Insight Enterprises, Inc. (NASDAQ:NSIT) Q3 2023 Earnings Call Transcript

Matt Sheerin: Okay, great. Thank you.

Operator: Thank you. The next question comes from the line of Anthony Lebiedzinski with Sidoti. Your line is now open.

Unidentified Analyst: Hi, good morning.

Joyce Mullen: Morning.

Unidentified Analyst: This is [indiscernible] on for Anthony Lebiedzinski. My first question is, can you talk about the performance during the quarter for your different client groups, such as large enterprise, public sector, and SMB?

Joyce Mullen: Yes. So, I think we’ve published all this. It’s all in the documents, but I’m happy to talk about it. I think the most challenged segments for the quarter is the enterprise business overall. Conversion was also pretty challenged, I would say. Public sector was strong. So I think we’re happy with that because we think that’s pretty consistent with the market.

Glynis Bryan: Yes. So, our public sector grew a low single digit. A little bit low to mid-single digit. And the enterprise and corporate and commercial segments were down in the double digit in mid-teens area.

Joyce Mullen: Yes, commercial was down the most.

Unidentified Analyst: Thank you. And do you think we are at the bottom for the demand for devices? Or if not, when do you expect to show positive results for devices?

Joyce Mullen: So, we said last quarter we thought we’re at the bottom of the device market. We believe that that was true. We saw some sequential growth that we expect to continue, largely because the comparisons also get a lot easier.

Unidentified Analyst: Thank you so much.

Operator: Thank you. The next question comes from the line of Jake Morrison with Raymond James. Your line is now open.

Jake Morrison: Hey, thank you for taking my question. I’m hoping you guys could touch on the performance geographically a little more. Maybe touch on what you thought of EMEA relative to expectations and maybe just the overall macro environment there relative to Americas? Thank you.

Joyce Mullen: Okay. So, EMEA business delivers to our expectations. I would say that maybe the mix of business was a little bit different. I think that the outlook for the EMEA region for Q4 as well as going into 2024 is likely is softer than it is anticipated to be for North America. We did do an Amdaris, the Amdaris acquisition in EMEA. So, as we look into 2024 we would see some growth coming through from that. I know, so, by the time you identify the expenses, it’s not necessarily material to total Insight results, but you will see kind of improvement in services growth margin associated with that acquisition. And we think that that acquisition will also help with regard to data and cloud related sales that drive combined with services business outcomes for our clients. So we think that the acquisition should be very beneficial to EMEA as we go into 2024, especially in light of a softer economic environment that’s forecast in EMEA for next year.

Jake Morrison: Perfect. And then on the topic of M&A, can you just please opine on your sort of M&A outlook or what you’re thinking about fiscal 2024 just after coming off the Amdaris acquisition? Thank you.

Joyce Mullen: So, we’ve been pretty consistent in talking about focusing on acquisitions that help us improve our capabilities in the fastest growing areas of the market, cloud, data, AI, edge, cyber. So, nothing has changed there. We’re really pleased by the acquisition in EMEA and we remain very, very focused on looking for other acquisitions that can offer great capabilities to our clients. So, we’re still very, very focused on it. We also have the capacity, of course, on the balance sheet, I think, like Glynis talked about. So, no change in the strategy there. We do believe that the transactions and the valuations have come down this year, so it’s making it a bit more possible to do things like Amdaris.