PC Connection, Inc.

Good afternoon and welcome to the first quarter 2026 Connection earnings conference call. My name is Josh and I will be the coordinator for today. At this time, all participants are in a listen-only mode. Following the prepared remarks, there will be a question and answer session. As a reminder, this conference call is the property of Connection and may not be recorded or rebroadcast without specific permission from the company. On the call today are Tim McGrath, President and Chief Executive Officer of and Tom Baker, Senior Vice President and Chief Financial Officer. I will now turn the call over to the company.

Thanks, operator, and good afternoon, everyone. I will now read our cautionary note regarding forward-looking statements. Any statements or references made during the conference call that are not statements of historical fact may be deemed to be forward-looking statements. Various remarks that management may make about the company's future expectations plans, and prospects constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the risk factors section of the company's annual report on Form 10-K for the year ended December 31, 2025, which is on file with the Securities and Exchange Commission, as well as in other documents that the company files with the Commission from time to time. In addition, any forward-looking statements represent management's view as of today and should not be relied upon as representing views as of any subsequent date. While the company may elect to update forward-looking statements at some point in the future, the company specifically disclaims any obligation to do so other than is required by law, even if estimates change. And therefore, you should not rely on these forward-looking statements as representing management's views as of any date subsequent to today. During this call, non-GAAP financial measures will be discussed. A reconciliation between any non-GAAP financial measure discussed and its most directly comparable GAAP measure is available in today's earnings release and on the company's website at www.connection.com. Please note that unless otherwise stated, all references to first quarter 2026 comparisons are being made against the first quarter 2025. Today's call is being webcast and will be available on Connection's website. The earnings release will be available on the SEC website at www.sec.gov and in the investor relations section of our website at www.connection.com. I would now like to turn the call over to our host, Tim McGrath, President and CEO. Tim?

Thank you, Samantha. Good afternoon, everyone, and thank you for joining us today for Connections Q1 2026 conference call. I'll begin this afternoon with an overview of our first quarter results and highlights of our performance. Tom will then walk us through a more detailed look at our financials. We're pleased to announce a solid start to 2026 as we continue to execute with discipline and agility Despite ongoing supply challenges and a dynamic economic landscape, our business solutions and enterprise solution segments delivered strong growth and consistent execution. Each improved both net sales and gross profit performance. The increase in net sales was driven by growth in endpoint devices, networking, services, and software, including cloud and security. This performance helped offset the expected year-over-year decline in our public sector business and highlights the resilience and diversification of our model. As we discussed in our call last quarter, public sector results reflected the impact of a large, non-repeating project that straddled both Q4 2024 and Q1 2025. On a consolidated basis, Gross billings grew 4.3% to $1 billion, compared to $978.9 million in the prior year quarter. We also delivered total net sales of $721.9 million, representing a 3% increase year-over-year. Gross profit increased 4.3% year-over-year to $132.7 million, Gross margin expanded by 20 basis points to 18.4 percent. This reflects our disciplined pricing strategy and strong execution in navigating this dynamic cost environment, along with favorable shifts in both product and customer mix. Industry-wide memory constraints and related price increases have been widely discussed across the market, and we began to see an impact in the first quarter. In response, we proactively engaged in comprehensive planning sessions with our partners and customers, positioning ourselves to navigate these supply chain constraints effectively. We saw a range of customer responses, including advanced purchasing in some cases, while others took a more measured approach, given budget considerations and project timing. As expected, The impact varied for each sales segment, which we will discuss in detail as we progress through the call. With that, let's turn to our segment performance. Business Solutions delivered another solid quarter. Net sales increased 6.6% to $275.6 million, while gross profit rose 3.2% to a record $67.5 million. Gross billings grew 9.3% to $446 million. Gross margin declined by 80 basis points year over year to 24.5% due to a shift in customer mix. The business solution segment experienced double-digit growth across Netcom and software, including cloud and security solutions. While some customers pulled orders into Q1, Others were impacted by product availability constraints. Overall, we believe these dynamics had little net effect on our business. In public sector solutions, net sales were 99.8 million, down 31% from a year ago, mostly due to the large federal contract that we've discussed. Excluding this non-recurring item, underlying performance remains stable, and we expect conditions to improve as we progress through the balance of 2026. Gross billings were $135.7 million, reflecting a 21.2% decline year over year. Notably, gross margin expanded 140 basis points to 15%, driven by favorable shifts in customer and product mix. Enterprise Solutions delivered outstanding top-line growth, with net sales increasing 16.3% to $346.5 million, driven by strong demand for endpoint devices. Gross profit grew 18.7% to $50.2 million, while gross billings increased 10.3%, to $439.6 million. Gross margin was 14.5%, up 30 basis points year-over-year, reflecting changes in product mix. Enterprise Solutions was the most affected by supply chain dynamics this quarter. Some customers moved orders into the quarter, while a portion chose to delay ordering during Q1 due to their own fixed IT budgets. Overall, we believe that the pull-ins benefited enterprise revenues in the low to mid single digits on a percentage basis. We also had other enterprise customers make aggressive commitments to secure supply ahead of their needs, and while not affecting our revenue and profit, this resulted in increases in inventory. Enterprise Solutions also ended the quarter with a record backlog of positioning us well for continued momentum throughout the year. I'll now turn the call over to Tom to discuss additional financial highlights. Tom?