The setup
Insight raised the year, printed adjusted diluted EPS of $3.59 against a $2.80 feed consensus (unverified, market data, possibly on an older basis), and the stock traded down 7.7% to $162.09 by midday from a $175.62 close (unverified, market data). The reason sits in one piece of arithmetic. Full-year gross profit growth of 12.5% to 14.0% on 2025's $1,761.4M, less the $1,507.0M already earned, leaves a December quarter of $474.6M to $501.1M. Last December was $478.4M. So a business that just grew gross profit 20.5% is guiding to between −0.8% and +4.7%.
Then the chief financial officer read out the lines. Hardware gross profit up high single digits, Insight Core services up mid-teens, cloud up in the mid-20% range (unverified pending the official transcript). Add those three and you get $437.0M to $444.6M before a dollar from anything else. Everything else (on-premise software plus agent fees outside cloud) has run between $77.3M and $97.8M for five straight quarters. The ceiling of the guide leaves it $56.5M to $64.1M.
Our call: December-quarter gross profit comes in above $501.1M, which puts full-year growth above the 14.0% top of the range, because the parts management gave are worth more than the whole it gave. At or below $501.1M refutes it, and it would mean the missing money is a real decline in the bucket nobody guided. The test reports around (unverified, date not confirmed by the company).
First the grade, because the last page asked for one. On we wrote that cloud gross profit at or above $150M with services gross profit outgrowing product gross profit would confirm the read that the fee layer, not the server cycle, is the engine. Cloud printed $164M. Services grew 23.1% against 16.6% for product. The call held. The same page called the hardware boom "a revenue event with a gross profit rounding error attached" and the second half "guided flat." Hardware added $30.8M of gross profit this quarter, and September alone grew 20.5%. Both of those lines were too harsh, and the rest of this page is partly about why we should not make the same mistake twice in the same direction.
The numbers
Insight Q3 2026 · $ millions
| Line | Q3 26 | Y/Y | ||
|---|---|---|---|---|
| Sales | ||||
| Net sales | 2,441.5 | |||
| Hardware | 1,507.2 | |||
| Software | 422.4 | |||
| Services | 511.9 | |||
| Profit | ||||
| Gross profit | 523.2 | |||
| Hardware | 178.6 | |||
| Software | 22.4 | |||
| Services | 322.2 | |||
| Cloud (within services) | 164 | |||
| Insight Core (within services) | 95 | |||
| Earnings from operations | 68.7 | |||
| Adjusted earnings from operations | 166.9 | |||
| Net earnings | 22.2 | |||
| Cash and balance sheet | ||||
| Operating cash flow | 128.4 | |||
| Accounts receivable | 7,383.6 | |||
| Inventories | 267.2 | |||
| Accrued and other current liabilities | 871.5 | |||
| Long-term debt | 1,498.9 | |||
Source: Insight Form 8-K Ex. 99.1 and 99.2, (unaudited). The Q3 Form 10-Q is not yet filed. Quarterly cash flow derived from year-to-date figures. Notes ↓
The rest of this dive is for paid subscribers.
The headline numbers are above. The 13 sections below carry the mechanism, the peer read, the valuation work, and the dated tests that decide it.
- Nine quarters: the level before the delta
- Where the $89.0M came from
- The guide that does not add up
- Segment by segment
- $0.74 and $3.59
- The cash under September
- The funding stack
- Connecting the dots
- The December bar
- Valuation
- The strongest case against this read
- What we'd watch
- Bottom line
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