CDW (CDW) UBS Global Technology and AI Conference summary

Macro environment and industry outlook

• IT spending has faced two years of volatility, but hardware and data center refresh cycles are expected to drive growth starting mid-2025 and beyond.

• Clarity from the recent election and a pro-business administration are anticipated to improve the macro environment, especially once tax and tariff policies are defined.

• Technology remains essential for efficiency, innovation, and agility, with no signs of budget cuts in tech across sectors.

• Key growth catalysts include data proliferation, early-stage AI adoption, increasing security needs, and the permanence of hybrid work.

• Optimism for 2025 is tempered by prudence, given ongoing macro uncertainties.

Federal and corporate segment trends

• Federal IT spending is delayed due to late budget approvals, but funds remain available and are expected to flow more quickly with administrative clarity.

• Efficiency initiatives in government could initially slow approvals but ultimately drive greater tech adoption.

• The federal segment is expected to remain a growth area long-term, despite short-term friction and a cautious 2024 outlook.

• Corporate and small business segments could benefit from lower taxes and targeted tariffs, with potential acceleration in business startups.

• Tariff impacts are expected to be passed through to customers without margin dilution due to a cost-plus model.

Product cycles, inventory, and market health

• PC refresh cycles are underway, and networking inventory overhangs are easing, signaling a healthier market for 2025.

• Hardware Solutions have seen eight consecutive down quarters, but early signs of recovery are emerging, especially in storage.

• Customer demand is expected to increase as clarity improves around AI and the broader environment.