Insight Enterprises Inc Tech Talk Hosted by JPMorgan Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Yes, of course. I'm sure folks are very familiar with Insight , but maybe you can just start off by giving us a quick background on yourself and your experiences just to kind of set the stage here.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : That definitely sounds like an interesting journey in -- so obviously, it's even more interesting now, right? We -- especially going to this year. Obviously, you probably have had you're head in it a little bit earlier than we have. But AI obviously has been a hot topic this year, particularly from an investor standpoint, right? It's obviously getting a lot of attention from the investment community over recent months. So maybe you can just start off by outlining what's the key difference between traditional AI and generative AI? Because I -- as of -- from our perspective, obviously, the generative AI is the new and hot topic, but maybe we can just level set and just kind of parse out the details between the two.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : That's interesting. And so obviously, I wouldn't be surprised to know the answer to this question before I ask it. But it seems like that would be just incremental, like you just see incremental interest from customers. But I guess like what are you hearing from customers today around their interest in leveraging generative AI? And are you actually seeing customers using it today? And if so, what for, like can you provide us some examples of where you're seeing customers deploy it?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : So maybe the other side of the coin there is what we're hearing is concerns around generative AIs, right? Particularly customers viewing it as maybe a disruptive -- disruption to their business. I guess, have you seen any customers express that concern and like who do you think from your perspective is more at risk around generative AI disrupting their business practices? And I guess who's better positioned to benefit from generative AI, at least from your perspective?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Sounds super interesting. Very, very interesting to see the #1 risk. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 12, 2023 / 2:00PM, JPM.N - Insight Enterprises Inc Tech Talk Hosted by JPMorgan

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : It's a bit SciFi movie-esque.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Looking forward to having you back then.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : So maybe we can go on that -- to follow up on that and just talk about like what's in the market today? Like what are you guys seeing? Like who are the players, who are the -- what are customers leveraging in terms of these generative AI offerings today? And like what are they specifically addressing? And like maybe you can even touch on how you see them maybe evolving, not necessarily longer term, but maybe just in the medium term, like what does it look like today? And what will it look like in a year from now in terms of what you're seeing from these cloud service providers or what have you?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : So you brought up an interesting point at the end of the day. It's like the delivery rate. You mentioned Amazon Marketplace in terms of them trying to deliver that. That kind of leads into my next question, and it's how important is the channel during this kind of technology cycle, right? And so I guess, one, like how do you see insights roll or maybe even broader the channel in terms of dispersing this to a broader ecosystem. You talked about having all these meetings where everyone's bringing it up to you. And I think what's probably even more interesting is if you can like look back at prior technology cycles and maybe there's not one that's an apples-to-apples example. I guess the easiest or low-hanging fruit would be cloud generally, right? But maybe you can just talk to, has there been an incremental focus on the channel being able to deliver this? Because it seems like that's where the -- maybe the air pocket is as everyone's hearing about this, but they don't know how they can leverage it in their business today. So do you see kind of incremental weight pushed on of the insights of the world in terms of bringing this out to customers and kind of showing them what the capabilities are and how they can leverage it.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Interesting. So I guess from -- on that note, where is Insight today relative to making Generative AI solutions available for its customers? And I guess -- the crux of my question there is the way that I kind of think the go-to-market rolls out, and you can correct me if I'm wrong, is probably you partner with customers on projects that you guys are kind of working on in tandem with. And then as soon as you kind of end up creating some type of solution, you probably look to basically bundle it and almost make it like an off of the shelf kind of offering, right? So I guess, if I'm correct in characterizing that, like where are we in that journey? Are you seeing more of the R&D/experimental phase still? Or are you guys actually having those bundled offers today because you worked on some early inning projects. And so therefore, you do have some off-the-shelf offerings today. Can you just kind of elaborate on that?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : And so when you think about the strategy around evolving Insights portfolio around all these different offerings, packaging, et cetera. Like how are you tackling that? Like how do you see it evolving as you go into the future? And then maybe like a second part of this, like who are the key partners that are dominating your share of mind as you kind of are looking to evolve your offerings?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Sounds super interesting. You might have touched on my last question, but it's a 2-parter. So maybe the second part will be a little bit unique. But before I get to my last question, I just want to remind folks we'll definitely hit the questions that are in the Q&A section after I finish mine. But obviously, if you guys have any other questions, please feel free to drop it in the Q&A box, and I'll read it on your behalf and have that answer it for you. So yes, just -- you kind of touched on this already throughout the conversation, right? You mentioned Microsoft a couple of times. I don't think it's anybody -- it's a surprise to anybody that Insight has a very close partnership with Microsoft. As you look forward in the context of generative AI, how are you seeing that relationship develop? Do you think it's going to be a tighter and closer relationship between the both of you as you kind of lean on each other to get these generative AI solutions out there to a broader customer? And then the second part of my question is, is there anyone in the ecosystem that could almost be like another Microsoft, right? Because obviously, AI, Microsoft that was originally developed or that relationship kind of was developed on this concept of getting cloud out there. And even if you look at your competitive landscape, there are some folks that are considered the large VARs of today, right? And they're not even leaning into cloud as much as some folks might even think of. So from that context, is there another -- like how should we think about the ecosystem? Is there another play into AI obviously, the low-hanging fruit here is like a NVIDIA relationship. But is there another like tight knit relationship that folks should kind of think about in terms of as the relationship develops that maybe they're not really considering because it's not typical for the channel to have that partner in that ecosystem. Just trying to get any thoughts around that.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : That's super interesting. And as you said, Scott, a couple of questions here for you. So we'll start off at the top. The first one reads, how will the data stack evolve to Gen AI trend? Will lake house players like Snowflake and Databricks proliferate? Will no SQL players like MongoDB become more popular among developers?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Yes. Interesting. Another question from a client goes, where does your AI value pop -- okay, let me rephrase this. Essentially, they're basically asking you, how does the competitive landscape look like relative for you guys versus your peers. Yes, basically, that's how it reads.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : For sure. The next question here is what's the most common first enterprise application that Insight is working with clients on it? Is it contact centers? Is it cybersecurity? Is it document processing? Is it unlabeled data management? Is it process automation? What copilots are they mostly implementing?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : Yes. Interesting. So the next one I have for you is, do you have examples of start-ups that are bringing AI-enabled software to the market and disrupting established players? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 12, 2023 / 2:00PM, JPM.N - Insight Enterprises Inc Tech Talk Hosted by JPMorgan

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : No, for sure. Next question here says, do you think Gen AI will disrupt software business models in terms of profitability, having to invest in infrastructure/data models, negative on gross margins, having to recruit and pay less, lower on -- OpEx, consumption-based pricing versus subscription, et cetera. So I guess how do you see the go-to-market and kind of the monetization of that changing with this generative AI use cases run software?

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : No. For sure. I don't worry, I'll make sure James stays in this place.

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : We were just testing. So. Let me just check time. Okay. So maybe this is -- there's enough time for this last one here. Are you seeing any material

Question: Joseph Lima Cardoso - JPMorgan Chase & Co, Research Division - Analyst : No. Got it. So we did perfect timing here. So let me end the call here. I know there's a couple of questions left in the Q&A. So I'll get through those and circle back and then hopefully, we can get Matt some -- get you guys some answers, but we'll get back to you over e-mail. With that, I wanted to thank you, Matt, for taking the time today. James, Ryan from Insight as well. Thank you for taking the time today and setting this all up. I appreciate the time of all of you participating in the call as well. And with that, we can close it up.