SEGMENT REPORTING

9 Months Ended

Dec. 31, 2023

SEGMENT REPORTING [Abstract]

SEGMENT REPORTING

16. SEGMENT REPORTING

We manage and report our operating results through four operating segments: product, professional services, managed services, and financing. Our product segment includes sales of IT products, third-party software, and third-party maintenance, software assurance, and other third-party services. Our professional services segment includes our advanced professional services, staff augmentation, project management services, cloud consulting services and security services. Our managed services segment includes our advanced managed services, service desk, storage-as-a-service, cloud hosted services, cloud managed services and managed security services. We refer to the product segment, professional services segment, and managed services segment collectively as our technology business. Our financing business segment consists of the financing of IT equipment, software, and related services to commercial enterprises, state and local governments, and government contractors.

We measure the performance of the segments within our technology business based on gross profit, while we measure our financing business segment based on operating income. We do not present asset information for our reportable segments as we do not provide asset information to our chief operating decision maker.

The following table provides reportable segment information (in thousands):

	Three Months Ended				Nine Months Ended
	December 31,				December 31,
	2023		2022		2023		2022
Net sales
Product	$	419,478	$	544,316	$	1,418,581	$	1,336,309
Professional services		40,044		39,151		113,870		114,369
Managed services		34,640		28,307		99,335		81,359
Financing		14,893		11,702		39,055		43,504
Total		509,055		623,476		1,670,841		1,575,541
Gross profit
Product		91,919		104,485		308,059		282,042
Professional services		17,332		15,294		47,852		45,046
Managed services		11,015		8,075		31,006		22,692
Financing		13,544		10,518		33,531		35,419
Total		133,810		138,372		420,448		385,199
Operating expenses
Technology business		91,599		86,764		278,869		247,568
Financing		4,164		5,150		12,337		13,883
Total		95,763		91,914		291,206		261,451
Operating income
Technology business		28,667		41,090		108,048		102,212
Financing		9,380		5,368		21,194		21,536
Total		38,047		46,458		129,242		123,748
Other income (expense), net		366		2,907		673		(3,112	)
Earnings before tax	$	38,413	$	49,365	$	129,915	$	120,636
Depreciation and amortization
Technology business	$	5,381	$	3,582	$	15,747	$	10,304
Financing		18		27		74		83
Total	$	5,399	$	3,609	$	15,821	$	10,387
Interest and financing costs
Technology business	$	217	$	1,308	$	1,428	$	2,117
Financing		766		267		1,626		746
Total	$	983	$	1,575	$	3,054	$	2,863
Selected Financial Data - Statement of Cash Flow
Purchases of property, equipment, and operating lease equipment
Technology business	$	2,028	$	2,225	$	6,717	$	4,122
Financing		68		1,026		987		1,539
Total	$	2,096	$	3,251	$	7,704	$	5,661

The following tables provide a disaggregation of net sales by source and further disaggregate our revenue recognized from contracts with customers by timing and our position as principal or agent (in thousands):

	Three months ended December 31, 2023
	Product		Professional Services		Managed Services		Financing		Total
Net Sales
Contracts with customers	$	412,060	$	40,044	$	34,640	$	774	$	487,518
Financing and other		7,418		-		-		14,119		21,537
Total	$	419,478	$	40,044	$	34,640	$	14,893	$	509,055
Timing and position as principal or agent
Transferred at a point in time as principal	$	367,350	$	-	$	-	$	774	$	368,124
Transferred at a point in time as agent		44,710		-		-		-		44,710
Transferred over time as principal		-		40,044		34,640		-		74,684
Total revenue from contracts with customers	$	412,060	$	40,044	$	34,640	$	774	$	487,518

	Nine months ended December 31, 2023
	Product		Professional Services		Managed Services		Financing		Total
Net Sales
Contracts with customers	$	1,398,668	$	113,870	$	99,335	$	4,899	$	1,616,772
Financing and other		19,913		-		-		34,156		54,069
Total	$	1,418,581	$	113,870	$	99,335	$	39,055	$	1,670,841
Timing and position as principal or agent
Transferred at a point in time as principal	$	1,262,010	$	-	$	-	$	4,899	$	1,266,909
Transferred at a point in time as agent		136,658		-		-		-		136,658
Transferred over time as principal		-		113,870		99,335		-		213,205
Total revenue from contracts with customers	$	1,398,668	$	113,870	$	99,335	$	4,899	$	1,616,772

	Three months ended December 31, 2022
	Product		Professional Services		Managed Services		Financing		Total
Net Sales
Contracts with customers	$	538,400	$	39,151	$	28,307	$	560	$	606,418
Financing and other		5,916		-		-		11,142		17,058
Total	$	544,316	$	39,151	$	28,307	$	11,702	$	623,476
Timing and position as principal or agent
Transferred at a point in time as principal	$	495,294	$	-	$	-	$	560	$	495,854
Transferred at a point in time as agent		43,106		-		-		-		43,106
Transferred over time as principal		-		39,151		28,307		-		67,458
Total revenue from contracts with customers	$	538,400	$	39,151	$	28,307	$	560	$	606,418

	Nine months ended December 31, 2022
	Product		Professional Services		Managed Services		Financing		Total
Net Sales
Contracts with customers	$	1,320,904	$	114,369	$	81,359	$	8,428	$	1,525,060
Financing and other		15,405		-		-		35,076		50,481
Total	$	1,336,309	$	114,369	$	81,359	$	43,504	$	1,575,541
Timing and position as principal or agent
Transferred at a point in time as principal	$	1,199,508	$	-	$	-	$	8,428	$	1,207,936
Transferred at a point in time as agent		121,396		-		-		-		121,396
Transferred over time as principal		-		114,369		81,359		-		195,728
Total revenue from contracts with customers	$	1,320,904	$	114,369	$	81,359	$	8,428	$	1,525,060

TECHNOLOGY BUSINESS DISAGGREGATION OF REVENUE

The following table provides a disaggregation of our revenue from contracts with customers for our technology business by customer end market and by type (in thousands):

	Three Months Ended December 31,						Nine Months Ended December 31,
	2023			2022			2023			2022
Customer end market:
Telecom, Media & Entertainment	$	139,551		$	184,539		$	405,192		$	431,269
Technology		83,951			133,067			268,302			299,088
State and local government and educational institutions		60,108			72,730			264,419			207,823
Healthcare		55,504			69,825			214,182			205,297
Financial Services		38,816			48,008			174,391			118,917
All others		116,232			103,605			305,300			269,643
Net sales		494,162			611,774			1,631,786			1,532,037
Less: Revenue from financing and other		(7,418	)		(5,916	)		(19,913	)		(15,405	)
Revenue from contracts with customers	$	486,744		$	605,858		$	1,611,873		$	1,516,632
Type:
Product
Networking	$	209,936		$	275,774		$	723,760		$	584,311
Cloud		120,253			157,126			427,365			470,851
Security		58,822			77,111			156,504			173,623
Collaboration		13,608			13,405			53,647			45,572
Other		16,859			20,900			57,305			61,952
Total product		419,478			544,316			1,418,581			1,336,309
Professional services		40,044			39,151			113,870			114,369
Managed services		34,640			28,307			99,335			81,359
Net sales		494,162			611,774			1,631,786			1,532,037
Less: Revenue from financing and other		(7,418	)		(5,916	)		(19,913	)		(15,405	)
Revenue from contracts with customers	$	486,744		$	605,858		$	1,611,873		$	1,516,632

We do not disaggregate sales by customer end market beyond the technology business.

FINANCING BUSINESS SEGMENT DISAGGREGATION OF REVENUE

We analyze our revenues within our financing business segment based on the nature of the arrangement. Our financing revenue generally consists of portfolio income, transactional gains, and post-contract earnings including month-to-month rents and the sales of off-lease equipment. All our revenues from contracts with customers within our financing business segment is from the sales of off-lease equipment.