PC Connection (CNXN) 10-Q2 Aug 232023 Q2 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2023	Jul. 26, 2023
Document And Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Entity File Number	0-23827
Entity Registrant Name	PC CONNECTION, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	02-0513618
Entity Address, Address Line One	730 Milford Road
Entity Address, City or Town	Merrimack
Entity Address, State or Province	NH
Entity Address, Postal Zip Code	03054
City Area Code	603
Local Phone Number	683-2000
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	CNXN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		26,256,784
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001050377
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current Assets:
Cash and cash equivalents	$ 243,983	$ 122,930
Accounts receivable, net	592,663	610,280
Inventories, net	159,734	208,682
Income taxes receivable	9,016
Prepaid expenses and other current assets	16,537	11,900
Total current assets	1,021,933	953,792
Property and equipment, net	58,012	59,171
Right-of-use assets	5,775	7,558
Goodwill	73,602	73,602
Intangible, net	4,038	4,648
Other assets	915	1,055
Total Assets	1,164,275	1,099,826
Current Liabilities:
Accounts payable	277,235	232,638
Accrued payroll	20,257	24,071
Accrued expenses and other liabilities	49,813	53,808
Total current liabilities	347,305	310,517
Deferred income taxes	17,970	17,970
Noncurrent operating lease liabilities	4,196	4,994
Other liabilities	684	170
Total Liabilities	370,155	333,651
Stockholders' Equity:
Common stock	291	291
Additional paid-in capital	129,486	125,784
Retained earnings	715,726	686,037
Treasury stock, at cost	(51,383)	(45,937)
Total Stockholders' Equity	794,120	766,175
Total Liabilities and Stockholders' Equity	$ 1,164,275	$ 1,099,826

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Consolidated Statements of Income
Net sales	$ 733,547	$ 828,509	$ 1,461,092	$ 1,616,853
Cost of sales	605,770	691,608	1,211,019	1,351,646
Gross profit	127,777	136,901	250,073	265,207
Selling, general and administrative expenses	100,960	102,131	204,242	200,302
Restructuring and other charges	1,746		2,643
Income from operations	25,071	34,770	43,188	64,905
Other income, net	1,874	15	3,160	11
Income before taxes	26,945	34,785	46,348	64,916
Income tax provision	(7,248)	(9,387)	(12,453)	(17,726)
Net income	$ 19,697	$ 25,398	$ 33,895	$ 47,190
Earnings per common share:
Basic	$ 0.75	$ 0.97	$ 1.29	$ 1.80
Diluted	$ 0.75	$ 0.96	$ 1.28	$ 1.79
Shares used in computation of earnings per common share:
Basic	26,256	26,268	26,291	26,262
Diluted	26,365	26,429	26,400	26,417

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Retained Earnings	Treasury Shares	Total
Balance at Dec. 31, 2021	$ 290	$ 122,354	$ 605,766	$ (45,937)	$ 682,473
Balance (in shares) at Dec. 31, 2021	29,025
Balance - Treasury Shares (in shares) at Dec. 31, 2021				(2,773)
Stock-based compensation expense		2,790			2,790
Restricted stock units vested (in shares)	20
Shares withheld for taxes paid on stock awards		(454)			(454)
Net Income (Loss)			47,190		47,190
Balance at Jun. 30, 2022	$ 290	124,690	652,956	$ (45,937)	731,999
Balance (in shares) at Jun. 30, 2022	29,045
Balance - Treasury Shares (in shares) at Jun. 30, 2022				(2,773)
Balance at Mar. 31, 2022	$ 290	123,571	627,558	$ (45,937)	705,482
Balance (in shares) at Mar. 31, 2022	29,034
Balance - Treasury Shares (in shares) at Mar. 31, 2022				(2,773)
Stock-based compensation expense		1,408			1,408
Restricted stock units vested (in shares)	11
Shares withheld for taxes paid on stock awards		(289)			(289)
Net Income (Loss)			25,398		25,398
Balance at Jun. 30, 2022	$ 290	124,690	652,956	$ (45,937)	731,999
Balance (in shares) at Jun. 30, 2022	29,045
Balance - Treasury Shares (in shares) at Jun. 30, 2022				(2,773)
Balance at Dec. 31, 2022	$ 291	125,784	686,037	$ (45,937)	766,175
Balance (in shares) at Dec. 31, 2022	29,123			(2,773)
Issuance of common stock under Employee Stock Purchase Plan		537			537
Issuance of common stock under Employee Stock Purchase Plan (in shares)	13
Stock-based compensation expense		3,636			3,636
Restricted stock units vested (in shares)	22
Shares withheld for taxes paid on stock awards		(471)			(471)
Repurchase of common stock for treasury				$ (5,392)	(5,392)
Repurchase of common stock for treasury (in shares)				(129)
Excise tax on stock repurchases				$ (54)	(54)
Dividend declaration			(4,206)		(4,206)
Net Income (Loss)			33,895		33,895
Balance at Jun. 30, 2023	$ 291	129,486	715,726	$ (51,383)	794,120
Balance (in shares) at Jun. 30, 2023	29,158			(2,902)
Balance at Mar. 31, 2023	$ 291	127,424	698,128	$ (49,360)	776,483
Balance (in shares) at Mar. 31, 2023	29,133			(2,852)
Issuance of common stock under Employee Stock Purchase Plan		537			537
Issuance of common stock under Employee Stock Purchase Plan (in shares)	13
Stock-based compensation expense		1,783			1,783
Restricted stock units vested (in shares)	12
Shares withheld for taxes paid on stock awards		(258)			(258)
Repurchase of common stock for treasury				$ (1,969)	(1,969)
Repurchase of common stock for treasury (in shares)				(50)
Excise tax on stock repurchases				$ (54)	(54)
Dividend declaration			(2,099)		(2,099)
Net Income (Loss)			19,697		19,697
Balance at Jun. 30, 2023	$ 291	$ 129,486	$ 715,726	$ (51,383)	$ 794,120
Balance (in shares) at Jun. 30, 2023	29,158			(2,902)

CONSOLIDATED STATEMENTS OF ST_2

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Consolidated Statement of Changes in Stockholders' Equity
Dividend declaration	$ 0.08	$ 0.08

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash Flows provided by (used in) Operating Activities:
Net income	$ 33,895	$ 47,190
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	6,167	5,980
Adjustments to credit losses reserve	1,247	1,642
Stock-based compensation expense	3,636	2,790
Loss on disposal of fixed assets	475	13
Changes in assets and liabilities:
Accounts receivable	16,370	(38,063)
Inventories	48,948	(16,603)
Prepaid expenses and other current assets	(13,653)	(3,352)
Other non-current assets	140	27
Accounts payable	44,584	(3,445)
Accrued expenses and other liabilities	(6,364)	(4,574)
Net cash provided by (used in) operating activities	135,445	(8,395)
Cash Flows used in Investing Activities:
Purchases of property and equipment	(4,860)	(4,565)
Net cash used in investing activities	(4,860)	(4,565)
Cash Flows used in Financing Activities:
Proceeds from short-term borrowings	67,895	26,054
Repayment of short-term borrowings	(67,895)	(26,054)
Purchase of common stock for treasury shares	(5,392)
Dividend payments	(4,206)
Issuance of stock under Employee Stock Purchase Plan	537
Payments of payroll taxes on stock-based compensation through shares withheld	(471)	(454)
Net cash used in financing activities	(9,532)	(454)
Increase (decrease) in cash and cash equivalents	121,053	(13,414)
Cash and cash equivalents, beginning of year	122,930	108,310
Cash and cash equivalents, end of period	243,983	94,896
Non-cash Investing and Financing Activities:
Accrued purchases of property and equipment	205	390
Accrued excise tax on treasury purchases	54
Supplemental Cash Flow Information:
Income taxes paid	27,410	21,509
Interest paid	$ 18	$ 3

BASIS OF PRESENTATION

BASIS OF PRESENTATION	6 Months Ended
BASIS OF PRESENTATION	Jun. 30, 2023
Basis of Presentation
Basis of Presentation	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, 2022, filed with the SEC. The accompanying 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, 2022. 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, 2023 may not be indicative of the results expected for any succeeding quarter or the entire year ending December 31, 2023. 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. Treasury Stock, at Cost The total repurchases for the six months ended June 30, 2023 were recorded as treasury stock of $5,446. Such cost reflects 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. Restructuring and Other Charges The restructuring and other charges recorded for the three and six months ended June 30, 2023 were primarily related to an involuntary reduction in our headquarter workforce and included cash severance and other related termination benefits. These costs will be paid within a year of termination and any unpaid balances are included in accrued expenses as of June 30, 2023. The Company is currently evaluating additional restructuring activities for the third quarter of 2023 and beyond. Restructuring and other charges are presented separately from selling, general and administrative expenses. Costs incurred were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Employee separations $ 1,701 $ — $ 2,399 $ — Other charges 45 — 244 — Total restructuring and other charges $ 1,746 $ — $ 2,643 $ — Included in accrued expenses and other liabilities as of June 30, 2023 was $1,381 related to unpaid termination benefits. Recently Issued Financial Accounting Standards In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848

REVENUE

REVENUE	6 Months Ended
REVENUE	Jun. 30, 2023
Revenue
Revenue	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, 2023 and 2022, along with the segment for each category (in thousands). Three Months Ended June 30, 2023 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 88,081 $ 87,590 $ 74,231 $ 249,902 Desktops 19,011 33,572 17,971 70,554 Software 33,828 17,561 13,059 64,448 Servers/Storage 22,605 18,705 11,959 53,269 Net/Com Products 28,584 28,727 22,233 79,544 Displays and Sound 23,654 27,322 16,785 67,761 Accessories 26,506 41,095 16,488 84,089 Other Hardware/Services 18,758 32,581 12,641 63,980 Total net sales $ 261,027 $ 287,153 $ 185,367 $ 733,547 Three Months Ended June 30, 2022 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 123,176 $ 117,407 $ 67,211 $ 307,794 Desktops 23,749 52,632 13,267 89,648 Software 39,567 21,572 10,508 71,647 Servers/Storage 29,698 11,857 9,598 51,153 Net/Com Products 24,430 24,244 6,640 55,314 Displays and Sound 30,969 37,732 19,207 87,908 Accessories 35,656 57,728 15,683 109,067 Other Hardware/Services 21,106 25,782 9,090 55,978 Total net sales $ 328,351 $ 348,954 $ 151,204 $ 828,509 The following tables represent a disaggregation of revenue from arrangements with customers for the six months ended June 30, 2023 and 2022, along with the segment for each category (in thousands). Six Months Ended June 30, 2023 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 183,000 $ 201,908 $ 126,005 $ 510,913 Desktops 37,773 63,714 32,388 133,875 Software 68,404 56,795 22,976 148,175 Servers/Storage 46,896 31,212 21,946 100,054 Net/Com Products 56,888 49,259 35,553 141,700 Displays and Sound 46,467 54,042 29,987 130,496 Accessories 55,241 88,689 29,961 173,891 Other Hardware/Services 39,472 55,477 27,039 121,988 Total net sales $ 534,141 $ 601,096 $ 325,855 $ 1,461,092 Six Months Ended June 30, 2022 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 253,609 $ 238,747 $ 124,061 $ 616,417 Desktops 47,308 97,496 31,255 176,059 Software 74,475 42,582 15,777 132,834 Servers/Storage 51,862 27,228 19,228 98,318 Net/Com Products 47,057 46,435 14,667 108,159 Displays and Sound 63,793 74,811 32,630 171,234 Accessories 67,897 105,735 28,615 202,247 Other Hardware/Services 42,793 51,317 17,475 111,585 Total net sales $ 648,794 $ 684,351 $ 283,708 $ 1,616,853 Contract Balances The following table provides information about contract liabilities from arrangements with customers as of June 30, 2023 and December 31, 2022 (in thousands). June 30, 2023 December 31, 2022 Contract liabilities, which are included in "Accrued expenses and other liabilities" $ 6,563 $ 4,266 Changes in the contract liability balances during the six months ended June 30, 2023 and 2022 are as follows (in thousands): 2023 Balance at December 31, 2022 $ 4,266 Cash received in advance and not recognized as revenue 11,980 Amounts recognized as revenue as performance obligations satisfied (9,683) Balance at June 30, 2023 $ 6,563 2022 Balance at December 31, 2021 $ 8,628 Cash received in advance and not recognized as revenue 16,316 Amounts recognized as revenue as performance obligations satisfied (18,907) Balance at June 30, 2022 $ 6,037

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
EARNINGS PER SHARE	Jun. 30, 2023
Earnings Per Share
Earnings Per Share	Note 3–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 (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net income $ 19,697 $ 25,398 $ 33,895 $ 47,190 Denominator: Denominator for basic earnings per share 26,256 26,268 26,291 26,262 Dilutive effect of employee stock awards 109 161 109 155 Denominator for diluted earnings per share 26,365 26,429 26,400 26,417 Earnings per share: Basic $ 0.75 $ 0.97 $ 1.29 $ 1.80 Diluted $ 0.75 $ 0.96 $ 1.28 $ 1.79 For the three and six months ended June 30, 2023 and 2022, 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.

LEASES

LEASES	6 Months Ended
LEASES	Jun. 30, 2023
Leases
Leases	Note 4 – Leases The Company leases certain facilities from a related party, which is a company affiliated with us through common ownership. Included in the right-of-use, or ROU, asset as of June 30, 2023 was $519 and a corresponding lease liability of $519 associated with related party leases. As of June 30, 2023, there were no additional 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, 2023 and 2022 (dollars in thousands): Three Months Ended June 30, 2023 Six Months Ended June 30, 2023 Related Parties Others Total Related Parties Others Total Lease Cost Capitalized operating lease cost $ 314 $ 590 $ 904 $ 627 $ 1,299 $ 1,926 Short-term lease cost 107 115 222 214 136 350 Total lease cost $ 421 $ 705 $ 1,126 $ 841 $ 1,435 $ 2,276 Other Information Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases: Operating cash flows $ 314 $ 602 $ 916 $ 627 $ 1,245 $ 1,872 Weighted-average remaining lease term (in years): Capitalized operating leases 0.42 3.59 3.33 Weighted-average discount rate: Capitalized operating leases 3.92% 4.06% 4.04% Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Related Parties Others Total Related Parties Others Total Lease Cost Capitalized operating lease cost $ 313 $ 711 $ 1,024 $ 627 $ 1,419 $ 2,046 Short-term lease cost 107 21 128 214 42 256 Total lease cost $ 420 $ 732 $ 1,152 $ 841 $ 1,461 $ 2,302 Other Information Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases: Operating cash flows $ 313 $ 747 $ 1,060 $ 627 $ 1,434 $ 2,061 Weighted-average remaining lease term (in years): Capitalized operating leases 1.42 4.10 3.58 Weighted-average discount rate: Capitalized operating leases 3.92% 3.91% 3.92% For the Years Ended December 31, Related Parties Others Total 2023, excluding the six months ended June 30, 2023 $ 735 $ 802 $ 1,537 2024 163 1,697 1,860 2025 163 1,635 1,798 2026 163 952 1,115 2027 1 232 233 Thereafter — 340 340 $ 1,225 $ 5,658 $ 6,883 Imputed interest (448) Lease liability balance at June 30, 2023 $ 6,435 As of June 30, 2023, the ROU asset had a balance of $5,775. The long-term lease liability was $4,196 and the short-term lease liability, which is included in accrued expenses and other liabilities in the consolidated balance sheets, was $2,239. As of June 30, 2022, the ROU asset had a balance of $8,267. The long-term lease liability was $5,242 and the short-term lease liability, which is included in accrued expenses and other liabilities in the consolidated balance sheets, was $3,641.

SEGMENT INFORMATION

SEGMENT INFORMATION	6 Months Ended
SEGMENT INFORMATION	Jun. 30, 2023
Segment Information
Segment Information	Note 5–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 CODM is its Chief Executive Officer, and he evaluates operations and allocates resources based on a measure of operating income. The Company’s operations are organized under three segments—the Business Solutions segment, which serves primarily small- to medium-sized businesses; the Enterprise Solutions segment, which serves primarily medium-to-large corporations; and the Public Sector Solutions segment, which serves primarily federal, state, and local government and educational institutions. In addition, the Headquarters/Other group provides services in areas such as finance, human resources, information technology, or IT, marketing, and product management. Most of the operating costs associated with the Headquarters/Other group functions are charged to the operating segments based on their estimated usage of the underlying functions. The Company reports these charges to the operating segments as “Allocations”. Certain headquarters costs relating to executive oversight and other fiduciary functions that are not allocated to the operating segments are included under the heading of Headquarters/Other in the tables below. Net sales presented below exclude inter-segment product revenues. Segment information applicable to the Company’s operating segments for the three and six months ended June 30, 2023 and 2022 is shown below (in thousands): Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2023 2022 2023 2022 Net sales: Business Solutions $ 261,027 $ 328,351 $ 534,141 $ 648,794 Enterprise Solutions 287,153 348,954 601,096 684,351 Public Sector Solutions 185,367 151,204 325,855 283,708 Total net sales $ 733,547 $ 828,509 $ 1,461,092 $ 1,616,853 Operating income (loss): Business Solutions $ 18,831 $ 22,279 $ 35,384 $ 42,952 Enterprise Solutions 7,511 15,389 14,033 29,703 Public Sector Solutions 1,650 1,071 1,679 (55) Headquarters/Other (2,921) (3,969) (7,908) (7,695) Total operating income 25,071 34,770 43,188 64,905 Other income, net 1,874 15 3,160 11 Income before taxes $ 26,945 $ 34,785 $ 46,348 $ 64,916 Selected operating expense: Depreciation and amortization: Business Solutions $ 158 $ 168 $ 317 $ 335 Enterprise Solutions 423 501 847 1,035 Public Sector Solutions 20 20 39 39 Headquarters/Other 2,493 2,300 4,964 4,571 Total depreciation and amortization $ 3,094 $ 2,989 $ 6,167 $ 5,980 Total assets: Business Solutions $ 472,566 $ 430,763 Enterprise Solutions 678,104 663,837 Public Sector Solutions 102,652 86,743 Headquarters/Other (89,047) (57,710) Total assets $ 1,164,275 $ 1,123,633 The assets of the Company’s three operating segments presented above consist primarily of accounts receivable, net intercompany receivable, goodwill, and other intangibles. Assets reported under the Headquarters/Other group are managed by corporate headquarters, including cash and cash equivalents, inventories, property and equipment, ROU assets, and intercompany balance, net. As of June 30, 2023 and 2022, total assets for the Headquarters/Other group were presented net of intercompany balance eliminations of $55,432 and $41,439 , 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.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
COMMITMENTS AND CONTINGENCIES	Jun. 30, 2023
Commitments and Contingencies
Commitments and Contingencies	Note 6–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.

BANK BORROWINGS

BANK BORROWINGS	6 Months Ended
BANK BORROWINGS	Jun. 30, 2023
Bank Borrowings
Bank Borrowings	Note 7–Bank Borrowings The Company has a $50,000 credit facility collateralized by its account receivables that expires March 31, 2025. This facility can be increased, at the Company’s option, to $80,000 for permitted acquisitions or other uses authorized by the lender on substantially the same terms. Amounts outstanding under this facility bear 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 (8.25% at June 30, 2023). The credit facility includes various customary financial ratios and operating covenants, including minimum net worth and maximum funded debt ratio requirements, and default acceleration provisions. The credit facility does not include restrictions on future dividend payments. Funded debt ratio is the ratio of average outstanding advances under the credit facility for a given quarter to consolidated trailing twelve months Adjusted Earnings Before Interest Expense, Taxes, Depreciation, Amortization, and Special Charges, or Adjusted EBITDA. The maximum allowable funded debt ratio under the agreement is 2.0 to 1.0. Decreases in the Company’s consolidated trailing twelve months Adjusted EBITDA could limit its potential borrowing capacity under the credit facility. As of June 30, 2023, the Company was in compliance with all financial covenants contained in the agreement governing the credit facility. Cash receipts are automatically applied against any outstanding borrowings. During the six months ended June 30, 2023, the Company borrowed incremental amounts that were each repaid in full. These borrowings for the six months ended June 30, 2023 totaled $67,895; 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 as of June 30, 2023 or 2022, and accordingly, the entire $50,000 credit facility was available for borrowings on such date.

BASIS OF PRESENTATION (Policies

BASIS OF PRESENTATION (Policies)	6 Months Ended
BASIS OF PRESENTATION (Policies)	Jun. 30, 2023
Summary of Significant Accounting Policies
Principles of Consolidation	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, 2022, filed with the SEC. The accompanying 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, 2022. 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, 2023 may not be indicative of the results expected for any succeeding quarter or the entire year ending December 31, 2023.
Use of Estimates in the Preparation of Financial Statements	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.
Treasury Stock, at Cost	Treasury Stock, at Cost The total repurchases for the six months ended June 30, 2023 were recorded as treasury stock of $5,446. Such cost reflects 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.
Restructuring and other charges	Restructuring and Other Charges The restructuring and other charges recorded for the three and six months ended June 30, 2023 were primarily related to an involuntary reduction in our headquarter workforce and included cash severance and other related termination benefits. These costs will be paid within a year of termination and any unpaid balances are included in accrued expenses as of June 30, 2023. The Company is currently evaluating additional restructuring activities for the third quarter of 2023 and beyond. Restructuring and other charges are presented separately from selling, general and administrative expenses. Costs incurred were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Employee separations $ 1,701 $ — $ 2,399 $ — Other charges 45 — 244 — Total restructuring and other charges $ 1,746 $ — $ 2,643 $ — Included in accrued expenses and other liabilities as of June 30, 2023 was $1,381 related to unpaid termination benefits.
Recently Issued Financial Accounting Standards	Recently Issued Financial Accounting Standards In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848

BASIS OF PRESENTATION (Tables)

BASIS OF PRESENTATION (Tables)	6 Months Ended
BASIS OF PRESENTATION (Tables)	Jun. 30, 2023
Basis of Presentation
Schedule of restructuring and other charges	Restructuring and other charges are presented separately from selling, general and administrative expenses. Costs incurred were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Employee separations $ 1,701 $ — $ 2,399 $ — Other charges 45 — 244 — Total restructuring and other charges $ 1,746 $ — $ 2,643 $ —

REVENUE (Tables)

REVENUE (Tables)	6 Months Ended
REVENUE (Tables)	Jun. 30, 2023
Revenue
Schedule of disaggregation of revenue from contracts with customers	The following tables represent a disaggregation of revenue from arrangements with customers for the three months ended June 30, 2023 and 2022, along with the segment for each category (in thousands). Three Months Ended June 30, 2023 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 88,081 $ 87,590 $ 74,231 $ 249,902 Desktops 19,011 33,572 17,971 70,554 Software 33,828 17,561 13,059 64,448 Servers/Storage 22,605 18,705 11,959 53,269 Net/Com Products 28,584 28,727 22,233 79,544 Displays and Sound 23,654 27,322 16,785 67,761 Accessories 26,506 41,095 16,488 84,089 Other Hardware/Services 18,758 32,581 12,641 63,980 Total net sales $ 261,027 $ 287,153 $ 185,367 $ 733,547 Three Months Ended June 30, 2022 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 123,176 $ 117,407 $ 67,211 $ 307,794 Desktops 23,749 52,632 13,267 89,648 Software 39,567 21,572 10,508 71,647 Servers/Storage 29,698 11,857 9,598 51,153 Net/Com Products 24,430 24,244 6,640 55,314 Displays and Sound 30,969 37,732 19,207 87,908 Accessories 35,656 57,728 15,683 109,067 Other Hardware/Services 21,106 25,782 9,090 55,978 Total net sales $ 328,351 $ 348,954 $ 151,204 $ 828,509 The following tables represent a disaggregation of revenue from arrangements with customers for the six months ended June 30, 2023 and 2022, along with the segment for each category (in thousands). Six Months Ended June 30, 2023 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 183,000 $ 201,908 $ 126,005 $ 510,913 Desktops 37,773 63,714 32,388 133,875 Software 68,404 56,795 22,976 148,175 Servers/Storage 46,896 31,212 21,946 100,054 Net/Com Products 56,888 49,259 35,553 141,700 Displays and Sound 46,467 54,042 29,987 130,496 Accessories 55,241 88,689 29,961 173,891 Other Hardware/Services 39,472 55,477 27,039 121,988 Total net sales $ 534,141 $ 601,096 $ 325,855 $ 1,461,092 Six Months Ended June 30, 2022 Business Solutions Enterprise Solutions Public Sector Solutions Total Notebooks/Mobility $ 253,609 $ 238,747 $ 124,061 $ 616,417 Desktops 47,308 97,496 31,255 176,059 Software 74,475 42,582 15,777 132,834 Servers/Storage 51,862 27,228 19,228 98,318 Net/Com Products 47,057 46,435 14,667 108,159 Displays and Sound 63,793 74,811 32,630 171,234 Accessories 67,897 105,735 28,615 202,247 Other Hardware/Services 42,793 51,317 17,475 111,585 Total net sales $ 648,794 $ 684,351 $ 283,708 $ 1,616,853
Schedule of changes in contract liability balances	The following table provides information about contract liabilities from arrangements with customers as of June 30, 2023 and December 31, 2022 (in thousands). June 30, 2023 December 31, 2022 Contract liabilities, which are included in "Accrued expenses and other liabilities" $ 6,563 $ 4,266 Changes in the contract liability balances during the six months ended June 30, 2023 and 2022 are as follows (in thousands): 2023 Balance at December 31, 2022 $ 4,266 Cash received in advance and not recognized as revenue 11,980 Amounts recognized as revenue as performance obligations satisfied (9,683) Balance at June 30, 2023 $ 6,563 2022 Balance at December 31, 2021 $ 8,628 Cash received in advance and not recognized as revenue 16,316 Amounts recognized as revenue as performance obligations satisfied (18,907) Balance at June 30, 2022 $ 6,037

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
EARNINGS PER SHARE (Tables)	Jun. 30, 2023
Earnings Per Share
Computation of basic and diluted earnings per share	The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Numerator: Net income $ 19,697 $ 25,398 $ 33,895 $ 47,190 Denominator: Denominator for basic earnings per share 26,256 26,268 26,291 26,262 Dilutive effect of employee stock awards 109 161 109 155 Denominator for diluted earnings per share 26,365 26,429 26,400 26,417 Earnings per share: Basic $ 0.75 $ 0.97 $ 1.29 $ 1.80 Diluted $ 0.75 $ 0.96 $ 1.28 $ 1.79

LEASES (Tables)

LEASES (Tables)	6 Months Ended
LEASES (Tables)	Jun. 30, 2023
Leases
Schedule of lease cost	As of June 30, 2023, there were no additional 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, 2023 and 2022 (dollars in thousands): Three Months Ended June 30, 2023 Six Months Ended June 30, 2023 Related Parties Others Total Related Parties Others Total Lease Cost Capitalized operating lease cost $ 314 $ 590 $ 904 $ 627 $ 1,299 $ 1,926 Short-term lease cost 107 115 222 214 136 350 Total lease cost $ 421 $ 705 $ 1,126 $ 841 $ 1,435 $ 2,276 Other Information Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases: Operating cash flows $ 314 $ 602 $ 916 $ 627 $ 1,245 $ 1,872 Weighted-average remaining lease term (in years): Capitalized operating leases 0.42 3.59 3.33 Weighted-average discount rate: Capitalized operating leases 3.92% 4.06% 4.04% Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Related Parties Others Total Related Parties Others Total Lease Cost Capitalized operating lease cost $ 313 $ 711 $ 1,024 $ 627 $ 1,419 $ 2,046 Short-term lease cost 107 21 128 214 42 256 Total lease cost $ 420 $ 732 $ 1,152 $ 841 $ 1,461 $ 2,302 Other Information Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases: Operating cash flows $ 313 $ 747 $ 1,060 $ 627 $ 1,434 $ 2,061 Weighted-average remaining lease term (in years): Capitalized operating leases 1.42 4.10 3.58 Weighted-average discount rate: Capitalized operating leases 3.92% 3.91% 3.92%
Schedule of future lease payments on capitalized operating leases	For the Years Ended December 31, Related Parties Others Total 2023, excluding the six months ended June 30, 2023 $ 735 $ 802 $ 1,537 2024 163 1,697 1,860 2025 163 1,635 1,798 2026 163 952 1,115 2027 1 232 233 Thereafter — 340 340 $ 1,225 $ 5,658 $ 6,883 Imputed interest (448) Lease liability balance at June 30, 2023 $ 6,435

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	6 Months Ended
SEGMENT INFORMATION (Tables)	Jun. 30, 2023
Segment Information
Segment information applicable to reportable operating segments	Net sales presented below exclude inter-segment product revenues. Segment information applicable to the Company’s operating segments for the three and six months ended June 30, 2023 and 2022 is shown below (in thousands): Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2023 2022 2023 2022 Net sales: Business Solutions $ 261,027 $ 328,351 $ 534,141 $ 648,794 Enterprise Solutions 287,153 348,954 601,096 684,351 Public Sector Solutions 185,367 151,204 325,855 283,708 Total net sales $ 733,547 $ 828,509 $ 1,461,092 $ 1,616,853 Operating income (loss): Business Solutions $ 18,831 $ 22,279 $ 35,384 $ 42,952 Enterprise Solutions 7,511 15,389 14,033 29,703 Public Sector Solutions 1,650 1,071 1,679 (55) Headquarters/Other (2,921) (3,969) (7,908) (7,695) Total operating income 25,071 34,770 43,188 64,905 Other income, net 1,874 15 3,160 11 Income before taxes $ 26,945 $ 34,785 $ 46,348 $ 64,916 Selected operating expense: Depreciation and amortization: Business Solutions $ 158 $ 168 $ 317 $ 335 Enterprise Solutions 423 501 847 1,035 Public Sector Solutions 20 20 39 39 Headquarters/Other 2,493 2,300 4,964 4,571 Total depreciation and amortization $ 3,094 $ 2,989 $ 6,167 $ 5,980 Total assets: Business Solutions $ 472,566 $ 430,763 Enterprise Solutions 678,104 663,837 Public Sector Solutions 102,652 86,743 Headquarters/Other (89,047) (57,710) Total assets $ 1,164,275 $ 1,123,633

BASIS OF PRESENTATION - Restruc

BASIS OF PRESENTATION - Restructuring and Other Charges (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2023 USD ($)
Restructuring and other charges
Restructuring and other charges	$ 1,746	$ 2,643
Accrued employee termination benefits	1,381	1,381
Treasury stock
Common stock repurchases as treasury stock including excise tax		$ 5,446,000
Excise tax rate on certain stock repurchases		1%
Employee separations
Restructuring and other charges
Restructuring and other charges	1,701	$ 2,399
Other charges
Restructuring and other charges
Restructuring and other charges	$ 45	$ 244

REVENUE - Disaggregation of Rev

REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of revenue
Net sales	$ 733,547	$ 828,509	$ 1,461,092	$ 1,616,853
Notebooks/Mobility
Disaggregation of revenue
Net sales	249,902	307,794	510,913	616,417
Desktops
Disaggregation of revenue
Net sales	70,554	89,648	133,875	176,059
Software
Disaggregation of revenue
Net sales	64,448	71,647	148,175	132,834
Servers/Storage
Disaggregation of revenue
Net sales	53,269	51,153	100,054	98,318
Net/Com Products
Disaggregation of revenue
Net sales	79,544	55,314	141,700	108,159
Displays and Sound
Disaggregation of revenue
Net sales	67,761	87,908	130,496	171,234
Accessories
Disaggregation of revenue
Net sales	84,089	109,067	173,891	202,247
Other Hardware/Services
Disaggregation of revenue
Net sales	63,980	55,978	121,988	111,585
Business Solutions
Disaggregation of revenue
Net sales	261,027	328,351	534,141	648,794
Business Solutions \| Notebooks/Mobility
Disaggregation of revenue
Net sales	88,081	123,176	183,000	253,609
Business Solutions \| Desktops
Disaggregation of revenue
Net sales	19,011	23,749	37,773	47,308
Business Solutions \| Software
Disaggregation of revenue
Net sales	33,828	39,567	68,404	74,475
Business Solutions \| Servers/Storage
Disaggregation of revenue
Net sales	22,605	29,698	46,896	51,862
Business Solutions \| Net/Com Products
Disaggregation of revenue
Net sales	28,584	24,430	56,888	47,057
Business Solutions \| Displays and Sound
Disaggregation of revenue
Net sales	23,654	30,969	46,467	63,793
Business Solutions \| Accessories
Disaggregation of revenue
Net sales	26,506	35,656	55,241	67,897
Business Solutions \| Other Hardware/Services
Disaggregation of revenue
Net sales	18,758	21,106	39,472	42,793
Enterprise Solutions
Disaggregation of revenue
Net sales	287,153	348,954	601,096	684,351
Enterprise Solutions \| Notebooks/Mobility
Disaggregation of revenue
Net sales	87,590	117,407	201,908	238,747
Enterprise Solutions \| Desktops
Disaggregation of revenue
Net sales	33,572	52,632	63,714	97,496
Enterprise Solutions \| Software
Disaggregation of revenue
Net sales	17,561	21,572	56,795	42,582
Enterprise Solutions \| Servers/Storage
Disaggregation of revenue
Net sales	18,705	11,857	31,212	27,228
Enterprise Solutions \| Net/Com Products
Disaggregation of revenue
Net sales	28,727	24,244	49,259	46,435
Enterprise Solutions \| Displays and Sound
Disaggregation of revenue
Net sales	27,322	37,732	54,042	74,811
Enterprise Solutions \| Accessories
Disaggregation of revenue
Net sales	41,095	57,728	88,689	105,735
Enterprise Solutions \| Other Hardware/Services
Disaggregation of revenue
Net sales	32,581	25,782	55,477	51,317
Public Sector Solutions
Disaggregation of revenue
Net sales	185,367	151,204	325,855	283,708
Public Sector Solutions \| Notebooks/Mobility
Disaggregation of revenue
Net sales	74,231	67,211	126,005	124,061
Public Sector Solutions \| Desktops
Disaggregation of revenue
Net sales	17,971	13,267	32,388	31,255
Public Sector Solutions \| Software
Disaggregation of revenue
Net sales	13,059	10,508	22,976	15,777
Public Sector Solutions \| Servers/Storage
Disaggregation of revenue
Net sales	11,959	9,598	21,946	19,228
Public Sector Solutions \| Net/Com Products
Disaggregation of revenue
Net sales	22,233	6,640	35,553	14,667
Public Sector Solutions \| Displays and Sound
Disaggregation of revenue
Net sales	16,785	19,207	29,987	32,630
Public Sector Solutions \| Accessories
Disaggregation of revenue
Net sales	16,488	15,683	29,961	28,615
Public Sector Solutions \| Other Hardware/Services
Disaggregation of revenue
Net sales	$ 12,641	$ 9,090	$ 27,039	$ 17,475

REVENUE - Contract Balances (De

REVENUE - Contract Balances (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Change in contract liability
Beginning balance - Contract liability	$ 4,266	$ 8,628
Cash received in advance and not recognized as revenue	11,980	16,316
Amounts recognized as revenue as performance obligations satisfied	(9,683)	(18,907)
Ending balance - Contract liability	6,563	$ 6,037
Accrued expenses and other liabilities
Contract liabilities
Contract liabilities	$ 6,563		$ 4,266

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Numerator:
Net Income (Loss)	$ 19,697	$ 25,398	$ 33,895	$ 47,190
Denominator:
Denominator for basic earnings per share	26,256	26,268	26,291	26,262
Dilutive effect of unvested employee stock awards	109	161	109	155
Denominator for diluted earnings per share	26,365	26,429	26,400	26,417
Earnings per share:
Basic	$ 0.75	$ 0.97	$ 1.29	$ 1.80
Diluted	$ 0.75	$ 0.96	$ 1.28	$ 1.79
Additional Disclosure
Employee stock awards excluded from computation of diluted earnings per share	0	0	0	0

LEASES - Lease Cost and Other I

LEASES - Lease Cost and Other Information (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) lease	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Leases
Right-of-use assets	$ 5,775	$ 8,267	$ 5,775	$ 8,267	$ 7,558
Lease liability	6,435		$ 6,435
Number of additional operating or financing leases not yet commenced \| lease			0
Lease Cost
Capitalized operating lease cost	904	1,024	$ 1,926	2,046
Short-term lease cost	222	128	350	256
Total lease cost	1,126	1,152	2,276	2,302
Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases:
Operating cash flows	$ 916	$ 1,060	$ 1,872	$ 2,061
Weighted-average remaining lease term - Capitalized operating leases (in years)	3 years 3 months 29 days	3 years 6 months 29 days	3 years 3 months 29 days	3 years 6 months 29 days
Weighted-average discount rate - Capitalized operating leases	4.04%	3.92%	4.04%	3.92%
Related Parties
Leases
Right-of-use assets	$ 519		$ 519
Lease liability	519		519
Lease Cost
Capitalized operating lease cost	314	$ 313	627	$ 627
Short-term lease cost	107	107	214	214
Total lease cost	421	420	841	841
Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases:
Operating cash flows	$ 314	$ 313	$ 627	$ 627
Weighted-average remaining lease term - Capitalized operating leases (in years)	5 months 1 day	1 year 5 months 1 day	5 months 1 day	1 year 5 months 1 day
Weighted-average discount rate - Capitalized operating leases	3.92%	3.92%	3.92%	3.92%
Others
Lease Cost
Capitalized operating lease cost	$ 590	$ 711	$ 1,299	$ 1,419
Short-term lease cost	115	21	136	42
Total lease cost	705	732	1,435	1,461
Cash paid for amounts included in the measurement of lease liabilities and capitalized operating leases:
Operating cash flows	$ 602	$ 747	$ 1,245	$ 1,434
Weighted-average remaining lease term - Capitalized operating leases (in years)	3 years 7 months 2 days	4 years 1 month 6 days	3 years 7 months 2 days	4 years 1 month 6 days
Weighted-average discount rate - Capitalized operating leases	4.06%	3.91%	4.06%	3.91%

LEASES - Future Lease Payments

LEASES - Future Lease Payments (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022
Future lease payments over the remaining term of capitalized operating leases
2023, excluding the six months ended June 30, 2023	$ 1,537
2024	1,860
2025	1,798
2026	1,115
2027	233
Thereafter	340
Total	6,883
Imputed interest	(448)
Lease liability balance	6,435
Right-of-use assets	5,775	$ 7,558	$ 8,267
Long-term lease liability	4,196	$ 4,994	5,242
Short-term lease liability	$ 2,239		$ 3,641
Current operating lease liability, Statement of Financial Position	Accrued expenses and other liabilities		Accrued expenses and other liabilities
Related Parties
Future lease payments over the remaining term of capitalized operating leases
2023, excluding the six months ended June 30, 2023	$ 735
2024	163
2025	163
2026	163
2027	1
Total	1,225
Lease liability balance	519
Right-of-use assets	519
Others
Future lease payments over the remaining term of capitalized operating leases
2023, excluding the six months ended June 30, 2023	802
2024	1,697
2025	1,635
2026	952
2027	232
Thereafter	340
Total	$ 5,658

SEGMENT INFORMATION - Segment I

SEGMENT INFORMATION - Segment Information Applicable to Reportable Operating Segments (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($) segment	Jun. 30, 2022 USD ($) segment	Jun. 30, 2023 USD ($) segment	Jun. 30, 2022 USD ($) segment	Dec. 31, 2022 USD ($)
Segment Reporting Information
Number of reportable segments \| segment	3	3	3	3
Number of operating segments \| segment	3	3	3	3
Net sales:
Net sales	$ 733,547	$ 828,509	$ 1,461,092	$ 1,616,853
Operating income (loss):
Operating income (loss)	25,071	34,770	43,188	64,905
Other expenses, net	1,874	15	3,160	11
Income before taxes	26,945	34,785	46,348	64,916
Depreciation and amortization:
Depreciation and amortization	3,094	2,989	6,167	5,980
Total assets:
Total assets	1,164,275	1,123,633	1,164,275	1,123,633	$ 1,099,826
Business Solutions
Net sales:
Net sales	261,027	328,351	534,141	648,794
Enterprise Solutions
Net sales:
Net sales	287,153	348,954	601,096	684,351
Public Sector Solutions
Net sales:
Net sales	185,367	151,204	325,855	283,708
Operating Segments \| Business Solutions
Net sales:
Net sales	261,027	328,351	534,141	648,794
Operating income (loss):
Operating income (loss)	18,831	22,279	35,384	42,952
Depreciation and amortization:
Depreciation and amortization	158	168	317	335
Total assets:
Total assets	472,566	430,763	472,566	430,763
Operating Segments \| Enterprise Solutions
Net sales:
Net sales	287,153	348,954	601,096	684,351
Operating income (loss):
Operating income (loss)	7,511	15,389	14,033	29,703
Depreciation and amortization:
Depreciation and amortization	423	501	847	1,035
Total assets:
Total assets	678,104	663,837	678,104	663,837
Operating Segments \| Public Sector Solutions
Net sales:
Net sales	185,367	151,204	325,855	283,708
Operating income (loss):
Operating income (loss)	1,650	1,071	1,679	(55)
Depreciation and amortization:
Depreciation and amortization	20	20	39	39
Total assets:
Total assets	102,652	86,743	102,652	86,743
Headquarters/Other
Operating income (loss):
Operating income (loss)	(2,921)	(3,969)	(7,908)	(7,695)
Depreciation and amortization:
Depreciation and amortization	2,493	2,300	4,964	4,571
Total assets:
Assets net of intercompany balance eliminations	(89,047)	(57,710)	(89,047)	(57,710)
Intersegment Elimination
Total assets:
Total assets	$ (55,432)	$ (41,439)	$ (55,432)	$ (41,439)

BANK BORROWINGS (Details)

BANK BORROWINGS (Details) - USD ($) $ in Thousands	6 Months Ended
BANK BORROWINGS (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022
Subordinated Borrowing
Line of credit, borrowing capacity	$ 50,000
Credit facility, expiration date	Mar. 31, 2025
Line of credit, maximum borrowing capacity	$ 80,000
Proceeds from short-term borrowings	67,895	$ 26,054
Line of credit, outstanding borrowing	0	0
Line of credit, available for borrowing	$ 50,000	$ 50,000
Maximum
Subordinated Borrowing
Debt ratio	2
Prime Rate
Subordinated Borrowing
Debt instrument, interest rate	8.25%

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 19,697	$ 25,398	$ 33,895	$ 47,190

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false