Currency issues affect Insight EMEA performance

Insight has shared its third-quarter (Q3) numbers, revealing that exchange rates have had an effect on its performance in Europe, the Middle East and Africa (EMEA).

The firm delivered higher levels of net sales in both North America (up 4%) and APAC (19%), with EMEA relatively flat at $379.6m. If fluctuating exchange rates had been excluded, the rate in EMEA would have been 16%.

Gross profit in EMEA was also down by 7% year on year (YoY) to $51.8m, compared to a 12% climb in North America and 13% in APAC for the three months ended 30 September.

If fluctuating exchange rates had been taken out of the equation, consolidated gross profit would have been 11% and consolidated earnings from operations would have risen by 10%.

Drilling down into the EMEA business showed signs that the balance is shifting more towards a software and services business. Software sales up 3% in Q3 and 12% over the course of the fiscal year. Services improved by 4% and hardware sales dipped by 6% in the same quarter, while net sales from products were down by 1% and services rose by 4%.

Joyce Mullen, president and chief executive officer at Insight, said that she was pleased with the Q3 performance: “I am pleased to report that we delivered another quarter of solid results driven by double-digit gross profit growth and continued strength in cloud solutions, which grew 27%.”

Insight’s numbers will be added to those of other listed channel players that are being scrutinised for signs that macro-economic headwinds are having a negative impact on business.

Exchange rates were largely responsible for the EMEA performance issues, and the positive tone struck by Mullen about the future is one that is also consistent with other channel leaders.

“We are focused on our strategy and the year is shaping up as we expected, despite the economic volatility,” said Mullen, who recently spoke at the Canalys Channel Forum event and shared her view that the business had to focus on areas of growth.

“We need to make sure we are building and creating more value for clients. We do that by focusing on the fastest growing areas of the industry,” she added.

Mullen said that if Insight offered customers a positive experience, the business would be in a position to counter some of the competition that was not able to offer value as part of its sales mix.