Insight Enterprises saw a significant negative market reaction to its Q2 results, as both revenue and non-GAAP earnings per share missed Wall Street expectations. Management attributed the underperformance to ongoing disruptions from partner program changes, particularly in the cloud and software business lines, as well as delays in large enterprise services projects. CEO Joyce Mullen cited a “challenging environment, primarily driven by partner program changes,” and noted that while hardware sales showed growth, overall profitability was pressured by these structural headwinds.
Is now the time to buy NSIT? Find out in our full research report (it’s free).
Insight Enterprises (NSIT) Q2 CY2025 Highlights:
- Revenue: $2.09 billion vs analyst estimates of $2.14 billion (3.2% year-on-year decline, 2.4% miss)
- Adjusted EPS: $2.45 vs analyst expectations of $2.47 (0.7% miss)
- Adjusted EBITDA: $138.2 million vs analyst estimates of $139.5 million (6.6% margin, 0.9% miss)
- Management reiterated its full-year Adjusted EPS guidance of $9.90 at the midpoint
- Operating Margin: 4.1%, down from 6.1% in the same quarter last year
- Market Capitalization: $4.04 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Insight Enterprises’s Q2 Earnings Call
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Adam Tyler Tindle (Raymond James): Asked about the drivers behind second-half gross profit improvement and the risk of hardware demand “pull-in.” CFO James Morgado responded that hardware bookings and commercial client trends support continued growth and did not see significant pull-in effects.
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Adam Tyler Tindle (Raymond James): Pressed on industry-wide cost-cutting during a PC hardware upcycle. CEO Joyce Mullen explained that AI-enabled productivity gains allow Insight to hold headcount flat and improve service, even as certain business lines expand.
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Joseph Lima Cardoso (JPMorgan): Inquired about the causes behind large enterprise services project delays and the potential timing for recovery. Mullen cited macro uncertainty and clients conserving resources for future AI investments, with near-term growth expected in small-scale AI projects.
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Joseph Lima Cardoso (JPMorgan): Sought an update on underlying cloud growth excluding partner program changes and the sustainability of momentum. Morgado confirmed underlying cloud growth remained in the high teens, with normalization expected in the second half.
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Vincent Alexander Colicchio (Barrington Research): Questioned the company’s labor strategy for AI growth and the ongoing profitability initiatives. Mullen described a dual approach of M&A for skills acquisition and internal upskilling, while ongoing pricing initiatives continue to support margins.
Catalysts in Upcoming Quarters
Our analyst team will be closely monitoring (1) whether hardware demand continues to accelerate in line with device refresh cycles and Windows 10 end-of-life, (2) signs that partner program headwinds in cloud and software are normalizing as expected, and (3) the pace and scale of AI adoption in both internal operations and client-facing solutions. Progress on integrating recent acquisitions and expanding the services portfolio will also be important signposts for execution.
Insight Enterprises currently trades at $128.52, down from $144.77 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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