What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-14 compared with 2024-02-22 · 309 added, 300 removed, 1095 unchanged (36% of the section changed)

8 unchanged sentences

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

To the Stockholders and the Board of Directors

Insight Enterprises, Inc.:

1 unchanged sentence

We have audited the accompanying consolidated balance sheets of Insight Enterprises, Inc.

and subsidiaries (the Company) as of December 31, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and December 31, 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with U.S.

and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 14, 2025 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed its method of accounting for its convertible debt instrument in 2022 due to the adoption of the FASB’s Accounting Standards Update No.

2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.

Basis for Opinion

12 unchanged sentences

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by

communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Evaluation of revenue recognition

21 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

To the Stockholders and the Board of Directors

Insight Enterprises, Inc.:

4 unchanged sentences

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements), and our report dated February 14, 2025 expressed an unqualified opinion on those consolidated financial statements.

The Company acquired SADA Systems, LLC during 2023, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023, SADA Systems, LLC’s internal control over financial reporting associated with approximately 15% of total assets as of December 31, 2023 and less than 1% of net sales for the year ended December 31, 2023 included in the consolidated financial statements of the Company as of and for the year ended December 31, 2023.

Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of SADA Systems, LLC.

Basis for Opinion

10 unchanged sentences

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the

transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

15 unchanged sentences

Long-term contract assets, net

86,953 132,780

Property and equipment, net 215,678 210,061

51 unchanged sentences

Earnings from operations 388,584 419,795 413,700

Non-operating (income) expense:

Non-operating expense (income):

Interest expense, net 58,036 41,124 39,497

Other expense (income), net

817 ( 230 ) ( 1,012 )

Other (income) expense, net ( 2,365 ) 817 ( 230 )

Earnings before income taxes 332,913 377,854 374,433

14 unchanged sentences

Net earnings $ 249,691 $ 281,309 $ 280,608

Other comprehensive income (loss), net of tax:

Other comprehensive (loss) income, net of tax:

Foreign currency translation adjustments ( 39,546 ) 17,190 ( 31,708 )

12 unchanged sentences

Stock-based compensation expense — — — — 33,971 — — 33,971

ESPP 27 — — — 4,477 — — 4,477

Shares issued upon conversion of Convertible Notes 141 1 — — ( 1 ) — — —

Shares received from convertible note hedge upon conversion of Convertible Notes ( 141 ) ( 1 ) — — 1 — — —

Repurchase of treasury stock — — ( 1,023 ) ( 200,020 ) — — — ( 200,020 )

5 unchanged sentences

Balances at December 31, 2022 34,009 $ 340 — $ — $ 327,872 $ ( 58,802 ) $ 1,368,658 $ 1,638,068

Cumulative effect of accounting change — — — — ( 44,731 ) — 17,789 ( 26,942 )

Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes 215 2 — — ( 10,797 ) — — ( 10,795 )

2 unchanged sentences

Retirement of treasury stock ( 1,634 ) ( 16 ) 1,634 217,108 ( 15,537 ) — ( 201,555 ) —

Excise tax on stock repurchases — — — — ( 1,882 ) — — ( 1,882 )

Foreign currency translation adjustments, net of tax — — — — — 17,190 — 17,190

2 unchanged sentences

Balances at December 31, 2021 34,897 $ 349 — $ — $ 368,282 $ ( 27,094 ) $ 1,167,690 $ 1,509,227

Cumulative effect of accounting change — — — — ( 44,731 ) — 17,789 ( 26,942 )

Issuance of common stock under employee stock plans, net of shares withheld for payroll taxes 220 2 — — ( 7,907 ) — — ( 7,905 )

19 unchanged sentences

Amortization of debt issuance costs 5,591 4,870 6,105

Net change on revaluation of earnout liabilities ( 7,848 ) — —

Other adjustments 1,054 234 2,035

1 unchanged sentence

Increase in accounts receivable ( 656,092 ) ( 11,892 ) ( 406,370 )

Decrease (increase) in inventories 75,729 53,711 ( 148,941 )

Increase in contract assets ( 13,840 ) ( 3,152 ) ( 4,757 )

(Increase) decrease in long-term accounts receivable

( 126,850 ) ( 17,015 ) 11,750

Decrease (increase) in other assets

34,061 48,025 ( 25,093 )

Decrease in inventories 54,439 75,729 53,711

Decrease (increase) in contract assets 58,433 ( 13,840 ) ( 3,152 )

Increase in long-term accounts receivable ( 454,887 ) ( 126,850 ) ( 17,015 )

Decrease in other assets 16,199 34,061 48,025

Increase in accounts payable 825,555 216,229 53,607

Increase (decrease) in long-term accounts payable

111,790 7,931 ( 18,454 )

(Decrease) increase in accrued expenses and other liabilities

( 35,518 ) ( 3,518 ) 8,517

Increase in long-term accounts payable 441,881 111,790 7,931

Decrease in accrued expenses and other liabilities ( 51,613 ) ( 35,518 ) ( 3,518 )

Net cash provided by operating activities:

10 unchanged sentences

Net repayments under inventory financing facilities ( 13,577 ) ( 70,408 ) ( 8,307 )

Proceeds from issuance of senior unsecured notes 500,000 — —

Payment of debt issuance costs ( 8,652 ) — —

Repayment of principal on the Convertible Notes ( 16,895 ) — —

Repurchases of common stock ( 200,020 ) ( 217,108 ) ( 107,922 )

4 unchanged sentences

Foreign currency exchange effect on cash, cash equivalents and restricted cash balances ( 17,614 ) 7,449 ( 14,531 )

Increase (decrease) in cash, cash equivalents and restricted cash 105,067 59,741 ( 24,605 )

(Decrease) increase in cash, cash equivalents and restricted cash ( 9,318 ) 105,067 59,741

Cash, cash equivalents and restricted cash at beginning of period 270,785 165,718 105,977

18 unchanged sentences

Our offerings in the remainder of our EMEA and APAC segments consist largely of software and certain software-related services and cloud solutions.

Effective December 1, 2023, we acquired SADA Systems, LLC ("SADA"), a provider of cloud consultancy and technical services, for a preliminary cash purchase price of approximately $ 398,589,000 , net of cash and cash equivalents acquired of $ 24,701,000 and excluding the estimated fair value of earn outs, reported in other liabilities, with a range of payouts through 2027 of $ 0 to $ 390,000,000 .

Effective May 1, 2024, we acquired 100 percent of the issued and outstanding shares of Infocenter.io Corporation ("Infocenter") for a cash purchase price of $ 265,000,000 , net of cash and cash equivalents acquired of $ 5,103,000 , and excluding the estimated fair value of earn outs, reported in other liabilities, of up to $ 106,250,000 .

Effective December 1, 2023, we acquired SADA Systems, LLC ("SADA"), a provider of cloud consultancy and technical services, for a cash purchase price of approximately $ 399,762,000 , net of cash and cash equivalents acquired of $ 24,701,000 and excluding the estimated fair value of earn outs, reported in other liabilities, with a range of payouts through 2027 of $ 0 to $ 390,000,000 .

The acquisition was funded through a combination of cash on hand and borrowings under our senior secured revolving credit facility (the “ABL facility”).

Effective August 17, 2023, we acquired Amdaris Group Limited (“Amdaris”), a software development and digital services specialist, for a preliminary cash purchase price, net of cash and cash equivalents acquired, of approximately $ 82,875,000 , and excluding the estimated fair value of earn outs, reported in other liabilities, with a range of payouts through 2026 of $ 0 to $ 54,391,000 .

Effective June 1, 2022, we acquired Hanu Software Solutions, Inc.

and Hanu Software Solutions (India) Private Ltd.

(collectively, “Hanu”), a global leading cloud technology services and solutions provider, for a cash purchase price, net of cash and cash equivalents acquired, of approximately $ 68,248,000 , excluding the earn out and hold backs for representations and warranties.

Our results of operations include the results of Hanu, Amdaris and SADA from their respective acquisition dates.

Effective August 17, 2023, we acquired Amdaris Group Limited (“Amdaris”), a software development and digital services specialist, for a cash purchase price of approximately $ 82,875,000 , net of cash and cash equivalents acquired, and excluding the estimated fair value of earn outs, reported in other liabilities, with a range of payouts through 2026 of $ 0 to $ 54,391,000 .

Our results of operations include the results of Infocenter, SADA and Amdaris from their respective acquisition dates.

(See Note 20 for a discussion of our acquisitions).

4 unchanged sentences

Included in our accounts receivable, net balance at December 31, 2024 and 2023 is $ 18,010,000 and $ 26,025,000 , respectively, of accounts receivable from an unconsolidated affiliate.

References to “the Company,” “Insight,” “we,” “us,” “our” and other

References to “the Company,” “Insight,” “we,” “us,” “our” and other similar words refer to Insight Enterprises, Inc.

and its consolidated subsidiaries, unless the context suggests otherwise.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

similar words refer to Insight Enterprises, Inc.

and its consolidated subsidiaries, unless the context suggests otherwise.

Certain amounts in the prior year’s consolidated financial statements and related footnotes thereto have been reclassified to conform with the current year presentation.

Acquisition Accounting

9 unchanged sentences

Actual results could differ from those estimates.

On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts and contract assets, valuation of inventories, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

On an ongoing basis, we evaluate our estimates, including those related to sales recognition, anticipated achievement levels under partner funding programs, assumptions related to stock-based compensation valuation, allowances for doubtful accounts and contract assets, valuation of inventories, valuation of acquired intangible assets, litigation-related obligations, valuation allowances for deferred tax assets and impairment of long-lived assets, including purchased intangibles and goodwill, if indicators of potential impairment exist.

Cash, Cash Equivalents and Restricted Cash

10 unchanged sentences

The allowance is based on our evaluation of the aging of the receivables, historical write-offs and the current economic environment.

We write off individual accounts against the reserve when we no longer believe that it is probable that we will collect the receivable because we become aware of a client’s or partner’s inability to meet its

Such awareness may be as a result of bankruptcy filings, or deterioration in the client’s or partner’s operating results or financial position.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

financial obligations.

Such awareness may be as a result of bankruptcy filings, or deterioration in the client’s or partner’s operating results or financial position.

Allowance for Contract Assets

22 unchanged sentences

When an indication exists that the carrying amount of long-lived assets may not be recoverable, we assess the recoverability of our assets by comparing the projected undiscounted net cash flows associated with the related asset or group of assets over their remaining lives against their respective carrying amounts.

Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other

Such impairment test is based on the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities.

Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

groups of assets and liabilities.

Impairment, if any, is based on the excess of the carrying amount over the estimated fair value of those assets.

Goodwill is recorded when the purchase price paid for an acquisition exceeds the estimated fair value of net identified tangible and intangible assets acquired.

22 unchanged sentences

Right of use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

We use the implicit rate when readily determinable.

The operating lease ROU asset includes any prepaid lease payments and additional direct costs and excludes lease incentives.

The operating lease ROU

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

asset includes any prepaid lease payments and additional direct costs and excludes lease incentives.

Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option.

22 unchanged sentences

We recognize hardware product revenue on a gross basis at the point in time when a client takes control of the hardware, which typically occurs when title and risk of loss have passed to the client at its destination.

Our selling terms and conditions typically specify Free On Board (“F.O.B.”) destination contractual terms such that control is transferred from the Company at the point in

Our selling terms and conditions typically specify Free On Board (“F.O.B.”) destination contractual terms such that control is transferred from the Company at the point in time when the product is received by the client.

The transaction price for hardware sales is adjusted for estimated product returns that we expect to occur under our return policy based upon historical return rates.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

time when the product is received by the client.

The transaction price for hardware sales is adjusted for estimated product returns that we expect to occur under our return policy based upon historical return rates.

We leverage drop-shipment arrangements with many of our partners and suppliers to deliver products to our clients without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs.

1 unchanged sentence

In addition to other factors considered, we assume primary responsibility for fulfillment in the arrangement, we assume inventory risk if the product is returned by the client, we set the price of the product charged to the client and we work closely with our clients to determine their hardware specifications.

Bill and Hold Transactions

Warehousing services

We offer a service to our customers whereby clients may purchase product that we procure on their behalf and, at our clients’ direction, store the product in our warehouse for a designated period of time, with the intention of deploying the product to the clients’ designated locations at a later date.

15 unchanged sentences

Under net sales recognition, the cost of the software maintenance agreement is recorded as a reduction to sales, resulting in net sales equal to the gross profit on the transaction, and there are no costs of goods sold.

Because we are acting as the software publisher’s agent, revenue is recognized

Because we are acting as the software publisher’s agent, revenue is recognized when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.

We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

when the parties agree to the initial purchase, renewal or extension as our agency services are then complete.

We report all fees earned from activities reported net within our services net sales category in our consolidated statements of operations.

Vendor Direct Support Services Contracts

40 unchanged sentences

As such, we act as the principal in the transaction and record the services under a gross sales recognition basis, with the selling price being recorded in sales and our cost to the third-party service provider being recorded in costs of goods sold.

We recognize revenue for these contracts as the underlying services are performed and we satisfy our performance obligations.

For certain third-party service contracts in which we do not control the services prior to transferring to our clients because we are not responsible for fulfillment of the services, we have concluded that we are an agent in the transaction and record revenue on a net sales recognition basis.

3 unchanged sentences

Selling and Administrative Expenses

Selling and administrative expenses include salaries and wages for teammates who are not directly associated with delivering services, bonuses and incentives, stock-based compensation expense, employee-related expenses, facility-related expenses, marketing and advertising expense, reduced by certain payments and credits received from partners related to shared marketing expense programs, as described under “Partner Funding” below, depreciation of property and equipment, professional fees, amortization of intangible assets, provisions for losses on accounts receivable and other operating expenses.

Partner Funding

1 unchanged sentence

Partner funding received pursuant to volume sales incentive programs is recognized as it is earned as a reduction to costs of goods sold.

Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the applicable incentives earned from each partner and is recorded in cost of goods sold as the related

Partner funding received pursuant to volume purchase incentive programs is allocated as a reduction to inventories based on the

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

inventory is sold.

applicable incentives earned from each partner and is recorded in cost of goods sold as the related inventory is sold.

Partner funding received pursuant to shared marketing expense programs is recorded as it is earned as a reduction of the related selling and administrative expenses in the period the program takes place if the consideration represents a reimbursement of specific, incremental, identifiable costs.

Consideration that exceeds the specific, incremental, identifiable costs is classified as a reduction of costs of goods sold.

Partner funding received pursuant to certain services delivered is recorded as services net sales.

The amount of partner funding recorded as a reduction of selling and administrative expenses in our statements of operations totaled $ 127,059,000 , 122,638,000 and 128,153,000 in 2024, 2023 and 2022, respectively.

5 unchanged sentences

No other partner accounted for more than 10% of purchases in 2024.

Our top five partners as a group for 2023 were Microsoft, TD Synnex (a distributor), Cisco Systems, Ingram Micro (a distributor) and Dell, and approximately 60 % of our total purchases during 2023 came from this group of partners.

Our top five partners as a group for 2024 were Microsoft, TD Synnex (a distributor), Google, Cisco Systems and Ingram Micro (a distributor), and approximately 55 % of our total purchases during 2024 came from this group of partners.

Although brand names and individual products are important to our business, we believe that competitive sources of supply are available in substantially all of our product categories such that, with the exception of Microsoft, we are not dependent on any single partner for sourcing products.

1 unchanged sentence

Advertising costs are expensed as they are incurred.

Advertising expense of $ 81,959,000 , $ 88,667,000 and $ 66,375,000 was recorded in 2023, 2022 and 2021, respectively.

Advertising expense of approximately $ 76,167,000 , $ 81,959,000 and $ 88,667,000 was recorded in 2024, 2023 and 2022, respectively.

These amounts were predominantly offset by partner funding earned pursuant to shared marketing expense programs recorded as a reduction of selling and administrative expenses, as discussed in “Partner Funding” above.

12 unchanged sentences

Income and expense items are translated at the average exchange rate for each month within the year.

The resulting translation adjustments are recorded directly in accumulated other comprehensive income, net of tax – foreign currency translation adjustments as a separate component of stockholders’ equity.

Net foreign currency transaction gains/losses, including transaction gains/losses on intercompany balances that are not of a long-term investment nature and non-functional

The resulting translation adjustments are recorded directly in accumulated other comprehensive income, net of tax – foreign currency translation adjustments as a separate component of

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

currency cash balances, are reported in other expense (income), net within non-operating (income) expense in our consolidated statements of operations.

stockholders’ equity.

Net foreign currency transaction gains/losses, including transaction gains/losses on intercompany balances that are not of a long-term investment nature and non-functional currency cash balances, are reported in other expense (income), net within non-operating (income) expense in our consolidated statements of operations.

Income taxes are accounted for under the asset and liability method.

19 unchanged sentences

Diluted EPS is computed on the basis of the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method.

Dilutive potential common shares include outstanding RSUs and certain shares underlying our outstanding convertible senior notes (the "Notes") and the warrants relating to the Call Spread Transactions (as defined in Note 8), as applicable.

Dilutive potential common shares include outstanding RSUs and certain shares underlying our outstanding convertible senior notes (the "Convertible Notes") and the warrants (the "Warrants") relating to the Call Spread Transactions (as defined in Note 8), as applicable.

A reconciliation of the denominators of the basic and diluted EPS calculations follows (in thousands, except per share data):

7 unchanged sentences

Convertible senior notes 3,205 2,619 1,466

2,348 1,343 —

Weighted-average shares used to compute diluted EPS

5 unchanged sentences

These share-based awards could be dilutive in the future.

For the years ended December 31, 2022, and 2021, certain potential outstanding shares from the warrants relating to the Call Spread Transactions were excluded from the diluted EPS calculations because their inclusion would have been anti-dilutive.

For the years ended December 31, 2023, and 2022, certain potential outstanding shares underlying the Warrants were excluded from the diluted EPS calculations because their inclusion would have been anti-dilutive.

Recently Issued Accounting Standards

In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No.

2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)".

The standard requires public business entities to disclose detailed information about specific types of expenses that are relevant to certain line items on the income statement.

The guidance is effective for annual periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027.

The requirements can be applied prospectively with the option for retrospective application, and early adoption is permitted.

The Company is currently evaluating the impact the adoption of this standard will have on its consolidated financial statements.

In December 2023, the FASB issued Accounting Standard Update ASU No.

2023-09, "Income Taxes (Topic 740)".

The standard requires reporting entities to provide disaggregated information on their effective tax rate reconciliation and income taxes paid.

The standard is intended to aid business leaders and investors to make more informed investment decisions.

The guidance is effective for annual periods beginning after December 15, 2024 and can be applied

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

prospectively, with an option for retrospective application, and early adoption is allowed.

The Company plans to adopt this standard on January 1, 2025.

The adoption is not expected to have a material impact on the Company’s disclosures.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU No.

2023-07, "Segment Reporting (Topic 280):

2 unchanged sentences

The main objective of the amendments is to assist investors in understanding the entity's overall performance and evaluate potential future cash flows.

The guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024 with early adoption being permitted.

We adopted this standard effective January 1, 2024 and it did not have a material effect on the Company's consolidated financial statements or disclosures.

The standard is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024 with early adoption being permitted.

We adopted the annual requirements of this standard effective January 1, 2024 and will adopt the interim period requirements of this standard effective January 1, 2025.

This standard did not have a material effect on the Company's consolidated financial statements or disclosures.

In September 2022, the FASB issued ASU No.

2022-04, “Liabilities - Supplier Finance Programs (Subtopic 405-50)”.

This standard is intended to address requests from stakeholders

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

for information about an entity’s use of supplier finance programs and their effect on the entity’s working capital, liquidity, and cash flows.

This standard is intended to address requests from stakeholders for information about an entity’s use of supplier finance programs and their effect on the entity’s working capital, liquidity, and cash flows.

The guidance was effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, except for the amendment on roll-forward information requirement, which is effective for fiscal years beginning after December 15, 2023.

The Company adopted this standard effective January 1, 2023, with the exception of the roll-forward information requirement.

The Company adopted this standard effective January 1, 2023, with the exception of the roll-forward information requirement, which we adopted in the current annual period.

The adoption did not have a material effect on the Company's disclosures.

In October 2021, the FASB issued ASU No.

2021-08, "Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers", which clarifies how to properly account for deferred revenue in a business combination.

The amendments require an acquirer to use the guidance in ASC 606, Revenue from Contracts with Customers, rather than using fair value, when recognizing and measuring contract assets and contract liabilities related to customer contracts assumed in a business combination.

The guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

Early adoption is permitted.

The Company adopted this standard effective January 1, 2023 and the adoption did not have a material effect on the Company's consolidated financial statements or disclosures.

In August 2020, the Financial Accounting Standards Board ("FASB") issued ASU No.

2020-06, "Accounting for Convertible Instruments and Contracts in an Entity's Own Equity".

The new guidance is intended to simplify the accounting for certain convertible instruments with characteristics of both liability and equity.

The guidance removed certain accounting models which separate the embedded conversion features from the host contract for convertible instruments.

As a result, after the adoption of this guidance, an entity's convertible debt instrument will be wholly accounted for as debt.

The guidance also expanded disclosure requirements for convertible instruments and simplified areas of the guidance for diluted earnings-per-share calculations by requiring the use of the if-converted method.

The guidance was effective for fiscal years beginning after December 15, 2021, and could have been adopted on either a fully retrospective or modified retrospective basis.

The Company adopted this standard effective January 1, 2022, using the modified retrospective approach.

Therefore, financial statements for the year ended December 31, 2022 and forward are presented under the new standard, while the comparative period is not adjusted and is reported in accordance with the Company's previous method of accounting.

The adoption of ASU 2020-06 significantly impacted our consolidated statements of operations and consolidated balance sheet as we no longer report accreted interest on the Notes.

The cumulative effect adjustment from prior periods that we recognized in our consolidated balance sheet as adjustments to reduce additional paid in capital and increase retained earnings were $ 44,731,000 and $ 17,789,000 , respectively.

Had we followed the prior method of accounting for the year ended December 31, 2022, reported basic and diluted EPS would decrease by $ 0.24 and $ 0.22 , respectively, from $ 8.04 and $ 7.66 , respectively, to $ 7.80 and $ 7.44 , respectively.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(2) Receivables, Contract Assets, Contract Liabilities and Performance Obligations

Contract Balances

The following table provides information about receivables and contract liabilities as of December 31, 2023 and 2022 (in thousands):

The following table provides information about receivables, contract assets and contract liabilities balances as of December 31, 2024 and 2023 (in thousands):

Current receivables, which are included in “Accounts receivable, net”

2 unchanged sentences

81,980 120,518

Long-term accounts receivable

412,666 160,818

Long-term contract assets

$ 132,780 $ —

Long-term accounts receivable, net 845,943 412,666

Long-term contract assets, net $ 86,953 $ 132,780

Contract liabilities, which are included in “Accrued expenses and other current liabilities” and “Other liabilities”

$ 109,615 $ 107,217

Significant changes in the contract assets balances during the years ended December 31, 2023 and 2022 are as follows (in thousands):

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Significant changes in the gross contract assets balances during the years ended December 31, 2024 and 2023 are as follows (in thousands):

Balances at December 31, 2022 $ 7,909

Balances at Contract assets acquired through business combination 246,666

Reclassification of beginning contract assets to receivables, as a result of rights to consideration becoming unconditional ( 33,638 )

1 unchanged sentence

Balances at December 31, 2023 $ 272,287

Contract assets acquired through business combination

Reclassification of beginning contract assets to receivables, as a result of rights to consideration becoming unconditional

Contract assets recognized, net of reclassification to receivables 18,182

Measurement period adjustments to acquired contract assets ( 26,412 )

Balances at December 31, 2024 $ 178,438

Contract assets consist of amounts the Company is entitled to for the resale of third-party consumption-based services, prior to payment becoming unconditional.

In these transactions, the Company invoices clients for the gross amount of consideration it is responsible to collect,

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

including amounts ultimately passed on to the third-party service providers.

In these transactions, the Company invoices clients for the gross amount of consideration it is responsible to collect, including amounts ultimately passed on to the third-party service providers.

As of December 31, 2024, contract assets, net of allowances, were $ 168,933,000 .

Gross contract assets by our internal risk ratings as of December 31, 2024 are summarized as follows (in thousands):

Contract assets

Moderate risk

8 unchanged sentences

Balances at December 31, 2024 $ 109,615

Transaction price allocated to the remaining performance obligations

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Remaining performance obligations

The following table includes estimated net sales related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2024 that are expected to be recognized in the future (in thousands):

2 unchanged sentences

Total remaining performance obligations $ 233,894

With the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, remaining performance obligations that have original expected durations of one year or less are not included in the table above.

Amounts not included in the table above have an average original expected duration of nine months.

Additionally, for our time and material services contracts, whereby we have the right to consideration from a client in an amount that corresponds directly with the value to the client of our performance completed to date, we recognized revenue in the amount to which we have a right to invoice as of December 31, 2023 and do not disclose

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

information about related remaining performance obligations in the table above.

With the exception of remaining performance obligations associated with our OneCall Support Services contracts which are included in the table above regardless of original duration, the remaining performance obligations that have original expected durations of one year or less are not included in the table above.

Amounts not included in the table above have an average original expected duration of seven months.

Our open time and material contracts at December 31, 2024, have an average expected duration of 29 months.

The majority of our product backlog historically has been and continues to be open cancellable purchase orders.

We do not believe that backlog as of any particular date is predictive of future results, therefore we do not include performance obligations under open cancellable purchase orders, which do not qualify for revenue recognition as of December 31, 2023, in the table above.

Assets recognized for costs of obtaining a contract with a customer

6 unchanged sentences

During 2023, we completed the sale of our properties in Montreal, Canada and Sheffield, United Kingdom for the total net proceeds of approximately $ 15,476,000 .

During 2022, we had no assets held for sale.

During 2024, we did not have any assets held for sale.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(4) Property and Equipment

11 unchanged sentences

Depreciation and amortization expense related to property and equipment was $ 28,556,000 , $ 26,245,000 and $ 23,722,000 in 2024, 2023 and 2022, respectively.

Included within the buildings and equipment values presented above for 2023 are assets in the process of being readied for use in the amounts of approximately $ 11,200,000 and $ 1,500,000 , respectively.

Included within the software and buildings values presented above for 2022 are assets in the process of being readied for use in the amounts of approximately $ 3,532,000 and $ 3,346,000 , respectively.

Depreciation on these assets will commence, as appropriate, when they are ready for use and placed in service.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The changes in the carrying amount of goodwill for the year ended December 31, 2024 are as follows (in thousands):

EMEA APAC Consolidated

Goodwill $ 727,013 $ 169,174 $ 20,993 $ 917,180

Accumulated impairment losses ( 323,422 ) ( 151,439 ) ( 13,973 ) ( 488,834 )

Balance at December 31, 2022 $ 470,523 $ 15,987 $ 6,523 $ 493,033

Goodwill acquired during 2023 117,022 71,698 — 188,720

Measurement period adjustments during 2022 — — — —

Foreign currency translation adjustment 1,338 1,163 91 2,592

1 unchanged sentence

Goodwill acquired during 2024 191,728 5,547 — 197,275

Measurement period adjustments 17,807 — — 17,807

Foreign currency translation adjustment ( 3,936 ) ( 1,380 ) ( 595 ) ( 5,911 )

Balance at December 31, 2024 $ 794,482 $ 93,015 $ 6,019 $ 893,516

On December 1, 2023, we acquired SADA, which is reported in our North America business.

On May 1, 2024, we acquired Infocenter, which is reported in our North America business.

Under the acquisition method of accounting, the preliminary purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.

The excess purchase price over fair value of net assets acquired of approximately $ 190,725,000 was recorded as goodwill in the North America reporting unit.

The primary driver for this acquisition was to enhance our Solutions Integrator offering framework to drive better business outcomes for our clients by enabling them to scale their multicloud environments with modern infrastructure, applications, and unified data and AI platforms.

On December 1, 2023, we acquired SADA, which is reported in our North America business.

The excess purchase price over fair value of net

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

assets acquired of approximately $ 117,022,000 was recorded as goodwill in the North America reporting unit.

The primary driver for this acquisition was to strengthen our ability to benefit from the growing trend of multicloud adoption, and to accelerate our progress toward our strategic objective of growing cloud services and solutions.

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The primary driver for this acquisition was to expand our capacity to deliver services to support clients’ digital transformation initiatives in EMEA.

On June, 1, 2022 we acquired Hanu, which is reported in our North America business.

Under the acquisition method of accounting, the purchase price for the acquisition was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.

The excess purchase price over fair value of net assets acquired of approximately $ 69,923,000 was recorded as goodwill in the North America reporting unit.

During 2023, we periodically assessed whether any indicators of impairment existed which would require us to perform an interim impairment review.

As of each interim period end during the year, we concluded that a triggering event had not occurred that would more likely than not reduce the fair value of our reporting units below their carrying values.

We performed our annual test of goodwill for impairment during the fourth quarter of 2024.

The results of the qualitative goodwill impairment test indicated that the fair values of our North America, EMEA and APAC reporting units were in excess of their respective carrying values.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(6) Intangible Assets

13 unchanged sentences

Total amortization expense $ 426,493

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(7) Accounts Payable - Inventory Financing Facilities

2 unchanged sentences

Inventory Financing Facilities

We have an unsecured inventory financing facility with MUFG Bank Ltd (“MUFG”) for $ 280,000,000 .

During 2022, we increased our maximum availability under our unsecured inventory financing facility with PNC Bank, N.A.

( “PNC”) from $ 300,000,000 to $ 375,000,000 , including the $ 25,000,000 facility in Canada (the "Canada facility").

We also increased our unsecured inventory financing facility with Wells Fargo in EMEA (the "EMEA facility") to $ 50,000,000 .

We have maximum availability under our unsecured inventory financing facility with MUFG Bank Ltd (“MUFG”) of $ 280,000,000 .

We have maximum availability under our unsecured inventory financing facility with PNC Bank, N.A.

(“PNC”) of $ 375,000,000 , including a $ 25,000,000 facility in Canada (the "Canada facility").

We also have maximum availability under our unsecured inventory financing facility with Wells Fargo in EMEA (the "EMEA facility") of $ 50,000,000 .

As of December 31, 2024, our combined inventory financing facilities had a total maximum capacity of $ 705,000,000 , of which $ 217,604,000 was outstanding.

1 unchanged sentence

In the second quarter of 2023, the Company transitioned the reference rate for invoices issued in U.S.

Dollars under the PNC facility from LIBOR to the Term Secured Overnight

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Financing Rate ("Term SOFR") benchmark provisions.

If balances are not paid within stated vendor terms (typically 60 days), they will accrue interest at prime plus 2.00 % on the MUFG facility, Canadian Dollar Offered Rate plus 4.50 % on the Canada facility and Term SOFR, EURIBOR, or SONIA, as applicable, plus 4.50 % and 0.25 % on the PNC (other than the Canada facility) and EMEA facilities, respectively.

Dollars under the PNC facility from LIBOR to the Term Secured Overnight Financing Rate ("Term SOFR") benchmark provisions.

If balances are not paid within stated vendor terms (typically 60 days), they will accrue interest at prime plus 2.00 % on the MUFG facility, Canadian Overnight Repo Rate Average plus 4.50 % on the Canada facility and Term SOFR, EURIBOR, or SONIA, as applicable, plus 4.50 % and 0.25 % on the PNC (other than the Canada facility) and EMEA facilities, respectively.

Amounts outstanding under these facilities are classified separately as accounts payable – inventory financing facilities in the accompanying consolidated balance sheets and within cash flows from financing activities in the accompanying consolidated statements of cash flows.

1 unchanged sentence

Imputed interest of $ 9,647,000 , $ 13,276,000 and $ 15,523,000 was recorded in 2024, 2023 and 2022, respectively .

A roll forward of the inventory financing facilities balances during the year ended December 31, 2024 is as follows (in thousands):

Inventory financing facilities

Balances at December 31, 2023 $ 231,850

Purchases made through the inventory financing facilities 1,262,870

Cash payments made to settle balances due on the inventory financing facilities ( 1,276,447 )

Foreign exchange adjustments $ ( 669 )

Balances at December 31, 2024 $ 217,604

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(8) Debt, Finance Leases and Other Financing Obligations

1 unchanged sentence

ABL revolving credit facility $ 39,000 $ 591,500

Senior unsecured notes due 2032 492,222 —

Convertible senior notes due 2025 332,867 347,988

Finance leases and other financing obligations 1,033 102

Other financing obligations 23 1,033

864,112 940,521

1 unchanged sentence

Long-term debt $ 531,233 $ 592,517

On July 22, 2022, we entered into the Third Amendment to the Credit Agreement (as amended, the "credit agreement") to modify our senior secured revolving credit facility (the “ABL facility”), increasing the maximum borrowing amount from $ 1,200,000,000 to $ 1,800,000,000 , including a maximum borrowing capacity that could be used for borrowing in certain foreign currencies of $ 350,000,000 and extending the maturity date.

On May 14, 2024, we entered into the Fourth Amendment to the Credit Agreement (as amended, the "credit agreement") to modify our senior secured revolving credit facility (the “ABL facility”).

The amendment, among other things, releases certain immaterial guarantors from their obligations under the credit agreement.

Our maximum borrowing amount under the ABL facility is $ 1,800,000,000 , including a maximum borrowing capacity that could be used for borrowing in certain foreign currencies of $ 350,000,000 .

From time to time and at our option, we may request to increase the aggregate amount available for borrowing under the ABL facility by up to an aggregate of the U.S.

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The ABL facility provides for an uncommitted first-in, last-out revolving facility in an aggregate amount of up to $ 100,000,000 .

The interest rates applicable to borrowings under the ABL facility are based on the average aggregate excess availability under the ABL facility as set forth on a pricing grid in the credit agreement.

The ABL facility matures on July 22, 2027.

As of December 31, 2023, eligible accounts receivable and inventory were sufficient to permit availability to $ 1,709,888,000 of the full $ 1,800,000,000 facility amount, of which $ 591,500,000 was outstanding.

As of December 31, 2024, eligible accounts receivable and inventory permitted availability to the full $ 1,800,000,000 facility amount, of which $ 39,000,000 was outstanding.

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Interest expense associated with the ABL facility was $ 32,576,000 , $ 30,116,000 and $ 21,362,000 in 2024, 2023 and 2022, respectively, including the commitment fee and amortization of deferred financing fees.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The ABL facility contains customary affirmative and negative covenants and events of default.

If a default occurs (subject to customary grace periods and materiality thresholds) under the credit agreement, certain actions may be taken, including, but not limited to, possible termination of commitments and required payment of all outstanding principal amounts plus accrued interest and fees payable under the credit agreement.

Senior Unsecured Notes due 2032

On May 20, 2024, we issued $ 500,000,000 aggregate principal amount of 6.625 % Senior Notes due 2032 (the "Senior Notes") that mature on May 15, 2032.

The Senior Notes are

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

senior unsecured obligations of the Company and guaranteed by each of the Company's existing and future direct and indirect U.S.

subsidiaries that is or becomes a guarantor or borrower under the ABL facility, subject to certain exceptions.

The net proceeds from the offering were used to repay a portion of the outstanding borrowings under the ABL facility.

The Senior Notes were issued pursuant to an indenture (the "Senior Notes Indenture") containing certain covenants that limit the Company's ability to, subject to certain exceptions, create, incur, or assume liens to secure debt, among other things.

The Senior Notes bear interest at an annual rate of 6.625 % payable semiannually, in arrears, on May 15 th and November 15 th of each year beginning on November 15, 2024.

The Company may redeem the Senior Notes prior to May 15, 2027, with an amount equal to the net cash proceeds received by the Company from certain equity offerings at a redemption price equal to 106.625 % of the principal amount of such notes, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, in an aggregate principal amount for all such redemptions not to exceed 40 % of the aggregate principal amount of the Senior Notes.

The Senior Notes are subject to redemption at specified prices on or after May 15, 2027 plus accrued and unpaid interest, if any, on such notes redeemed, to, but excluding, the applicable redemption date.

In addition, at any time prior to May 15, 2027, the Company may, on one or more occasions, redeem the Senior Notes in whole or in part, at its option, upon notice, at a redemption price equal to 100 % of the principal amount of such notes plus a “make-whole” premium as specified in the Senior Notes Indenture and accrued and unpaid interest, if any, to, but excluding, the redemption date.

If the Company experiences certain change of control events, together with a ratings decline, as described in the Senior Notes Indenture, the Company will be required to make an offer to repurchase some or all of the Senior Notes at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The Senior Notes are subject to certain customary events of default and acceleration clauses.

As of December 31, 2024, no such events have occurred.

The Senior Notes consist of the following balances reported within the consolidated balance sheet as of December 31, 2024 (in thousands):

Principal $ 500,000

debt issuance costs, net of accumulated accretion ( 7,778 )

Net carrying amount $ 492,222

Convertible Senior Notes due 2025

In August 2019, we issued $ 350,000,000 aggregate principal amount of Notes that mature on February 15, 2025.

The Notes bear interest at an annual rate of 0.75 % payable semiannually, in arrears, on February 15 th and August 15 th of each year.

The Notes are general unsecured obligations of Insight and are guaranteed on a senior unsecured basis by Insight Direct USA, Inc., a wholly owned subsidiary of Insight.

Holders of the Notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding June 15, 2024, under the following circumstances:

(1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2019 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day (the "market price trigger");

(2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of our common stock and the conversion rate on each such trading day;

(3) if we call any or all of the Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date;

or (4) upon the occurrence of specified corporate events.

On or after June 15, 2024 until the close of business on the second scheduled trading day immediately preceding the maturity date, the holders may convert their notes at any time, regardless of the foregoing circumstances.

The Notes exceeded the market price trigger of $ 88.82 in the fourth quarter of 2023 and as such, the Notes are convertible at the option of the holders through March 31, 2024.

The Notes are convertible at the option of the holders at December 31, 2023 and, if converted, we are required to settle the principal amount of the Notes in cash.

As such, the Notes balance net of unamortized debt issuance costs is classified as a current liability.

If the Notes continue to exceed the market price trigger in future periods, they will remain convertible at the option of the holders, and the principal amount will continue to be classified as current.

Upon conversion, we will pay cash equal to the principal amount of the Notes, plus shares of our common stock for any additional amounts due.

The conversion rate will initially be 14.6376 shares of common stock per $ 1,000 principal amount of the Notes (equivalent to an initial conversion price of approximately $ 68.32 per share of common stock).

The conversion rate is subject to change in certain circumstances and will not be adjusted for any accrued and unpaid interest.

In addition, following certain events that occur prior to the maturity date or following our issuance of a notice of redemption, the conversion rate is subject to an increase for a holder who elects to convert their notes in connection with those events or during the related redemption period in certain circumstances.

If we undergo a fundamental change, the holders may require us to repurchase for cash all or any portion of their notes at a fundamental change repurchase price equal to 100 % of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date.

As of December 31, 2023, none of the criteria for a fundamental change or a conversion rate adjustment had been met.

The maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, would be 6,788,208 .

In August 2019, we issued $ 350,000,000 aggregate principal amount of the Convertible Notes that mature on February 15, 2025.

The Convertible Notes bear interest at an annual rate of 0.75 % payable semiannually, in arrears, on February 15 th and August 15 th of each year.

The Convertible Notes are general unsecured obligations of Insight and are guaranteed on a senior unsecured basis by Insight Direct USA, Inc., a wholly owned subsidiary of Insight.

Prior to the close of business on the business day immediately preceding June 15, 2024, holders of the Convertible Notes could have converted their notes at their option at any time under certain circumstances.

Beginning June 15, 2024 until the close of business on the second scheduled trading day immediately preceding the maturity date, the holders may convert their Convertible Notes at any time, regardless of such circumstances.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We may redeem for cash all or any portion of the Notes, at our option, on or after August 20, 2022 if the last reported sale price of our common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100 % of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

No sinking fund is provided for the Notes.

In September 2023, an individual Note holder exercised their option to convert their Notes in the aggregate principal amount of $ 16,895,000 , which was settled in January 2024.

As a result, the principal amount of the Notes was settled in cash with additional amounts due being settled in shares of our common stock.

The Notes are subject to certain customary events of default and acceleration clauses.

The Convertible Notes mature on February 15, 2025 and we are required to settle the principal amount of the Convertible Notes in cash.

As such, the Convertible Notes balance net of unamortized debt issuance costs is classified as a current liability.

Upon conversion, we will pay cash equal to the principal amount of the Convertible Notes, plus shares of our common stock for any additional amounts due.

The conversion rate will initially be 14.6376 shares of common stock per $ 1,000 principal amount of the Convertible Notes (equivalent to an initial conversion price of approximately $ 68.32 per share of common stock).

The conversion rate is subject to change in certain circumstances and will not be adjusted for any accrued and unpaid interest.

As of December 31, 2024, the maximum number of shares issuable upon conversion, including the effect of a fundamental change and subject to other conversion rate adjustments, was 6,460,532 .

In September 2023, an individual Convertible Note holder exercised their option to convert their Convertible Notes in the aggregate principal amount of $ 16,895,000 , which was settled in January 2024.

As a result, the principal amount of the Convertible Notes was settled in cash with additional amounts due being settled in shares of our common stock.

The Convertible Notes are subject to certain customary events of default and acceleration clauses.

As of December 31, 2024, no such events have occurred.

The Notes consist of the following balances reported within the consolidated balance sheet as of December 31, 2023 and 2022 (in thousands):

The Convertible Notes consist of the following balances reported within the consolidated balance sheet as of December 31, 2024 and 2023 (in thousands):

Principal $ 333,091 $ 350,000

2 unchanged sentences

Net carrying amount $ 332,867 $ 347,988

The following table summarizes the interest expense components resulting from the Notes reported within the consolidated statement of operations for the years ended December 31, 2023 and 2022 (in thousands):

The following table summarizes the interest expense components resulting from the Convertible Notes reported within the consolidated statement of operations for the years ended December 31, 2024, 2023 and 2022 (in thousands):

2024 2023 2022

Contractual coupon interest $ 2,625 $ 2,625 $ 2,625

Amortization of debt discount $ — $ — $ 10,702

Amortization of debt issuance costs $ 1,789 $ 1,789 $ 1,789

As a result of our adoption of ASU 2020-06, effective January 1, 2022, we will no longer reflect any debt discount on the Notes in our consolidated balance sheet, nor will we recognize amortization of debt discount within our consolidated statement of operations.

Also in January 2022, we filed an irrevocable settlement election notice with the Note holders to inform them of our election to settle the principal amount of the Notes in cash.

As a result of this election, at

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

period ends where the market price, or other conversion triggers are met, the Notes will be classified in our consolidated balance sheet as current.

In January 2022, we filed an irrevocable settlement election notice with the note holders to inform them of our election to settle the principal amount of the Convertible Notes in cash.

The remaining life of the debt issuance cost accretion is approximately 0.13 years.

The effective interest rate on the principal of the Notes is 0.75 %.

Interest expense resulting from the Notes reported within the consolidated statement of operations for the years ended December 31, 2023, 2022 and 2021 is made up of contractual coupon interest and amortization of debt issuance costs.

The effective interest rate on the principal of the Convertible Notes is 0.75 %.

Interest expense resulting from the Convertible Notes reported within the consolidated statement of operations for the years ended December 31, 2024, 2023 and 2022 is made up of contractual coupon interest and amortization of debt issuance costs.

Convertible Note Hedge and Warrant Transaction

In connection and concurrent with the issuance of the Notes, we entered into certain convertible note hedge and warrant transactions (the "Call Spread Transactions") with respect to the Company’s common stock.

In connection and concurrent with the issuance of the Convertible Notes, we entered into certain convertible note hedge and warrant transactions (the "Call Spread Transactions") with respect to the Company’s common stock.

The convertible note hedge consists of an option to purchase up to 5,123,160 common stock shares at a price of $ 68.32 per share.

The hedge expires on February 15, 2025 and can only be concurrently executed upon the conversion of the Notes.

The hedge expires on February 15, 2025 and can only be concurrently executed upon the conversion of the Convertible Notes.

We paid approximately $ 66,325,000 for the convertible note hedge transaction.

2 unchanged sentences

The Company received aggregate proceeds of approximately $ 34,440,000 for the sale of the Warrants.

The Call Spread Transactions have no effect on the terms of the Notes and reduce potential dilution by effectively increasing the initial conversion price of the Notes to $ 103.12 per share of the Company’s common stock.

Finance Leases and Other Financing Obligations

See Note 21 for additional information about the planned settlement of a portion of the Warrants in cash.

The Call Spread Transactions have no effect on the terms of the Convertible Notes and reduce potential dilution by effectively increasing the initial conversion price of the Convertible Notes to $ 103.12 per share of the Company’s common stock.

Other Financing Obligations

From time to time, we enter into finance leases and other financing agreements with financial intermediaries to facilitate the purchase of products from certain vendors.

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Operating lease assets Other assets $ 76,530 $ 84,956

Finance lease assets Property and equipment (a)

Total lease assets $ 84,956 $ 76,219

Operating lease liabilities Accrued expenses and other current liabilities $ 18,452 $ 20,582

Finance lease liabilities Current portion of long-term debt — 28

Operating lease liabilities Other liabilities 65,898 71,033

Total lease liabilities $ 84,350 $ 91,615

(a) Recorded net of accumulated amortization of $ 48,000 as of December 31, 2022.

The following table provides information about the financial statement classification of our lease expenses reported within the consolidated statement of operations for the years ended December 31, 2024 and 2023 (in thousands):

2 unchanged sentences

Selling and administrative expenses $ 24,008 $ 24,054

Finance lease cost

Amortization of leased assets

Selling and administrative expenses 16 29

Interest on lease liabilities Interest expense, net — 2

Total lease cost $ 24,070 $ 24,017

Excludes short-term and variable lease costs, which are immaterial.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Future minimum lease payments under non-cancelable leases as of December 31, 2024 are as follows (in thousands):

5 unchanged sentences

Present value of lease liabilities $ 84,350

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table provides information about the remaining lease terms and discount rates applied as of December 31, 2024 and 2023:

1 unchanged sentence

Operating leases 5.82 5.46

Finance leases — 0.75

Weighted average discount rate (%):

Operating leases 4.64 4.21

Finance leases — 1.49

The following table provides other information related to leases for the years ended December 31, 2024 and 2023 (in thousands):

3 unchanged sentences

19,906 28,675

(a) Includes operating lease assets acquired as part of the Amdaris and SADA acquisitions of $ 2,881,000 and $ 2,032,000 , respectively.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(a) Includes operating lease assets acquired as part of the Infocenter acquisition of $ 3,706,000 in 2024.

Includes operating lease assets acquired as part of the Amdaris and SADA acquisitions of $ 2,881,000 and $ 2,032,000 in 2023, respectively.

(10) Stock-Based Compensation

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We grant service-based RSUs and performance-based RSUs to officers and certain employees under the Plan.

RSUs generally vest over a two to four year vesting period, while performance-based RSUs are also subject to the achievement of pre-established annual financial and/or strategic performance goals.

RSUs generally vest over a two to three year vesting period, while

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

performance-based RSUs are also subject to the achievement of pre-established annual financial and/or strategic performance goals.

Beginning in February 2022, we also granted performance-based RSUs based on a relative total shareholder return (“rTSR”) metric to officers and certain employees under the Plan.

1 unchanged sentence

The Monte Carlo Simulation model is used to determine the fair value at grant date.

In 2023, we granted performance-based RSUs to our officers and certain employees (the "Ambition" grant).

In 2023, we granted performance-based RSUs to our officers and certain employees (the "INA Ambition" grant).

The number of RSUs granted was based on an INA Adjusted EFO margin financial metric, some of which also have an Absolute TSR ("aTSR") multiplier applied to the number of shares granted.

2 unchanged sentences

Additionally, the performance-based RSUs based on the aTSR multiplier will vest 50 % on the two-year anniversary of the grant, and the remaining 50 % will vest on the three-year anniversary of the grant date.

The INA Ambition grant performance measure was not attained and as a result none of the related awards vested.

The Company previously adopted the Amended Insight Enterprises, Inc.

4 unchanged sentences

No further awards will be made under the Prior Plan.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Plan is administered by the Compensation Committee of Insight’s Board of Directors, and, except as provided below, the Compensation Committee has the exclusive authority to administer the Plan, including the power to determine eligibility, the types of awards to be granted, the price and the timing of awards.

4 unchanged sentences

We recognize compensation expense associated with the issuance of such RSUs over the vesting period for each respective RSU.

The total compensation expense associated with RSUs represents the value based upon the number of RSUs awarded multiplied by the closing price of our common stock on the date of grant.

The total compensation expense associated with service-based RSUs and performance based RSUs subject to financial metrics represent the value based upon the number of RSUs awarded multiplied by the closing price of our common stock on the date of grant.

The total compensation expense associated with RSUs subject to market based metrics, the grant date fair value was computed on the probable outcome of the performance conditions based on the Monte Carlo simulation and the grant date estimate of compensation cost to be recognized over the performance period.

The number of RSUs to be awarded under our service-based RSUs is fixed at the grant date.

The number of RSUs ultimately awarded under our performance-based RSUs varies based on whether the Company achieves certain financial results.

We record compensation expense each period based on our estimate of the most probable number of RSUs that will be issued under the grants of performance-based RSUs.

The number of RSUs ultimately awarded under our performance-based RSUs varies based on whether the Company achieves certain financial or market based results.

We record compensation expense each period based on our estimate of the most probable number of RSUs that will be issued under the grants of performance-based RSUs subject to financial metrics.

Recipients of RSUs do not have voting or dividend rights until the vesting conditions are satisfied and shares are released.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2024, total compensation cost related to nonvested RSUs not yet recognized is $ 36,004,000 , which is expected to be recognized over the next 0.96 years on a weighted-average basis.

5 unchanged sentences

Performance-based RSUs (rTSR) granted 29,814 $ 212.67

Performance-based RSUs - Ambition granted 110,561 $ 169.75

Performance-based RSUs - EMEA Ambition granted 7,535 $ 185.94

Adjustment for Final Performance:

2022 rTSR 2,500 $ 99.05

Adjustment for Final Performance:

INA Ambition ( 93,943 ) $ 175.10

Vested, including shares withheld to cover taxes ( 250,107 ) $ 98.37 $ 46,290,045 (a)

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(b) The aggregate fair value of the nonvested RSUs and the RSUs expected to vest represents the total pre-tax fair value, based on our closing stock price of $ 152.10 as of December 31, 2024, which would have been received by holders of RSUs had all such holders sold their underlying shares on that date.

During each of the years in the three-year period ended December 31, 2023, the RSUs that vested for teammates in the United States were net-share settled such that we withheld shares with value equivalent up to the teammates’ maximum statutory United States tax

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

obligation for the applicable income and other employment taxes and remitted the equivalent cash amount to the appropriate taxing authorities.

During each of the years in the three-year period ended December 31, 2024, the RSUs that vested for teammates in the United States were net-share settled such that we withheld shares with value equivalent up to the teammates’ maximum statutory United States tax obligation for the applicable income and other employment taxes and remitted the equivalent cash amount to the appropriate taxing authorities.

The total shares withheld during 2024, 2023 and 2022 of 65,972 , 79,636 and 79,611 , respectively, were based on the value of the RSUs on their vesting dates as determined by our closing stock price on such dates.

1 unchanged sentence

These net-share settlements had the effect of repurchases of our common stock as they reduced the number of shares that would have otherwise been issued as a result of the vesting and did not represent an expense to us.

Employee Stock Purchase Plan

The Employee Stock Purchase Plan (the “ESPP”) is a broadly-based stock purchase plan in which any eligible employee may elect to participate by authorizing the Company to make payroll deductions in a designated percentage to pay the price of an option.

In no event will the ESPP permit an employee to purchase common stock with a fair market value in excess of $ 25,000 in any calendar year.

The first purchase under the ESPP was made on February 16, 2024, in accordance with the ESPP.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

There are four , three -month offering periods in each calendar year beginning on February 18, May 18, August 18, and November 18, respectively.

Purchases under the ESPP are made on the last trading day of each offering period.

Unless otherwise determined by the Compensation Committee, the purchase price of shares offered under the ESPP is an amount equal to 95 % of the fair market value of the common stock on the date of purchase.

The ESPP is designed to comply with Section 423 of the Internal Revenue Code (the "IRC"), and thus is eligible for the favorable tax treatment afforded by Section 423.

(11) Income Taxes

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$ 83,222 $ 96,545 $ 93,825

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following schedule reconciles the differences between the U.S.

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Effective tax rate $ 83,222 25.0 % $ 96,545 25.6 % $ 93,825 25.1 %

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2024, we have accumulated undistributed earnings generated by our foreign subsidiaries, most of which have been taxed in the U.S.

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Property and equipment ( 33,223 ) ( 31,194 )

Contract assets (net) ( 18,026 ) —

Other ( 1,940 ) ( 1,916 )

1 unchanged sentence

Net deferred tax liabilities $ ( 61,023 ) $ ( 24,526 )

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The net non-current deferred tax assets and liabilities are as follows (in thousands):

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At December 31, 2024 and 2023, our valuation allowances totaled $ 32,978,000 and $ 33,385,000 , respectively, relating primarily to foreign tax credits and NOLs.

This increase was primarily the result of foreign NOLs generated during the year for which there is an uncertainty as to future utilization.

This decrease was primarily the result of tax attributes utilized during the year.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of December 31, 2024 and 2023, we had approximately $ 11,060,000 and $ 13,947,000 , respectively, of unrecognized tax benefits.

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We are currently under audit in various jurisdictions for tax years 2017 through 2022.

Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months which could significantly increase or decrease the balance of our gross unrecognized tax benefits.

Although the timing of the resolutions and/or closures of audits is highly uncertain, it is reasonably possible that the examination phase of these audits may be concluded within the next 12 months which could increase or decrease the balance of our gross unrecognized tax benefits.

However, based on the status of the various examinations in multiple jurisdictions, an estimate of the range of reasonably possible outcomes cannot be made at this time, but the estimated effect on our income tax expense and net earnings is not expected to be significant.

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Interest Rate Risk

We have interest rate exposure arising from our financing facilities, which have variable interest rates.

We have interest rate exposure arising from certain of our financing facilities, which have variable interest rates.

These variable interest rates are affected by changes in short-term interest rates.

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Our financing facilities expose our net earnings to changes in short-term interest rates since interest rates on the underlying obligations are variable.

We had $ 591,500,000 outstanding under our ABL facility and $ 347,988,000 outstanding under the Notes at December 31, 2023.

The interest rate attributable to the borrowings under our ABL facility and the Notes was 6.69 % and 0.75 %, respectively, per annum at December 31, 2023.

The change in annual pre-tax earnings from

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

operations resulting from a hypothetical 10% increase or decrease in the applicable interest rate would have been immaterial.

Although the Notes are based on a fixed rate, changes in interest rates could impact the fair market value of such notes.

As of December 31, 2023, the fair market value of the Notes was $ 906,108,000 .

We had $ 39,000,000 outstanding under our ABL facility and the interest rate attributable to the borrowings under our ABL facility was 5.90 % per annum at December 31, 2024.

The change in annual pre-tax earnings from operations resulting from a hypothetical 10% increase or decrease in the interest rate would have been immaterial.

We had $ 492,222,000 outstanding under the Senior Notes and $ 332,867,000 outstanding under the Convertible Notes at December 31, 2024.

The interest rate attributable to the borrowings under the Senior Notes and the Convertible Notes was 6.625 % and 0.75 %, respectively, per annum at December 31, 2024.

Both the Senior Notes and the Convertible Notes are based on fixed rates and are currently not considered to have interest rate risk exposure.

Although the Senior Notes and the Convertible Notes are based on fixed rates, changes in market interest rates could impact the fair market value of such notes.

As of December 31, 2024, the fair market value of the Senior Notes was $ 503,250,000 and the fair market value of the Convertible Notes was $ 751,926,285 .

Foreign Currency Exchange Risk

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We also maintain cash accounts denominated in currencies other than the functional currency, which expose us to fluctuations in foreign exchange rates.

Remeasurement of these cash balances results in gains/losses that are also reported in other expense (income), net within non-operating (income) expense.

Remeasurement of these cash balances results in gains/losses that are also reported in other (income) expense, net within non-operating expense (income), net.

We monitor our foreign currency exposure and selectively enter into forward exchange contracts to mitigate risk associated with certain non-functional currency monetary assets and liabilities related to foreign denominated payables, receivables and cash balances.

Transaction gains and losses resulting from non-functional currency assets and liabilities are offset by gains and losses on forward contracts in non-operating (income) expense, net in our consolidated statements of operations.

The counterparties associated with our foreign exchange forward contracts are large creditworthy commercial banks.

Transaction gains and losses resulting from non-functional currency assets and liabilities are offset by gains and losses on forward contracts in non-operating expense (income), net in our consolidated statements of operations.

The counterparties associated with our

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

foreign exchange forward contracts are large creditworthy commercial banks.

The derivatives transacted with these institutions are short in duration and, therefore, we do not consider counterparty concentration and non-performance to be material risks.

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Unobservable inputs that are not corroborated by market data.

As of December 31, 2023, we have no non-financial assets or liabilities that are measured and recorded at fair value on a recurring basis, and our other financial assets or liabilities generally consist of cash and cash equivalents, accounts receivable, contract assets, accounts payable, accrued expenses and other current liabilities and long-term debt.

As of December 31, 2024, we have no non-financial assets or liabilities that are measured and recorded at fair value on a recurring basis, and our other financial assets or liabilities generally consist of cash and cash equivalents, accounts receivable, contract assets, long-term contract assets, accounts payable, accrued expenses and other current liabilities and long-term debt.

The estimated fair values of our cash and cash equivalents approximate their carrying values and are determined based on quoted prices in active markets for identical assets.

The estimated fair values of our long-term debt balances, excluding the Notes, approximate their carrying values based on their variable interest rate terms that are based on current market interest rates for similar debt instruments.

The fair market value of the Notes as of December 31, 2023 is disclosed in Note 12.

The fair values of the other financial assets and liabilities are based on the values that would be received or paid in an orderly transaction between market participants and approximate their carrying values due to their nature and short duration.

The estimated fair values of our long-term debt balances, excluding the Senior Notes and the Convertible Notes, approximate their carrying values based on their variable interest rate terms that are based on current market interest rates for similar debt instruments.

The fair market value of the Senior Notes and the Convertible Notes as of December 31, 2024 is disclosed in Note 12.

(14) Benefit Plans

We adopted a defined contribution benefit plan (the “Defined Contribution Plan”) for our U.S.

teammates which complies with section 401(k) of the Internal Revenue Code.

teammates which complies with section 401(k) of the IRC.

The Company provides a discretionary match to all participants who make 401(k) contributions pursuant to the Defined Contribution Plan.

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Total consolidated contribution expense under these plans was $ 30,288,000 , $ 28,341,000 and $ 27,827,000 for 2024, 2023 and 2022, respectively.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(15) Share Repurchase Programs

On September 19, 2022, we announced that our Board of Directors had authorized the repurchase of up to $ 300,000,000 of our common stock, including $ 50,000,000 that remained available from the prior authorization.

On May 18, 2023, we announced that our Board of Directors authorized the repurchase of up to $ 300,000,000 of our common stock, including $ 100,000,000 that remained available from the prior authorization.

During 2024, this repurchase authorization was substantially exhausted.

On September 11, 2024, we announced that our Board of Directors authorized the repurchase of up to $ 300,000,000 of our common stock, in addition to any amount that remained from prior authorizations.

As of December 31, 2024, approximately $ 300,000,476 remained available for repurchases under our share repurchase plan.

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The following table summarizes the shares of our common stock that we repurchased on the open market under these repurchase programs during the years ended December 31, 2024, 2023 and 2022, respectively, in thousands, except per share amounts:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

2024 1,023 $ 195.61 $ 200,000

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At December 31, 2024 we had a remaining purchase commitment of $ 26,123,000 .

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company has recorded a contingent liability of approximately $ 15,016,000 , payable to a partner to settle various contractual commitments to resell a minimum amount of cloud services to clients.

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If severance payments under the current employment agreements or plan payments were to become payable, the severance payments would generally range from three to twenty-four months of salary.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Indemnifications

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We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are required.

If accruals are not

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

required, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made.

If accruals are not required, we further evaluate each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made.

Although litigation is inherently unpredictable, we believe that we have adequate provisions for any probable and estimable losses.

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Legal expenses related to defense of any legal proceeding or the negotiations, settlements, rulings and advice of outside legal counsel in connection with any legal proceedings are expensed as incurred.

In connection with the acquisition of PCM, the Company assumed responsibility for various litigation matters related to PCM’s acquisition of certain assets of En Pointe Technologies in 2015 (the “PCM Earnout Litigation”).

The seller of En Pointe Technologies and related entities providing various post-closing support functions to PCM asserted claims regarding the sufficiency of earnout payments paid by PCM under the asset purchase agreement and the unwinding of the support functions post-closing.

PCM rejected and vigorously responded to those claims and pursued various counterclaims.

The PCM Earnout Litigation was being heard by multiple courts and arbitrators in several different jurisdictions including California, Delaware and Pakistan.

In May 2023, the Company settled all claims related to the PCM Earnout Litigation and the parties began the process of dismissing each of the related claims and counterclaims in the various courts and jurisdictions.

On July 14, 2023, the Company funded an escrow pursuant to which $ 10,550,000 would be paid to the plaintiffs over a period of 36 months beginning after all of the cases have been dismissed.

The full amount of the settlement payment had been previously reserved.

The Company is not involved in any pending or threatened legal proceedings, including the PCM Earnout Litigation, that it believes would reasonably be expected to have a material adverse effect on its business, financial condition or results of operations.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(17) Supplemental Financial Information

76 unchanged sentences

Decision Maker (“CODM”) in deciding how to allocate resources.

Our CODM is our Chief Executive Officer.

Our CODM is our Chief Executive Officer, Joyce Mullen.

All significant intercompany transactions are eliminated upon consolidation, and there are no differences between the accounting policies used to measure profit and loss for our segments or on a consolidated basis.

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Year Ended December 31, 2024

EMEA APAC Consolidated

Products $ 6,167,512 $ 1,331,338 $ 132,538 $ 7,631,388

North America EMEA APAC Consolidated

Hardware $ 4,038,341 $ 501,111 $ 35,448 $ 4,574,900

Software 1,721,403 626,372 92,965 2,440,740

Services 1,294,836 286,614 104,608 1,686,058

1 unchanged sentence

Costs of goods sold:

Products 5,520,701 1,217,585 120,892 6,859,178

Hardware 3,514,630 423,475 30,648 3,968,753

Software 1,616,648 588,466 85,948 2,291,062

Services 521,308 108,968 45,591 675,867

2 unchanged sentences

Operating expenses:

Selling and administrative expenses 976,172 216,246 43,825 1,236,243

Severance and restructuring expenses 3,793 2,125 173 6,091

Acquisition and integration related expenses 3,908 3,488 — 7,396

Earnings from operations $ 362,082 $ 38,128 $ 19,585 $ 419,795

Significant selling and administrative expenses 953,601 231,026 45,046 1,229,673

Stock-based compensation 26,416 6,226 1,329 33,971

Adjusted earnings from operations 421,977 55,936 24,459 502,372

INSIGHT ENTERPRISES, INC.

2 unchanged sentences

North America EMEA APAC Consolidated

Products $ 7,291,301 $ 1,511,897 $ 144,589 $ 8,947,787

Hardware $ 4,498,466 $ 546,621 $ 43,850 $ 5,088,937

Software 1,669,046 784,717 88,688 2,542,451

Services 1,214,842 232,316 97,294 1,544,452

1 unchanged sentence

Costs of goods sold:

Products 6,583,090 1,395,869 132,293 8,111,252

Hardware 3,950,853 477,245 38,613 4,466,711

Software 1,569,848 740,340 82,279 2,392,467

Services 515,698 86,082 45,357 647,137

2 unchanged sentences

Operating expenses:

Selling and administrative expenses 973,798 200,988 41,874 1,216,660

Severance and restructuring expenses 2,384 1,760 91 4,235

Acquisition and integration related expenses 1,715 257 — 1,972

Earnings from operations $ 350,436 $ 44,264 $ 19,000 $ 413,700

Significant selling and administrative expenses 899,527 206,860 42,060 1,148,447

Stock-based compensation 22,069 5,557 1,325 28,951

Adjusted earnings from operations 424,359 47,570 20,198 492,127

Year Ended December 31, 2022

North America EMEA APAC Consolidated

Products $ 6,478,637 $ 1,502,176 $ 139,314 $ 8,120,127

Hardware $ 5,738,586 $ 654,381 $ 57,928 $ 6,450,895

Software 1,552,715 857,516 86,661 2,496,892

Services 1,193,091 200,624 89,689 1,483,404

1 unchanged sentence

Costs of goods sold:

Products 5,874,551 1,380,221 126,136 7,380,908

Hardware 5,117,909 582,162 51,242 5,751,313

Software 1,465,181 813,707 81,051 2,359,939

Services 572,969 69,383 41,020 683,372

2 unchanged sentences

Operating expenses:

Selling and administrative expenses 869,766 210,616 36,748 1,117,130

Severance and restructuring expenses ( 3,129 ) 1,328 167 ( 1,634 )

Earnings from operations $ 268,813 $ 46,918 $ 16,330 $ 332,061

Significant selling and administrative expenses 911,430 195,332 40,485 1,147,247

Stock based compensation 17,822 3,960 928 22,710

Adjusted earnings from operations 399,081 47,977 19,552 466,610

Our CODM uses Adjusted earnings from operations when assessing the performance of and deciding how to allocate resources to the operating segments.

For example, Adjusted earnings from operations is a basis for executive variable compensation.

Significant selling and administrative expenses primarily reflect personnel costs, including teammate benefits.

Our CODM uses an Adjusted measure of earnings from operations which excludes amortization of intangible assets, severance and restructuring expenses, acquisition and integration related expenses and

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

certain other expenses.

These other expenses include transformation costs, costs associated with third-party data center outages, net of recoveries, revaluation of earnout liabilities and other non-significant expenses.

Our CODM uses comparisons of actual Adjusted earnings from operations against budget, forecasts and prior periods as a basis for assessing current period segment performance as well as for determining necessary resources to assign, including for determining necessary investments or reductions in resources.

The following table is a summary of our total assets by reportable operating segment (in thousands):

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Net sales by geographic area are presented by attributing net sales to external customers based on the domicile of the selling location.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We recorded the following pre-tax amounts, by operating segment, for depreciation and amortization in the accompanying consolidated financial statements (in thousands):

12 unchanged sentences

Total $ 98,137 $ 62,476 $ 56,614

(20) Acquisitions

Effective May 1, 2024, we acquired 100 percent of the issued and outstanding shares of Infocenter for a cash purchase price of $ 265,000,000 , net of cash and cash equivalents acquired of $ 5,103,000 , which is comprised of the initial purchase price of $ 269,477,000 paid in cash upon the acquisition and contractual adjustments to the purchase price of $ 626,000 paid in July 2024.

The total purchase price of $ 289,200,000 also includes the estimated fair value of earn out payments of approximately $ 24,200,000 , which provide an incentive opportunity for the sellers of up to $ 106,250,000 , based on Infocenter achieving certain EBITDA performance through April 2026.

Infocenter is a pure-play ServiceNow Elite Partner dedicated to automating business processes on the Now Platform®.

We believe this acquisition enhances our Solutions Integrator offering framework to drive better business outcomes for our clients by enabling them to scale their multicloud environments with modern infrastructure, applications, and unified data and AI platforms.

The preliminary fair value of net assets acquired was approximately $ 98,475,000 , including approximately $ 123,900,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight-line method over the estimated economic life of ten years .

As these intangible assets are not tax deductible, we recognized a related deferred tax liability of approximately $ 31,832,000 .

The preliminary purchase price was allocated using the information currently available.

Further information obtained upon the finalization of the fair value assumptions for identifiable intangible assets acquired and various accrued expense balance assessments could lead to an adjustment of the purchase price allocation.

Goodwill acquired approximated $ 190,725,000 , which was recorded in our North America operating segment.

We consolidated the results of operations for Infocenter within our North America operating segment since its acquisition on May 1, 2024.

Our historical results would not have been materially affected by the acquisition of Infocenter and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our consolidated statement of operations.

We recognized a net loss of $ 18,800,000 within selling and administrative expenses due to the net increase in the estimated fair value of the earnout payments in 2024.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(20) Acquisitions

Effective December 1, 2023, we acquired 100 percent of the issued and outstanding shares of SADA Systems, LLC (successor to SADA Systems, Inc.

8 unchanged sentences

A portion of the purchase price was used to settle SADA’s stock-based compensation liabilities of $ 68,335,000 and pay SADA’s transaction costs of approximately $ 16,852,000 at acquisition in accordance with purchase agreement.

The following table summarizes the preliminary purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

The following table summarizes the purchase price and the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

Total purchase price, net of cash and cash equivalents acquired

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The contract assets are an exception to the fair value model and are evaluated under relevant revenue recognition guidance including an allowance for credit losses using the current expected credit loss (“CECL”) model.

The preliminary estimated fair value of net assets acquired was approximately $ 308,305,000 , including $ 158,100,000 of identifiable intangible assets, consisting primarily of

The estimated fair value of net assets acquired was approximately $ 290,218,000 , including $ 158,100,000 of identifiable intangible assets, consisting primarily of customer relationships of $ 124,700,000 and non-compete agreements of $ 26,200,000 .

The fair values were

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

customer relationships of $ 124,700,000 and non-compete agreements of $ 26,200,000 .

The fair values were determined using the multiple-period excess earnings method and the lost income method, respectively.

determined using the multiple-period excess earnings method and the lost income method, respectively.

The identifiable intangibles resulting from the acquisition are amortized using the straight-line method over the following estimated useful lives:

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The addition of the SADA technical employees to our team and the opportunity to grow our business are the primary factors making up the goodwill recognized as part of the transaction.

The purchase price allocation was finalized in the fourth quarter of 2024 with a net increase of $ 18,810,000 in goodwill during the measurement period, primarily due to certain measurement period adjustments to contract assets, net, accounts payable and accrued expenses.

The intangible assets and goodwill are tax deductible as the transaction is a deemed asset acquisition for U.S.

federal income tax purposes after the Seller Parties undertook an internal restructuring pursuant to Section 368(a)(1)(F).

The purchase price allocation is preliminary and was allocated using information currently available.

Further information related to accounts receivable, contract assets, accounts payable, intangible assets, goodwill and various accrued expense balance assessments may lead to an adjustment of the purchase price allocation.

federal income tax purposes after the seller parties undertook an internal restructuring pursuant to Section 368(a)(1)(F) of the IRC.

We recognized a net gain of $ 20,219,000 within selling and administrative expenses due to the net decrease in the estimated fair value of the earnout payments in 2024.

We have consolidated the results of operations for SADA since its acquisition on December 1, 2023.

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The pro forma results primarily include the adjustments to reflect the additional amortization of acquired intangible assets and interest expense on the additional borrowing under the ABL revolving credit facility, removal of acquisition-related costs, and the consequential tax effects of the pro forma adjustments and SADA tax status change.

SADA’s stock-based compensation plans were fully vested and settled upon acquisition based on a preexisting change-in-control provision within the plan terms.

SADA’s stock-based compensation plans were fully vested and settled upon acquisition based on a pre-existing change-in-control provision within the plan terms.

INSIGHT ENTERPRISES, INC.

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It is neither indicative of the results of operations that would have been achieved had the acquisition been consummated at the beginning of 2022, nor is it necessarily indicative of future results.

Effective August 17, 2023, we acquired 100 percent of the issued and outstanding shares of Amdaris Group Limited (“Amdaris”) for a preliminary cash purchase price, net of cash and cash equivalents acquired, of approximately $ 82,875,000 , excluding the estimated fair value of an earn out, reported in other liabilities, with a range of payouts through 2026 of $ 0 to $ 54,391,000 .

Effective August 17, 2023, we acquired 100 percent of the issued and outstanding shares of Amdaris Group Limited (“Amdaris”) for a cash purchase price, net of cash and cash equivalents acquired, of approximately $ 82,875,000 , excluding the estimated fair value of an earn out, reported in other liabilities, with a range of payouts through 2026 of $ 0 to $ 54,391,000 .

We paid the earnout of $ 14,348,000 for Amdaris' 2023 performance in March 2024.

Amdaris, an award-winning software development and digital services specialist, provides innovative software development, application support, managed services and consultancy services to the customers in the United Kingdom with service delivery centers located in several eastern European countries.

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We believe this acquisition expands our global Modern Apps and Data & AI areas of solutions expertise as a leading solutions integrator and enhances our technological capabilities and scale to deliver an even broader range of customized services and solutions to clients in EMEA.

The preliminary fair value of net assets acquired was approximately $ 34,060,000 , including $ 41,291,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight-line method over the estimated economic life of ten years .

The fair value of net assets acquired was approximately $ 34,060,000 , including $ 41,291,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight-line method over the estimated economic life of ten years .

The preliminary purchase price was allocated using the information currently available.

Further information obtained upon the finalization of the fair value assumptions for identifiable intangible assets acquired and the finalization of the fair value of the non-cash working capital could lead to an adjustment of the purchase price allocation.

During the first quarter of 2024, we finalized the fair value assumptions for identifiable intangible assets with no changes being made to amounts previously recorded.

Goodwill acquired approximated $ 71,698,000 , which was recorded in our EMEA operating segment.

1 unchanged sentence

Our historical results would not have been materially affected by the acquisition of Amdaris and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our consolidated statement of operations.

In June 2022, we acquired 100 percent of the issued and outstanding shares of Hanu Software Solutions, Inc.

and Hanu Software Solutions (India) Private Ltd.

(collectively, “Hanu”) for a cash purchase price, net of cash and cash equivalents acquired, of approximately $ 90,106,000 , including $ 15,307,000 attributed to an earn out agreement and including hold backs for representations and warranties of approximately $ 6,358,000 , the majority of which will be paid in future periods.

We finalized the earn out and paid $ 10,748,000 in April 2023 and $ 3,973,000 in November 2023.

Hanu, a global leading cloud technology services and solutions provider, provides cloud solutions in the areas of applications and infrastructure, data and artificial intelligence, and cloud security to clients.

Hanu is recognized as one of Microsoft’s top public cloud service partners globally.

We believe this acquisition strengthens our service capabilities as a cloud solutions provider and is also a strategic investment in expanding our presence in India.

The fair value of net assets acquired was approximately $ 20,183,000 , including $ 24,750,000 of identifiable intangible assets, consisting primarily of customer relationships that will be amortized using the straight line method over the estimated economic life of ten years .

The purchase price was allocated using the information available.

Goodwill acquired approximated $ 69,923,000 which was recorded in our North America operating segment.

We finalized the purchase price allocation in relation to this acquisition in May 2023.

The completion of this work did not materially alter our preliminary purchase price allocation.

INSIGHT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

We consolidated the results of operations for Hanu within our North America operating segment beginning on June 1, 2022, the effective date of the acquisition.

Our historical results would not have been materially affected by the acquisition of Hanu and, accordingly, we have not presented pro forma information as if the acquisition had been completed at the beginning of each period presented in our consolidated statement of operations.

We recognized net gain of $ 6,430,000 within selling and administrative expenses due to the net decrease in the estimated fair value of the earnout payments in 2024.

(21) Subsequent Events

On January 6, 2025, the Company entered into an agreement to settle 2,049,264 of the total 5,123,160 Warrants.

The Warrants will be settled entirely in cash, based upon an agreed upon settlement amount that will be calculated using up to a thirty five trading day settlement period.

We recorded a liability of approximately $ 112,590,000 upon execution of the agreement.

Any change in the fair value of the settlement liability through the settlement date will be recognized in net income.

We expect final settlement to occur in February or March 2025.

INSIGHT ENTERPRISES, INC.

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What changed 10-K

Item 8. Financial Statements and Supplementary Data