross profit for the three months ended September 30, 2019 increased $657,000, or 1%, year over year (increasing 7% excluding the effects of fluctuating foreign currency exchange rates), compared to the three months ended September 30, 2018.  As a percentage of net sales, gross margin decreased approximately 20 basis points, year to year.  The year to year net decline in gross margin was primarily attributable to a net decrease in product margin, which includes partner funding and freight, of 22 basis points combined with a net decrease in services product margin, which declined by 3 basis points.

EMEA’s gross profit for the nine months ended September 30, 2019 increased $4.1 million, or 2% (increasing 9% excluding the effects of fluctuating foreign currency exchange rates), compared to the first nine months of 2018.  As a percentage of net sales, gross margin increased approximately 90 basis points, year over year.  The year over year improvement in gross margin

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was primarily attributable to an increase in higher margin services net sales, which contributed 73 basis points of the margin expansion, together with a net increase in product margin, which includes partner funding and freight, of 9 basis points.                    

APAC’s gross profit for the three months ended September 30, 2019 increased $1.3 million, or 16%, compared to the three months ended September 30, 2018 (increasing 21% excluding fluctuating foreign currency exchange rates).  As a percentage of net sales, gross margin decreased approximately 370 basis points, year to year.  The decrease in gross margin in the third quarter of 2019 compared to the third quarter of 2018 was primarily due to a decrease in product margin, which includes partner funding and freight, of 92 basis points combined with a net decrease in services product margin of 277 basis points.

APAC’s gross profit for the first nine months of 2019 increased $1.4 million, or 5%, compared to the first nine months of 2018 (increasing 11% excluding fluctuating foreign currency exchange rates).  As a percentage of net sales, gross margin increased approximately 160 basis points, year over year.  The increase in gross margin in the first nine months of 2019 compared to the first nine months of 2018 was primarily due to an increase in mix of cloud solutions recorded net and higher vendor reimbursement fees, which contributed 215 basis points of margin expansion, partially offset by lower margins on hardware, software and Insight delivered services net sales.

Operating Expenses.

Selling and Administrative Expenses. Selling and administrative expenses increased $39.1 million, or 21%, for the three months ended September 30, 2019 compared to the three months ended September 30, 2018.  Selling and administrative expenses increased $52.0 million, or 9%, for the nine months ended September 30, 2019 compared to the nine months ended September 30, 2018.  Our selling and administrative expenses by major expense type for the three and nine months ended September 30, 2019 and 2018 were as follows (dollars in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Personnel costs, including teammate benefits	$	174,598	$	144,710	$	483,015	$	442,028
Depreciation and amortization		10,479		8,708		28,105		26,634
Facility expenses		7,860		6,269		21,042		19,391
Travel and entertainment		7,379		6,454		20,225		19,246
Legal and professional fees		4,583		4,155		12,417		11,673
Marketing		2,507		2,415		7,786		7,768
Other		15,809		11,384		41,177		34,999
Total	$	223,215	$	184,095	$	613,767	$	561,739

Selling and administrative expenses increased approximately 120 basis points as a percentage of net sales in the third quarter of 2019 compared to the third quarter of 2018.  The overall net increase in selling and administrative expenses reflects a $29.9 million increase in personnel costs, including teammate benefits expenses primarily due to increased headcount, including the acquisition of PCM in August 2019 and Cardinal in August 2018, and increased variable compensation resulting from increased gross profit in the third quarter of 2019 compared to the third quarter of 2018.

Selling and administrative expenses increased approximately 80 basis points as a percentage of net sales in the first nine months of 2019 compared to the first nine months of 2018.  

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The overall net increase in selling and administrative expenses reflects an $41.0 million increase in personnel costs, including teammate benefits expenses primarily due to increased headcount, including the acquisition of PCM in August 2019 and Cardinal in August 2018, and increased variable compensation resulting from increased gross profit in the first nine months of 2019 compared to the first nine months of 2018.  

Severance and Restructuring Expenses.  During the three months ended September 30, 2019, we recorded severance expense, net of adjustments, of approximately $2.7 million.  During the nine months ended September 30, 2019, we recorded severance expense, net of adjustments, of approximately $3.7 million.  The charges in all three operating segments primarily related to a realignment of certain roles and responsibilities and for North America and EMEA, the acquisition of PCM.  Current period charges were partially offset by adjustments for changes in estimates of previous accruals as cash payments were made. Comparatively, during the three months ended September 30, 2018, we recorded severance expense, net of adjustments, of approximately $683,000.  For the nine months ended September 30, 2018, we recorded severance expense, net of adjustments, of approximately $2.7 million.  

Acquisition-related Expenses.  During the three and nine months ended September 30, 2019, we incurred $5.9 million and $9.1 million, respectively, in direct third-party transaction costs related to the acquisition of PCM, effective August 30, 2019.  Comparatively, during the three and nine months ended September 30, 2018, we incurred $188,000 and $282,000, respectively, in direct third-party transaction costs related to the acquisition of Cardinal in 2018.  

Non-Operating (Income) Expense.

Interest Income.  Interest income for the three and nine months ended September 30, 2019 and 2018 was generated from interest earned on cash and cash equivalent bank balances.  The increase in interest income year over year was primarily due to higher average interest-bearing cash and cash equivalent balances and to higher interest rates during the three and nine months ended September 30, 2019 compared to the three and nine months ended September 30, 2018.    

Interest Expense.  Interest expense primarily relates to borrowings under our financing facilities and imputed interest under our inventory financing facilities and our convertible senior notes.  Interest expense for the three months ended September 30, 2019 increased 32%, or $2.0 million, compared to the three months ended September 30, 2018.  Interest expense for the nine months ended September 30, 2019 increased 2%, or $262,000, compared to the nine months ended September 30, 2018.  These increases were due primarily to higher average daily balances on our debt facilities combined with higher interest rates. Imputed interest under our inventory financing facilities was $2.7 million and $8.6 million for the three and nine months ended September 30, 2019, respectively, compared to $2.9 million and $7.8 million for the three and nine months ended September 30, 2018, respectively.  The increase for the nine months ended September 30, 2019 was a result of a higher average incremental borrowing rate used to compute the imputed interest amounts compared to the prior year period.  Imputed interest under our convertible senior notes was $1.2 million for each of the three and nine months ended September 30, 2019.  For a description of our various financing facilities and our convertible senior notes, see Note 5 to our Consolidated Financial Statements in Part I, Item 1 of this report.

Net Foreign Currency Exchange Gains/Losses.  These gains/losses result from foreign currency transactions, including foreign currency derivative contracts and intercompany balances that are not considered long-term in nature.  The change in net foreign currency exchange gains/losses is due primarily to the underlying changes in the applicable exchange rates, partially

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mitigated by our use of foreign exchange forward contracts to offset the effects of fluctuations in foreign currencies on certain of our non-functional currency assets and liabilities.

Income Tax Expense.  Our effective tax rate of 27.2% for the three months ended September 30, 2019 was higher than our effective tax rate of 25.6% for the three months ended September 30, 2018. The increase in our effective tax rate for the three months ended September 30, 2019 compared to the three months ended September 30, 2018 was due primarily to non-deductible acquisition-related expenses recorded in the current quarter.

Our effective tax rate of 25.4% for the nine months ended September 30, 2019 was lower than our effective tax rate of 25.8% for the nine months ended September 30, 2018.  The decrease in our effective tax rate for the first nine months of 2019 compared to the first nine months of 2018 was due primarily to the increased recognition of tax benefits related to research and development activities during 2019 compared to 2018, partially offset by non-deductible acquisition-related expenses.

Liquidity and Capital Resources

The following table sets forth certain consolidated cash flow information for the nine months ended September 30, 2019 and 2018 (in thousands):

	Nine Months Ended September 30,
	2019			2018
Net cash provided by operating activities	$	168,595		$	247,241
Net cash used in investing activities		(681,209	)		(87,505	)
Net cash provided by (used in) financing activities		514,442			(152,103	)
Foreign currency exchange effect on cash, cash equivalent    and restricted cash balances		(3,960	)		(2,434	)
(Decrease) increase in cash, cash equivalents and restricted cash		(2,132	)		5,199
Cash, cash equivalents and restricted cash at beginning of period		144,293			107,445
Cash, cash equivalents and restricted cash at end of period	$	142,161		$	112,644

Cash and Cash Flow

• Our primary uses of cash during the nine months ended September 30, 2019 were to finance the acquisition of PCM, for capital expenditures, as well as funding our working capital requirements.  

• Operating activities provided $168.6 million in cash during the nine months ended September 30, 2019, compared to $247.2 million during the nine months ended September 30, 2018.

• We had net repayments under our inventory financing facilities of $96.5 million during the nine months ended September 30, 2019, compared to net repayments of $81.9 million during the nine months ended September 30, 2018.  

• We received net proceeds of $341.3 million from the issuance of our convertible senior notes during the nine months ended September 30, 2019.  

• In connection with the issuance of our convertible senior notes, we entered into certain convertible note hedge and warrant transactions with respect to our common stock.  We paid approximately $66.3 million for the convertible note hedge transaction using proceeds from the convertible senior notes offering.  

• In addition, we received aggregate proceeds of approximately $34.4 million for the sale of related warrants.  

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

• In August 2019, we terminated our senior revolving credit facility and ABS facility and entered into a new ABL revolving credit facility.  Net repayments of the senior revolving credit facility and ABS facility combined during the nine months ended September 30, 2019 were $194.0 million.  Net borrowings under the ABL revolving credit facility during the nine months ended September 30, 2019 were $532.2 million.

• We paid $660.9 million, net of cash and cash equivalents acquired, for PCM in August 2019.  We also paid an additional $3.4 million in the first half of 2019 related to the Cardinal acquisition.

• Capital expenditures were $16.9 million and $13.0 million in the nine months ended September 30, 2019 and September 30, 2018, respectively.

• During the nine months ended September 30, 2019, we repurchased an aggregate of $27.9 million of our common stock, using proceeds from the convertible notes offering, under a previously announced repurchase program compared to $22.1 million during the nine months ended September 30, 2018.  

• Cash, cash equivalents and restricted cash balances in the nine months ended September 30, 2019 and 2018 were negatively affected by $4.0 million and $2.4 million, respectively, as a result of foreign currency exchange rates.

We expect that cash flows from operations, together with the funds available under our financing facilities, will be adequate to support our presently anticipated cash and working capital requirements for operations over the next 12 months.      

Net cash provided by operating activities  

• Cash flow from operating activities in the first nine months of 2019 was $168.6 million compared to $247.2 million in the first nine months of 2018.  

• The anticipated decreases in accounts receivable and accounts payable reflects the seasonal decrease in net sales from the fourth quarter to the third quarter, which results in lower accounts receivable and accounts payable balances as of September 30, compared to December 31.  

• The significant increases in both other assets and accrued expenses and other liabilities for the nine months ended September 30, 2019 resulted from a single significant transaction in 2019 with no comparable activity in the prior year.

Our consolidated cash flow operating metrics were as follows:

	Three Months Ended September 30,
	2019			2018
Days sales outstanding in ending accounts receivable (“DSOs”) (a)		111			89
Days inventory outstanding (“DIOs”) (b)		11			10
Days purchases outstanding in ending accounts payable (“DPOs”) (c)		(80	)		(61	)
Cash conversion cycle (days) (d)		42			38

(a) Calculated as the balance of current accounts receivable, net at the end of the quarter divided by daily net sales.  Daily net sales is calculated as net sales for the quarter divided by 92 days.

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INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

(b) Calculated as average inventories (excluding inventories not available for sale) divided by daily costs of goods sold.  Average inventories is calculated as the sum of the balances of inventories at the beginning of the quarter plus inventories at the end of the quarter divided by two.  Daily costs of goods sold is calculated as costs of goods sold for the quarter divided by 92 days.

(c) Calculated as the sum of the balances of accounts payable – trade and accounts payable – inventory financing facility at the end of the quarter divided by daily costs of goods sold.  Daily costs of goods sold is calculated as costs of goods sold for the quarter divided by 92 days.

(d) Calculated as DSOs plus DIOs, less DPOs.

• Our cash conversion cycle was 42 days in the third quarter of 2019, up four days from the third quarter of 2018.  

• The net changes were a result of a 22 day increase in DSOs primarily due to the inclusion of acquired PCM accounts receivable balances and the relative timing of sales during the respective quarters, a one day increase in DIOs and a 19 day increase in DPOs as a result of including assumed PCM accounts payable balances.

• We expect that cash flow from operations will be used, at least partially, to fund working capital as we typically pay our partners on average terms that are shorter than the average terms we grant to our clients to take advantage of supplier discounts.  

• We intend to use cash generated in the remainder of 2019 in excess of working capital needs to pay down our debt balances and to support our capital expenditures for the year.  

• We also may use cash to fund potential acquisitions to add select capabilities within our current geographic operating segments.

Net cash used in investing activities  

• Cash used in acquisitions, net of cash and cash equivalents acquired was $660.9 million related to the acquisition of PCM in August 2019 and an additional $3.4 million related to net working capital and tax adjustments for the acquisition of Cardinal paid in the first half of 2019.

• Capital expenditures were $16.9 million and $13.0 million for the nine months ended September 30, 2019 and 2018, respectively.  

• We expect capital expenditures for the full year 2019 to be between $70.0 million and $75.0 million, primarily for the purchase of real estate in the fourth quarter as well as technology-related upgrade projects.    

Net cash provided by (used in) financing activities  

• We received net proceeds of $341.3 million from the issuance of our convertible senior notes during the nine months ended September 30, 2019.  

• In connection with the issuance of our convertible senior notes, we entered into certain convertible note hedge and warrant transactions with respect to our common stock.  We paid approximately $66.3 million for the convertible note hedge transaction using proceeds from the convertible senior notes offering.  

• In addition, we received aggregate proceeds of approximately $34.4 million for the sale of related warrants.  

• During the nine months ended September 30, 2019, we had net combined borrowings under our ABL facility that increased our outstanding long-term debt balance by $532.2 million.  The proceeds were used in part to repay and terminate our senior revolving and ABS facilities.

• During the nine months ended September 30, 2019, we had net combined repayments under our senior revolving facility and our ABS facility that decreased

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INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

our outstanding long-term debt balance by $194.0 million.  Comparatively, during the nine months ended September 30, 2018, we had net combined repayments under our senior revolving credit facility and our ABS facility that decreased our outstanding long-term debt balance by $41.3 million, including scheduled amortization payments under our TLA.  

• We had net repayments under our inventory financing facilities of $96.5 million during the nine months ended September 30, 2019 compared to $81.9 million during the nine months ended September 30, 2018.  

• During the nine months ended September 30, 2019 we repurchased an aggregate of $27.9 million of our common stock, using proceeds from our convertible notes offering, under a previously announced repurchase program.  Comparatively, we repurchased an aggregate of $22.1 million of our common stock under the same previously announced repurchase program during the nine months ended September 30, 2018.  

Financing Facilities

Our debt balance as of September 30, 2019 was $836.9 million, including our finance lease obligations for certain IT equipment and other financing obligations.  

• Our objective is to pay our debt balances down while retaining adequate cash balances to meet overall business objectives.

• Our convertible senior notes are subject to certain events of default and certain acceleration clauses.  As of September 30, 2019, no such events have occurred.

• Our ABL revolving credit facility contains various covenants customary for transactions of this type, including complying with a minimum receivable and inventory requirement and meeting monthly, quarterly and annual reporting requirements.  

• The credit agreement contains customary affirmative and negative covenants and events of default.  

• At September 30, 2019, we were in compliance with all such covenants.

We also have agreements with financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions.  

• These amounts are classified separately as accounts payable – inventory financing facilities in our consolidated balance sheets.  

• Our inventory financing facilities have an aggregate availability for vendor purchases of $450.0 million, of which $207.7 million was outstanding at September 30, 2019.  

Undistributed Foreign Earnings

Cash and cash equivalents held by foreign subsidiaries are generally subject to U.S. income taxation upon repatriation to the United States.  As of September 30, 2019, we had approximately $120.2 million in cash and cash equivalents in certain of our foreign subsidiaries, primarily residing in the Netherlands, Canada, the United Kingdom and Australia.  Certain of these cash balances will be remitted to the United States by paying down intercompany payables generated in the ordinary course of business or through actual dividend distributions.

Off-Balance Sheet Arrangements

We have entered into off-balance sheet arrangements, which include indemnifications.  The indemnifications are discussed in Note 10 to the Consolidated Financial Statements in Part I, Item 1 of this report and such discussion is incorporated by reference herein.  We believe that none of

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INSIGHT ENTERPRISES, INC.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS (continued)

our off-balance sheet arrangements have, or are reasonably likely to have, a material current or future effect on our business, financial condition or results of operations.

Recently Issued Accounting Standards

The information contained in Notes 1 and 2 to the Consolidated Financial Statements in Part I, Item 1 of this report concerning a description of recently issued accounting standards which affect or may affect our financial statements, including our expected dates of adoption and the estimated effects on our results of operations and financial condition, is incorporated by reference herein.

Contractual Obligations

Except as described below, there have been no material changes in our reported contractual obligations, as described under “Contractual Obligations” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2018.

During the third quarter of 2019 we restructured our debt facilities.  These changes have resulted in changes to our contractual obligations as of September 30, 2019.  As of September 30, 2019 we had $553.0 million due on our ABL revolving credit facility in August 2024 and $350.0 million of principal due on the senior convertible notes in February 2025.  We estimate making interest payments of $18.5 million in each of 2020 through 2023, and $17.0 million in the eleven months from October 1, 2023 to August 30, 2024, based on the current debt balance at September 30, 2019 of $553.0 million under our ABL revolving credit facility, using the weighted average interest rate for the quarter ended September 30, 2019 of 3.35% per annum.  We estimate making interest payments of $2.6 million in each of 2020 through 2024, and $984,000 in the four and a half months from October 1, 2024 to February 15, 2025, based on the principal debt balance at September 30, 2019 of $350.0 million under our convertible senior notes, using the weighted average interest rate for the quarter ended September 30, 2019 of 0.75% per annum.  

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Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

Except as described below, there have been no material changes in our reported market risks, as described in “Quantitative and Qualitative Disclosures About Market Risk” in Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2018.

Although our convertible senior notes are based on a fixed rate, changes in interest rates could impact the fair market value of such notes. As of September 30, 2019, the fair market value of our convertible senior notes was $361.6 million. For additional information about our convertible senior notes, see Note 5 to our Consolidated Financial Statements in Part I, Item 1 of this report.

Item 4. Controls and Procedures.  

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, as of the end of the period covered by this report, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) and determined that as of September 30, 2019 our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.  We completed the acquisition of PCM on August 30, 2019. As permitted under U.S. Securities and Exchange Commission guidance, management’s assessment as of September 30, 2019 did not include an assessment of controls and procedures of PCM, which is included in the consolidated financial statements as of September 30, 2019.

Change in Internal Control over Financial Reporting

Except as described below, there was no change in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) in the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

As noted above, on August 30, 2019 we completed the acquisition of PCM.  We are currently integrating PCM into our control environment.  In executing this integration, we are analyzing, evaluating, and where necessary, making changes in controls and procedures related to the PCM business, which is expected to be completed in the year ended December 31, 2020.    

Inherent Limitations of Internal Control Over Financial Reporting

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Projections of any evaluation of effectiveness to future periods are subject to risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

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INSIGHT ENTERPRISES, INC.

Part II – OTHER INFORMATION

Item 1.   Legal Proceedings.

For a discussion of legal proceedings, see “– Legal Proceedings” in Note 10 to the Consolidated Financial Statements in Part I, Item 1 of this report, which section is incorporated by reference herein.   

Item 1A.  Risk Factors.

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A, “Risk Factors”, in our Annual Report on Form 10-K for the year ended December 31, 2018, those set forth in our Current Report on Form 8-K filed on June 24, 2019 relating to the PCM acquisition and those listed below, which could materially affect our business, financial condition or future results.  The risks described in our Annual Report on Form 10-K are not the only risks facing the Company.  Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition or operating results.  

The senior convertible notes (the “notes”) are effectively subordinated to the Company’s secured debt and are structurally subordinated to any liabilities of our subsidiaries, other than the subsidiary guarantor.

The notes will be senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the notes; equal in right of payment to any of our unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of our secured indebtedness (including all amounts outstanding under our inventory financing facilities and the ABL revolving credit facility) to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities of our subsidiaries (including trade payables, obligations under our inventory financing facilities and ABL revolving credit facility), other than the subsidiary guarantor. In the event of our bankruptcy, liquidation, reorganization or other winding up, our assets that secure debt that is senior or equal in right of payment to the notes (including all amounts outstanding under our inventory financing facilities and ABL revolving credit facility) will be available to pay obligations on the notes only after the secured debt has been repaid in full from these assets, and the assets of our subsidiaries (other than the subsidiary guarantor) will be available to pay obligations on the notes only after all claims senior to the notes have been repaid in full. There may not be sufficient assets remaining to pay amounts due on any or all of the notes then outstanding. The indenture governing the notes will not restrict us from incurring additional senior debt or secured debt, nor does it restrict any of our subsidiaries, including the subsidiary guarantor, from incurring additional liabilities, and we may incur any such debt or liabilities without any consent of holders of the notes.

The debt may restrict the Company’s future operations and impair its ability to meet business obligations under the notes.

Our ability to make scheduled payments of the principal of, to pay interest on or to refinance our indebtedness, including the amounts payable under our inventory financing facilities and the ABL revolving credit facility, and the notes, depends on our future performance, which is subject to economic, financial, competitive and other factors beyond our control. Our business may not continue to generate cash flow from operations in the future sufficient to service our debt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to refinance our indebtedness will depend on the capital markets and our financial condition at such time. We

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INSIGHT ENTERPRISES, INC.

may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations.

In addition, our level of indebtedness could have important consequences. It could make it more difficult for us to satisfy our financial obligations, including those under the notes, requires us to use portions of our cash flow to pay interest, exposes us to fluctuations in interest rates under our financing facilities and could make us vulnerable to economic downturns and adverse developments in our business and industry. In addition, we may be unable to comply with financial or other restrictive covenants in our financing facilities. Any of these consequences could have a material adverse effect on our business, financial condition and results of operations.

The conditional conversion feature of the notes, if triggered, may adversely affect the Company’s financial condition and operating results.

In the event the conditional conversion feature of the notes is triggered, holders of notes will be entitled to convert the notes at any time during specified periods at their option. If one or more holders elect to convert their notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our common stock (other than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity. In addition, even if holders of notes do not elect to convert their notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.

The accounting method for convertible debt securities that may be settled in cash, such as the notes, could have a material effect on the Company’s reported financial results.

Under Accounting Standards Codification 470-20, Debt with Conversion and Other Options (“ASC 470-20”), an entity must separately account for the liability and equity components of the convertible debt instruments (such as the notes) that may be settled entirely or partially in cash upon conversion in a manner that reflects the issuer’s economic interest cost. The effect of ASC 470-20 on the accounting for the notes is that the equity component is required to be included in the additional paid-in capital section of stockholders’ equity on our consolidated balance sheet at the issuance date and the value of the equity component is treated as debt discount for purposes of accounting for the debt component of the notes. As a result, we record a greater amount of non-cash interest expense as a result of the amortization of the discounted carrying value of the notes to their face amount over the term of the notes. We will report larger net losses (or lower net income) in our financial results because ASC 470-20 requires interest to include both the amortization of the debt discount and the instrument’s non-convertible coupon interest rate, which could adversely affect our reported or future financial results, the trading price of our common stock and the trading price of the notes.

In addition, under certain circumstances, convertible debt instruments (such as the notes) that may be settled entirely or partly in cash at the election of the issuer and are in the money at the reporting date may be included in the treasury stock method under Accounting Standards Codification 260, Earnings Per Share. To the extent that the conversion value of the notes exceeds their principal amount, the shares issuable upon conversion of such notes are included in the calculation of diluted earnings per share thus increasing the number of shares included in this calculation. We cannot be sure that the accounting standards in the future will continue to permit the use of the treasury stock method. If we are required to include the notes in the treasury stock method in accounting for the shares issuable upon conversion of the notes, then our diluted earnings per share could be adversely affected.

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INSIGHT ENTERPRISES, INC.

Future sales of the Company’s common stock or equity-linked securities in the public market could lower the market price for our common stock and adversely impact the trading price of the notes.

In the future, we may sell additional shares of our common stock or equity-linked securities to raise capital. In addition, a substantial number of shares of our common stock is reserved for issuance upon the exercise of stock options, restricted stock units, upon conversion of the notes and in connection with the warrants to be issued in connection with the convertible note hedge and warrant transactions. We cannot predict the size of future issuances or the effect, if any, that they may have on the market price for our common stock. The issuance and sale of substantial amounts of common stock or equity-linked securities, or the perception that such issuances and sales may occur, could adversely affect the trading price of the notes and the market price of our common stock and impair our ability to raise capital through the sale of additional equity or equity-linked securities.

The Company is subject to counterparty risk with respect to the convertible note hedge transactions.

The option counterparties are financial institutions or affiliates of financial institutions, and we are subject to the risk that one or more of such option counterparties may default under the convertible note hedge transactions. Our exposure to the credit risk of the option counterparties will not be secured by any collateral. If any option counterparty becomes subject to insolvency proceedings, we will become an unsecured creditor in those proceedings with a claim equal to our exposure at that time under the convertible note hedge transaction. Our exposure will depend on many factors but, generally, the increase in our exposure will be correlated to the increase in our common stock market price and in the volatility of the market price of our common stock. In addition, upon a default by the option counterparty, we may suffer adverse tax consequences and dilution with respect to our common stock.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

There were no unregistered sales of equity securities during the three months ended September 30, 2019 other than as reported in our Current Reports on Form 8-K filed with the SEC on August 15, 2019 and August 23, 2019 in connection with our offering of convertible senior notes.  We issued the convertible senior notes to the initial purchasers of the notes in reliance on the exemption from the registration requirements provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and the convertible senior notes were resold to qualified institutional buyers pursuant to Rule 144A under the Securities Act.  We issued the warrants to the option counterparties in connection with related convertible note hedge and warrant transactions in reliance on the exemption from the registration requirements provided by Section 4(a)(2) of the Securities Act.

We have never paid a cash dividend on our common stock, and we currently do not intend to pay any cash dividends in the foreseeable future.  

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INSIGHT ENTERPRISES, INC.

Issuer Purchases of Equity Securities

Period	(a) Total Number of Shares Purchased		(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		(d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
July 1, 2019 through July 31, 2019		—	$	—		—	$	27,931,000
August 1, 2019 through August 31, 2019		541,117		51.56		541,117		32,000
September 1, 2019 through September 30, 2019		—		—		—		32,000
Total		541,117	$	51.56		541,117

On February 14, 2018, we announced that our Board of Directors had authorized the repurchase of up to $50 million of our common stock.  Repurchases during the quarter ended September 30, 2019 are reflected in the table above.  All shares repurchased during the three months ended September 30, 2019 were retired.

Item 3.  Defaults Upon Senior Securities.

Not applicable.

Item 4.  Mine Safety Disclosures.

Not applicable.

Item 5.  Other Information.

Not applicable.

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INSIGHT ENTERPRISES, INC.

Item 6.  Exhibits.

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing Date	Filed/Furnished Herewith
2.1	Agreement and Plan of Merger, dated as of June 23, 2019, by and among Insight Enterprises, Inc., Trojan Acquisition Corp. and PCM*	8-K	000-25092	2.1	June 24, 2019
3.1	Amended and Restated Certificate of Incorporation of Insight Enterprises, Inc.	10-K	000-25092	3.1	February 17, 2006
3.2	Certificate of Amendment of Amended and Restated Certificate of Incorporation of Insight Enterprises, Inc.	8-K	000-25092	3.1	May 21, 2015
3.3	Amended and Restated Bylaws of Insight Enterprises, Inc.	8-K	000-25092	3.2	May 21, 2015
4.1	Specimen Common Stock Certificate (P)	S-1	33-86142	4.1	January 20, 1995
4.2	Indenture (including Form of Note) with respect to Insight Enterprises, Inc.’s 0.750% Convertible Senior Notes due 2025, dated August 15, 2019, by and among Insight Enterprises, Inc., Insight Direct USA, Inc. and U.S. Bank National Association, as trustee.	8-K	000-25092	4.1	August 15, 2019
10.1	Amendment No. 3 to the Fourth Amended and Restated Credit Agreement, dated as of August 9. 2019, by and among Insight Enterprises, Inc. Insight Direct (UK), Ltd. And Insight Enterprises B.V., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto.	8-K	000-25092	10.1	August 12, 2019
10.2	Amendment No. 4 to the Second Amended and Restated Credit Agreement and Reaffirmation Agreement, dated as of August 9, 2019, by and among Calence, LLC, Insight Direct USA, Inc. and Insight Public Sector, Inc. as Resellers, the guarantors party thereto Wells Fargo Capital Finance, LLC, as administrative agent, syndication agent ,  and collateral agent, and the lenders party thereto.	8-K	000-25092	10.2	August 12, 2019
10.3	Letter Agreement to the Commitment Letter, dated as of August 12, 2019, by and among Insight Enterprises, Inc., JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A. and Bank of America, N.A.	8-K	000-25092	10.3	August 12, 2019
10.4	Credit Agreement, dated as of August 30, 2019, by and among Insight Enterprises, Inc., the subsidiaries of Insight Enterprises, Inc. party thereto as borrowers and guarantors, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto. **	8-K	000-25092	10.1	August 30, 2019
10.5	Form of Bond Hedge Confirmation.	8-K	000-25092	10.1	August 15, 2019
10.6	Form of Warrant Confirmation.	8-K	000-25092	10.2	August 15, 2019

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		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File No.	Exhibit Number	Filing Date	Filed/Furnished Herewith
31.1	Certification of Chief Executive Officer Pursuant to Securities Exchange Act Rule 13a-14					X
31.2	Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rule 13a-14					X
32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002					X
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document					X
101.SCH	Inline XBRL Taxonomy Extension Schema Document					X
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document					X
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document					X
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document					X
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document					X
104	Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101)					X

(P) Paper exhibit.

* Certain schedules (or similar attachments) have been omitted pursuant to Item 601(b)(2) of Regulation S-K.  The Company agrees to furnish copies of any such schedules (or similar attachments) to the SEC upon request.

** Schedules and exhibits have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K.  The Company agrees to furnish copies of any such schedules and exhibits to the SEC upon request.

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INSIGHT ENTERPRISES, INC.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date:	November 6, 2019	INSIGHT ENTERPRISES, INC.
		By:	/s/ Kenneth T. Lamneck
			Kenneth T. Lamneck
			President and Chief Executive Officer
			(Duly Authorized Officer)

By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer
	(Principal Financial Officer)

By:	/s/ Rachael A. Bertrandt
	Rachael A. Bertrandt
	Global Corporate Controller
	(Principal Accounting Officer)

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EX-31.1

INSIGHT ENTERPRISES, INC.

Exhibit 31.1

CERTIFICATION

I, Kenneth T. Lamneck, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Insight Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	November 6, 2019
By:	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer

EX-31.2

INSIGHT ENTERPRISES, INC.

Exhibit 31.2

CERTIFICATION

I, Glynis A. Bryan, certify that:  

1. I have reviewed this Quarterly Report on Form 10-Q of Insight Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	November 6, 2019
By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer

EX-32.1

INSIGHT ENTERPRISES, INC.

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Insight Enterprises, Inc. (the “Company”) for the quarter ended September 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Kenneth T. Lamneck, Chief Executive Officer of the Company, and Glynis A. Bryan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of our knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Kenneth T. Lamneck
	Kenneth T. Lamneck
	Chief Executive Officer
	November 6, 2019

By:	/s/ Glynis A. Bryan
	Glynis A. Bryan
	Chief Financial Officer
	November 6, 2019

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Leases - Additional Information (Detail) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Lessee Lease Description [Line Items]
Operating lease, existence of option to extend	true
Operating lease, option to extend lease terms, description	Operating lease payments include $13.4 million related to options to extend lease terms that are reasonably certain of being exercised
Operating lease payments	$ 93,904,000
Operating leases rental expense		$ 20,114,000	$ 19,126,000	$ 14,444,000
Non-cancellable rental income, 2019		$ 1,600,000
Options to Eextend Lease Terms [Member]
Lessee Lease Description [Line Items]
Operating lease payments	$ 13,400,000
Minimum [Member]
Lessee Lease Description [Line Items]
Operating lease renewal term	1 year
Maximum [Member]
Lessee Lease Description [Line Items]
Operating lease renewal term	5 years

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Leases - Schedule of Future Minimum Lease Payments Under Non-cancelable Leases (Detail) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Operating Lease
Remainder of 2019	$ 6,008,000
2020	21,144,000
2021	17,812,000
2022	14,470,000
2023	8,984,000
After 2023	25,486,000
Total lease payments	93,904,000
Less: Interest	(10,384,000)
Present value of lease liabilities	83,520,000
Finance Lease
Remainder of 2019	310,000
2020	1,150,000
2021	432,000
Total lease payments	1,892,000
Less: Interest	(79,000)
Present value of lease liabilities	1,813,000	$ 2,920,000
Total
Remainder of 2019	6,318,000
2020	22,294,000
2021	18,244,000
2022	14,470,000
2023	8,984,000
After 2023	25,486,000
Total lease payments	95,796,000
Less: Interest	(10,463,000)
Present value of lease liabilities	$ 85,333,000

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Stock-Based Compensation

9 Months Ended

Sep. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

7.Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
North America	$	3,102	$	2,837	$	8,965	$	8,172
EMEA		860		754		2,544		2,234
APAC		136		126		386		358
Total Consolidated	$	4,098	$	3,717	$	11,895	$	10,764

As of September 30, 2019, total compensation cost related to nonvested RSUs not yet recognized is $29,920,000, which is expected to be recognized over the next 1.33 years on a weighted-average basis.  

The following table summarizes our RSU activity during the nine months ended September 30, 2019:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at January 1, 2019		1,020,930		$	36.10
Granted(a)		414,405			56.15
Vested, including shares withheld to cover taxes		(423,909	)		33.87	$	14,357,798	(b)
Forfeited		(60,129	)		42.52
Nonvested at September 30, 2019(a)		951,297			45.42	$	52,977,730	(c)

^(a) Includes 84,602 RSUs subject to remaining performance conditions.  The number of RSUs subject to performance conditions are based on the Company achieving 97% of its 2019 targeted financial results.  These RSUs will be awarded at 100% this annual period due to the completion of a significant acquisition in the period.  

^(b) The aggregate fair value of vested RSUs represents the total pre-tax fair value, based on the closing stock price on the day of vesting, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.  

^(c) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $55.69 as of September 30, 2019, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

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Sales Recognition

9 Months Ended

Sep. 30, 2019

Revenue From Contract With Customer [Abstract]

Sales Recognition

3. Sales Recognition

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined by their related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	1,020,083	$	137,416	$	9,243	$	1,166,742
Software		295,730		186,839		19,569		502,138
Services		199,349		31,453		12,865		243,667
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Major Client Groups
Large Enterprise / Corporate	$	1,110,817	$	277,536	$	17,811	$	1,406,164
Public Sector		165,085		59,174		6,178		230,437
Small and Medium-Sized Businesses		239,260		18,998		17,688		275,946
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,448,385	$	336,600	$	35,979	$	1,820,964
Net revenue recognition (Agent)		66,777		19,108		5,698		91,583
	$	1,515,162	$	355,708	$	41,677	$	1,912,547

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	953,431	$	147,497	$	6,041	$	1,106,969
Software		259,602		168,603		13,099		441,304
Services		158,426		29,080		11,947		199,453
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Major Client Groups
Large Enterprise / Corporate	$	986,665	$	265,430	$	10,715	$	1,262,810
Public Sector		141,895		62,720		6,255		210,870
Small and Medium-Sized Businesses		242,899		17,030		14,117		274,046
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,322,391	$	326,671	$	26,638	$	1,675,700
Net revenue recognition (Agent)		49,068		18,509		4,449		72,026
	$	1,371,459	$	345,180	$	31,087	$	1,747,726

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,704,212	$	451,892	$	25,740	$	3,181,844
Software		907,683		560,073		80,287		1,548,043
Services		551,215		113,092		39,840		704,147
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Major Client Groups
Large Enterprise / Corporate	$	3,159,269	$	819,156	$	47,903	$	4,026,328
Public Sector		418,583		246,583		47,428		712,594
Small and Medium-Sized Businesses		585,258		59,318		50,536		695,112
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,969,411	$	1,051,101	$	127,129	$	5,147,641
Net revenue recognition (Agent)		193,699		73,956		18,738		286,393
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,724,916	$	505,844	$	22,518	$	3,253,278
Software		828,231		551,920		91,459		1,471,610
Services		465,458		104,086		36,658		606,202
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Major Client Groups
Large Enterprise / Corporate	$	2,945,880	$	836,865	$	37,770	$	3,820,515
Public Sector		388,109		273,821		67,134		729,064
Small and Medium-Sized Businesses		684,616		51,164		45,731		781,511
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,857,104	$	1,093,110	$	133,542	$	5,083,756
Net revenue recognition (Agent)		161,501		68,740		17,093		247,334
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090

The following table provides information about receivables, contract assets and contract liabilities as of September 30, 2019 and December 31, 2018 (in thousands):

	September 30,		December 31,
	2019		2018
Current receivables, which are included in “Accounts    receivable, net”	$	2,320,681	$	1,931,736
Non-current receivables, which are included in “Other assets”		150,455		38,157
Contract assets, which are included in “Other current assets”		117		892
Contract liabilities, which are included in “Deferred revenue”    and “Other liabilities”		72,501		82,117

Changes in the contract assets and the contract liabilities balances during the nine months ended September 30, 2019 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at December 31, 2018	$	892		$	82,117
Reclassification of the beginning contract liabilities    to revenue, as the result of performance obligations satisfied		—			(47,831	)
Cash received in advance and not recognized as revenue		—			45,660
Reclassification of the beginning contract assets to receivables, as    the result of rights to consideration becoming unconditional		(892	)		—
Contract assets recognized, net of reclassification to receivables		117			—
Business Combination		—			(7,445	)
Balances at September 30, 2019	$	117		$	72,501

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2019 that are expected to be recognized in the future (in thousands):

	Services
Remainder of 2019	$	40,161
2020		70,395
2021		23,815
2022		8,273
2023 and thereafter		3,781
Total remaining performance obligations	$	146,425

With the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, remaining performance obligations that have original expected durations of one year or less are not included in the table above.  Amounts not included in the table above have an average original expected duration of eight months.  Additionally, for our time and material services contracts, whereby we have the right to consideration from a client in an amount that corresponds directly with the value to the client of our performance completed to date, we recognized revenue in the amount to which we have a right to invoice as of September 30, 2019 and do not disclose information about related remaining performance obligations in the table above.  Our time and material contracts have an average expected duration of 13 months.

The majority of our backlog historically has been and continues to be open cancelable purchase orders.  We do not believe that backlog as of any particular date is predictive of future results, therefore we do not include performance obligations under open cancelable purchase orders, which do not qualify for revenue recognition, in the table above.

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Segment Information

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Segment Information

11.Segment Information

We operate in three reportable geographic operating segments: North America; EMEA; and APAC with PCM being included in our North America and EMEA segments.  Our offerings in North America and certain countries in EMEA and APAC include IT hardware, software and services.  Our offerings in the remainder of our EMEA and APAC segments are largely software and certain software-related services.

The following table summarizes net sales by offering for North America, EMEA and APAC for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	North America				EMEA				APAC
	Three Months Ended September 30,				Three Months Ended September 30,				Three Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	1,020,083	$	953,431	$	137,416	$	147,497	$	9,243	$	6,041
Software		295,730		259,602		186,839		168,603		19,569		13,099
Services		199,349		158,426		31,453		29,080		12,865		11,947
	$	1,515,162	$	1,371,459	$	355,708	$	345,180	$	41,677	$	31,087
	North America				EMEA				APAC
	Nine Months Ended September 30,				Nine Months Ended September 30,				Nine Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	2,704,212	$	2,724,916	$	451,892	$	505,844	$	25,740	$	22,518
Software		907,683		828,231		560,073		551,920		80,287		91,459
Services		551,215		465,458		113,092		104,086		39,840		36,658
	$	4,163,110	$	4,018,605	$	1,125,057	$	1,161,850	$	145,867	$	150,635

All significant intercompany transactions are eliminated upon consolidation, and there are no differences between the accounting policies used to measure profit and loss for our segments or on a consolidated basis.  Net sales are defined as net sales to external clients.  None of our clients exceeded ten percent of consolidated net sales for the three or nine months ended September 30, 2019 or 2018.

A portion of our operating segments’ selling and administrative expenses arise from shared services and infrastructure that we have historically provided to them in order to realize economies of scale and to use resources efficiently.  These expenses, collectively identified as corporate charges, include senior management expenses, internal audit, legal, tax, insurance services, treasury and other corporate infrastructure expenses.  Charges are allocated to our operating segments, and the allocations have been determined on a basis that we consider to be a reasonable reflection of the utilization of services provided to or benefits received by the operating segments.  

The following tables present our results of operations by reportable operating segment for the periods indicated (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,315,813	$	324,255	$	28,812	$	1,668,880
Services		199,349		31,453		12,865		243,667
Total net sales		1,515,162		355,708		41,677		1,912,547
Costs of goods sold:
Products		1,195,020		297,789		26,431		1,519,240
Services		101,498		10,028		5,586		117,112
Total costs of goods sold		1,296,518		307,817		32,017		1,636,352
Gross profit		218,644		47,891		9,660		276,195
Operating expenses:
Selling and administrative expenses		170,993		44,568		7,654		223,215
Severance and restructuring expenses		2,449		213		—		2,662
Acquisition-related expenses		5,896		—		—		5,896
Earnings from operations	$	39,306	$	3,110	$	2,006	$	44,422

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,213,033	$	316,100	$	19,140	$	1,548,273
Services		158,426		29,080		11,947		199,453
Total net sales		1,371,459		345,180		31,087		1,747,726
Costs of goods sold:
Products		1,108,658		290,071		17,079		1,415,808
Services		83,474		7,875		5,655		97,004
Total costs of goods sold		1,192,132		297,946		22,734		1,512,812
Gross profit		179,327		47,234		8,353		234,914
Operating expenses:
Selling and administrative expenses		134,792		42,206		7,097		184,095
Severance and restructuring expenses		253		430		—		683
Acquisition-related expenses		188		—		—		188
Earnings from operations	$	44,094	$	4,598	$	1,256	$	49,948

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,611,895	$	1,011,965	$	106,027	$	4,729,887
Services		551,215		113,092		39,840		704,147
Total net sales		4,163,110		1,125,057		145,867		5,434,034
Costs of goods sold:
Products		3,290,555		926,712		98,197		4,315,464
Services		272,245		29,021		17,188		318,454
Total costs of goods sold		3,562,800		955,733		115,385		4,633,918
Gross profit		600,310		169,324		30,482		800,116
Operating expenses:
Selling and administrative expenses		452,441		139,365		21,961		613,767
Severance and restructuring expenses		3,260		328		124		3,712
Acquisition-related expenses		9,059		—		—		9,059
Earnings from operations	$	135,550	$	29,631	$	8,397	$	173,578

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,553,147	$	1,057,764	$	113,977	$	4,724,888
Services		465,458		104,086		36,658		606,202
Total net sales		4,018,605		1,161,850		150,635		5,331,090
Costs of goods sold:
Products		3,242,903		971,232		105,046		4,319,181
Services		230,487		25,370		16,498		272,355
Total costs of goods sold		3,473,390		996,602		121,544		4,591,536
Gross profit		545,215		165,248		29,091		739,554
Operating expenses:
Selling and administrative expenses		402,638		137,383		21,718		561,739
Severance and restructuring expenses		1,034		1,545		130		2,709
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	141,261	$	26,320	$	7,243	$	174,824

The following is a summary of our total assets by reportable operating segment (in thousands):

	September 30, 2019			December 31, 2018
North America	$	3,729,338		$	2,660,886
EMEA		596,657			611,338
APAC		101,829			98,959
Corporate assets and intercompany eliminations, net		(445,464	)		(595,236	)
Total assets	$	3,982,360		$	2,775,947

We recorded the following pre-tax amounts, by reportable operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Depreciation and amortization of property and    equipment:
North America	$	4,371	$	4,131	$	12,114	$	12,587
EMEA		1,013		1,052		2,980		3,053
APAC		140		123		412		378
		5,524		5,306		15,506		16,018
Amortization of intangible assets:
North America		5,765		3,949		13,037		10,670
EMEA		67		71		205		216
APAC		114		165		348		513
		5,946		4,185		13,590		11,399
Total	$	11,470	$	9,491	$	29,096	$	27,417

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Stock-Based Compensation - Summary of Restricted Stock Units Activity (Parenthetical) (Detail)	9 Months Ended
	Sep. 30, 2019 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing stock price | $ / shares	$ 55.69
Percentage of award vested upon completion of acquisition	100.00%
Performance Based Restricted Stock Unit [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total RSUs | shares	84,602

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Restricted Cash - Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2017
Cash And Cash Equivalents [Abstract]
Cash and cash equivalents	$ 140,549	$ 142,655	$ 111,055	$ 105,831
Restricted cash included in other current assets		$ 8	$ 17	$ 46
Restricted Cash, Current, Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssetsCurrent	us-gaap:OtherAssetsCurrent	us-gaap:OtherAssetsCurrent	us-gaap:OtherAssetsCurrent
Restricted cash included in other non-current assets	$ 1,612	$ 1,630	$ 1,572	$ 1,568
Restricted Cash, Noncurrent, Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssetsNoncurrent	us-gaap:OtherAssetsNoncurrent	us-gaap:OtherAssetsNoncurrent	us-gaap:OtherAssetsNoncurrent
Total cash, cash equivalents and restricted cash shown in the statement of cash flows	$ 142,161	$ 144,293	$ 112,644	$ 107,445

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Segment Information - Pre-Tax Depreciation and Amortization by Operating Segment (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	$ 5,524	$ 5,306	$ 15,506	$ 16,018
Amortization of intangible assets	5,946	4,185	13,590	11,399
Depreciation and amortization, total	11,470	9,491	29,096	27,417
North America Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	4,371	4,131	12,114	12,587
Amortization of intangible assets	5,765	3,949	13,037	10,670
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	1,013	1,052	2,980	3,053
Amortization of intangible assets	67	71	205	216
APAC Segment [Member]
Segment Reporting Information [Line Items]
Depreciation and amortization of property and equipment	140	123	412	378
Amortization of intangible assets	$ 114	$ 165	$ 348	$ 513

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Segment Information - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2019 Segment
Segment Reporting [Abstract]
Number of operating segments	3
Description of major customers net sales	None of our clients exceeded ten percent of consolidated net sales for the three or nine months ended September 30, 2019 or 2018.

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Subsequent Event - Additional Information (Detail)	Nov. 01, 2019 USD ($)
Arizona [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Purchase of real estate	$ 48,000,000

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Consolidated Statements of Stockholders' Equity (unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Statement Of Stockholders Equity [Abstract]
Equity component of convertible senior notes, Deferred tax	$ 14,819	$ 14,819
Equity component of convertible senior notes, issuance cost	1,700	1,700
Purchase of note hedge related to convertible senior notes, deferred tax	$ 16,047	$ 16,047

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Sales Recognition - Summary of Changes in Contract Assets and Contract Liabilities from Contract with Customers (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($)
Revenue From Contract With Customer [Abstract]
Beginning balance, Contract Assets	$ 892
Reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional, Contract Assets	(892)
Contract assets recognized, net of reclassification to receivables, Contract Assets	117
Ending balance, Contract Assets	117
Beginning balance, Contract Liabilities	82,117
Reclassification of the beginning contract liabilities to revenue, as the result of performance obligations satisfied, Contract Liabilities	(47,831)
Cash received in advance and not recognized as revenue, Contract Liabilities	45,660
Business Combination	(7,445)
Ending balance, Contract Liabilities	$ 72,501

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Net Earnings Per Share ("EPS") - Reconciliation of Denominators of Basic and Diluted EPS Calculations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Numerator:
Net earnings	$ 27,132	$ 32,154	$ 116,457	$ 116,636
Denominator:
Weighted average shares used to compute basic EPS	35,512	35,468	35,631	35,622
Dilutive potential common shares due to dilutive RSUs, net of tax effect	356	489	396	390
Weighted average shares used to compute diluted EPS	35,868	35,957	36,027	36,012
Net earnings per share:
Basic	$ 0.76	$ 0.91	$ 3.27	$ 3.27
Diluted	$ 0.76	$ 0.89	$ 3.23	$ 3.24

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Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Statement Of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 10,243	$ 10,462
Accumulated depreciation and amortization of property and equipment	255,916	331,700
Accumulated amortization of intangible assets	$ 65,922	$ 52,942
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	3,000,000	3,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	35,251,000	35,482,000
Common stock, shares outstanding	35,251,000	35,482,000

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Restricted Cash (Tables)

9 Months Ended

Sep. 30, 2019

Cash And Cash Equivalents [Abstract]

Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the nine months ended September 30, 2019 and 2018 (in thousands):

	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	140,549	$	142,655
Restricted cash included in other current assets		—		8
Restricted cash included in other non-current assets		1,612		1,630
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	142,161	$	144,293

	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	111,055	$	105,831
Restricted cash included in other current assets		17		46
Restricted cash included in other non-current assets		1,572		1,568
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	112,644	$	107,445

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Leases (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Schedule of Financial Statement Classification of Lease Balances With Consolidated Balance Sheet

The following table provides information about the financial statement classification of our lease balances reported within the consolidated balance sheets as of September 30, 2019 and January 1, 2019 (in thousands):

Leases	Classification	September 30, 2019		January 1, 2019
Assets
Operating lease assets	Other assets	$	78,621	$	65,922
Finance lease assets	Property and equipment(a)		1,178		1,693
Total lease assets		$	79,799	$	67,615
Liabilities
Current
Operating lease liabilities	Accrued expenses and other current liabilities	$	19,502	$	15,788
Finance lease liabilities	Current portion of long-term debt		1,143		1,399
Non-current
Operating lease liabilities	Other liabilities		64,018		54,724
Finance lease liabilities	Long-term debt		670		1,521
Total lease liabilities		$	85,333	$	73,432

(a) Recorded net of accumulated amortization of $515,000 as of September 30, 2019 and there is no accumulated amortization as of January 1, 2019.

Schedule of Financial Statement Classification of Lease Balances With Consolidated Statement of Operations

The following table provides information about the financial statement classification of our lease expenses reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Lease cost	Classification	Three months ended September 30, 2019		Nine months ended September 30, 2019
Operating lease cost (a) (b)	Selling and administrative expenses	$	5,197	$	14,965
Finance lease cost
Amortization of leased      assets	Selling and administrative expenses		171		515
Interest on lease liabilities	Interest expense, net		22		72
Total lease cost		$	5,390	$	15,552

(a) Includes immaterial amounts recorded to cost of goods sold.

(b) Excludes short-term and variable lease costs, which are immaterial.

Schedule of Future Minimum Lease Payments Under Non-cancelable Leases

Future minimum lease payments under non-cancelable leases as of September 30, 2019 are as follows (in thousands):

	Operating leases			Finance leases			Total
Remainder of 2019	$	6,008		$	310		$	6,318
2020		21,144			1,150			22,294
2021		17,812			432			18,244
2022		14,470			—			14,470
2023		8,984			—			8,984
After 2023		25,486			—			25,486
Total lease payments		93,904			1,892			95,796
Less:  Interest		(10,384	)		(79	)		(10,463	)
Present value of lease liabilities	$	83,520		$	1,813		$	85,333

Operating lease payments include $13.4 million related to options to extend lease terms that are reasonably certain of being exercised.

Schedule of Weighted Average Remaining Term and Discount Rates

The following table provides information about the remaining lease terms and discount rates applied as of September 30, 2019:

	September 30, 2019
Weighted average remaining lease term (years)
Operating leases		6.19
Finance leases		1.69
Weighted average discount rate (%)
Operating leases		3.65
Finance leases		4.85

Schedule of Other Information Related to Leases

The following table provides other information related to leases for the nine months ended September 30, 2019 (in thousands):

	Nine months ended September 30, 2019
Cash paid for amounts included in the measurement of lease    liabilities:
Operating cash flows from operating leases	$	14,527
Leased assets obtained in exchange for new operating lease liabilities		5,901

Future Minimum Lease Payments

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

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Acquisitions - Summary of Pro Forma Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Business Acquisition [Line Items]
Net sales, As reported	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
Net earnings, As reported	$ 27,132	$ 32,154	$ 116,457	$ 116,636
Diluted earnings per share, As reported	$ 0.76	$ 0.89	$ 3.23	$ 3.24
PCM [Member]
Business Acquisition [Line Items]
Net sales, As reported	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
Net sales, Pro forma	2,322,828	2,257,769	6,910,356	6,928,539
Net earnings, As reported	27,132	32,154	116,457	116,636
Net earnings, Pro forma	$ 24,678	$ 31,876	$ 115,321	$ 114,250
Diluted earnings per share, As reported	$ 0.76	$ 0.89	$ 3.23	$ 3.24
Diluted earnings per share, Pro forma	$ 0.69	$ 0.89	$ 3.20	$ 3.17

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Segment Information - Summary of Total Assets by Reportable Operating Segment (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ 3,982,360	$ 2,775,947
Operating Segments [Member] | North America Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	3,729,338	2,660,886
Operating Segments [Member] | EMEA Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	596,657	611,338
Operating Segments [Member] | APAC Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	101,829	98,959
Intersegment Eliminations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ (445,464)	$ (595,236)

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Commitments and Contingencies - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2019 USD ($)
Commitments And Contingencies Disclosure [Abstract]
Other commitment, Performance bonds outstanding	$ 3,739,000
Number of months of salary paid as severance	from three to twenty-four months

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Consolidated Statements of Stockholders' Equity (unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock [Member]	Treasury Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Loss [Member]	Retained Earnings [Member]
Beginning Balance at Dec. 31, 2017	$ 843,469	$ 358		$ 317,155	$ (24,264)	$ 550,220
Beginning Balance, Shares at Dec. 31, 2017		35,829
Cumulative effect of accounting change	7,176					7,176
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(3,195)	$ 3		(3,198)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		288
Stock-based compensation expense	10,764			10,763		1
Repurchase of common stock, Amount	(22,069)		$ (22,069)
Repurchase of common stock, Shares			(641)
Retirement of treasury stock, Amount		$ (6)	$ 22,069	(5,655)		(16,408)
Retirement of treasury stock, Shares		(641)	641
Foreign currency translation adjustments, net of tax	(9,774)				(9,774)
Net earnings	116,636					116,636
Ending Balance at Sep. 30, 2018	943,007	$ 355		319,065	(34,038)	657,625
Ending Balance, Shares at Sep. 30, 2018		35,476
Beginning Balance at Jun. 30, 2018	906,749	$ 355		315,619	(34,695)	625,470
Beginning Balance, Shares at Jun. 30, 2018		35,459
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(270)			(270)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		17
Stock-based compensation expense	3,717			3,716		1
Foreign currency translation adjustments, net of tax	657				657
Net earnings	32,154					32,154
Ending Balance at Sep. 30, 2018	943,007	$ 355		319,065	(34,038)	657,625
Ending Balance, Shares at Sep. 30, 2018		35,476
Beginning Balance at Dec. 31, 2018	986,989	$ 355		323,622	(41,653)	704,665
Beginning Balance, Shares at Dec. 31, 2018		35,482
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(6,419)	$ 3		(6,422)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		310
Stock-based compensation expense	11,895			11,895
Equity component of convertible senior notes, net of deferred tax of $14,819 and issuance costs of $1,700	44,731			44,731
Issuance of warrants related to convertible senior notes	34,440			34,440
Purchase of note hedge related to convertible senior notes, net of deferred tax of $16,047	(50,278)			(50,278)
Repurchase of common stock, Amount	(27,899)		$ (27,899)
Repurchase of common stock, Shares			(541)
Retirement of treasury stock, Amount		$ (5)	$ 27,899	(4,919)		(22,975)
Retirement of treasury stock, Shares		(541)	541
Foreign currency translation adjustments, net of tax	(7,278)				(7,278)
Net earnings	116,457					116,457
Ending Balance at Sep. 30, 2019	1,102,638	$ 353		353,069	(48,931)	798,147
Ending Balance, Shares at Sep. 30, 2019		35,251
Beginning Balance at Jun. 30, 2019	1,079,583	$ 358		325,263	(40,028)	793,990
Beginning Balance, Shares at Jun. 30, 2019		35,781
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Value	(266)			(266)
Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes, Shares		11
Stock-based compensation expense	4,098			4,098
Equity component of convertible senior notes, net of deferred tax of $14,819 and issuance costs of $1,700	44,731			44,731
Issuance of warrants related to convertible senior notes	34,440			34,440
Purchase of note hedge related to convertible senior notes, net of deferred tax of $16,047	(50,278)			(50,278)
Repurchase of common stock, Amount	(27,899)		$ (27,899)
Repurchase of common stock, Shares			(541)
Retirement of treasury stock, Amount		$ (5)	$ 27,899	(4,919)		(22,975)
Retirement of treasury stock, Shares		(541)	541
Foreign currency translation adjustments, net of tax	(8,903)				(8,903)
Net earnings	27,132					27,132
Ending Balance at Sep. 30, 2019	$ 1,102,638	$ 353		$ 353,069	$ (48,931)	$ 798,147
Ending Balance, Shares at Sep. 30, 2019		35,251

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Sales Recognition - Summary of Estimated Net Sales Related to Performance Obligation (Detail) - Services [Member] $ in Thousands	Sep. 30, 2019 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 146,425
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2019-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 40,161
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 70,395
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 23,815
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 8,273
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 3,781
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period

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Net Earnings Per Share ("EPS") - Additional Information (Detail) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
RSUs excluded from the diluted EPS calculations	3,000	5,000	56,000	13,000

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Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 140,549	$ 142,655
Accounts receivable, net of allowance for doubtful accounts of $10,243 and $10,462, respectively	2,320,681	1,931,736
Inventories	219,932	148,503
Other current assets	120,972	115,683
Total current assets	2,802,134	2,338,577
Property and equipment, net of accumulated depreciation and amortization of $255,916 and $331,700, respectively	169,996	72,954
Goodwill	358,384	166,841
Intangible assets, net of accumulated amortization of $65,922 and $52,942, respectively	350,342	112,179
Deferred income taxes	3,027	7,967
Other assets	298,477	77,429
Total assets	3,982,360	2,775,947
Current liabilities:
Accounts payable—trade	1,220,678	978,104
Accounts payable—inventory financing facilities	207,658	304,130
Accrued expenses and other current liabilities	254,677	190,733
Current portion of long-term debt	1,142	1,395
Deferred revenue	67,819	62,300
Total current liabilities	1,751,974	1,536,662
Long-term debt	835,714	195,525
Deferred income taxes	58,665	683
Other liabilities	233,369	56,088
Total liabilities	2,879,722	1,788,958
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value, 3,000 shares authorized; no shares issued
Common stock, $0.01 par value, 100,000 shares authorized; 35,251 shares at September 30, 2019 and 35,482 shares at December 31, 2018 issued and outstanding	353	355
Additional paid-in capital	353,069	323,622
Retained earnings	798,147	704,665
Accumulated other comprehensive loss – foreign currency translation adjustments	(48,931)	(41,653)
Total stockholders’ equity	1,102,638	986,989
Total liabilities and stockholders' equity	$ 3,982,360	$ 2,775,947

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Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations (Tables)

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Long-Term Debt

Our long-term debt consists of the following (in thousands):

	September 30, 2019			December 31, 2018
Senior revolving credit facility	$	—		$	—
ABL revolving credit facility		553,000			—
Accounts receivable securitization financing facility		—			194,000
Convertible senior notes due 2025		282,043			—
Finance leases and other financing obligations		1,813			2,920
Total		836,856			196,920
Less: current portion of long-term debt		(1,142	)		(1,395	)
Long-term debt	$	835,714		$	195,525

Schedule of Convertible Senior Notes Balances

The notes consist of the following balances reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

Liability:
Principal	$	350,000
Less: debt discount and issuance costs, net of accumulated accretion		(67,957	)
Net carrying amount	$	282,043
Equity, net of deferred tax	$	44,731

Summary of Equity Components of Notes Included in Additional Paid-in Capital

The following table summarizes the equity components of the notes included in additional paid-in capital reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

	Embedded Conversion Option		Embedded Conversion Option - Debt Issuance Costs			Deferred Tax			Total
Convertible Senior Notes due 2025	$	61,250	$	(1,700	)	$	(14,819	)	$	44,731

Summary of Interest Expense Components Resulting From Notes

The following table summarizes the interest expense components resulting from the notes reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Interest expense	Three months ended September 30, 2019		Nine months ended September 30, 2019
Contractual coupon interest	$	328	$	328
Amortization of debt discount	$	1,235	$	1,235
Amortization of debt issuance costs	$	163	$	163

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Basis of Presentation and Recently Issued Accounting Standards (Policies)

9 Months Ended

Sep. 30, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Recently Issued Accounting Standards

Recently Issued Accounting Standards

In June 2016, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standard Update (“ASU”) No. 2016-13, “Financial Instruments – Credit Losses.”  The new standard is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held at each reporting date.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.

In April 2019, the FASB issued ASU No. 2019-04, “Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments.”  The new standard provides changes for how a company considers expected recoveries and contractual extensions or renewal options when estimating expected credit losses.  The new standard is effective with the adoption of  ASU No. 2016-13.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.    

Effective January 1, 2019, we adopted the FASB ASU No. 2016-02—Leases (Topic 842) using the effective date transition method. This approach provides a method for recording existing leases at adoption without restating comparative periods. We elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification.  In addition, we made an accounting policy election not to separate non-lease components from lease components for all existing classes of underlying assets with the exception of land and buildings.  We also made an accounting policy election to not record right of use (“ROU”) assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.

Adoption of the new standard resulted in the recording of additional net operating lease ROU assets and lease liabilities of $65,922,000 and $70,512,000, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities reflected existing accrued and prepaid rent balances that were reclassified to the operating lease ROU asset at January 1, 2019. The standard did not materially impact our consolidated net earnings and had no impact on cash flows.  

There have been no other material changes in or additions to the recently issued accounting standards as previously reported in Note 1 to our Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2018 that affect or may affect our current financial statements.

Significant Leases Accounting Policy - Leases

Significant Leases Accounting Policy

We determine if a contract or arrangement is, or contains, a lease at inception.  Balances related to operating leases are included in other assets, other current liabilities, and other liabilities in our consolidated balance sheet.  Balances related to financing leases are included in property and equipment, current portion of long-term debt, and long-term debt in our consolidated balance sheet.  ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.  

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.  As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.  We use the implicit rate when readily determinable.  The operating lease ROU asset includes any prepaid lease payments and additional direct costs and excludes lease incentives.  Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.  

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Leases - Schedule of Financial Statement Classification of Lease Balances With Consolidated Balance Sheet (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019
Lessee Lease Description [Line Items]
Total lease assets	$ 79,799	$ 67,615
Total lease liabilities	85,333	73,432
Other Assets [Member]
Lessee Lease Description [Line Items]
Operating lease assets	78,621	65,922
Property and equipment [Member]
Lessee Lease Description [Line Items]
Finance lease assets	1,178	1,693
Accrued expenses and other current liabilities [Member]
Lessee Lease Description [Line Items]
Operating lease liabilities	19,502	15,788
Current portion of long-term debt [Member]
Lessee Lease Description [Line Items]
Finance lease liabilities	1,143	1,399
Other liabilities [Member]
Lessee Lease Description [Line Items]
Operating lease liabilities	64,018	54,724
Long-term debt [Member]
Lessee Lease Description [Line Items]
Finance lease liabilities	$ 670	$ 1,521

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Leases - Schedule of Weighted Average Remaining Term and Discount Rates (Detail)	Sep. 30, 2019
Leases [Abstract]
Operating leases, Weighted average remaining lease term (years)	6 years 2 months 8 days
Finance leases, Weighted average remaining lease term (years)	1 year 8 months 8 days
Operating leases, Weighted average discount rate	3.65%
Finance leases, Weighted average discount rate	4.85%

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2019

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

10. Commitments and Contingencies

Contractual

In the ordinary course of business, we issue performance bonds to secure our performance under certain contracts or state tax requirements.  As of September 30, 2019, we had approximately $3,739,000 of performance bonds outstanding.  These bonds are issued on our behalf by a surety company on an unsecured basis; however, if the surety company is ever required to pay out under the bonds, we have contractually agreed to reimburse the surety company.

Management believes that payments, if any, related to these performance bonds are not probable at September 30, 2019.  Accordingly, we have not accrued any liabilities related to such performance bonds in our consolidated financial statements.

Employment Contracts and Severance Plans

We have employment contracts with, and severance plans covering, certain officers and management teammates under which severance payments would become payable in the event of specified terminations without cause or terminations under certain circumstances after a change in control.  In addition, vesting of outstanding nonvested RSUs would accelerate following a change in control.  If severance payments under the current employment agreements or plan payments were to become payable, the severance payments would generally range from three to twenty-four months of salary.

Indemnifications

From time to time, in the ordinary course of business, we enter into contractual arrangements under which we agree to indemnify either our clients or third-party service providers from certain losses incurred relating to services performed on our behalf or for losses arising from defined events, which may include litigation or claims relating to past performance.  These arrangements include, but are not limited to, the indemnification of our clients for certain claims arising out of our performance under our sales contracts, the indemnification of our landlords for certain claims arising from our use of leased facilities and the indemnification of the lenders that provide our credit facilities for certain claims arising from their extension of credit to us.  Such indemnification obligations may not be subject to maximum loss clauses.

Management believes that payments, if any, related to these indemnifications are not probable at September 30, 2019.  Accordingly, we have not accrued any liabilities related to such indemnifications in our consolidated financial statements.

We have entered into separate indemnification agreements with certain of our executive officers and with each of our directors.  These agreements require us, among other requirements, to indemnify such officers and directors against expenses (including attorneys’ fees), judgments and settlements incurred by such individual in connection with any action arising out of such individual’s status or service as our executive officer or director (subject to exceptions such as where the individual failed to act in good faith or in a manner the individual reasonably believed to be in, or not opposed to, the best interests of the Company) and to advance expenses incurred by such individual with respect to which such individual may be entitled to indemnification by us.  There are no pending legal proceedings that involve the indemnification of any of the Company’s directors or officers.

Contingencies Related to Third-Party Review

From time to time, we are subject to potential claims and assessments from third parties.  We are also subject to various governmental, client and partner audits.  We continually assess whether or not such claims have merit and warrant accrual.  Where appropriate, we accrue estimates of anticipated liabilities in the consolidated financial statements.  Such estimates are subject to change and may affect our results of operations and our cash flows.

Legal Proceedings

From time to time, we are party to various legal proceedings incidental to the business, including preference payment claims asserted in client bankruptcy proceedings, indemnification claims, claims of alleged infringement of patents, trademarks, copyrights and other intellectual property rights, employment claims, claims of alleged non-compliance with contract provisions, and claims related to alleged violations of laws and regulations.  We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are appropriate.  If accruals are not appropriate, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made.  Although litigation is inherently unpredictable, we believe that we have adequate provisions for any probable and estimable losses.  It is possible, nevertheless, that our consolidated financial position, results of operations or liquidity could be materially and adversely affected in any particular period by the work required pursuant to any legal proceedings or the resolution of any legal proceedings during such period.  Legal expenses related to the defense of any legal proceeding or the negotiations, settlement, rulings and advice of outside legal counsel in connection with any legal proceeding are expensed as incurred.

In connection with the acquisition of PCM, the Company has effectively assumed responsibility for PCM litigation matters, including various disputes related to PCM’s acquisition of certain assets of En Pointe Technologies in 2015.  The seller of En Pointe Technologies and related  entities providing various post-closing support functions to PCM have asserted claims regarding the sufficiency of earnout payments paid by PCM under the asset purchase agreement and the unwinding of the support functions post-closing.  PCM has rejected and vigorously responded to those claims and is pursuing various counterclaims.  The disputes are being heard by multiple courts and arbitrators in several different jurisdictions including California, Delaware and Pakistan.  The Company cannot determine with certainty the costs or outcome of these matters.  However, the Company is not involved in any pending or threatened legal proceedings, including the PCM litigation matters, that it believes would reasonably be expected to have a material adverse effect on its business, financial condition or results of operations.

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Restricted Cash

9 Months Ended

Sep. 30, 2019

Cash And Cash Equivalents [Abstract]

Restricted Cash

6. Restricted Cash

Amounts included in restricted cash represent those required to be set aside by a contractual agreement with a lessor related to certain leased office space in foreign jurisdictions.  The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows for the nine months ended September 30, 2019 and 2018 (in thousands):

	September 30, 2019		December 31, 2018
Cash and cash equivalents	$	140,549	$	142,655
Restricted cash included in other current assets		—		8
Restricted cash included in other non-current assets		1,612		1,630
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	142,161	$	144,293

	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	111,055	$	105,831
Restricted cash included in other current assets		17		46
Restricted cash included in other non-current assets		1,572		1,568
Total cash, cash equivalents and restricted cash shown in    the statement of cash flows	$	112,644	$	107,445

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Leases

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Leases

2. Leases

We lease office space, distribution centers, land, vehicles and equipment. Lease agreements with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.   

Certain lease agreements include one or more options to renew, with renewal terms that can extend the lease term from one to five years or more. The exercise of lease renewal options is at our sole discretion. Some agreements also include options to purchase the leased property. The estimated life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.  

Certain of our lease agreements include rental payments adjusted periodically for inflation.  Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Significant Leases Accounting Policy

We determine if a contract or arrangement is, or contains, a lease at inception.  Balances related to operating leases are included in other assets, other current liabilities, and other liabilities in our consolidated balance sheet.  Balances related to financing leases are included in property and equipment, current portion of long-term debt, and long-term debt in our consolidated balance sheet.  ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.  

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.  As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.  We use the implicit rate when readily determinable.  The operating lease ROU asset includes any prepaid lease payments and additional direct costs and excludes lease incentives.  Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.  

The following table provides information about the financial statement classification of our lease balances reported within the consolidated balance sheets as of September 30, 2019 and January 1, 2019 (in thousands):

Leases	Classification	September 30, 2019		January 1, 2019
Assets
Operating lease assets	Other assets	$	78,621	$	65,922
Finance lease assets	Property and equipment(a)		1,178		1,693
Total lease assets		$	79,799	$	67,615
Liabilities
Current
Operating lease liabilities	Accrued expenses and other current liabilities	$	19,502	$	15,788
Finance lease liabilities	Current portion of long-term debt		1,143		1,399
Non-current
Operating lease liabilities	Other liabilities		64,018		54,724
Finance lease liabilities	Long-term debt		670		1,521
Total lease liabilities		$	85,333	$	73,432

(a) Recorded net of accumulated amortization of $515,000 as of September 30, 2019 and there is no accumulated amortization as of January 1, 2019.

The following table provides information about the financial statement classification of our lease expenses reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Lease cost	Classification	Three months ended September 30, 2019		Nine months ended September 30, 2019
Operating lease cost (a) (b)	Selling and administrative expenses	$	5,197	$	14,965
Finance lease cost
Amortization of leased      assets	Selling and administrative expenses		171		515
Interest on lease liabilities	Interest expense, net		22		72
Total lease cost		$	5,390	$	15,552

(a) Includes immaterial amounts recorded to cost of goods sold.

(b) Excludes short-term and variable lease costs, which are immaterial.

Future minimum lease payments under non-cancelable leases as of September 30, 2019 are as follows (in thousands):

	Operating leases			Finance leases			Total
Remainder of 2019	$	6,008		$	310		$	6,318
2020		21,144			1,150			22,294
2021		17,812			432			18,244
2022		14,470			—			14,470
2023		8,984			—			8,984
After 2023		25,486			—			25,486
Total lease payments		93,904			1,892			95,796
Less:  Interest		(10,384	)		(79	)		(10,463	)
Present value of lease liabilities	$	83,520		$	1,813		$	85,333

Operating lease payments include $13.4 million related to options to extend lease terms that are reasonably certain of being exercised.

The following table provides information about the remaining lease terms and discount rates applied as of September 30, 2019:

	September 30, 2019
Weighted average remaining lease term (years)
Operating leases		6.19
Finance leases		1.69
Weighted average discount rate (%)
Operating leases		3.65
Finance leases		4.85

The following table provides other information related to leases for the nine months ended September 30, 2019 (in thousands):

	Nine months ended September 30, 2019
Cash paid for amounts included in the measurement of lease    liabilities:
Operating cash flows from operating leases	$	14,527
Leased assets obtained in exchange for new operating lease liabilities		5,901

Operating Leases pre-Topic 842 adoption:

We have non-cancelable operating leases with third parties, primarily for administrative and distribution center space and computer equipment.  Our facilities leases generally provide for periodic rent increases and many contain escalation clauses and renewal options.  We recognize rent expense on a straight-line basis over the lease term.  Rental expense for these third-party operating leases was $20,114,000, $19,126,000 and $14,444,000 in 2018, 2017 and 2016, respectively, and is included in selling and administrative expenses.

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2018 are as follows (in thousands):

Years Ending December 31,
2019	$	21,499
2020		15,580
2021		12,121
2022		9,150
2023		6,296
Thereafter		7,238
Total minimum lease payments	$	71,884

Amounts in the table above exclude approximately $1.6 million in 2019 in non-cancellable rental income.

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Stock-Based Compensation - Summary of Restricted Stock Units Activity (Detail) - Restricted Stock Units (RSUs) [Member]	9 Months Ended
	Sep. 30, 2019 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested Number, Beginning balance | shares	1,020,930
Number, Granted | shares	414,405
Number, Vested, including shares withheld to cover taxes | shares	(423,909)
Number, Forfeited | shares	(60,129)
Nonvested Number, Ending balance | shares	951,297
Nonvested Weighted Average Grant Date Fair Value, Beginning balance | $ / shares	$ 36.10
Weighted Average Grant Date Fair Value, Granted | $ / shares	56.15
Weighted Average Grant Date Fair Value, Vested, including shares withheld to cover taxes | $ / shares	33.87
Weighted Average Grant Date Fair Value, Forfeited | $ / shares	42.52
Nonvested Weighted Average Grant Date Fair Value, Ending balance | $ / shares	$ 45.42
Fair Value, Vested, including shares withheld to cover taxes | $	$ 14,357,798
Fair Value, Nonvested at end of period | $	$ 52,977,730

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Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations - Summary of Interest Expense Components Resulting From Notes (Detail) - Convertible Senior Notes due 2025 [Member] - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Debt Instrument [Line Items]
Contractual coupon interest	$ 328	$ 328
Amortization of debt discount	1,235	1,235
Amortization of debt issuance costs	$ 163	$ 163

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Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities:
Net earnings	$ 116,457	$ 116,636
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization of property and equipment	15,506	16,018
Amortization of intangible assets	13,590	11,399
Provision for losses on accounts receivable	2,695	2,572
Amortization of debt discount and issuance costs	2,322
Loss on extinguishment of debt	352
Write-downs of inventories	3,281	2,410
Write-off of property and equipment		367
Non-cash stock-based compensation	11,895	10,764
Deferred income taxes	2,501	2,964
Changes in assets and liabilities:
Decrease in accounts receivable	68,057	222,047
(Increase) decrease in inventories	(17,946)	24,373
(Increase) decrease in other assets	(99,681)	31,555
Decrease in accounts payable	(39,191)	(201,147)
(Decrease) increase in deferred revenue	(1,148)	11,326
Increase (decrease) in accrued expenses and other liabilities	89,905	(4,043)
Net cash provided by operating activities	168,595	247,241
Cash flows from investing activities:
Purchases of property and equipment	(16,922)	(13,046)
Proceeds from sale of foreign entity		479
Acquisitions, net of cash and cash equivalents acquired	(664,287)	(74,938)
Net cash used in investing activities	(681,209)	(87,505)
Cash flows from financing activities:
Borrowings on senior revolving credit facility	242,936	569,232
Repayments on senior revolving credit facility	(242,936)	(686,732)
Borrowings on accounts receivable securitization financing facility	2,364,500	2,662,000
Repayments on accounts receivable securitization financing facility	(2,558,500)	(2,576,000)
Repayments under Term Loan A		(9,844)
Repayments under other financing agreements	(183)	(2,312)
Payments on finance lease obligations	(980)	(1,002)
Net repayments under inventory financing facilities	(96,472)	(81,911)
Proceeds from issuance of convertible senior notes	341,250
Proceeds from issuance of warrants	34,440
Purchase of note hedge related to convertible senior notes	(66,325)
Payment of debt issuance costs	(1,180)	(270)
Payment of payroll taxes on stock-based compensation through shares withheld	(6,419)	(3,195)
Repurchases of common stock	(27,899)	(22,069)
Net cash provided by (used in) financing activities	514,442	(152,103)
Foreign currency exchange effect on cash, cash equivalents and restricted cash balances	(3,960)	(2,434)
(Decrease) increase in cash, cash equivalents and restricted cash	(2,132)	5,199
Cash, cash equivalents and restricted cash at beginning of period	144,293	107,445
Cash, cash equivalents and restricted cash at end of period	142,161	$ 112,644
ABL Facility [Member]
Cash flows from financing activities:
Borrowings on senior revolving credit facility	986,754
Repayments on senior revolving credit facility	$ (454,544)

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Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations - Additional Information (Detail)				9 Months Ended
	Aug. 30, 2019 USD ($)	Aug. 15, 2019 USD ($)	Jul. 10, 2019 USD ($)	Sep. 30, 2019 USD ($) shares d $ / shares	Aug. 23, 2019 USD ($)	Dec. 31, 2018 USD ($)
Debt Instrument [Line Items]
Payments to convertible note hedge transaction				$ 66,325,000
Proceeds from issuance of warrants				34,440,000
Accounts payable-inventory financing facility				207,658,000		$ 304,130,000
Finance lease obligations				1,813,000		$ 2,920,000
Convertible Senior Notes due 2025 [Member]
Debt Instrument [Line Items]
Aggregate principal amount of convertible senior notes, issued amount		$ 300,000,000		$ 350,000,000
Convertible senior notes, maturity date		Feb. 15, 2025
Additional aggregate principal amount of notes issued					$ 50,000,000
Convertible senior notes, interest rate		0.75%
Convertible senior notes, payable term				payable semiannually, in arrears, on February 15th and August 15th of each year.
Number of trading days | d				20
Number of consecutive trading days | d				30
Percentage of last reported sale price to conversion price on each applicable trading day				130.00%
Principal amount per note used in conversion rate				$ 1,000
Debt Conversion, initial conversion rate | shares				14.6376
Conversion price per share | $ / shares				$ 68.32
Repurchase price as percentage of principal amount				100.00%
Shares issuable upon conversion of debt | shares				6,788,208
Debt instrument, redemption price, percentage of principal amount redeemed				100.00%
Convertible senior notes, remaining accretion period of debt discount and issuance cost				5 years 4 months 15 days
Convertible senior notes, effective interest rate				4.325%
Conversion price per share | $ / shares				$ 68.32
Convertible note hedge expiration date				Feb. 15, 2025
Payments to convertible note hedge transaction				$ 66,325,000
Warrants sold to purchase of additional common stock | shares				5,123,160
Warrant price per share to purchase additional common stock | $ / shares				$ 103.12
Warrants expiration date				May 15, 2025
Proceeds from issuance of warrants				$ 34,440,000
Convertible Senior Notes due 2025 [Member] | Scenario One [Member]
Debt Instrument [Line Items]
Number of trading days | d				20
Number of consecutive trading days | d				30
Percentage of last reported sale price to conversion price on each applicable trading day				130.00%
Convertible Senior Notes due 2025 [Member] | Scenario Two [Member]
Debt Instrument [Line Items]
Number of consecutive trading days | d				5
Percentage of last reported sale price to conversion price on each applicable trading day				98.00%
Measurement period				5 days
Convertible Senior Notes due 2025 [Member] | Maximum [Member]
Debt Instrument [Line Items]
Option to purchase common stock, shares | shares				5,123,160
ABL Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity	$ 1,200,000,000
Line of credit maturity date	Aug. 30, 2024
Amount of facility permitted by qualified receivables				$ 1,200,000,000
Line of credit outstanding amount				553,000,000
ABL Facility [Member] | Maximum [Member]
Debt Instrument [Line Items]
Credit facility, increase in amount available for borrowing	$ 500,000,000
ABL Facility [Member] | Foreign Currency Borrowings [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity	150,000,000
Senior Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity	350,000,000
Senior Revolving Credit Facility [Member] | Foreign Currency Borrowings [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity	50,000,000
ABS Facility [Member]
Debt Instrument [Line Items]
Credit facility, borrowing capacity	250,000,000
Inventory Financing Facility [Member]
Debt Instrument [Line Items]
Inventory financing facility maximum borrowing capacity				450,000,000
Accounts payable-inventory financing facility				$ 207,658,000
Inventory Financing Facility [Member] | Wells Fargo [Member]
Debt Instrument [Line Items]
Inventory financing facility interest rate if balances are not paid within stated vendor terms				prime plus 1.25%
Inventory financing facility rate if vendor terms not met equal prime plus				1.25%
Unsecured Inventory Financing Facility [Member] | Wells Fargo [Member]
Debt Instrument [Line Items]
Inventory financing facility maximum borrowing capacity	$ 250,000,000
Unsecured Inventory Financing Facility [Member] | MUFG Bank Ltd [Member]
Debt Instrument [Line Items]
Accounts payable-inventory financing facility			$ 200,000,000
Inventory financing facility interest rate if balances are not paid within stated vendor terms			prime plus 2.00%
Inventory financing facility rate if vendor terms not met equal prime plus			2.00%

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Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Net sales:
Total net sales	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
Costs of goods sold:
Total costs of goods sold	1,636,352	1,512,812	4,633,918	4,591,536
Gross profit	276,195	234,914	800,116	739,554
Operating expenses:
Selling and administrative expenses	223,215	184,095	613,767	561,739
Severance and restructuring expenses, net	2,662	683	3,712	2,709
Acquisition related expenses	5,896	188	9,059	282
Earnings from operations	44,422	49,948	173,578	174,824
Non-operating (income) expense:
Interest income	(393)	(330)	(930)	(653)
Interest expense	8,087	6,132	17,511	17,249
Net foreign currency exchange (gain) loss	(391)	539	(10)	19
Other (income) expense, net	(147)	393	868	1,019
Earnings before income taxes	37,266	43,214	156,139	157,190
Income tax expense	10,134	11,060	39,682	40,554
Net earnings	$ 27,132	$ 32,154	$ 116,457	$ 116,636
Net earnings per share:
Basic	$ 0.76	$ 0.91	$ 3.27	$ 3.27
Diluted	$ 0.76	$ 0.89	$ 3.23	$ 3.24
Shares used in per share calculations:
Basic	35,512	35,468	35,631	35,622
Diluted	35,868	35,957	36,027	36,012
Products [Member]
Net sales:
Total net sales	$ 1,668,880	$ 1,548,273	$ 4,729,887	$ 4,724,888
Costs of goods sold:
Total costs of goods sold	1,519,240	1,415,808	4,315,464	4,319,181
Services [Member]
Net sales:
Total net sales	243,667	199,453	704,147	606,202
Costs of goods sold:
Total costs of goods sold	$ 117,112	$ 97,004	$ 318,454	$ 272,355

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Sales Recognition - Summary of Information about Receivables,Contract Assets and Contract Liabilities (Detail) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Disaggregation of Revenue [Line Items]
Current receivables, which are included in “Accounts receivable, net”	$ 2,320,681	$ 1,931,736
Contract assets, which are included in “Other current assets”	117	892
Contract liabilities, which are included in “Deferred revenue” and “Other liabilities”	72,501	82,117
Accounts Receivable, Net [Member]
Disaggregation of Revenue [Line Items]
Current receivables, which are included in “Accounts receivable, net”	2,320,681	1,931,736
Other Assets [Member]
Disaggregation of Revenue [Line Items]
Non-current receivables, which are included in “Other assets”	150,455	38,157
Other Current Assets [Member]
Disaggregation of Revenue [Line Items]
Contract assets, which are included in “Other current assets”	117	892
Deferred Revenue and Other Liabilities [Member]
Disaggregation of Revenue [Line Items]
Contract liabilities, which are included in “Deferred revenue” and “Other liabilities”	$ 72,501	$ 82,117

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Sales Recognition - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2019
New Accounting Pronouncements And Changes In Accounting Principles [Abstract]
Description of expected duration	With the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, remaining performance obligations that have original expected durations of one year or less are not included in the table above.  Amounts not included in the table above have an average original expected duration of eight months.
Time and material contracts expected duration	13 months

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Acquisitions - Additional Information (Detail)					3 Months Ended			9 Months Ended
	Aug. 30, 2019 USD ($) Office Teammate	Apr. 30, 2019 USD ($)	Jan. 31, 2019 USD ($)	Aug. 01, 2018 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)
Business Acquisition [Line Items]
Amortization of intangible assets					$ 5,946,000		$ 4,185,000	$ 13,590,000	$ 11,399,000
Goodwill					358,384,000			358,384,000		$ 166,841,000
Acquisitions, net of cash and cash equivalents acquired								664,287,000	74,938,000
North America Segment [Member]
Business Acquisition [Line Items]
Amortization of intangible assets					5,765,000		$ 3,949,000	13,037,000	$ 10,670,000
PCM [Member]
Business Acquisition [Line Items]
Cash purchase price	$ 745,562,000
Acquisition, percentage of issued and outstanding shares acquired	100.00%
Cash and cash equivalents acquired	$ 84,637,000
Number of office locations globally | Office	40
Identifiable intangible assets	$ 251,400,000
Amortization of intangible assets								2,130,000
Goodwill	192,160,000
Tax deductible goodwill	0
Business combination, net sales from acquired entity					172,468,000			172,468,000
Business combination, gross profit from acquired entity					$ 27,753,000			$ 27,753,000
Acquisitions, net of cash and cash equivalents acquired	660,925,000
PCM [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Identifiable intangible assets	238,900,000
PCM [Member] | Trade Name [Member]
Business Acquisition [Line Items]
Identifiable intangible assets	$ 8,400,000
Useful Life	1 year
PCM [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Identifiable intangible assets	$ 4,100,000
PCM [Member] | Minimum [Member]
Business Acquisition [Line Items]
Number of teammates | Teammate	4,000
PCM [Member] | Minimum [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Useful Life	12 years
PCM [Member] | Minimum [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Useful Life	2 years
PCM [Member] | Maximum [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Useful Life	15 years
PCM [Member] | Maximum [Member] | Non-compete Agreements [Member]
Business Acquisition [Line Items]
Useful Life	3 years
Cardinal Solutions Group, Inc [Member]
Business Acquisition [Line Items]
Acquisition, percentage of issued and outstanding shares acquired				100.00%
Acquisitions, net of cash and cash equivalents acquired				$ 78,400,000
Cardinal Solutions Group, Inc [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Identifiable intangible assets				27,540,000
Goodwill				36,040,000
Net assets acquired				$ 42,360,000
Working capital adjustment in the amount paid			$ 762,000
Acquisition, estimated tax adjustments		$ 2,600,000
Reduction of the previously recorded purchase price						$ 400,000
Cardinal Solutions Group, Inc [Member] | Customer Relationships [Member] | North America Segment [Member]
Business Acquisition [Line Items]
Estimated useful life of acquired intangible assets				10 years

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Segment Information - Net Sales by Offering for North America, EMEA and APAC (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenue from External Customer [Line Items]
Revenues from external customers	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	1,515,162	1,371,459	4,163,110	4,018,605
EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	355,708	345,180	1,125,057	1,161,850
APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	41,677	31,087	145,867	150,635
Hardware Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	1,166,742	1,106,969	3,181,844	3,253,278
Hardware Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	1,020,083	953,431	2,704,212	2,724,916
Hardware Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	137,416	147,497	451,892	505,844
Hardware Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	9,243	6,041	25,740	22,518
Software Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	502,138	441,304	1,548,043	1,471,610
Software Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	295,730	259,602	907,683	828,231
Software Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	186,839	168,603	560,073	551,920
Software Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	19,569	13,099	80,287	91,459
Services Net Sales [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	243,667	199,453	704,147	606,202
Services Net Sales [Member] | North America Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	199,349	158,426	551,215	465,458
Services Net Sales [Member] | EMEA Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	31,453	29,080	113,092	104,086
Services Net Sales [Member] | APAC Segment [Member]
Revenue from External Customer [Line Items]
Revenues from external customers	$ 12,865	$ 11,947	$ 39,840	$ 36,658

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Sales Recognition (Tables)

9 Months Ended

Sep. 30, 2019

Revenue From Contract With Customer [Abstract]

Summary of Revenue Disaggregated by Reportable Operating Segments

In the following table, revenue is disaggregated by our reportable operating segments, which are primarily defined by their related geographies, as well as by major product offering, by major client group and by recognition on either a gross basis as a principal in the arrangement, or on a net basis as an agent, for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	1,020,083	$	137,416	$	9,243	$	1,166,742
Software		295,730		186,839		19,569		502,138
Services		199,349		31,453		12,865		243,667
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Major Client Groups
Large Enterprise / Corporate	$	1,110,817	$	277,536	$	17,811	$	1,406,164
Public Sector		165,085		59,174		6,178		230,437
Small and Medium-Sized Businesses		239,260		18,998		17,688		275,946
	$	1,515,162	$	355,708	$	41,677	$	1,912,547
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,448,385	$	336,600	$	35,979	$	1,820,964
Net revenue recognition (Agent)		66,777		19,108		5,698		91,583
	$	1,515,162	$	355,708	$	41,677	$	1,912,547

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	953,431	$	147,497	$	6,041	$	1,106,969
Software		259,602		168,603		13,099		441,304
Services		158,426		29,080		11,947		199,453
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Major Client Groups
Large Enterprise / Corporate	$	986,665	$	265,430	$	10,715	$	1,262,810
Public Sector		141,895		62,720		6,255		210,870
Small and Medium-Sized Businesses		242,899		17,030		14,117		274,046
	$	1,371,459	$	345,180	$	31,087	$	1,747,726
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	1,322,391	$	326,671	$	26,638	$	1,675,700
Net revenue recognition (Agent)		49,068		18,509		4,449		72,026
	$	1,371,459	$	345,180	$	31,087	$	1,747,726

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,704,212	$	451,892	$	25,740	$	3,181,844
Software		907,683		560,073		80,287		1,548,043
Services		551,215		113,092		39,840		704,147
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Major Client Groups
Large Enterprise / Corporate	$	3,159,269	$	819,156	$	47,903	$	4,026,328
Public Sector		418,583		246,583		47,428		712,594
Small and Medium-Sized Businesses		585,258		59,318		50,536		695,112
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,969,411	$	1,051,101	$	127,129	$	5,147,641
Net revenue recognition (Agent)		193,699		73,956		18,738		286,393
	$	4,163,110	$	1,125,057	$	145,867	$	5,434,034

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Major Offerings
Hardware	$	2,724,916	$	505,844	$	22,518	$	3,253,278
Software		828,231		551,920		91,459		1,471,610
Services		465,458		104,086		36,658		606,202
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Major Client Groups
Large Enterprise / Corporate	$	2,945,880	$	836,865	$	37,770	$	3,820,515
Public Sector		388,109		273,821		67,134		729,064
Small and Medium-Sized Businesses		684,616		51,164		45,731		781,511
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090
Revenue Recognition based on acting as    Principal or Agent in the Transaction
Gross revenue recognition (Principal)	$	3,857,104	$	1,093,110	$	133,542	$	5,083,756
Net revenue recognition (Agent)		161,501		68,740		17,093		247,334
	$	4,018,605	$	1,161,850	$	150,635	$	5,331,090

Summary of Information about Receivables, Contract Assets and Contract Liabilities

The following table provides information about receivables, contract assets and contract liabilities as of September 30, 2019 and December 31, 2018 (in thousands):

	September 30,		December 31,
	2019		2018
Current receivables, which are included in “Accounts    receivable, net”	$	2,320,681	$	1,931,736
Non-current receivables, which are included in “Other assets”		150,455		38,157
Contract assets, which are included in “Other current assets”		117		892
Contract liabilities, which are included in “Deferred revenue”    and “Other liabilities”		72,501		82,117

Summary of Changes in Contract Assets and Contract Liabilities from Contract with Customers

Changes in the contract assets and the contract liabilities balances during the nine months ended September 30, 2019 are as follows (in thousands):

	Increase (Decrease)
	Contract			Contract
	Assets			Liabilities
Balances at December 31, 2018	$	892		$	82,117
Reclassification of the beginning contract liabilities    to revenue, as the result of performance obligations satisfied		—			(47,831	)
Cash received in advance and not recognized as revenue		—			45,660
Reclassification of the beginning contract assets to receivables, as    the result of rights to consideration becoming unconditional		(892	)		—
Contract assets recognized, net of reclassification to receivables		117			—
Business Combination		—			(7,445	)
Balances at September 30, 2019	$	117		$	72,501

Summary of Estimated Net Sales Related to Performance Obligation

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2019 that are expected to be recognized in the future (in thousands):

	Services
Remainder of 2019	$	40,161
2020		70,395
2021		23,815
2022		8,273
2023 and thereafter		3,781
Total remaining performance obligations	$	146,425

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Acquisitions

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Acquisitions

12.Acquisitions

PCM

On August 30,2019, we completed our acquisition of PCM, acquiring 100 percent of the issued and outstanding shares of PCM for a cash purchase price of $745,562,000, which included cash and cash equivalents acquired of $84,637,000 and the payment of PCM’s outstanding debt. PCM is a provider of multi-vendor technology offerings, including hardware, software and services to small, mid-sized and corporate/enterprise commercial clients, state, local and federal governments and educational institutions across the United States, Canada and the United Kingdom.  Based in El Segundo, California, PCM has 40 office locations globally and more than 4,000 teammates.  We believe that this acquisition allows us to help existing PCM clients in positioning their businesses for future growth, transforming and securing their data platforms, creating modern and mobile experiences for their workforce and optimizing the procurement of technology.  The addition of PCM complements our supply chain optimization solution offering, adding scale and clients in the mid-market and corporate space in North America.

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):  

Purchase price net of cash and cash equivalents acquired				$	660,925
Fair value of net assets acquired:
Current assets	$	542,642
Identifiable intangible assets - see description below		251,400
Property and equipment		96,959
Other assets		32,373
Current liabilities		(367,613	)
Long-term liabilities, including deferred taxes		(86,996	)
Total fair value of net assets acquired					468,765
Excess purchase price over fair value of net assets acquired ("goodwill")				$	192,160

Under the acquisition method of accounting, the total purchase price as shown in the table above was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.  The excess of the purchase price over fair value of net assets acquired was recorded as goodwill.  

The estimated fair values of current assets and liabilities (other than deferred revenue and related deferred costs) are based upon their historical costs on the date of acquisition due to their short-term nature.  The estimated fair values of the majority of property and equipment are also based upon historical costs as they approximate fair value.  Certain long-term assets, including PCM’s IT systems, will be written down to the estimated fair value based on the economic benefit expected to be realized from the assets following the acquisition.  

The preliminary estimated fair value of identified intangible assets of $251,400,000 consists primarily of customer relationships, trade names and non-compete agreements, which are valued at $238,900,000, $8,400,000 and $4,100,000, respectively.  These estimated values will be determined using the multiple-period excess earnings method, the relief from royalty method and the lost income method, respectively.  The identifiable intangible assets resulting from the acquisition has been amortized using the straight-line method over the following estimated useful lives: customer relationships – 12-15 years; trade names – 1 year; non-compete agreements – 2-3 years.

Amortization expense recognized relating to the acquired identifiable intangible assets for the period from the acquisition date through September 30, 2019 was $2,130,000.

Goodwill of $192,160,000, which was recorded in our North America and EMEA operating segments, represents the excess of the purchase price over the estimated fair value assigned to tangible and identifiable intangible assets acquired and liabilities assumed from PCM.  The goodwill is not amortized and will be tested for impairment annually in the fourth quarter of our fiscal year.  The addition of the PCM technical employees to our team and the opportunity to grow our business are the primary factors making up the goodwill recognized as part of the transaction.  None of the goodwill is tax deductible.  

The purchase price allocation is preliminary and was allocated using information currently available.  Further information may lead to an adjustment of the purchase price allocation.  

We have consolidated the results of operations for PCM since its acquisition on August 30, 2019.  Consolidated net sales and gross profit for the three and nine months ended September 30, 2019 each include $172,468,000 and $27,753,000, respectively, from PCM.  

The following table reports pro forma information as if the acquisition of PCM had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Three Months Ended September 30,				Nine Months Ended September 30,
		2019		2018		2019		2018
Net sales	As reported	$	1,912,547	$	1,747,726	$	5,434,034	$	5,331,090
	Pro forma	$	2,322,828	$	2,257,769	$	6,910,356	$	6,928,539
Net earnings	As reported	$	27,132	$	32,154	$	116,457	$	116,636
	Pro forma	$	24,678	$	31,876	$	115,321	$	114,250
Diluted earnings per share	As reported	$	0.76	$	0.89	$	3.23	$	3.24
	Pro forma	$	0.69	$	0.89	$	3.20	$	3.17

Cardinal

Effective August 1, 2018, we acquired 100 percent of the issued and outstanding shares of Cardinal, a digital solutions provider based in Cincinnati, Ohio, with offices across the Midwest and Southeast United States, for a cash purchase price, net of cash acquired, of approximately $78,400,000, including final working capital and tax gross up adjustments.  Cardinal provides technology solutions to digitally transform organizations through their expertise in mobile applications development, Internet of Things and cloud enabled business intelligence.  We believe that this acquisition strengthens our services capabilities and will bring value to our clients within our digital innovation services solution offering.

The fair value of net assets acquired was approximately $42,360,000, including $27,540,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight line method over the estimated economic life of ten years.  We finalized the fair value assumptions for identifiable intangible assets acquired in the fourth quarter of 2018.  Goodwill acquired approximated $36,040,000 which was recorded in our North America operating segment.  The goodwill is tax deductible.  The working capital adjustment in the amount of $762,000 was finalized in the fourth quarter of 2018 and paid in January 2019.  Additionally, we finalized the purchase price allocation when the tax gross up adjustment of $2,600,000 was agreed upon in April 2019.  This resulted in a reduction of the previously recorded purchase price of $400,000 in the second quarter of 2019.

Changes in Goodwill and Intangible Assets

Other than the goodwill and intangible assets recorded in conjunction with the acquisitions of Cardinal and PCM, the only other change in consolidated goodwill and intangible assets as of September 30, 2019 compared to the balance as of December 31, 2018 resulted from foreign currency translation adjustments associated with the balances in our EMEA and APAC operating segments.

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Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2019

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Pre-tax Amounts by Operating Segment for Stock-Based Compensation

We recorded the following pre-tax amounts in selling and administrative expenses for stock-based compensation, by operating segment, in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
North America	$	3,102	$	2,837	$	8,965	$	8,172
EMEA		860		754		2,544		2,234
APAC		136		126		386		358
Total Consolidated	$	4,098	$	3,717	$	11,895	$	10,764

Summary of Restricted Stock Units Activity

The following table summarizes our RSU activity during the nine months ended September 30, 2019:

	Number			Weighted Average Grant Date Fair Value		Fair Value
Nonvested at January 1, 2019		1,020,930		$	36.10
Granted(a)		414,405			56.15
Vested, including shares withheld to cover taxes		(423,909	)		33.87	$	14,357,798	(b)
Forfeited		(60,129	)		42.52
Nonvested at September 30, 2019(a)		951,297			45.42	$	52,977,730	(c)

^(a) Includes 84,602 RSUs subject to remaining performance conditions.  The number of RSUs subject to performance conditions are based on the Company achieving 97% of its 2019 targeted financial results.  These RSUs will be awarded at 100% this annual period due to the completion of a significant acquisition in the period.  

^(b) The aggregate fair value of vested RSUs represents the total pre-tax fair value, based on the closing stock price on the day of vesting, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.  

^(c) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $55.69 as of September 30, 2019, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

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Income Taxes

9 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

Our effective tax rate for the three and nine months ended September 30, 2019 was 27.2% and 25.4%, respectively.  For the three months ended September 30, 2019, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit, higher taxes on earnings in foreign jurisdictions, and the effect of non-deductible acquisition-related expenses partially offset by the recognition of tax benefits related to research and development activities.  For the nine months ended September 30, 2019, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit, higher taxes on earnings in foreign jurisdictions, and the effect of non-deductible acquisition-related expenses partially offset by tax benefits on the settlement of employee share-based awards and the recognition of tax benefits related to research and development activities.  

Our effective tax rate for the three and nine months ended September 30, 2018 was 25.6% and 25.8%, respectively.  For the three and nine months ended September 30, 2018, our effective tax rate was higher than the United States federal statutory rate of 21.0% due primarily to state income taxes, net of federal benefit.

As of September 30, 2019 and December 31, 2018, we had approximately $8,666,000 and $6,849,000, respectively, of unrecognized tax benefits.  Of these amounts, approximately $417,000 and $313,000, respectively, related to accrued interest.  In the future, if recognized, the liability associated with uncertain tax positions would affect our effective tax rate.  We do not believe there will be any changes over the next 12 months that would have a material effect on our effective tax rate.  

Several of our subsidiaries are currently under audit for tax years 2012 through 2017.  Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months, which could increase or decrease the balance of our gross unrecognized tax benefits.  However, based on the status of the various examinations in multiple jurisdictions, an estimate of the range

of reasonably possible outcomes cannot be made at this time, but the estimated effect on our income tax expense and net earnings is not expected to be significant.  

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Net Earnings Per Share ("EPS")

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Net Earnings Per Share ("EPS")

4. Net Earnings Per Share (“EPS”)

Basic EPS is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each period.  Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method.  Dilutive potential common shares include outstanding restricted stock units (“RSUs”). A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Numerator:
Net earnings	$	27,132	$	32,154	$	116,457	$	116,636
Denominator:
Weighted average shares used to    compute basic EPS		35,512		35,468		35,631		35,622
Dilutive potential common shares due to    dilutive RSUs, net of tax effect		356		489		396		390
Weighted average shares used to compute    diluted EPS		35,868		35,957		36,027		36,012
Net earnings per share:
Basic	$	0.76	$	0.91	$	3.27	$	3.27
Diluted	$	0.76	$	0.89	$	3.23	$	3.24

For the three and nine months ended September 30, 2019, 3,000 and 56,000, respectively, of our RSUs were not included in the diluted EPS calculations because their inclusion would have been anti-dilutive.  These share-based awards could be dilutive in the future.  There were 5,000 and 13,000 anti-dilutive RSUs for the three and nine months ended September 30, 2018, respectively.  

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Leases - Future Minimum Lease Payment (Detail) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
2019	$ 21,499
2020	15,580
2021	12,121
2022	9,150
2023	6,296
Thereafter	7,238
Total minimum lease payments	$ 71,884

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Basis of Presentation and Recently Issued Accounting Standards - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2019 USD ($) Segment	Jan. 01, 2019 USD ($)
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Number of operating segments | Segment	3
Additional lease liabilities	$ 83,520,000
ASU 2016-02 [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Additional ROU assets		$ 65,922,000
Additional lease liabilities		$ 70,512,000
Cardinal Solutions Group, Inc [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Business acquisition, effective date of acquisition	Aug. 01, 2018

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Leases - Schedule of Financial Statement Classification of Lease Balances With Consolidated Statement of Operations (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Lessee Lease Description [Line Items]
Total lease cost	$ 5,390	$ 15,552
Selling and Administrative Expenses [Member]
Lessee Lease Description [Line Items]
Operating lease cost	5,197	14,965
Amortization of leased assets	171	515
Interest Expense, Net [Member]
Lessee Lease Description [Line Items]
Interest on lease liabilities	$ 22	$ 72

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Stock-Based Compensation - Pre-tax Amounts by Operating Segment for Stock-Based Compensation (Detail) - Restricted Stock Units (RSUs) [Member] - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	$ 4,098	$ 3,717	$ 11,895	$ 10,764
Selling and Administrative Expenses [Member] | North America Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	3,102	2,837	8,965	8,172
Selling and Administrative Expenses [Member] | EMEA Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	860	754	2,544	2,234
Selling and Administrative Expenses [Member] | APAC Segment [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense related to restricted stock units (RSUs)	$ 136	$ 126	$ 386	$ 358

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Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations - Schedule of Convertible Senior Notes Balances (Detail) - Convertible Senior Notes due 2025 [Member] - USD ($)	Sep. 30, 2019	Aug. 15, 2019
Liability:
Principal	$ 350,000,000	$ 300,000,000
Less: debt discount and issuance costs, net of accumulated accretion	(67,957,000)
Net carrying amount	282,043,000
Equity, net of deferred tax	$ 44,731,000

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Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Income Tax [Line Items]
Effective tax rate	27.20%	25.60%	25.40%	25.80%
United States federal statutory income tax rate	21.00%	21.00%	21.00%	21.00%
Unrecognized tax benefits	$ 8,666,000		$ 8,666,000		$ 6,849,000
Unrecognized tax benefits, interest on income taxes accrued	$ 417,000		$ 417,000		$ 313,000
Period during which examination phase of tax audits may conclude, description			Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months, which could increase or decrease the balance of our gross unrecognized tax benefits.
Earliest Tax Year [Member]
Income Tax [Line Items]
Open tax year			2012
Latest Tax Year [Member]
Income Tax [Line Items]
Open tax year			2017

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Share Repurchase Program

9 Months Ended

Sep. 30, 2019

Equity [Abstract]

Share Repurchase Program

9. Share Repurchase Program

On February 13, 2018, our Board of Directors authorized the repurchase of up to $50,000,000 of our common stock.  

During the nine months ended September 30, 2019, we repurchased 541,117 shares of our common stock on the open market at a total cost of approximately $27,899,000 (an average price of $51.56 per share).  During the comparative nine months ended September 30, 2018, we repurchased 641,211 shares of our common stock on the open market at a total cost of approximately $22,069,000 (an average price of $34.42 per share).  All shares repurchased were retired.      

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Debt, Inventory Financing Facility, Finance Leases and Other Financing Obligations

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations

5. Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations

Debt

Our long-term debt consists of the following (in thousands):

	September 30, 2019			December 31, 2018
Senior revolving credit facility	$	—		$	—
ABL revolving credit facility		553,000			—
Accounts receivable securitization financing facility		—			194,000
Convertible senior notes due 2025		282,043			—
Finance leases and other financing obligations		1,813			2,920
Total		836,856			196,920
Less: current portion of long-term debt		(1,142	)		(1,395	)
Long-term debt	$	835,714		$	195,525

On August 30, 2019, we entered into a credit agreement (the “credit agreement”) providing for a senior secured revolving credit facility (the “ABL facility”), which has an aggregate U.S. dollar equivalent maximum borrowing amount of $1,200,000,000, including a maximum borrowing capacity that could be used for borrowing ,in certain foreign currencies of $150,000,000.  While the

ABL facility has a stated maximum amount, the actual availability under the ABL facility is limited by specified percentages of eligible accounts receivable and certain eligible inventory, in each case as set forth in the credit agreement.  From time to time and at our option, we may request to increase the aggregate amount available for borrowing under the ABL facility by up to an aggregate of the U.S. dollar equivalent of $500,000,000, subject to customary conditions, including receipt of commitments from lenders.  The ABL facility is guaranteed by certain of our material subsidiaries and is secured by a lien on certain of our assets and certain of each other borrower’s and each guarantor’s assets.  The interest rates applicable to borrowings under the ABL facility are based on the average aggregate excess availability under the ABL facility as set forth on a pricing grid in the credit agreement.  The ABL facility matures on August 30, 2024.  As of September 30, 2019, eligible accounts receivable and inventory were sufficient to permit access to the full $1,200,000,000 facility amount, of which $553,000,000 was outstanding.  

The ABL facility contains customary affirmative and negative covenants and events of default.  If a default occurs (subject to customary grace periods and materiality thresholds) under the credit agreement, certain actions may be taken, including, but not limited to, possible termination of commitments and required payment of all outstanding principal amounts plus accrued interest and fees payable under the credit agreement.  

On August 30, 2019, we repaid in full and terminated our then existing senior revolving credit facility (the “revolving facility”). The revolving facility had an aggregate U.S. dollar equivalent maximum borrowing amount of $350,000,000, including a maximum borrowing capacity that could be used for borrowing in certain foreign currencies of $50,000,000.

On August 30, 2019, we repaid in full and terminated our accounts receivable securitization financing facility (the “ABS facility”).  The ABS facility had a maximum aggregate borrowing availability of $250,000,000, subject to limitations based on the quantity and quality of the underlying accounts receivable.  

Convertible Senior Notes due 2025

On August 15, 2019, we issued $300,000,000 aggregate principal amount of convertible senior notes (the “notes”) that mature on February 15, 2025. On August 23, 2019, we issued an additional $50,000,000 aggregate principal amount of the notes pursuant to the exercise in full by the initial purchasers of the notes of their option to purchase additional notes.  The notes bear interest at an annual rate of 0.75% payable semiannually, in arrears, on February 15^th and August 15^th of each year. The notes are general unsecured obligations of Insight and are guaranteed on a senior unsecured basis by Insight Direct USA, Inc., a wholly owned subsidiary of Insight.  

Holders of the notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding June 15, 2024, under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2019 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price of our common stock per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; (3) if we call any or all of the notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after June 15, 2024 until the close of

business on the second scheduled trading day immediately preceding the maturity date, the holders may convert their notes at any time, regardless of the foregoing circumstances.

Upon conversion, we will pay or deliver cash, shares of our common stock or a combination of the two, at our discretion. The conversion rate will initially be 14.6376 shares of common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $68.32 per share of common stock). The conversion rate is subject to change in certain circumstances and will not be adjusted for any accrued and unpaid interest. In addition, following certain events that occur prior to the maturity date or following our issuance of a notice of redemption, the conversion rate is subject to an increase for a holder who elects to convert their notes in connection with those events or during the related redemption period in certain circumstances.

If we undergo a fundamental change, the holders may require us to repurchase for cash all or any portion of their notes at a fundamental change repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. As of September 30, 2019, none of the criteria for a fundamental change or a conversion rate adjustment had been met.

The maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, would be 6,788,208.

We may redeem for cash all or any portion of the notes, at our option, on or after August 20, 2022 if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes.  

The notes are subject to certain customary events of default and acceleration clauses.  As of September 30, 2019, no such events have occurred.

The notes consist of the following balances reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

Liability:
Principal	$	350,000
Less: debt discount and issuance costs, net of accumulated accretion		(67,957	)
Net carrying amount	$	282,043
Equity, net of deferred tax	$	44,731

The remaining life of the debt discount and issuance cost accretion is approximately 5.375 years.  The effective interest rate on the liability component of the notes is 4.325%.

The following table summarizes the equity components of the notes included in additional paid-in capital reported within the consolidated balance sheet as of September 30, 2019 (in thousands):

	Embedded Conversion Option		Embedded Conversion Option - Debt Issuance Costs			Deferred Tax			Total
Convertible Senior Notes due 2025	$	61,250	$	(1,700	)	$	(14,819	)	$	44,731

The following table summarizes the interest expense components resulting from the notes reported within the consolidated statement of operations for the three and nine months ended September 30, 2019 (in thousands):

Interest expense	Three months ended September 30, 2019		Nine months ended September 30, 2019
Contractual coupon interest	$	328	$	328
Amortization of debt discount	$	1,235	$	1,235
Amortization of debt issuance costs	$	163	$	163

Convertible Note Hedge and Warrant Transaction

In connection with the issuance of the notes, we entered into certain convertible note hedge and warrant transactions (the “Call Spread Transactions”) with respect to the Company’s common stock.

The convertible note hedge consists of an option to purchase up to 5,123,160 common stock shares at a price of $68.32 per share. The hedge expires on February 15, 2025 and can only be concurrently executed upon the conversion of the notes. We paid approximately $66,325,000 for the convertible note hedge transaction.

Additionally, we sold warrants to purchase 5,123,160 shares of common stock at a price of $103.12 per share. The warrants expire on May 15, 2025 and can only be exercised at maturity.  The Company received aggregate proceeds of approximately $34,440,000 for the sale of the warrants.

The Call Spread Transactions have no effect on the terms of the notes and reduce potential dilution by effectively increasing the initial conversion price of the notes to $103.12 per share of the Company’s common stock.

Inventory Financing Facilities

On July 10, 2019, we entered into an unsecured inventory financing facility with a maximum availability for vendor purchases of $200,000,000 with MUFG Bank Ltd (“MUFG”).  On August 30, 2019, we terminated our existing inventory financing facility with Wells Fargo Capital Finance, LLC (“Wells Fargo”) and entered into a new unsecured inventory financing facility with Wells Fargo with an aggregate availability for vendor purchases under the facility of $250,000,000 thereunder.  As of September 30, 2019, our combined inventory financing facilities had a total maximum capacity of $450,000,000, of which $207,658,000 was outstanding at September 30, 2019.  The inventory financing facilities will remain in effect until they are terminated by any of the parties.  If balances are not paid within stated vendor terms, they will accrue interest at prime plus 2.00% or prime plus 1.25% with respect to the MUFG facility and Wells Fargo facility, respectively.  Amounts outstanding under these facilities are classified separately as accounts payable – inventory financing facilities in the accompanying consolidated balance sheets.

Finance Lease and Other Financing Obligations

Our finance lease obligations totaled $1,813,000 and $2,920,000 as of September 30, 2019 and December 31, 2018, respectively.     

The current and long-term portions of our finance leases are included in the current and long-term portions of long-term debt in the table above and in our consolidated balance sheets as of September 30, 2019 and December 31, 2018.  Further, see Note 2 for additional information.    

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Acquisitions (Tables)

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Summary of Purchase Price and Estimated Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):  

Purchase price net of cash and cash equivalents acquired				$	660,925
Fair value of net assets acquired:
Current assets	$	542,642
Identifiable intangible assets - see description below		251,400
Property and equipment		96,959
Other assets		32,373
Current liabilities		(367,613	)
Long-term liabilities, including deferred taxes		(86,996	)
Total fair value of net assets acquired					468,765
Excess purchase price over fair value of net assets acquired ("goodwill")				$	192,160

Summary of Pro Forma Information

The following table reports pro forma information as if the acquisition of PCM had been completed at the beginning of the earliest period presented (in thousands, except per share amounts):

		Three Months Ended September 30,				Nine Months Ended September 30,
		2019		2018		2019		2018
Net sales	As reported	$	1,912,547	$	1,747,726	$	5,434,034	$	5,331,090
	Pro forma	$	2,322,828	$	2,257,769	$	6,910,356	$	6,928,539
Net earnings	As reported	$	27,132	$	32,154	$	116,457	$	116,636
	Pro forma	$	24,678	$	31,876	$	115,321	$	114,250
Diluted earnings per share	As reported	$	0.76	$	0.89	$	3.23	$	3.24
	Pro forma	$	0.69	$	0.89	$	3.20	$	3.17

XML

Leases - Schedule of Financial Statement Classification of Lease Balances With Consolidated Balance Sheet (Parenthetical) (Detail) - USD ($)	Sep. 30, 2019	Jan. 01, 2019
Leases [Abstract]
Finance lease assets, accumulated amortization	$ 515,000	$ 0

XML

Leases - Schedule of Cash Flows Associated With the Company's Leasing Activities (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($)
Leases [Abstract]
Operating cash flows from operating leases	$ 14,527
Leased assets obtained in exchange for new operating lease liabilities	$ 5,901

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Share Repurchase Program - Additional Information (Detail) - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Feb. 13, 2018
Equity [Abstract]
Common stock repurchase program, authorized amount			$ 50,000,000
Common stock repurchase program, number of shares repurchased	541,117	641,211
Repurchase program, approximate dollar value of shares purchased	$ 27,899,000	$ 22,069,000
Repurchase program, average price paid per share	$ 51.56	$ 34.42

XML

Stock-Based Compensation - Additional Information (Detail) - Restricted Stock Units (RSUs) [Member]	9 Months Ended
	Sep. 30, 2019 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total compensation cost related to RSU's not yet recognized	$ 29,920,000
Weighted average number of years for recognition of outstanding nonvested RSUs	1 year 3 months 29 days

XML

Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations - Summary of Equity Components of Notes Included in Additional Paid-in Capital (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Debt Instrument [Line Items]
Embedded Conversion Option - Debt Issuance Costs	$ (1,700)	$ (1,700)
Deferred Tax	(14,819)	(14,819)
Total	$ 44,731	44,731
Convertible Senior Notes due 2025 [Member]
Debt Instrument [Line Items]
Embedded Conversion Option		61,250
Embedded Conversion Option - Debt Issuance Costs		(1,700)
Deferred Tax		(14,819)
Total		$ 44,731

XML

Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Statement Of Income And Comprehensive Income [Abstract]
Net earnings	$ 27,132	$ 32,154	$ 116,457	$ 116,636
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(8,903)	657	(7,278)	(9,774)
Total comprehensive income	$ 18,229	$ 32,811	$ 109,179	$ 106,862

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Sales Recognition - Summary of Revenue Disaggregated by Reportable Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,820,964	1,675,700	5,147,641	5,083,756
Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	91,583	72,026	286,393	247,334
Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,406,164	1,262,810	4,026,328	3,820,515
Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	230,437	210,870	712,594	729,064
Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	275,946	274,046	695,112	781,511
North America Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,515,162	1,371,459	4,163,110	4,018,605
North America Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,448,385	1,322,391	3,969,411	3,857,104
North America Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	66,777	49,068	193,699	161,501
North America Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,110,817	986,665	3,159,269	2,945,880
North America Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	165,085	141,895	418,583	388,109
North America Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	239,260	242,899	585,258	684,616
EMEA Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	355,708	345,180	1,125,057	1,161,850
EMEA Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	336,600	326,671	1,051,101	1,093,110
EMEA Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	19,108	18,509	73,956	68,740
EMEA Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	277,536	265,430	819,156	836,865
EMEA Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	59,174	62,720	246,583	273,821
EMEA Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	18,998	17,030	59,318	51,164
APAC Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	41,677	31,087	145,867	150,635
APAC Segment [Member] | Gross Revenue Recognition (Principal) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	35,979	26,638	127,129	133,542
APAC Segment [Member] | Net Revenue Recognition (Agent) [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	5,698	4,449	18,738	17,093
APAC Segment [Member] | Large Enterprise / Corporate [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	17,811	10,715	47,903	37,770
APAC Segment [Member] | Public Sector [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	6,178	6,255	47,428	67,134
APAC Segment [Member] | Small and Medium-Sized Businesses [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	17,688	14,117	50,536	45,731
Hardware Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,166,742	1,106,969	3,181,844	3,253,278
Hardware Net Sales [Member] | North America Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	1,020,083	953,431	2,704,212	2,724,916
Hardware Net Sales [Member] | EMEA Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	137,416	147,497	451,892	505,844
Hardware Net Sales [Member] | APAC Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	9,243	6,041	25,740	22,518
Software Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	502,138	441,304	1,548,043	1,471,610
Software Net Sales [Member] | North America Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	295,730	259,602	907,683	828,231
Software Net Sales [Member] | EMEA Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	186,839	168,603	560,073	551,920
Software Net Sales [Member] | APAC Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	19,569	13,099	80,287	91,459
Services Net Sales [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	243,667	199,453	704,147	606,202
Services Net Sales [Member] | North America Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	199,349	158,426	551,215	465,458
Services Net Sales [Member] | EMEA Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	31,453	29,080	113,092	104,086
Services Net Sales [Member] | APAC Segment [Member]
Disaggregation of Revenue [Line Items]
Disaggregation of Revenue	$ 12,865	$ 11,947	$ 39,840	$ 36,658

XML

Sales Recognition - Summary of Estimated Net Sales Related to Performance Obligation (Detail 1) $ in Thousands	Sep. 30, 2019 USD ($)
Services [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Total remaining performance obligations	$ 146,425

XML

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 01, 2019
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Trading Symbol	NSIT
Entity Registrant Name	INSIGHT ENTERPRISES INC
Entity Central Index Key	0000932696
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		35,256,041
Entity File Number	0-25092
Entity Tax Identification Number	86-0766246
Entity Address, Address Line One	6820 South Harl Avenue
Entity Address, City or Town	Tempe
Entity Address, State or Province	AZ
Entity Address, Postal Zip Code	85283
City Area Code	480
Local Phone Number	333-3000
Entity Incorporation, State or Country Code	DE
Title of 12(b) Security	Common stock, par value $0.01
Security Exchange Name	NASDAQ
Document Quarterly Report	true
Document Transition Report	false

XML

Basis of Presentation and Recently Issued Accounting Standards

9 Months Ended

Sep. 30, 2019

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation and Recently Issued Accounting Standards

1.Basis of Presentation and Recently Issued Accounting Standards

We empower organizations of all sizes with Insight Intelligent Technology Solutions^TM and services to maximize the business value of IT in North America; Europe, the Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).  As a Fortune 500-ranked global provider of digital innovation, cloud/data center transformation, connected workforce, and supply chain optimization solutions and services, we help clients innovate and optimize their operations to run smarter.  Our company is organized in the following three operating segments, which are primarily defined by their related geographies:

Operating Segment	Geography
North America	United States and Canada
EMEA	Europe, Middle East and Africa
APAC	Asia-Pacific

Our offerings in North America and certain countries in EMEA and APAC include hardware, software and services.  Our offerings in the remainder of our EMEA and APAC segments consist of largely software and certain software-related services.  

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly our financial position as of September 30, 2019 and our results of operations for the three and nine months ended September 30, 2019 and 2018 and cash flows for the nine months ended September 30, 2019 and 2018.  The consolidated balance sheet as of December 31, 2018 was derived from the audited consolidated balance sheet at such date.  The accompanying unaudited consolidated financial statements and notes have been prepared in accordance with the rules and regulations promulgated by the SEC and consequently do not include all of the disclosures normally required by United States generally accepted accounting principles (“GAAP”).  

The results of operations for interim periods are not necessarily indicative of results for the full year, due in part to the seasonal nature of our business.  These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements, including the related notes thereto, in our Annual Report on Form 10-K for the year ended December 31, 2018.  Our results of operations include the results of PCM, Inc. (“PCM”) from its acquisition date of August 30, 2019 and Cardinal Solutions Group, Inc. (“Cardinal”) from its acquisition date of August 1, 2018.  

The consolidated financial statements include the accounts of Insight Enterprises, Inc. and its wholly owned subsidiaries.  All significant intercompany balances and transactions have been eliminated in consolidation.  

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements.  Additionally, these estimates and assumptions affect the reported amounts of net sales and expenses during the reporting period.  Actual results could differ from those estimates.  On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

Recently Issued Accounting Standards

In June 2016, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standard Update (“ASU”) No. 2016-13, “Financial Instruments – Credit Losses.”  The new standard is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held at each reporting date.  The new standard is effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.

In April 2019, the FASB issued ASU No. 2019-04, “Codification Improvements to Topic 326, Financial Instruments – Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments.”  The new standard provides changes for how a company considers expected recoveries and contractual extensions or renewal options when estimating expected credit losses.  The new standard is effective with the adoption of  ASU No. 2016-13.  We will adopt the new standard as of January 1, 2020 and do not expect the adoption to have a material effect on our consolidated financial statements.    

Effective January 1, 2019, we adopted the FASB ASU No. 2016-02—Leases (Topic 842) using the effective date transition method. This approach provides a method for recording existing leases at adoption without restating comparative periods. We elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed us to carry forward the historical lease classification.  In addition, we made an accounting policy election not to separate non-lease components from lease components for all existing classes of underlying assets with the exception of land and buildings.  We also made an accounting policy election to not record right of use (“ROU”) assets and lease liabilities for leases with an initial term of twelve months or less on our consolidated balance sheet.

Adoption of the new standard resulted in the recording of additional net operating lease ROU assets and lease liabilities of $65,922,000 and $70,512,000, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities reflected existing accrued and prepaid rent balances that were reclassified to the operating lease ROU asset at January 1, 2019. The standard did not materially impact our consolidated net earnings and had no impact on cash flows.  

There have been no other material changes in or additions to the recently issued accounting standards as previously reported in Note 1 to our Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2018 that affect or may affect our current financial statements.

XML

Debt, Inventory Financing Facilities, Finance Leases and Other Financing Obligations - Long-Term Debt (Detail) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Long-term debt
Accounts receivable securitization financing facility		$ 194,000,000
Finance leases and other financing obligations	$ 1,813,000	2,920,000
Total	836,856,000	196,920,000
Less: current portion of long-term debt	(1,142,000)	(1,395,000)
Long-term debt	835,714,000	$ 195,525,000
ABL Facility [Member]
Long-term debt
Revolving credit facility	553,000,000
Convertible Senior Notes due 2025 [Member]
Long-term debt
Convertible senior notes due 2025	$ 282,043,000

XML

Acquisitions - Summary of Purchase Price and Estimated Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($)		9 Months Ended
	Aug. 30, 2019	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Business Acquisition [Line Items]
Purchase price net of cash and cash equivalents acquired		$ 664,287,000	$ 74,938,000
Fair value of net assets acquired:
Excess purchase price over fair value of net assets acquired ("goodwill")		$ 358,384,000		$ 166,841,000
PCM [Member]
Business Acquisition [Line Items]
Purchase price net of cash and cash equivalents acquired	$ 660,925,000
Fair value of net assets acquired:
Current assets	542,642,000
Identifiable intangible assets - see description below	251,400,000
Property and equipment	96,959,000
Other assets	32,373,000
Current liabilities	(367,613,000)
Long-term liabilities, including deferred taxes	(86,996,000)
Total fair value of net assets acquired	468,765,000
Excess purchase price over fair value of net assets acquired ("goodwill")	$ 192,160,000

XML

Segment Information - Financial Information about Reportable Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Segment Reporting Information [Line Items]
Total net sales	$ 1,912,547	$ 1,747,726	$ 5,434,034	$ 5,331,090
Total costs of goods sold	1,636,352	1,512,812	4,633,918	4,591,536
Gross profit	276,195	234,914	800,116	739,554
Operating expenses:
Selling and administrative expenses	223,215	184,095	613,767	561,739
Severance and restructuring expenses	2,662	683	3,712	2,709
Acquisition-related expenses	5,896	188	9,059	282
Earnings from operations	44,422	49,948	173,578	174,824
Products [Member]
Segment Reporting Information [Line Items]
Total net sales	1,668,880	1,548,273	4,729,887	4,724,888
Total costs of goods sold	1,519,240	1,415,808	4,315,464	4,319,181
Services [Member]
Segment Reporting Information [Line Items]
Total net sales	243,667	199,453	704,147	606,202
Total costs of goods sold	117,112	97,004	318,454	272,355
North America Segment [Member]
Segment Reporting Information [Line Items]
Total net sales	1,515,162	1,371,459	4,163,110	4,018,605
Total costs of goods sold	1,296,518	1,192,132	3,562,800	3,473,390
Gross profit	218,644	179,327	600,310	545,215
Operating expenses:
Selling and administrative expenses	170,993	134,792	452,441	402,638
Severance and restructuring expenses	2,449	253	3,260	1,034
Acquisition-related expenses	5,896	188	9,059	282
Earnings from operations	39,306	44,094	135,550	141,261
North America Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales	1,315,813	1,213,033	3,611,895	3,553,147
Total costs of goods sold	1,195,020	1,108,658	3,290,555	3,242,903
North America Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales	199,349	158,426	551,215	465,458
Total costs of goods sold	101,498	83,474	272,245	230,487
EMEA Segment [Member]
Segment Reporting Information [Line Items]
Total net sales	355,708	345,180	1,125,057	1,161,850
Total costs of goods sold	307,817	297,946	955,733	996,602
Gross profit	47,891	47,234	169,324	165,248
Operating expenses:
Selling and administrative expenses	44,568	42,206	139,365	137,383
Severance and restructuring expenses	213	430	328	1,545
Earnings from operations	3,110	4,598	29,631	26,320
EMEA Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales	324,255	316,100	1,011,965	1,057,764
Total costs of goods sold	297,789	290,071	926,712	971,232
EMEA Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales	31,453	29,080	113,092	104,086
Total costs of goods sold	10,028	7,875	29,021	25,370
APAC Segment [Member]
Segment Reporting Information [Line Items]
Total net sales	41,677	31,087	145,867	150,635
Total costs of goods sold	32,017	22,734	115,385	121,544
Gross profit	9,660	8,353	30,482	29,091
Operating expenses:
Selling and administrative expenses	7,654	7,097	21,961	21,718
Severance and restructuring expenses			124	130
Earnings from operations	2,006	1,256	8,397	7,243
APAC Segment [Member] | Products [Member]
Segment Reporting Information [Line Items]
Total net sales	28,812	19,140	106,027	113,977
Total costs of goods sold	26,431	17,079	98,197	105,046
APAC Segment [Member] | Services [Member]
Segment Reporting Information [Line Items]
Total net sales	12,865	11,947	39,840	36,658
Total costs of goods sold	$ 5,586	$ 5,655	$ 17,188	$ 16,498

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Net Sales by Offering for North America, EMEA and APAC

The following table summarizes net sales by offering for North America, EMEA and APAC for the three and nine months ended September 30, 2019 and 2018 (in thousands):

	North America				EMEA				APAC
	Three Months Ended September 30,				Three Months Ended September 30,				Three Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	1,020,083	$	953,431	$	137,416	$	147,497	$	9,243	$	6,041
Software		295,730		259,602		186,839		168,603		19,569		13,099
Services		199,349		158,426		31,453		29,080		12,865		11,947
	$	1,515,162	$	1,371,459	$	355,708	$	345,180	$	41,677	$	31,087
	North America				EMEA				APAC
	Nine Months Ended September 30,				Nine Months Ended September 30,				Nine Months Ended September 30,
Sales Mix	2019		2018		2019		2018		2019		2018
Hardware	$	2,704,212	$	2,724,916	$	451,892	$	505,844	$	25,740	$	22,518
Software		907,683		828,231		560,073		551,920		80,287		91,459
Services		551,215		465,458		113,092		104,086		39,840		36,658
	$	4,163,110	$	4,018,605	$	1,125,057	$	1,161,850	$	145,867	$	150,635

Financial Information about Reportable Operating Segments

The following tables present our results of operations by reportable operating segment for the periods indicated (in thousands):

	Three Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,315,813	$	324,255	$	28,812	$	1,668,880
Services		199,349		31,453		12,865		243,667
Total net sales		1,515,162		355,708		41,677		1,912,547
Costs of goods sold:
Products		1,195,020		297,789		26,431		1,519,240
Services		101,498		10,028		5,586		117,112
Total costs of goods sold		1,296,518		307,817		32,017		1,636,352
Gross profit		218,644		47,891		9,660		276,195
Operating expenses:
Selling and administrative expenses		170,993		44,568		7,654		223,215
Severance and restructuring expenses		2,449		213		—		2,662
Acquisition-related expenses		5,896		—		—		5,896
Earnings from operations	$	39,306	$	3,110	$	2,006	$	44,422

	Three Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	1,213,033	$	316,100	$	19,140	$	1,548,273
Services		158,426		29,080		11,947		199,453
Total net sales		1,371,459		345,180		31,087		1,747,726
Costs of goods sold:
Products		1,108,658		290,071		17,079		1,415,808
Services		83,474		7,875		5,655		97,004
Total costs of goods sold		1,192,132		297,946		22,734		1,512,812
Gross profit		179,327		47,234		8,353		234,914
Operating expenses:
Selling and administrative expenses		134,792		42,206		7,097		184,095
Severance and restructuring expenses		253		430		—		683
Acquisition-related expenses		188		—		—		188
Earnings from operations	$	44,094	$	4,598	$	1,256	$	49,948

	Nine Months Ended September 30, 2019
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,611,895	$	1,011,965	$	106,027	$	4,729,887
Services		551,215		113,092		39,840		704,147
Total net sales		4,163,110		1,125,057		145,867		5,434,034
Costs of goods sold:
Products		3,290,555		926,712		98,197		4,315,464
Services		272,245		29,021		17,188		318,454
Total costs of goods sold		3,562,800		955,733		115,385		4,633,918
Gross profit		600,310		169,324		30,482		800,116
Operating expenses:
Selling and administrative expenses		452,441		139,365		21,961		613,767
Severance and restructuring expenses		3,260		328		124		3,712
Acquisition-related expenses		9,059		—		—		9,059
Earnings from operations	$	135,550	$	29,631	$	8,397	$	173,578

	Nine Months Ended September 30, 2018
	North America		EMEA		APAC		Consolidated
Net sales:
Products	$	3,553,147	$	1,057,764	$	113,977	$	4,724,888
Services		465,458		104,086		36,658		606,202
Total net sales		4,018,605		1,161,850		150,635		5,331,090
Costs of goods sold:
Products		3,242,903		971,232		105,046		4,319,181
Services		230,487		25,370		16,498		272,355
Total costs of goods sold		3,473,390		996,602		121,544		4,591,536
Gross profit		545,215		165,248		29,091		739,554
Operating expenses:
Selling and administrative expenses		402,638		137,383		21,718		561,739
Severance and restructuring expenses		1,034		1,545		130		2,709
Acquisition-related expenses		282		—		—		282
Earnings from operations	$	141,261	$	26,320	$	7,243	$	174,824

Summary of Total Assets by Reportable Operating Segment

The following is a summary of our total assets by reportable operating segment (in thousands):

	September 30, 2019			December 31, 2018
North America	$	3,729,338		$	2,660,886
EMEA		596,657			611,338
APAC		101,829			98,959
Corporate assets and intercompany eliminations, net		(445,464	)		(595,236	)
Total assets	$	3,982,360		$	2,775,947

Pre-Tax Depreciation and Amortization by Operating Segment

We recorded the following pre-tax amounts, by reportable operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Depreciation and amortization of property and    equipment:
North America	$	4,371	$	4,131	$	12,114	$	12,587
EMEA		1,013		1,052		2,980		3,053
APAC		140		123		412		378
		5,524		5,306		15,506		16,018
Amortization of intangible assets:
North America		5,765		3,949		13,037		10,670
EMEA		67		71		205		216
APAC		114		165		348		513
		5,946		4,185		13,590		11,399
Total	$	11,470	$	9,491	$	29,096	$	27,417

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Net Earnings Per Share ("EPS") (Tables)

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Reconciliation of Denominators of Basic and Diluted EPS Calculations

A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Numerator:
Net earnings	$	27,132	$	32,154	$	116,457	$	116,636
Denominator:
Weighted average shares used to    compute basic EPS		35,512		35,468		35,631		35,622
Dilutive potential common shares due to    dilutive RSUs, net of tax effect		356		489		396		390
Weighted average shares used to compute    diluted EPS		35,868		35,957		36,027		36,012
Net earnings per share:
Basic	$	0.76	$	0.91	$	3.27	$	3.27
Diluted	$	0.76	$	0.89	$	3.23	$	3.24

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Subsequent Event

9 Months Ended

Sep. 30, 2019

Subsequent Events [Abstract]

Subsequent Event

13.Subsequent Event

On November 1, 2019 we completed the purchase of real estate in Chandler, Arizona for approximately $48,000,000 that we intend to use as our global corporate headquarters.  The property contains a building and some infrastructure in place that we will complete readying for our use over the next year.  We intend to sell our current properties in Tempe, Arizona.