CDW: Google Apps Partnership Won't Affect Our Microsoft Business


CDW CEO Thomas Richards said the company's new Google Apps For Business partnership won't negatively impact other software partners, namely Microsoft.

During the question-and-answer session of CDW's fourth-quarter and fiscal 2013 earnings call, Richards was asked how CDW's Google Apps agreement might affect its Microsoft business. Richards said the Google alliance had nothing to do with other vendor partnerships and contested media reports that claimed it would negatively impact CDW's relationship with Microsoft.

"I don't think it's going to have any impact on other partners," he said. "We are absolutely excited about this partnership, but it's not at the expense of other partnerships."

[Related: CRN Exclusive Survey: Microsoft Cloud Cuts Have Partners Embracing Google]

Richards said CDW wanted to build off its existing partnership with Google around Chromebooks and help meet growing interest in cloud applications. The company declined previous CRN requests for comment about the Google Apps partnership.

The Chromebook business has been a successful one for CDW; the company reported strong sales of Chromebooks during its fourth quarter, particularly in the education market, which grew close to 20 percent year over year.

"For the fourth quarter, ongoing momentum in our largest customer channel, medium and large businesses, and another quarter of record sales to K-12 education customers more than offset declines in sales to the federal government," Richards said during the earnings call.

In addition, the company reported double-digit PC growth for the fourth quarter, which included strong Chromebook sales. "We continue to see positive growth in the PC marketplace," he said. We are expecting that to continue [in 2014]."

For the quarter, CDW reported revenue of $2.71 billion, a 4.3 percent increase from the same period one year ago, and a profit of $60 million, or 35 cents per share, compared with $33.3 million and 23 cents per share one year ago. CDW's hardware sales increased 4 percent, software improved 7 percent, and services jumped 20 percent.

For the year, CDW recorded $10.7 billion in revenue, up 6.3 percent from its fiscal 2012 period, and net income of $132 million, an increase of 11.6 percent from the previous year. Hardware revenue increased 6 percent, software improved 8 percent, and services revenue grew 15 percent for the year.

Richards said CDW is deepening its services capabilities to help meet the needs of corporate customers. CDW added nearly 120 new customer-facing employees in 2013 to boost its solutions and services business and plans to add between 150 and 200 new customer-facing employees this year as well, he said.

PUBLISHED FEB. 13, 2014