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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934*

For the quarterly period ended June 30, 2025

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 0-23827

PC CONNECTION, INC.

(Exact name of registrant as specified in its charter)


Delaware	02-0513618
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)


730 Milford Road
Merrimack, New Hampshire	03054
(Address of principal executive offices)	(Zip Code)


	(603) 683-2000
	(Registrant's telephone number, including area code)

Former name, former address and former fiscal year, if changed since last report: N/A

Securities registered pursuant to Section 12(b) of the Act:

C
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CNXN	Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


	Large accelerated filer ☑		Accelerated filer ☐
	Non-accelerated filer ☐		Smaller reporting company ☐
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☑

The number of shares outstanding of the issuer’s common stock as of July 23, 2025 was 25,389,003.

Table of Contents

PC CONNECTION, INC. AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS


	PART I FINANCIAL INFORMATION

		Page
ITEM 1.	Unaudited Condensed Consolidated Financial Statements:

	Condensed Consolidated Balance Sheets–June 30, 2025 and December 31, 2024	1

	Condensed Consolidated Statements of Income–Three and Six Months Ended June 30, 2025 and 2024	2

	Condensed Consolidated Statements of Other Comprehensive Income–Three and Six Months Ended June 30, 2025 and 2024	3

	Condensed Consolidated Statements of Stockholders’ Equity–Three and Six Months Ended June 30, 2025 and 2024	4

	Condensed Consolidated Statements of Cash Flows–Three and Six Months Ended June 30, 2025 and 2024	6

	Notes to Unaudited Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	28

ITEM 4.	Controls and Procedures	28




	PART II OTHER INFORMATION

ITEM 1.	Legal Proceedings	30

ITEM 1A.	Risk Factors	30

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30

ITEM 5.	Other Information	30

ITEM 6.	Exhibits	31

SIGNATURES		32

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PART I ― FINANCIAL INFORMATION

Item 1. Financial Statements

PC CONNECTION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(amounts in thousands)


	June 30,		December 31,
	2025		2024
ASSETS
Current Assets:
Cash and cash equivalents	$	186,744	$	178,318
Short-term investments		159,350		264,295
Accounts receivable, net		637,037		611,433
Inventories, net		133,487		95,054
Prepaid expenses and other current assets		22,449		17,750
Total current assets		1,139,067		1,166,850
Property and equipment, net		48,267		52,520
Right-of-use assets		2,219		3,077
Goodwill		73,602		73,602
Intangibles, net		1,599		2,209
Other assets		4,523		1,096
Total Assets	$	1,269,277	$	1,299,354
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	303,756	$	300,242
Accrued payroll		23,444		23,330
Accrued expenses and other liabilities		41,076		47,633
Total current liabilities		368,276		371,205
Deferred income taxes		15,031		15,091
Non-current operating lease liabilities		634		1,552
Other liabilities		516		516
Total Liabilities		384,457		388,364
Stockholders’ Equity:
Common stock		294		294
Additional paid-in capital		141,406		137,036
Retained earnings		868,016		837,466
Accumulated other comprehensive (loss) income		(53)		174
Treasury stock, at cost		(124,843)		(63,980)
Total Stockholders’ Equity		884,820		910,990
Total Liabilities and Stockholders’ Equity	$	1,269,277	$	1,299,354

See notes to unaudited condensed consolidated financial statements.

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PC CONNECTION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(amounts in thousands, except per share data)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2025		2024		2025		2024
Net sales	$	759,693	$	736,479	$	1,460,739	$	1,368,504
Cost of sales		621,927		599,937		1,195,662		1,113,890
Gross profit		137,766		136,542		265,077		254,614
Selling, general and administrative expenses		106,869		105,208		216,728		209,816
Severance expenses		—		415		2,930		415
Income from operations		30,897		30,919		45,419		44,383
Interest income, net		3,216		4,649		7,116		9,216
Other income		—		—		76		—
Income before taxes		34,113		35,568		52,611		53,599
Income tax provision		(9,324)		(9,407)		(14,341)		(14,284)
Net income	$	24,789	$	26,161	$	38,270	$	39,315

Earnings per common share:
Basic	$	0.98	$	0.99	$	1.49	$	1.49
Diluted	$	0.97	$	0.99	$	1.48	$	1.48

Shares used in computation of earnings per common share:
Basic		25,405		26,348		25,739		26,355
Diluted		25,520		26,520		25,860		26,522

See notes to unaudited condensed consolidated financial statements.

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PC CONNECTION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME

(Unaudited)

(amounts in thousands)


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2025		2024		2025		2024
Net income	$	24,789	$	26,161	$	38,270	$	39,315
Other comprehensive loss:
Unrealized losses on available-for-sale investments, net of tax of $30 and $60 for the three and six months ended June 30, 2025, respectively, and net of tax of $11 and $49 for the three and six months ended June 30, 2024, respectively		(114)		(41)		(227)		(184)
Comprehensive income	$	24,675	$	26,120	$	38,043	$	39,131

See notes to unaudited condensed consolidated financial statements.

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PC CONNECTION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(amounts in thousands)


	Three Months Ended June 30, 2025
	Common Stock			Additional		Retained		Accumulated Other		Treasury Shares
	Shares	Amount		Paid-In Capital		Earnings		Comprehensive (Loss) Income		Shares	Amount		Total
Balance - March 31, 2025	29,415	$	294	$	138,725	$	847,037	$	61	(3,787)	$	(109,142)	$	876,975
Stock-based compensation expense	—		—		2,461		—		—	—		—		2,461
Restricted stock units vested	13		—		—		—		—	—		—		—
Shares withheld for taxes paid on stock awards	—		—		(399)		—		—	—		—		(399)
Repurchase of common stock for treasury	—		—		—		—		—	(255)		(15,701)		(15,701)
Issuance of common stock under Employee Stock Purchase Plan	10		—		619		—		—	—		—		619
Dividend declaration ($0.15 per share)	—		—		—		(3,810)		—	—		—		(3,810)
Net income	—		—		—		24,789		—	—		—		24,789
Other comprehensive loss, net of tax	—		—		—		—		(114)	—		—		(114)
Balance - June 30, 2025	29,438	$	294	$	141,406	$	868,016	$	(53)	(4,042)	$	(124,843)	$	884,820

	Three Months Ended June 30, 2024
	Common Stock			Additional		Retained		Accumulated Other		Treasury Shares
	Shares	Amount		Paid-In Capital		Earnings		Comprehensive (Loss) Income		Shares	Amount		Total
Balance - March 31, 2024	29,271	$	293	$	132,596	$	771,416	$	(62)	(2,905)	$	(51,571)	$	852,672
Stock-based compensation expense	—		—		2,248		—		—	—		—		2,248
Restricted stock units vested	14		—		—		—		—	—		—		—
Shares withheld for taxes paid on stock awards	—		—		(414)		—		—	—		—		(414)
Repurchase of common stock for treasury	—		—		—		—		—	(57)		(3,600)		(3,600)
Issuance of common stock under Employee Stock Purchase Plan	9		—		537		—		—	—		—		537
Dividend declaration ($0.10 per share)	—		—		—		(2,635)		—	—		—		(2,635)
Net income	—		—		—		26,161		—	—		—		26,161
Other comprehensive loss, net of tax	—		—		—		—		(41)	—		—		(41)
Balance - June 30, 2024	29,294	$	293	$	134,967	$	794,942	$	(103)	(2,962)	$	(55,171)	$	874,928

See notes to unaudited condensed consolidated financial statements.

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	Six Months Ended June 30, 2025
	Common Stock			Additional		Retained		Accumulated Other		Treasury Shares
	Shares	Amount		Paid-In Capital		Earnings		Comprehensive (Loss) Income		Shares	Amount		Total
Balance - December 31, 2024	29,390	$	294	$	137,036	$	837,466	$	174	(3,090)	$	(63,980)	$	910,990
Stock-based compensation expense	—		—		4,669		—		—	—		—		4,669
Restricted stock units vested	38		—		—		—		—	—		—		—
Shares withheld for taxes paid on stock awards	—		—		(918)		—		—	—		—		(918)
Repurchase of common stock for treasury	—		—		—		—		—	(952)		(60,863)		(60,863)
Issuance of common stock under Employee Stock Purchase Plan	10		—		619		—		—	—		—		619
Dividend declaration ($0.15 per share)	—		—		—		(7,720)		—	—		—		(7,720)
Net income	—		—		—		38,270		—	—		—		38,270
Other comprehensive loss, net of tax	—		—		—		—		(227)	—		—		(227)
Balance - June 30, 2025	29,438	$	294	$	141,406	$	868,016	$	(53)	(4,042)	$	(124,843)	$	884,820

	Six Months Ended June 30, 2024
	Common Stock			Additional		Retained		Accumulated Other		Treasury Shares
	Shares	Amount		Paid-In Capital		Earnings		Comprehensive (Loss) Income		Shares	Amount		Total
Balance - December 31, 2023	29,262	$	293	$	130,878	$	760,898	$	81	(2,902)	$	(51,383)	$	840,767
Stock-based compensation expense	—		—		4,197		—		—	—		—		4,197
Restricted stock units vested	23		—		—		—		—	—		—		—
Shares withheld for taxes paid on stock awards	—		—		(645)		—		—	—		—		(645)
Repurchase of common stock for treasury	—		—		—		—		—	(60)		(3,788)		(3,788)
Issuance of common stock under Employee Stock Purchase Plan	9		—		537		—		—	—		—		537
Dividend declaration ($0.10 per share)	—		—		—		(5,271)		—	—		—		(5,271)
Net income	—		—		—		39,315		—	—		—		39,315
Other comprehensive loss, net of tax	—		—		—		—		(184)	—		—		(184)
Balance - June 30, 2024	29,294	$	293	$	134,967	$	794,942	$	(103)	(2,962)	$	(55,171)	$	874,928

See notes to unaudited condensed consolidated financial statements.

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PC CONNECTION, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(amounts in thousands)


	Six Months Ended
	June 30,
	2025		2024
Cash Flows (used in) provided by Operating Activities:
Net income	$	38,270	$	39,315
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization		5,965		6,539
Adjustments to credit losses reserve		1,058		410
Stock-based compensation expense		4,669		4,197
Deferred income taxes		—		1,623
Amortization of discount on short-term investments, net		(1,672)		(5,593)
Gain on sale of short-term investments		(76)		—
Loss on disposal of fixed assets		20		36
Changes in assets and liabilities:
Accounts receivable		(26,662)		7,598
Inventories		(38,433)		(12,434)
Prepaid expenses and other current assets		(4,142)		(5,823)
Other non-current assets		(1,629)		448
Accounts payable		3,368		53,172
Accrued expenses and other liabilities		(6,865)		6,188
Net cash (used in) provided by operating activities		(26,129)		95,676
Cash Flows provided by (used in) Investing Activities:
Purchases of short-term investments		(52,358)		(203,278)
Proceeds from sale of short-term investments		108,763		—
Maturities of short-term investments		50,000		103,280
Purchases of property and equipment		(3,331)		(3,427)
Net cash provided by (used in) investing activities		103,074		(103,425)
Cash Flows used in Financing Activities:
Proceeds from short-term borrowings		732		10,560
Repayment of short-term borrowings		(732)		(10,560)
Purchase of common stock for treasury shares		(60,464)		(3,613)
Payments for excise tax on treasury purchases		(36)		—
Dividend payments		(7,720)		(5,271)
Issuance of stock under Employee Stock Purchase Plan		619		537
Payment of payroll taxes on stock-based compensation through shares withheld		(918)		(645)
Net cash used in financing activities		(68,519)		(8,992)
Increase (decrease) in cash and cash equivalents		8,426		(16,741)
Cash and cash equivalents, beginning of period		178,318		144,954
Cash and cash equivalents, end of period	$	186,744	$	128,213

Non-cash Investing and Financing Activities:
Accrued purchases of property and equipment	$	346	$	347
Accrued purchase of treasury shares	$	66	$	211
Accrued excise tax on treasury purchases	$	572	$	18
Supplemental Cash Flow Information:
Income taxes paid	$	18,171	$	17,946
Interest paid	$	—	$	2

See notes to unaudited condensed consolidated financial statements.

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PC CONNECTION, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(amounts in thousands, except per share data)

Note 1–Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of PC Connection, Inc. and its subsidiaries, or the Company, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting and in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. Such principles were applied on a basis consistent with the accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the results of operations for the interim periods reported and of the Company’s financial condition as of the date of the interim balance sheet. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date of issuance of these financial statements. The operating results for the three and six months ended June 30, 2025 may not be indicative of the results expected for any succeeding quarter or the entire year ending December 31, 2025.

Certain amounts in the prior period’s condensed consolidated financial statements have been reclassified to conform with the current period presentation.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts and disclosures of assets and liabilities and the reported amounts and disclosures of revenue and expenses during the period. Management bases its estimates and judgments on the information available at the time and various other assumptions believed to be reasonable under the circumstances. By nature, estimates are subject to an inherent degree of uncertainty. Actual results could differ from those estimates and assumptions.

Cash and Cash Equivalents and Investments

The Company considers all highly liquid short-term investments with original maturities of 90 days or less to be cash equivalents. The carrying value of the Company’s cash equivalents approximates fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

At the time of purchase, the Company determines the appropriate classification of investments based upon its intent with regard to such investments. All of the Company’s investments are classified as available-for-sale. The Company classifies investments as short-term when their remaining contractual maturities are one year or less from the balance sheet date, and as long-term when the investment has a remaining contractual maturity of more than one year from the balance sheet date. The Company records investments at fair value with unrealized gains and losses recorded as a component of accumulated other comprehensive (loss) income on the condensed consolidated balance sheets.

Included in interest income, net on the condensed consolidated statements of income is interest income on cash equivalents and short-term investments of $3,217 and $7,018 for the three and six months ended June 30, 2025, respectively, and $4,655 and $9,220 for the three and six months ended June 30, 2024, respectively.

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Treasury Stock, at Cost

The total repurchases for the six months ended June 30, 2025 and 2024 were recorded as treasury stock of $60,863 and $3,788, respectively. Such costs reflect the applicable one percent excise tax imposed by the Inflation Reduction Act of 2022 on the net value of certain stock repurchases made after December 31, 2022.

Severance Expenses

The severance expenses recorded for the six months ended June 30, 2025 and the three and six months ended June 30, 2024 were related to involuntary reductions in the Company’s workforce to lower the Company’s cost structure and included cash severance and other related termination benefits. The majority of these costs are expected to be paid within a year of the applicable termination. Included in accrued expenses and other liabilities on the condensed consolidated balance sheets as of June 30, 2025 was $1,394 related to unpaid severance expenses.

Recently Issued Financial Accounting Standards

In December 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This guidance is intended to improve the transparency of income tax disclosures through, among other things, enhancement of the disclosure requirements within the rate reconciliation, as well as increased income tax disaggregation disclosures. This ASU is effective for the Company’s annual reporting periods beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statement disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This guidance is intended to provide more detailed disclosure about certain costs and expenses presented in the income statement, including inventory purchases, employee compensation, selling expenses, and depreciation expense. This ASU is effective for the Company’s annual reporting periods beginning January 1, 2027, and for interim reporting periods beginning January 1, 2028, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this standard on its consolidated financial statements.

Note 2–Revenue

The Company disaggregates revenue from its arrangements with customers by type of products and services, as it believes this method best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

The following tables represent a disaggregation of revenue from arrangements with customers for the three months ended June 30, 2025 and 2024, along with the segment for each category (in thousands).


	Three Months Ended June 30, 2025
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Notebooks/Mobility	$	97,683	$	106,075	$	57,460	$	261,218
Desktops		57,713		28,559		17,020		103,292
Software		23,389		37,576		7,641		68,606
Servers/Storage		21,724		34,127		15,432		71,283
Net/Com Products		23,532		19,496		11,368		54,396
Displays and Sound		30,052		23,595		13,657		67,304
Accessories		44,142		24,515		10,004		78,661
Other Hardware/Services		27,776		19,225		7,932		54,933
Total Net sales	$	326,011	$	293,168	$	140,514	$	759,693

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	Three Months Ended June 30, 2024
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Notebooks/Mobility	$	89,802	$	97,841	$	69,816	$	257,459
Desktops		52,680		20,105		12,792		85,577
Software		21,628		37,775		9,571		68,974
Servers/Storage		15,691		34,056		13,640		63,387
Net/Com Products		19,107		19,845		14,312		53,264
Displays and Sound		37,265		19,981		16,745		73,991
Accessories		38,645		28,663		11,470		78,778
Other Hardware/Services		23,990		19,932		11,127		55,049
Total Net sales	$	298,808	$	278,198	$	159,473	$	736,479

The following tables represent a disaggregation of revenue from arrangements with customers for the six months ended June 30, 2025 and 2024, along with the segment for each category (in thousands).


	Six Months Ended June 30, 2025
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Notebooks/Mobility	$	185,225	$	208,421	$	125,038	$	518,684
Desktops		111,185		52,352		29,879		193,416
Software		56,834		69,762		16,373		142,969
Servers/Storage		39,626		54,417		27,367		121,410
Net/Com Products		41,787		37,511		21,220		100,518
Displays and Sound		53,064		42,903		24,199		120,166
Accessories		83,949		48,175		25,733		157,857
Other Hardware/Services		52,344		38,012		15,363		105,719
Total Net sales	$	624,014	$	551,553	$	285,172	$	1,460,739


	Six Months Ended June 30, 2024
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Notebooks/Mobility	$	180,033	$	189,997	$	108,698	$	478,728
Desktops		90,717		38,223		21,539		150,479
Software		48,748		68,427		15,121		132,296
Servers/Storage		28,058		55,667		22,146		105,871
Net/Com Products		39,069		41,690		19,917		100,676
Displays and Sound		68,529		41,733		27,348		137,610
Accessories		80,177		59,036		19,066		158,279
Other Hardware/Services		46,136		39,294		19,135		104,565
Total Net sales	$	581,467	$	534,067	$	252,970	$	1,368,504

Contract Balances

The following table provides information about contract liabilities from arrangements with customers as of June 30, 2025 and December 31, 2024 (in thousands).


	June 30, 2025		December 31, 2024
Contract liabilities, which are included in accrued expenses and other liabilities	$	10,227	$	10,290

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Changes in the contract liability balances during the six months ended June 30, 2025 and 2024 are as follows (in thousands):


	2025
Balance at December 31, 2024	$	10,290
Cash received in advance and not recognized as revenue		25,180
Amounts recognized as revenue as performance obligations satisfied		(25,243)
Balance at June 30, 2025	$	10,227

	2024
Balance at December 31, 2023	$	4,206
Cash received in advance and not recognized as revenue		9,769
Amounts recognized as revenue as performance obligations satisfied		(6,875)
Balance at June 30, 2024	$	7,100

Note 3–Fair Value Measurements

Cash equivalents and short-term investments as of June 30, 2025 and December 31, 2024 consist of the following (in thousands):


	June 30, 2025
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Cash equivalents:
Money market funds	$	169,235	$	—	$	—	$	169,235
Short-term investments:
U.S. Government treasury securities		159,417		1		(68)		159,350
Total	$	328,652	$	1	$	(68)	$	328,585

	December 31, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Cash equivalents:
Money market funds	$	161,094	$	—	$	—	$	161,094
Short-term investments:
U.S. Government treasury securities		264,074		309		(88)		264,295
Total	$	425,168	$	309	$	(88)	$	425,389

Investments with maturities of 90 days or less from the date of purchase are classified as cash equivalents; investments with maturities of greater than 90 days from the date of purchase but less than one year are generally classified as short-term investments; and investments with maturities of one year or greater from the date of purchase are generally classified as long-term investments. All short-term investments had stated maturity dates of less than one year. The Company has recorded the securities at fair value on its condensed consolidated balance sheets and unrealized gains and losses are reported as a component of accumulated other comprehensive (loss) income. The amount of realized gains and losses reclassified into earnings and the related adjustments to deferred taxes are based on the specific identification of the securities sold or securities that reached maturity date.

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Fair Value

The Company measures certain financial assets at fair value. Fair value is determined based upon the exit price that would be received to sell an asset in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques are classified based on a three-level hierarchy, as follows:

●

Level 1 inputs: Quoted prices for identical assets or liabilities in active markets;

●

Level 2 inputs: Observable inputs other than those described as Level 1; and

●

Level 3 inputs: Unobservable inputs that are supported by little or no market activities and are based on significant assumptions and estimates.

As of June 30, 2025 and December 31, 2024, the fair values of the Company’s investments were all measured using level 1 inputs.

Note 4–Earnings Per Share

Basic earnings per common share is computed using the weighted average number of shares outstanding. Diluted earnings per share is computed using the weighted average number of shares outstanding adjusted for the incremental shares attributable to non-vested stock units and stock options outstanding, if dilutive.

The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended June 30, 2025 and 2024 (in thousands, except per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Numerator:
Net income	$	24,789	$	26,161	$	38,270	$	39,315
Denominator:
Denominator for basic earnings per share	$	25,405	$	26,348	$	25,739	$	26,355
Dilutive effect of employee stock awards		115		172		121		167
Denominator for diluted earnings per share	$	25,520	$	26,520	$	25,860	$	26,522
Earnings per share:
Basic	$	0.98	$	0.99	$	1.49	$	1.49
Diluted	$	0.97	$	0.99	$	1.48	$	1.48

For the three and six months ended June 30, 2025 and 2024, the Company had no outstanding non-vested stock units that were excluded from the computation of diluted earnings per share because including them would have had an anti-dilutive effect.

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Note 5–Leases

The Company leases certain facilities from a related party, which is a company affiliated with it through common ownership.

As of June 30, 2025, there were no additional significant operating leases that have not yet commenced. Refer to the following table for quantitative information related to the Company’s leases for the three and six months ended June 30, 2025 and 2024 (dollars in thousands):


	Three Months Ended June 30, 2025						Six Months Ended June 30, 2025
	Related Parties		Others		Total		Related Parties		Others		Total
Lease Cost
Capitalized operating lease cost	$	—	$	461	$	461	$	—	$	922	$	922
Short-term lease cost		420		148		568		840		296		1,136
Total lease cost	$	420	$	609	$	1,029	$	840	$	1,218	$	2,058

Other Information
Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases:
Operating cash flows	$	—	$	512	$	512	$	—	$	1,025	$	1,025

Weighted-average remaining lease term (in years):
Capitalized operating leases								—		1.63		1.63

Weighted-average discount rate:
Capitalized operating leases								0.00%		4.32%		4.32%

	Three Months Ended June 30, 2024						Six Months Ended June 30, 2024
	Related Parties		Others		Total		Related Parties		Others		Total
Lease Cost
Capitalized operating lease cost	$	—	$	485	$	485	$	—	$	944	$	944
Short-term lease cost		421		140		561		841		281		1,122
Total lease cost	$	421	$	625	$	1,046	$	841	$	1,225	$	2,066

Other Information
Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases:
Operating cash flows	$	—	$	532	$	532	$	—	$	977	$	977

Weighted-average remaining lease term (in years):
Capitalized operating leases								—		2.43		2.43

Weighted-average discount rate:
Capitalized operating leases								3.92%		4.28%		4.21%

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As of June 30, 2025, future lease payments over the remaining term of capitalized operating leases were as follows (in thousands):


For the Years Ended December 31,
2025, excluding the six months ended June 30, 2025	$	1,037
2026		1,205
2027		237
2028		161
2029		—
Thereafter		—
		2,640
Imputed interest		(89)
Lease liability balance at June 30, 2025	$	2,551

As of June 30, 2025, the right-of-use, or ROU, asset had a balance of $2,219. The long-term lease liability was $634 and the short-term lease liability, which is included in accrued expenses and other liabilities on the condensed consolidated balance sheets, was $1,917. As of December 31, 2024, the ROU asset had a balance of $3,077. The long-term lease liability was $1,552 and the short-term lease liability, which is included in accrued expenses and other liabilities on the condensed consolidated balance sheets, was $1,805.

Note 6–Accumulated Other Comprehensive (Loss) Income

Accumulated other comprehensive (loss) income, which is included as a component of stockholders’ equity, is comprised of unrealized gains and losses on short-term investments, net of tax. The changes in accumulated other comprehensive (loss) income were as follows (in thousands):


	Six Months Ended
	June 30, 2025
Balance - December 31, 2024	$	174
Other comprehensive loss before reclassifications, net of tax		(56)
Less amounts reclassified from accumulated other comprehensive (loss) income, net of tax		171
Net other comprehensive loss		(227)
Balance - June 30, 2025	$	(53)

	Six Months Ended
	June 30, 2024
Balance - December 31, 2023	$	81
Other comprehensive loss before reclassifications, net of tax		(158)
Less amounts reclassified from accumulated other comprehensive (loss) income, net of tax		26
Net other comprehensive loss		(184)
Balance - June 30, 2024	$	(103)

Included in amounts reclassified from accumulated other comprehensive (loss) income, net of tax for the six months ended June 30, 2025 is $76 of realized gain, which is included in “Other income” on the unaudited condensed consolidated statements of income.

Note 7–Segment Information

The internal reporting structure used by the Company’s chief operating decision maker, or CODM, to assess performance and allocate resources determines the basis for the Company’s operating segments. The Company’s operations are organized under three reporting segments—the Enterprise Solutions segment, which serves primarily medium-to-large corporations; the Business Solutions segment, which serves primarily small- to medium-sized businesses; and the Public Sector Solutions segment, which serves primarily federal, state, and local government and educational institutions. In addition, the Headquarters/Other provides services in areas such as finance, human resources, IT, marketing, and product management. Most of the operating costs associated with the Headquarters/Other functions are charged to the operating segments based on their estimated usage of the underlying functions. The Company reports

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these charges to the operating segments as “Allocations”. Headquarters/Other amounts that are not allocated to the operating segments are shown as reconciling items in the tables below.

The Company’s CODM is its Chief Executive Officer, and he assesses the segments’ performance by using each segments’ operating income (which includes certain corporate overhead allocations attributable to each of the segments). Net sales presented below exclude inter-segment product revenues. The CODM uses operating income for each segment in the annual budget, periodic forecasting, and quarterly results processes.

Segment information applicable to the Company’s operating segments and the related reconciliations to consolidated amounts for the three and six months ended June 30, 2025 and 2024 are shown below (in thousands):


	Three Months Ended June 30, 2025
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	326,011	$	293,168	$	140,514	$	759,693
Cost of sales		278,389		224,319		119,219
Personnel costs		16,995		17,662		9,273
Marketing		787		2,564		575
Allocated corporate overhead		18,069		21,521		10,761
Depreciation and amortization		195		155		22
Other segment expenses¹		1,230		1,383		2,796
Operating income (loss)	$	10,346	$	25,564	$	(2,132)	$	33,778
Unallocated Headquarters/Other expenses								(2,881)
Interest income, net								3,216
Income before taxes							$	34,113


	Six Months Ended June 30, 2025
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	624,014	$	551,553	$	285,172	$	1,460,739
Cost of sales		534,094		417,297		244,271
Personnel costs		33,165		35,437		18,859
Marketing		2,884		7,403		1,659
Allocated corporate overhead		36,359		42,997		21,499
Depreciation and amortization		387		310		45
Other segment expenses¹		2,277		4,128		4,313
Operating income (loss)	$	14,848	$	43,981	$	(5,474)	$	53,355
Unallocated Headquarters/Other expenses								(7,936)
Interest income, net								7,116
Other income								76
Income before taxes							$	52,611

Segment assets	$	753,931	$	591,894	$	88,650	$	1,434,475
Headquarters/Other assets								(165,198)
Consolidated assets							$	1,269,277

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	Three Months Ended June 30, 2024
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	298,808	$	278,198	$	159,473	$	736,479
Cost of sales		252,763		211,872		135,302
Personnel costs		15,346		18,124		9,370
Marketing		757		3,672		812
Allocated corporate overhead		18,433		20,689		10,345
Depreciation and amortization		221		147		23
Other segment expenses¹		1,058		1,465		907
Operating income	$	10,230	$	22,229	$	2,714	$	35,173
Unallocated Headquarters/Other expenses								(4,254)
Interest income, net								4,649
Income before taxes							$	35,568


	Six Months Ended June 30, 2024
	Enterprise Solutions		Business Solutions		Public Sector Solutions		Total
Net sales	$	581,467	$	534,067	$	252,970	$	1,368,504
Cost of sales		492,688		407,377		213,825
Personnel costs		30,815		36,087		17,661
Marketing		2,644		8,002		1,995
Allocated corporate overhead		36,815		41,197		20,599
Depreciation and amortization		426		310		46
Other segment expenses¹		2,002		3,076		1,480
Operating income (loss)	$	16,077	$	38,018	$	(2,636)	$	51,459
Unallocated Headquarters/Other expenses								(7,076)
Interest income, net								9,216
Income before taxes							$	53,599

Segment assets	$	729,450	$	537,655	$	107,382	$	1,374,487
Headquarters/Other assets								(91,002)
Consolidated assets							$	1,283,485

Other segment expenses for each of the reportable segments include service contracts/subscriptions, professional fees, facilities operations, credit card fees, and other miscellaneous expenses.

The assets of the Company’s three operating segments presented above consist primarily of accounts receivable, net intercompany receivables, goodwill, and other intangibles, net. Assets reported under the Headquarters/Other are managed by corporate headquarters, including cash and cash equivalents, short-term investments, inventories, property and equipment, ROU assets, and intercompany balance, net. As of June 30, 2025 and 2024, total assets for the Headquarters/Other were presented net of intercompany balance eliminations of $46,339 and $59,751, respectively. The Company’s capital expenditures consist largely of IT hardware and software purchased to maintain or upgrade its management information systems. These information systems serve all of the Company’s segments, to varying degrees, and accordingly, the CODM does not evaluate capital expenditures on a segment-by-segment basis.

Note 8–Commitments and Contingencies

The Company is subject to various legal proceedings and claims, which have arisen during the ordinary course of business. The outcomes of such matters are not expected to have a material, adverse effect on the Company’s financial position, results of operations, and/or cash flows.

The Company is subject to audits by states on sales and income taxes, employment matters, and other assessments. Additional liabilities for these and other audits could be assessed, but such outcomes are not expected to have a material, adverse impact on the Company’s financial position, results of operations, and/or cash flows.

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Note 9–Bank Borrowings

The Company previously had a $50,000 credit facility collateralized by its account receivables that expired March 31, 2025 that the Company elected not to renew or replace. Amounts outstanding under the credit facility bore interest at the daily Bloomberg Short-Term Bank Yield Index, or BSBY Rate, plus a spread based on the Company’s funded debt ratio, or in the absence of BSBY Rate, the prime rate (7.50% at March 31, 2025).

Cash receipts were automatically applied against any outstanding borrowings. During the six months ended June 30, 2025 and 2024, the Company borrowed incremental amounts that were each repaid in full. These borrowings for the six months ended June 30, 2025 and 2024 totaled $732 and $10,560, respectively; however, at no time were the outstanding borrowings greater than the $50,000 limit under the credit facility. The Company had no outstanding borrowings under the credit facility immediately prior to the expiration of the credit facility, or as of June 30, 2024.

Note 10–Supplier Finance Programs

The Company has agreements with third-party financial institutions, instituted by request of participating suppliers, that allow for the ability to finance payment obligations from the Company. The third-party financial institutions have separate arrangements with the Company’s suppliers and provide them with the option to request early payment for invoices confirmed by the Company. The Company does not determine the terms or conditions of the arrangements between the third-parties and its suppliers and receives no compensation from the third-party financial institutions. The Company’s obligation to its suppliers, including amounts due and scheduled payment dates, are not impacted by the suppliers’ decisions to finance amounts under the arrangements. The payment terms under these arrangements are typical with industry standards and range from 30 to 50 days. The agreements with the financial institutions are collateralized by the inventory purchased through the financing agreements. The Company’s outstanding payment obligations under the supplier finance programs, which are included in accounts payable on the condensed consolidated balance sheets, were $62,448 and $47,763 at June 30, 2025 and December 31, 2024, respectively. The rollforward of the Company’s outstanding obligations confirmed as valid under the supplier finance programs for the six months ended June 30, 2025 is as follows (in thousands):


	2025
Confirmed obligations outstanding at December 31, 2024	$	47,763
Invoices confirmed		248,813
Confirmed invoices paid		(234,128)
Confirmed obligations outstanding at June 30, 2025	$	62,448

Note 11–Subsequent Events

The One Big Beautiful Bill Act, or OBBBA, was enacted on July 4, 2025. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through future years. We are currently assessing its impact on our consolidated financial statements.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements generally relate to future events or our future financial or operating performance and include statements concerning, among other things, our future financial results, business plans (including statements regarding new products and services we may offer and future expenditures, costs and investments), liabilities, impairment charges, competition, and the expected impact of current macroeconomic conditions on our businesses and results of operations. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “would,” “should,” “expects,” “plans,” “could,” “intends,” “target,” “projects,” “believes,” “estimates,” “anticipates,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. These statements reflect our current views and are based on assumptions as of the date of this report. Such assumptions are based upon internal estimates and other analyses of current market conditions and trends, management expectations, plans, and strategies, economic conditions, and other factors. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from expectations or results projected or implied by forward-looking statements.

Such differences may result from actions taken by us, including expense reduction or strategic initiatives (including reductions in force, capital investments and new or expanded product offerings or services), the execution of our business plans (including our inventory management, cost structure and management and other personnel decisions) or other business decisions, as well as from developments beyond our control, including:

●

macroeconomic factors facing the global economy, including disruptions in or increased volatility of the capital markets, changes in trade policy, which may include the imposition of tariffs or other trade barriers, economic sanctions and economic slowdowns or recessions, changes in tax policy, rising inflation and changing interest rates modifying our potential for investment income and the timing or reducing the level of investment our customers are willing to make in IT products;

●

substantial competition reducing our market share;

●

significant price competition reducing our profit margins;

●

the loss of any of our major vendors adversely affecting the number or type of products we may offer;

●

virtualization of information technology, or IT, resources and applications, including networks, servers, applications, and data storage disrupting or altering our traditional distribution models;

●

service interruptions at third-party shippers negatively impacting our ability to deliver the products we offer to our customers;

●

increases in shipping and postage costs reducing our margins and adversely affecting our results of operations;

●

loss of key persons or the inability to attract, train and retain qualified personnel adversely affecting our ability to operate our business; and

●

cyberattacks or the failure to safeguard personal information and our IT systems resulting in liability and harm to our reputation.

Additional factors include those described in our Annual Report on Form 10-K for the year ended December 31, 2024, including under the captions “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Business,” in our subsequent quarterly reports on Form 10-Q, including under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in the other subsequent filings we make with the Securities and Exchange Commission from time to time.

A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances. You should not place undue reliance on the forward-looking statements. We assume no obligation to update any of these forward-looking statements, or to update the reasons actual results could differ materially from those anticipated, to reflect circumstances or events that occur after the statements are made except as required by law.

Unless the context otherwise requires, we use the terms “Connection”, the “Company”, “we”, “us”, and “our” in this Quarterly Report on Form 10-Q to refer to PC Connection, Inc. and its subsidiaries.

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OVERVIEW

We are a Fortune 1000 Global Solutions Provider that simplifies the IT customer experience, guiding the connection between people and technology. Our dedicated account managers partner with customers to design, deploy, and support cutting-edge IT environments using the latest hardware, software, and services. We provide a wide range of IT solutions, from the desktop to the cloud—including computer systems, data center solutions, software and peripheral equipment, networking communications, and other products and accessories that we purchase from manufacturers, distributors, and other suppliers. Our Technology Solutions Organization, or TSO, and state-of-the-art Technology Integration and Distribution Center with ISO 9001:2015 certified technical configuration lab offer end-to-end services related to the design, configuration, and implementation of IT solutions. Our team also provides a comprehensive portfolio of managed services and professional services. These services are performed by our personnel and by third-party providers. Our GlobalServe offering ensures worldwide coverage for our multinational customers, delivering global procurement solutions through our network of in-country suppliers in over 150 countries.

The “Connection®” brand includes Connection Enterprise Solutions, Connection Business Solutions, and Connection Public Sector Solutions, which provide IT solutions and services to enterprise, small- to medium-sized businesses, and public sector markets.

Financial results for each of our segments are included in the financial statements attached hereto. We generate sales through (i) outbound inside sales and field sales contacts by sales representatives focused on the business, educational, healthcare, retail, manufacturing, and government markets, (ii) our websites, and (iii) direct responses from customers responding to our advertising media. We offer a broad selection of over 460,000 products at competitive prices, including products from vendors like Apple, Cisco, Dell Inc., Hewlett-Packard Inc., Hewlett-Packard Enterprise, Intel, Lenovo, Microsoft Corporation, and VMware, and we partner with more than 2,500 suppliers. We are able to leverage our state-of-the art logistic capabilities to rapidly ship product to customers.

As a value-added reseller in the IT supply chain, we do not manufacture IT hardware or software products. We are dependent on our suppliers—manufacturers and distributors that historically have only sold to resellers rather than directly to end users. However, certain manufacturers have, on multiple occasions, sold or attempted to sell directly to our customers, and in some cases, have restricted our ability to sell their products directly to certain customers, thereby attempting to and, in some cases successfully, eliminate our role. We believe that the success of these direct sales efforts by manufacturers will depend on their ability to meet our customers’ ongoing demands and provide solutions to meet their needs. We believe more of our customers are seeking out comprehensive and integrated IT solutions, rather than the ability to acquire specific IT products on a one-off basis. Our advantage is our ability to be product-neutral and provide a broader combination of products, services, and advice tailored to our customers’ individual needs. By providing customers with customized solutions from a variety of manufacturers, we believe we can mitigate the negative impact of continued direct sales initiatives from individual manufacturers. Through the formation of our TSO, we are able to provide customers complete IT solutions, from identifying their needs, to designing, developing, and managing the integration of products and services to implement their IT projects. Such service offerings carry higher margins than traditional product sales. Additionally, the technical certifications of our service engineers permit us to offer higher-end, more complex products that generally carry higher gross margins. We expect these service offerings and technical certifications to continue to play a role in sales generation and gross margin improvements in this competitive environment.

The primary challenges we continue to face in effectively managing our business are (1) increasing our product and service revenues while at the same time improving our gross margin in all three segments, (2) recruiting, retaining, and improving the productivity of our sales and technical support personnel, and (3) effectively controlling our selling, general and administrative, or SG&A, expenses while making major investments in our IT systems and solution selling personnel, especially in relation to changing revenue levels.

To support future growth, we have invested and expect to continue to invest in our IT solutions business, which requires the addition of highly skilled service engineers. Although we expect to realize the ultimate benefit of higher-margin service revenues under this multi-year initiative, we believe that our cost of services will increase as we add additional service engineers. If our service revenues do not grow enough to offset the cost of these headcount additions, our operating results may be negatively impacted.

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Market conditions and technology advances significantly affect the demand for our products and services. Virtual delivery of software products and advanced Internet technology providing customers enhanced functionality have substantially increased customer expectations, requiring us to invest on an ongoing basis in our own IT infrastructure to meet these new demands.

Our investments in IT infrastructure are designed to enable us to operate more efficiently and provide our customers enhanced functionality.

The new U.S. administration has announced or imposed a series of tariffs on U.S. trading partners. In response, several countries have threatened or imposed retaliatory measures. The imposition of new tariffs or increases in existing tariffs on goods imported from countries where our suppliers operate could result in increased inventory costs. These cost increases may reduce our margins or require us to raise prices. We continue to assess the impact of the tariffs on our supply chain. In addition, these actions and threatened actions and increased volatility in financial markets may affect customer decisions about the timing or size of IT investments.

RESULTS OF OPERATIONS

The following table sets forth information derived from our statements of income expressed as a percentage of net sales for the periods indicated (dollars in millions):


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Net sales	$	759.7		$	736.5		$	1,460.7		$	1,368.5
Gross margin		18.1	%		18.5	%		18.1	%		18.6	%
Selling, general and administrative expenses		14.1	%		14.3	%		14.8	%		15.3	%
Income from operations		4.1	%		4.2	%		3.1	%		3.2	%

Net sales of $759.7 million for the second quarter of 2025 reflect an increase of $23.2 million, or 3.2% compared to the second quarter of 2024. The increase was primarily driven by increases in net sales of desktops, servers/storage, notebooks/mobility, and net/com products of $17.7 million, $7.9 million, $3.8 million, and $1.1 million, respectively, as shown in the table in Note 2 “Revenue” in the Notes to our Unaudited Condensed Consolidated Financial Statements. These increases were partially offset by a decrease in net sales of displays and sound of $6.7 million. Gross profit for the second quarter of 2025 increased year-over-year by $1.3 million, or 0.9%, to $137.8 million as illustrated in the table and the discussion beginning on page 21 of this Quarterly Report on Form 10-Q. Gross margin decreased to 18.1% from 18.5% a year ago. The decrease in gross margin was primarily driven by reduced software agency fees in the current period. SG&A expenses increased year-over-year by $1.7 million, or 1.6%, to $106.9 million. SG&A expenses as a percentage of net sales decreased to 14.1% compared to 14.3% a year ago. The increase in SG&A expenses is primarily due to an increase in professional fees as shown in the table on page 20 of this Quarterly Report on Form 10-Q. Operating income for the second quarter of 2025 remained substantially the same year-over-year both in dollars and as a percentage of net sales.

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Net Sales Distribution

The following table sets forth our percentage of net sales by segment and product mix for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Operating Segment
Enterprise Solutions	43	%	40	%	43	%	43	%
Business Solutions	39		38		38		39
Public Sector Solutions	18		22		19		18
Total	100	%	100	%	100	%	100	%

Product Mix
Notebooks/Mobility	34	%	35	%	36	%	35	%
Desktops	14		12		13		11
Software	9		9		10		10
Servers/Storage	9		9		8		8
Net/Com Products	7		7		7		7
Displays and Sound	9		10		8		10
Accessories	10		11		11		11
Other Hardware/Services	8		7		7		8
Total	100	%	100	%	100	%	100	%

Gross Profit Margin

The following table summarizes our gross margin, as a percentage of net sales, for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Operating Segment
Enterprise Solutions	14.6	%	15.4	%	14.4	%	15.3	%
Business Solutions	23.5		23.8		24.3		23.7
Public Sector Solutions	15.2		15.2		14.3		15.5
Total Company	18.1	%	18.5	%	18.1	%	18.6	%

Operating Expenses

The following table reflects our SG&A expenses for the periods indicated (dollars in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Personnel costs	$	81.2	$	81.1	$	164.1	$	159.6
Marketing		4.4		5.2		12.4		12.6
Service contracts/subscriptions		6.4		5.7		13.2

PC CONNECTION INC 10-Q