Insight Raises Gross Profit Growth Outlook to 14% After Sales Increase 22%

Key Facts

Insight Enterprises reported third-quarter results on November 5, with net sales of $2.4 billion, up 22% year over year, and raised its fiscal 2026 gross profit growth outlook to a range of 12.5%–14.0%. The company said gross profit rose 20% to $523.2 million, while gross margin fell 30 basis points to 21.4%. The results showed two different paths for profitability: strong growth in adjusted metrics, alongside a decline in earnings under accounting standards. Adjusted diluted EPS was $3.59, while GAAP diluted EPS was about $0.74. The announcement came before trading began on November 5, after the company had set the date in an earlier announcement.

Product sales rose 22% year over year, and services sales increased 20%, according to the company’s statement. Within the product category, hardware sales grew 32%, while software sales fell 3%. The company also said gross profit increased 20% to $523.2 million, but gross margin contracted to 21.4%, down 30 basis points from a year earlier. The figures reflect broad sales growth across products and services, with a clear divergence between hardware and software. Gross profit growth did not prevent the margin from declining during the quarter.

Adjusted operating income rose 23% to $166.9 million, equal to 6.8% of sales, compared with $135.3 million in the third quarter of 2025. By contrast, GAAP operating income fell 26% to $68.7 million, from $93.1 million a year earlier. The company attributed the decline mainly to higher adjustments for contingent consideration valuation, along with increased severance and restructuring costs. The costs included a voluntary separation program the company launched in the third quarter of 2026. Consolidated GAAP net income was $22.2 million, down 57%, while adjusted consolidated net income rose 28% to $107.3 million.

At the per-share level, Insight reported adjusted diluted EPS of $3.59, up 34% year over year, while GAAP diluted EPS fell 54% to $0.74. This gap, alongside the difference between adjusted operating income and GAAP operating income, stands out as sales and gross profit increased. The results put the adjusted metrics in a different context from net and operating income under accounting standards. No verifiable analyst estimate was cited in the available results, so the report focuses on the company’s results and year-over-year comparisons. The annual outlook was also raised, while restructuring costs and a lower gross margin continued to weigh on quarterly results.

The company raised its 2026 gross profit growth outlook to a range of 12.5%–14.0% and expects a gross margin of about 21.5% for the fiscal year. It also set its adjusted diluted EPS outlook at $13.55–$13.75. The outlook follows third-quarter increases of 22% in sales and 20% in gross profit, despite a contraction in gross margin during the quarter. Before the announcement, NSIT shares closed at $175.62 on November 4, then ended the November 5 session at $152.72, according to EL7 data. The company had announced on October 15 that it would report third-quarter results before the market opened on November 5 and hold a conference call and live webcast at 9:00 a.m. Eastern Time that day.