Insight Enterprises (NASDAQ:NSIT) reported fourth-quarter results that executives said capped a “challenging year” with improved momentum, record profitability metrics, and continued progress in shifting the business toward cloud and higher-margin services. Management also offered 2026 guidance that reflected what it described as “cautious optimism” amid still-subdued enterprise spending and potential hardware disruption tied to rising memory costs.
Fourth-quarter performance: revenue down slightly, profitability up
For the quarter ended December 31, 2025, net revenue was $2.0 billion, down 1%, according to CFO James Morgado. The decline was driven by a 4% drop in product revenue, primarily from on-prem software revenue that declined 18% as customers migrated to cloud-delivered software and transactions were increasingly “netted.”
Despite the modest revenue decline, profitability improved. Gross profit increased 9%, and total gross margin expanded to 23.4%, up 220 basis points year-over-year. CEO Joyce Mullen attributed the margin gains to strong execution in cloud, growth in core services, and “incremental netting,” which lowered reported revenue but benefited margin rate calculations.
- Cloud gross profit: $138 million, up 11%, led by growth in SaaS and infrastructure as a service, partially offset by previously discussed partner program changes.
- Core services gross profit: $90 million, up 16%, driven by acquisitions and organic growth.
- EMEA gross profit: up 30%, driven by activity in the UAE and Saudi Arabia where Insight acts as an agent, plus growth in EMEA services.
Adjusted SG&A increased 7%, reflecting acquisitions and variable costs, particularly in EMEA. Morgado said this produced adjusted EBITDA of $156 million, up 11%, with margin expanding 80 basis points to 7.6%. Adjusted diluted EPS was $2.96, up 11%.
Services strategy: acquisitions, advisory pull-through, and AI platform launch
Mullen emphasized that expanding core services is central to Insight’s strategy and said the company has streamlined offerings, implemented “disciplined processes,” augmented leadership, and adopted best practices from acquisitions to improve pipeline and cross-selling. She said the fourth quarter marked the second consecutive quarter of organic bookings growth for core services.
Management highlighted the Inspire11 acquisition as expanding advisory capabilities in North America, complementing Insight’s infrastructure, cloud, edge, data, and security services. Mullen also cited advisory-led engagements that expanded into larger delivery programs, including a European green IT provider building sustainable data centers optimized for AI workloads, and work at Sedgwick to design and implement a unified claims management platform.
On AI, Mullen said client interest remains strong but focused on “tangible business outcomes,” and described Insight’s effort to help customers move from “hype to how.” She said the company is also advancing its own internal AI transformation and introduced “Prism,” described as an AI platform intended to help clients identify and prioritize AI use cases through a proprietary transformation index and manage AI projects from assessment to measurable outcomes.
Full-year 2025: revenue pressured by netting, margins expanded
For full-year 2025, net revenue was $8.2 billion, down 5%, as netted transactions continued to mute revenue growth. Gross profit was flat year-over-year, while gross margin expanded 110 basis points to a record 21.4%.
Cloud gross profit was $495 million, up 2%, as SaaS and infrastructure as a service growth offset partner program changes. Mullen said the company delivered record core services gross profit of $320 million and core services margin “over 32%,” while record adjusted earnings from operations reached $504 million with a margin of 6.1%. Adjusted diluted EPS for 2025 was $9.87, up 2%, Morgado said.
Insight generated approximately $300 million in operating cash flow in 2025. Morgado said the company increased its share repurchase authorization by $150 million in the fourth quarter, bringing authorization remaining to $299 million at year-end, and settled $333 million of convertible notes and associated warrants. He said share repurchases and warrant settlement reduced adjusted diluted share count by about 3 million shares.
The company ended the fourth quarter with total debt of approximately $1.4 billion, up from about $900 million a year earlier, primarily due to acquisitions, warrant settlement, and repurchases. Morgado said Insight increased the limit on its ABL facility to $2.0 billion and extended the term five years; at quarter-end, about $1.1 billion of availability remained. Adjusted return on invested capital was 15.2% for the trailing twelve months, roughly flat year-over-year.
2026 outlook: subdued enterprise spend, cloud and services growth expected
Executives said industry conditions have “largely remained unchanged,” with corporate and large enterprise clients still cautious. Mullen said PC and infrastructure investment should remain moderate near term, while Insight monitors supply chain dynamics and memory pricing. She also said the company sees opportunity in cloud modernization, security, and AI adoption.
In guidance for full-year 2026, the company expects:
- Gross profit growth in the low single digits and gross margin of approximately 21%.
- Adjusted diluted EPS (including stock-based compensation) of $10.10 to $10.60.
- Adjusted diluted EPS (excluding stock-based compensation) of $11.00 to $11.50. Morgado said this is about 5% growth at the midpoint versus 2025 adjusted EPS of $10.75 excluding stock-based compensation.
- Cash flow from operations of $300 million to $400 million.
Morgado said EPS growth is expected to be “more heavily weighted toward the first half,” with first-half results likely closer to the upper end of the range and the second half “a little bit below the midpoint to the lower end,” based on current visibility. He cited stronger expected performance in cloud and hardware in the first half, while core services should be steadier across the year.
On cloud, Morgado said Insight expects low double-digit cloud gross profit growth in 2026 as the company moves past most partner program changes. He added that the “pivot” toward corporate and mid-market resale is complete operationally, but a financial “tail” remains in 2026, particularly tied to Google-related dynamics and seasonality associated with the SADA business, with more impact expected in the second half. He said the partner program change impact in 2025 was about $70 million in gross profit, consistent with what the company projected at the start of the year.
On capital allocation, Morgado said the company intends to begin repurchasing $75 million in shares starting in the first quarter of 2026.
Additional themes: memory price inflation, AI infrastructure, and leadership transition
During Q&A, Mullen discussed expected memory-driven price increases in PCs, saying OEMs have documented price increases and that the range could be “between 10% and probably 20%-25%” in 2026. She said higher prices can trigger demand elasticity—historically above roughly 15%—which could pressure unit volumes, while also creating opportunities for Insight to help customers navigate supply-chain constraints and alternatives.
Asked about AI data center build-outs, Mullen said AI infrastructure deployments are more complex than historical data center projects and that the industry is in the early stages of broader enterprise adoption. She pointed to prepackaged “AI factories” from partners and highlighted Insight’s work as the first partner to launch the Cisco Secure AI Factory with NVIDIA into its labs.
Mullen also noted the board’s CEO succession process is underway, with an external search “progressing as planned,” and said Insight expects to name a successor “in the next few months.”
About Insight Enterprises (NASDAQ:NSIT)
Insight Enterprises, Inc is a global technology provider headquartered in Tempe, Arizona. Founded in 1988, the company specializes in helping organizations harness the power of digital transformation by offering a comprehensive portfolio of IT hardware, software, cloud and licensing management solutions. Insight’s expertise spans across the full technology lifecycle, from initial strategy and consulting to implementation, integration and ongoing managed services.
At the core of Insight’s business are its consulting and professional services, which guide clients through complex technology environments and ensure optimal deployment of solutions.
