CDW’s May 3, 2023, first-quarter results showed net sales of $5.103 billion, down 14.2% from a year earlier. The steepest pressure came from client-device demand, particularly among large corporate customers. CEO Christine Leahy acknowledged staffing reductions, but CDW did not disclose how many employees were affected.
What CDW reported in Q1 2023
The figures cover the three months ended March 31, 2023. CDW’s year-over-year net-sales decline was its first since the company went public in 2013, according to CRN’s May 3, 2023 report. The company’s SEC-filed earnings release provides the reported financial results:
| Measure | Q1 2023 | Comparison with Q1 2022 |
|---|---|---|
| Net sales | $5.103 billion | Down 14.2% |
| Average daily sales | $79.7 million | Down 15.6% |
| Gross profit | $1.089 billion | Down 1.3% |
| Gross margin | 21.3% | 18.6% in Q1 2022 |
| Operating income | $355.3 million | Down 8.2% |
| Net income | $230.1 million | Down 8.0% |
| GAAP diluted EPS | $1.68 | $1.83 in Q1 2022 |
| Non-GAAP diluted EPS | $2.03 | $2.20 in Q1 2022 |
Net sales and average daily sales are different measures: the latter adjusts for the number of selling days. Both fell year over year, but the sales decrease was much larger than the decline in gross profit.
Why client-device demand weakened
Leahy said hardware and client devices were at the center of the sales pressure, with the largest impact among large commercial customers. CRN reported that the client-device market softened further as the quarter progressed. Customers facing economic uncertainty, slower hiring, or their own workforce reductions were less likely to add or replace employee computers.
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Those customer-side job cuts and hiring slowdowns were factors in weaker device demand; they were distinct from CDW’s own staffing reductions. The reported results do not establish a single cause for every segment’s decline or quantify client-device sales separately.
What Leahy said about CDW’s staffing reductions
During the earnings call, Leahy acknowledged that CDW had reduced staffing as part of aligning its cost structure with demand. She described the response in the context of economic uncertainty, the sales outlook, cost discipline, and shifting resources toward areas with stronger demand. CDW did not disclose a number of jobs eliminated in the Q1 2023 discussion, as reported by CRN.
The available reporting supports saying that staffing reductions occurred, not assigning them a specific scale. It also does not support treating CDW’s own cuts as the cause of the sales decline: management discussed them as a response to the business environment.
Why reported headcount still increased
CDW had approximately 15,300 coworkers at quarter-end, slightly more than at the end of Q4 2022, according to CRN. The increase principally reflected technical personnel added through the acquisition of Sirius Computer Solutions. A period-end headcount is a net figure: it combines employees retained, hired, let go, and added through acquisitions, so it does not reveal the gross number of layoffs.
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Which customer segments saw the largest declines
Every reported segment had lower net sales year over year, though the size of the decline varied. The segment results in CDW’s earnings release were:
| Segment | Q1 2023 net sales | Year-over-year change |
|---|---|---|
| Corporate | $2.204 billion | Down 17.4% |
| Small Business | $411 million | Down 22.7% |
| Public | $1.813 billion | Down 12.2% |
| Other (U.K. and Canada) | $675 million | Down 13.1% |
Education sales within the Public segment declined 27.4%. CDW described healthcare and government sales as roughly consistent with the prior year. These differences show why the overall decline should not be read as an identical pullback across every customer group.
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How gross margin held up as sales fell
CDW’s 14.2% revenue decline did not translate into a comparable gross-profit decline: gross profit was down 1.3%, and gross margin rose to 21.3% from 18.6%. The company attributed the margin improvement mainly to product-margin performance, notebook mix and rate, and a greater mix of software revenue reported on a netted-down basis.
That pattern points to a demand and sales-mix shock more than a proportionate collapse in gross profitability. It does not mean operating results were unaffected: operating income, net income, and both GAAP and non-GAAP diluted EPS were lower than a year earlier.
What CDW expected for 2023
In its Q1 results and outlook update, CDW expected the U.S. IT market to contract at a high-single-digit rate in 2023. It also expected full-year non-GAAP diluted EPS to be modestly below 2022 and said it would continue aligning its fixed-cost base with anticipated demand. The company expected to outperform the U.S. IT market by about 200–300 basis points on a constant-currency basis. This was an industry outlook and company EPS expectation, not a precise forecast for CDW revenue.
How to read the story’s date
The CRN headline refers to CDW’s first-quarter 2023 earnings call and was published May 3, 2023; it is not a current earnings announcement. CRN later reported separate CDW workforce reductions in 2026 connected to an AI-focused efficiency effort. That later event should not be treated as the same cuts discussed in 2023 or used to infer their size. See CRN’s 2026 workforce report for that separate episode.
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