Insight Enterprises, Inc. Reports First Quarter Results

Published: 2026-05-07 08:06:07 ET NSIT

Published on 05/07/2026 at 08:06 am EDT

Insight Enterprises, Inc. (NASDAQ: NSIT) (the “Company”) today reported financial results for the quarter ended March 31, 2026. Highlights include:

In the first quarter of 2026, net sales increased 1%, year over year, to $2.1 billion, and gross profit increased 14%, year over year, to $462.2 million. Gross margin expanded 240 basis points compared to the first quarter of 2025 to 21.7%. Selling and administrative expenses increased 13%, year to year, while Adjusted selling and administrative expenses increased 9%, year to year. Earnings from operations of $71.7 million, or 3.4% of net sales, increased 19% compared to $60.1 million in the first quarter of 2025. Adjusted earnings from operations of $141.1 million, or 6.6% of net sales, increased 27% year over year compared to $111.2 million in the first quarter of 2025. Consolidated net earnings were $30.0 million, or 1.4% of net sales, in the first quarter of 2026, up more than 100% compared to the first quarter of 2025. Adjusted consolidated net earnings were $88.9 million, or 4.2% of net sales, up 18% compared to the first quarter of 2025. Diluted earnings per share for the quarter was $0.97, up more than 100% year over year, and Adjusted diluted earnings per share was $2.88, up 26% year over year.

“In the first quarter, we delivered double-digit gross profit growth across every geography, as well as double-digit adjusted earnings from operations and adjusted diluted earnings per share growth. Total gross profit grew 14% with Cloud gross profit increasing 35% and Core Services gross profit growing 19%, the two critical priority areas of our strategy.” stated Jack Azagury, President and Chief Executive Officer. “The team has built a truly differentiated set of capabilities across hardware, software and services to deliver compelling solutions to our clients. I am excited to continue our transformation to become the leading Solutions Integrator and build upon this strong foundation.” Azagury added.

KEY HIGHLIGHTS

Results for the Quarter:

In discussing financial results for the three months ended March 31, 2026 and 2025 in this press release, the Company refers to certain financial measures that are adjusted from the financial results prepared in accordance with United States generally accepted accounting principles (“GAAP”). When referring to non-GAAP measures, the Company refers to them as “Adjusted.” See “Use of Non-GAAP Financial Measures” for additional information. A tabular reconciliation of financial measures prepared in accordance with GAAP to the non-GAAP financial measures is included at the end of this press release.

In some instances, the Company refers to changes in net sales, gross profit, earnings from operations and Adjusted earnings from operations on a consolidated basis and in North America, EMEA and APAC excluding the effects of fluctuating foreign currency exchange rates. In addition, the Company refers to changes in Adjusted diluted earnings per share on a consolidated basis excluding the effects of fluctuating foreign currency exchange rates. These are also considered to be non-GAAP measures. The Company believes providing this information excluding the effects of fluctuating foreign currency exchange rates provides valuable supplemental information to investors regarding its underlying business and results of operations, consistent with how the Company and its management evaluate the Company’s performance. In computing these changes and percentages, the Company compares the current year amount as translated into U.S. dollars under the applicable accounting standards to the prior year amount in local currency translated into U.S. dollars utilizing the weighted average translation rate for the current period. The performance measures excluding the effects of fluctuating foreign currency exchange rates should not be considered a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.

The tax effect of Adjusted amounts referenced herein were computed using the statutory tax rate for the taxing jurisdictions in the operating segment in which the related expenses were recorded, adjusted for the effects of valuation allowances on net operating losses in certain jurisdictions.

GUIDANCE

For the full year 2026, we expect Adjusted diluted earnings per share to be between $11.00 to $11.50, with a bias toward the high end of the range. This represents approximately 5% growth at the midpoint compared to the 2025 Adjusted diluted EPS of 10.75. We expect gross profit to grow in the low single digits and expect that our gross margin will be approximately 21.5%.

This outlook assumes:

This outlook excludes acquisition-related intangibles amortization expense of approximately $83.4 million, excludes non-cash stock-based compensation expense and assumes no acquisition or integration related expenses, transformation or severance and restructuring expenses, net, no significant change in our debt instruments, and no significant change in the macroeconomic environment, whether due to tariffs or otherwise. Due to the inherent difficulty of forecasting some of these types of expenses, which impact net earnings, diluted earnings per share and selling and administrative expenses, the Company is unable to reasonably estimate the impact of such expenses, if any, to net earnings, diluted earnings per share and selling and administrative expenses. Accordingly, the Company is unable to provide a reconciliation of GAAP to non-GAAP diluted earnings per share for the full year 2026 forecast.

CONFERENCE CALL AND WEBCAST

The Company will host a conference call and live webcast today at 9:00 a.m. ET to discuss first quarter 2026 results of operations. A live webcast of the conference call (in listen-only mode) will be available on the Company’s web site at http://investor.insight.com/, and a replay of the webcast will be available on the Company’s web site for a limited time following the call. To access the live conference call, please register in advance using the event link on the Company's web site. Upon registering, participants will receive dial-in information via email, as well as a unique registrant ID, event passcode, and detailed instructions regarding how to join the call.

USE OF NON-GAAP FINANCIAL MEASURES

The non-GAAP financial measures are referred to as “Adjusted”. Adjusted earnings from operations, Adjusted net earnings, Adjusted diluted earnings per share and Adjusted selling and administrative expenses exclude (i) severance and restructuring expenses, net, (ii) certain executive recruitment and hiring related expenses, (iii) amortization of intangible assets, (iv) transformation costs, (v) certain acquisition and integration related expenses, (vi) gains and losses from revaluation of acquisition related earnout liabilities, (vii) impairment losses on long lived real estate assets held for sale, (viii) stock-based compensation expense, and (ix) the tax effects of each of these items, as applicable. Transformation costs represent costs we are incurring to transform our business to help us achieve our strategic objectives including becoming a leading solutions integrator. The Company excludes these items when internally evaluating earnings from operations, tax expense, net earnings and diluted earnings per share for the Company and earnings from operations for each of the Company’s operating segments. Adjusted net earnings and Adjusted diluted earnings per share also exclude a net loss on revaluation of warrant settlement liabilities, as applicable. Adjusted diluted earnings per share also includes the impact of the benefit from the note hedge where the Company’s average stock price for the period was in excess of $68.32, which was the initial conversion price of our previously outstanding convertible senior notes (the “Convertible Notes”), which matured in February 2025, as applicable. Adjusted EBITDA excludes (i) interest expense, (ii) income tax expense, (iii) depreciation and amortization of property and equipment, (iv) amortization of intangible assets, (v) severance and restructuring expenses, net, (vi) certain executive recruitment and hiring related expenses, (vii) transformation costs (viii) certain acquisition and integration related expenses, (ix) gains and losses from revaluation of acquisition related earnout liabilities, (x) gains and losses from the revaluation of warrant settlement liabilities, (xi) impairment losses on long lived real estate assets held for sale, and (xii) stock-based compensation expense, as applicable. Adjusted return on invested capital (“ROIC”) excludes (i) severance and restructuring expenses, net, (ii) certain executive recruitment and hiring related expenses, (iii) amortization of intangible assets, (iv) transformation costs, (v) certain acquisition and integration related expenses, (vi) certain third-party data center service outage related expenses and recoveries, (vii) gains and losses from revaluation of acquisition related earnout liabilities, (viii) impairment losses on long lived real estate assets held for sale, (ix) stock-based compensation expense, and (x) the tax effects of each of these items, as applicable.

These non-GAAP measures are used by the Company and its management to evaluate financial performance against budgeted amounts, to calculate incentive compensation, to assist in forecasting future performance and to compare the Company’s results to those of the Company’s competitors. The Company believes that these non-GAAP financial measures are useful to investors because they allow for greater transparency, facilitate comparisons to prior periods and the Company’s competitors’ results and assist in forecasting performance for future periods. These non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures presented by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

FINANCIAL SUMMARY TABLE

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended March 31,

2026

2025

change

Insight Enterprises, Inc.

Net sales:

Products

1,666,546

1,707,800

(2%)

Services

461,440

395,756

17%

Total net sales

2,127,986

2,103,556

Gross profit

462,151

406,477

14%

Gross margin

21.7

19.3

240 bps

Selling and administrative expenses

383,983

339,173

13%

Severance and restructuring expenses, net

6,485

7,026

(8%)

Acquisition and integration related expenses

175

(99%)

Earnings from operations

71,682

60,103

19%

Net earnings

30,009

7,514

> 100%

Diluted earnings per share

0.97

0.22

> 100%

Sales Mix

Hardware

Software

(21%)

Services

17%

100

North America

Net sales:

Products

1,349,017

1,403,027

(4%)

Services

333,788

297,616

12%

Total net sales

1,682,805

1,700,643

(1%)

Gross profit

353,326

319,452

11%

Gross margin

21.0

18.8

220 bps

Selling and administrative expenses

282,426

265,381

Severance and restructuring expenses, net

4,641

3,111

49%

Acquisition and integration related expenses

170

(64%)

Earnings from operations

66,198

50,790

30%

Sales Mix

Hardware

Software

(28%)

Services

12%

100

(1%)

FINANCIAL SUMMARY TABLE (CONTINUED)

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended March 31,

2026

2025

change

EMEA

Net sales:

Products

281,955

267,160

Services

90,896

75,668

20%

Total net sales

372,851

342,828

Gross profit

86,803

71,927

21%

Gross margin

23.3

21.0

230 bps

Selling and administrative expenses

78,464

63,063

24%

Severance and restructuring expenses, net

1,750

3,853

(55%)

Acquisition and integration related expenses

(16

)

—

Earnings from operations

6,605

5,011

32%

Sales Mix

Hardware

11%

Software

—%

Services

20%

100

APAC

Net sales:

Products

35,574

37,613

(5%)

Services

36,756

22,472

64%

Total net sales

72,330

60,085

20%

Gross profit

22,022

15,098

46%

Gross margin

30.4

25.1

530 bps

Selling and administrative expenses

23,093

10,729

> 100%

Severance and restructuring expenses, net

52%

Acquisition and integration related expenses

(44

)

< (100%)

Earnings from operations

(1,121

)

4,302

< (100%)

Sales Mix

Hardware

> 100%

Software

(28%)

Services

64%

100

20%

Percentage change not considered meaningful

Change in sales mix represents growth/decline in category net sales on a U.S. dollar basis and does not exclude the effects of fluctuating foreign currency exchange rates

FORWARD-LOOKING INFORMATION

Certain statements in this release and the related conference call, webcast and presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including those related to the impact of inflation and higher interest rates, the Company’s future financial performance and results of operations, including gross profit, Adjusted diluted earnings per share, gross margin, and Adjusted selling and administrative expenses, as well as the Company’s other key performance indicators, the Company’s anticipated effective tax rate, interest and other expenses, capital expenditures, and expected average share count, the Company’s expectations regarding cash flow, the Company’s expectations regarding supply constraints, future trends in the IT market, the effects of tariffs and trade policies, and the Company’s business strategy and strategic initiatives, all of which are inherently subject to risks and uncertainties, and 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 the results discussed by the forward-looking statements will be achieved, and actual results may differ materially from those set forth in the forward-looking statements. Some of the important factors that could cause the Company’s 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 the Company’s filings with the Securities and Exchange Commission (the “SEC”), including in the “Risk Factors” sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings with the SEC:

Additionally, there may be other risks that are otherwise described from time to time in the reports that the Company files with the SEC. Any forward-looking statements in this release, the related conference call, webcast and presentation speak only as of the date on which they are made and should be considered in light of various important factors, including the risks and uncertainties listed above, as well as others. The Company assumes no obligation to update, and, except as may be required by law, does not intend to update, any forward-looking statements. The Company does not endorse any projections regarding future performance that may be made by third parties.

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended

March 31,

2026

2025

Net sales:

Products

1,666,546

1,707,800

Services

461,440

395,756

Total net sales

2,127,986

2,103,556

Costs of goods sold:

Products

1,487,644

1,531,826

Services

178,191

165,253

Total costs of goods sold

1,665,835

1,697,079

Gross profit:

Products

178,902

175,974

Services

283,249

230,503

Gross profit

462,151

406,477

Operating expenses:

Selling and administrative expenses

383,983

339,173

Severance and restructuring expenses, net

6,485

7,026

Acquisition and integration related expenses

175

Earnings from operations

71,682

60,103

Non-operating expense (income):

Interest expense, net

23,633

15,625

Other (income) expense, net

(1,452

)

25,469

Earnings before income taxes

49,501

19,009

Income tax expense

19,492

11,495

Net earnings

30,009

7,514

Net earnings per share:

Basic

0.97

0.24

Diluted

0.97

0.22

Shares used in per share calculations:

Basic

30,788

31,839

Diluted

30,856

34,683

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In THOUSANDS)

(UNAUDITED)

March 31, 2026

December 31, 2025

ASSETS

Current assets:

Cash and cash equivalents

440,626

358,020

Accounts receivable, net

6,421,861

5,516,984

Inventories

251,564

160,648

Contract assets, net

59,564

65,745

Other current assets

279,121

260,990

Total current assets

7,452,736

6,362,387

Long-term contract assets, net

46,560

53,176

Property and equipment, net

187,210

188,449

Goodwill

1,168,255

1,169,734

Intangible assets, net

404,845

426,237

Long-term accounts receivable, net

673,897

763,923

Other assets

121,774

123,466

10,055,277

9,087,372

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable – trade

4,820,923

4,263,796

Accounts payable – inventory financing facilities

259,611

225,035

Accrued expenses and other current liabilities

1,053,424

615,464

Current portion of long-term debt

Total current liabilities

6,133,971

5,104,303

Long-term debt

1,469,032

1,361,327

Deferred income taxes

69,543

70,715

Long-term accounts payable

613,736

715,494

Other liabilities

166,399

186,659

8,452,681

7,438,498

Stockholders’ equity:

Preferred stock

—

Common stock

302

310

Additional paid-in capital

164,747

164,560

Retained earnings

1,480,197

1,520,404

Accumulated other comprehensive loss – foreign currency translation adjustments

(42,650

)

(36,400

)

Total stockholders’ equity

1,602,596

1,648,874

10,055,277

9,087,372

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

(UNAUDITED)

Three Months Ended

March 31,

2026

2025

Cash flows from operating activities:

Net earnings

30,009

7,514

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization

28,478

25,779

Provision for losses on accounts receivable

3,429

3,666

Non-cash stock-based compensation

8,197

8,847

Net change on revaluation of earnout liabilities

25,284

15,200

Deferred income taxes

(1,185

)

(7,772

)

Net loss on revaluation of warrant settlement liabilities

—

25,069

Earnout payments in excess of acquisition date fair value

(1,071

)

—

Impairment loss on long lived real estate asset

1,369

—

Amortization of debt issuance costs

850

1,281

Other adjustments

(330

)

(22

)

Changes in assets and liabilities:

Increase in accounts receivable

(960,000

)

(391,354

)

Increase in inventories

(92,033

)

(26,033

)

Decrease in contract assets

12,014

35,526

Decrease in long-term accounts receivable

88,065

30,816

Increase in other assets

(14,827

)

(21,961

)

Increase in accounts payable

601,778

416,952

Decrease in long-term accounts payable

(100,059

)

(31,160

)

Increase (decrease) in accrued expenses and other liabilities

402,415

(14,298

)

Net cash provided by operating activities:

32,383

78,050

Cash flows from investing activities:

Purchases of property and equipment

(5,995

)

(7,130

)

Acquisitions, net of cash and cash equivalents acquired

—

Net cash used in investing activities:

(5,995

)

(7,130

)

Cash flows from financing activities:

Borrowings on ABL revolving credit facility

1,518,570

1,389,224

Repayments on ABL revolving credit facility

(1,406,177

)

(965,452

)

Warrants settlement

—

(138,892

)

Repayment of principal on the Convertible Notes

—

(333,091

)

Net borrowings under inventory financing facilities

34,976

42,701

Repurchases of common stock

(75,000

)

—

Earnout and acquisition related payments

(5,456

)

—

Other payments

(2,628

)

(9,963

)

Net cash provided by (used in) financing activities:

64,285

(15,473

)

Foreign currency exchange effect on cash, cash equivalents and restricted cash balances

(7,776

)

7,177

Increase in cash, cash equivalents and restricted cash

82,897

62,624

Cash, cash equivalents and restricted cash at beginning of period

360,776

261,467

Cash, cash equivalents and restricted cash at end of period

443,673

324,091

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended March 31,

2026

2025

Adjusted Consolidated Earnings from Operations:

GAAP consolidated EFO

71,682

60,103

Amortization of intangible assets

21,059

18,548

Change in fair value of earnout liabilities

25,293

15,200

Transformation costs

6,504

1,270

Impairment loss on a long lived real estate asset held for sale

1,369

—

Severance and restructuring expenses, net

6,485

7,026

Acquisition and integration related expenses

175

Stock-based compensation expense

8,197

8,847

Other*

558

Adjusted non-GAAP consolidated EFO

141,148

111,199

GAAP EFO as a percentage of net sales

3.4

2.9

Adjusted non-GAAP EFO as a percentage of net sales

6.6

5.3

Adjusted Consolidated Net Earnings:

GAAP consolidated net earnings

30,009

7,514

Amortization of intangible assets

21,059

18,548

Change in fair value of earnout liabilities

25,293

15,200

Net loss on revaluation of warrant settlement liabilities

—

25,069

Transformation costs

6,504

1,270

Impairment loss on a long lived real estate asset held for sale

1,369

—

Severance and restructuring expenses, net

6,485

7,026

Acquisition and integration related expenses

175

Stock-based compensation expense

8,197

8,847

Other*

558

Income taxes on non-GAAP adjustments

(10,551

)

(8,555

)

Adjusted non-GAAP consolidated net earnings

88,924

75,124

GAAP net earnings as a percentage of net sales

1.4

0.4

Adjusted non-GAAP net earnings as a percentage of net sales

4.2

3.6

Adjusted Diluted Earnings Per Share:

GAAP diluted EPS

0.97

0.22

Amortization of intangible assets

0.68

0.53

Change in fair value of earnout liabilities

0.82

0.44

Net loss on revaluation of warrant settlement liabilities

—

0.72

Transformation costs

0.21

0.04

Impairment loss on a long lived real estate asset held for sale

0.04

—

Severance and restructuring expenses, net

0.21

0.20

Acquisition and integration related expenses

—

0.01

Stock-based compensation expense

0.27

0.26

Other*

0.02

—

Income taxes on non-GAAP adjustments

(0.34

)

(0.25

)

Impact of benefit from note hedge

—

0.11

Adjusted non-GAAP diluted EPS

2.88

2.28

Shares used in diluted EPS calculation

30,856

34,683

Impact of benefit from note hedge

—

(1,731

)

Shares used in Adjusted non-GAAP diluted EPS calculation

30,856

32,952

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (CONTINUED)

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended March 31,

2026

2025

Adjusted North America Earnings from Operations:

GAAP EFO from North America segment

66,198

50,790

Amortization of intangible assets

18,644

16,804

Gain on revaluation of earnout liabilities

21,286

15,200

Transformation costs

3,582

860

Impairment loss on a long lived real estate asset held for sale

1,369

—

Severance and restructuring expenses, net

4,641

3,111

Acquisition and integration related expenses

170

Stock-based compensation expense

6,060

6,895

Other*

558

Adjusted non-GAAP EFO from North America segment

122,399

93,860

GAAP EFO as a percentage of net sales

3.9

3.0

Adjusted non-GAAP EFO as a percentage of net sales

7.3

5.5

Adjusted EMEA Earnings from Operations:

GAAP EFO from EMEA segment

6,605

5,011

Amortization of intangible assets

1,813

1,744

Transformation costs

2,922

410

Severance and restructuring expenses, net

1,750

3,853

Acquisition and integration related expenses

(16

)

—

Stock-based compensation expense

1,688

1,581

Adjusted non-GAAP EFO from EMEA segment

14,762

12,599

GAAP EFO as a percentage of net sales

1.8

1.5

Adjusted non-GAAP EFO as a percentage of net sales

4.0

3.7

Adjusted APAC Earnings from Operations:

GAAP EFO from APAC segment

(1,121

)

4,302

Amortization of intangible assets

602

—

Gain on revaluation of earnout liabilities

4,007

—

Severance and restructuring expenses, net

Acquisition and integration related expenses

(44

)

Stock-based compensation expense

449

371

Adjusted non-GAAP EFO from APAC segment

3,987

4,740

GAAP EFO as a percentage of net sales

(1.5

7.2

Adjusted non-GAAP EFO as a percentage of net sales

5.5

7.9

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (CONTINUED)

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Three Months Ended March 31,

2026

2025

Adjusted EBITDA:

GAAP consolidated net earnings

30,009

7,514

Interest expense

25,610

17,739

Income tax expense

19,492

11,495

Depreciation and amortization of property and equipment

7,419

7,231

Amortization of intangible assets

21,059

18,548

Gain on revaluation of earnout liabilities

25,293

15,200

Net loss on revaluation of warrant settlement liability

—

25,069

Transformation costs

6,504

1,270

Impairment loss on a long lived real estate asset held for sale

1,369

—

Severance and restructuring expenses, net

6,485

7,026

Acquisition and integration related expenses

175

Stock-based compensation expense

8,197

8,847

Other*

558

Adjusted non-GAAP EBITDA

151,996

120,144

GAAP consolidated net earnings as a percentage of net sales

1.4

0.4

Adjusted non-GAAP EBITDA as a percentage of net sales

7.1

5.7

Three Months Ended March 31,

2026

2025

Adjusted Consolidated Selling and Administrative Expenses:

GAAP selling and administrative expenses

383,983

339,173

Less: Change in fair value of earnout liabilities

25,293

15,200

Amortization of intangible assets

21,059

18,548

Transformation costs

6,504

1,270

Impairment loss on a long lived real estate asset held for sale

1,369

—

Stock-based compensation expense

8,197

8,847

Other*

558

Adjusted non-GAAP selling and administrative expenses

321,003

295,278

GAAP selling and administrative expenses as a percentage of net sales

18.0

16.1

Adjusted non-GAAP selling and administrative expenses as a percentage of net sales

15.1

14.0

Other includes certain executive recruitment and hiring related expenses. Certain executive recruitment and hiring related expenses were $0.6 million for the three months ended March 31, 2026, compared to immaterial amounts for the three months ended March 31, 2025.

INSIGHT ENTERPRISES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (CONTINUED)

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

Twelve Months Ended

March 31,

2026

2025

Adjusted return on invested capital:

GAAP consolidated EFO

346,502

348,701

Amortization of intangible assets

79,279

73,204

Change in fair value of earnout liabilities

35,396

6,410

Transformation costs

18,317

17,375

Impairment loss on a long lived real estate asset held for sale

13,957

—

Severance and restructuring expenses, net

36,590

36,404

Acquisition and integration related expenses

3,393

1,570

Stock-based compensation expense

33,088

34,775

Other5

1,153

(690

)

Adjusted non-GAAP consolidated EFO

567,675

517,749

Income tax expense1

147,595

134,615

Adjusted non-GAAP consolidated EFO, net of tax

420,080

383,134

Average stockholders’ equity2

1,605,726

1,746,178

Average debt2

1,301,841

957,752

Average cash2

(395,330

)

(306,790

)

Invested Capital

2,512,237

2,397,140

Adjusted non-GAAP ROIC (from GAAP consolidated EFO)3

10.21

10.76

Adjusted non-GAAP ROIC (from non-GAAP consolidated EFO)4

16.72

15.98

Assumed tax rate of 26.0%.

Average of previous five quarters.

Computed as GAAP consolidated EFO, net of tax of $90,091 and $90,662 for the twelve months ended March 31, 2026 and 2025, respectively, divided by invested capital.

Computed as Adjusted non-GAAP consolidated EFO, net of tax, divided by invested capital.

Other includes certain executive recruitment and hiring related expenses and certain third-party data center service outage related expenses and recoveries, net, as applicable. Net recoveries related to third-party data center service outages were $0.2 million and $2.1 million for the twelve months ended March 31, 2026 and 2025, respectively. Certain executive recruitment and hiring related expenses were $1.3 million and $1.4 million for the twelve months ended March 31, 2026 and 2025, respectively.

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