UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________________

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):   May 5, 2011

PC Connection, Inc.	
(Exact name of registrant as specified in charter)	

Delaware	0-23827	02-0513618	
(State or other juris-
diction of incorporation)	(Commission
File Number)	(IRS Employer
Identification No.)	

Rt. 101A, 730 Milford Road
Merrimack, NH	03054	
(Address of principal executive offices)	(Zip Code)	

Registrant’s telephone number, including area code:   (603) 683-2000

N/A	
(Former name or former address, if changed since last report)	

⃞  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.  Results of Operations and Financial Condition

On May 5, 2011, PC Connection, Inc. announced its financial results for the quarter ended March 31, 2011.  The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.  

The information in this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 9.01.  Financial Statements and Exhibits
(d)	Exhibits	
 	 	
 	The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:	
 	 	
 	99.1     Press Release issued by PC Connection, Inc. on May 5, 2011.	

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date:	May 5, 2011	PC CONNECTION, INC.	
 	 	 	
 	 	By:	/s/ Jack Ferguson	
 	 	 	Jack Ferguson	
 	 	 	Executive Vice President, Treasurer, and	
 	 	 	Chief Financial Officer	

EXHIBIT INDEX

Exhibit No.	Description	
 	 	
99.1	Press release issued by PC Connection, Inc. on May 5, 2011.	

Exhibit 99.1

PC Connection, Inc. Reports First Quarter Results

MERRIMACK, N.H.--(BUSINESS WIRE)--May 5, 2011--PC Connection, Inc. (NASDAQ: PCCC):

FIRST QUARTER SUMMARY:
Net sales: $461.9 million, up 13% year over year
Gross margin: 12.7%, improved from 11.9% year over year
Operating income: $7.5 million, 1.6% of net sales
Diluted earnings per share: $0.17 per share

PC Connection, Inc. (NASDAQ: PCCC), which specializes in providing end-to-end information technology (IT) solutions to business, government, and education markets through operating subsidiaries, today announced results for the quarter ended March 31, 2011. Net sales for the three months ended March 31, 2011 increased by $53.7 million, or 13.1%, to $461.9 million from $408.3 million for the three months ended March 31, 2010. Net income for the quarter was $4.5 million, or $0.17 per share, compared to net income of $2.4 million, or $0.09 per share, for the corresponding prior year quarter.

On March 17, 2011, we announced the acquisition of ValCom Technology (“ValCom”), a provider of infrastructure management and onsite managed services to medium-to-large corporations. ValCom had approximately 200 employees as of the acquisition date and is headquartered in the Chicago metro region. Under the terms of the stock purchase agreement, we made a payment of $8.5 million at closing, subject to final validation of stockholders’ equity. In addition, we have agreed to pay up to $3.0 million upon the achievement of certain performance milestones over the next eighteen months. We have included the operating results for ValCom since the closing date in our Large Account segment. The acquisition is expected to be immediately accretive to PC Connection’s earnings, however not material to consolidated results of operations, financial position, or cash flows.

Quarterly Sales by Segment:
Net sales for the small- and medium-sized businesses (“SMB”) segment increased by 11.7%, to $210.9 million compared to the first quarter of 2010. We attribute the growth in SMB sales to our continued focus on solution selling, deeper penetration of existing accounts, and an increase in sales representatives. Year-over-year SMB growth continued to be strong in notebooks and desktops due to the PC refresh and improved profits of SMB customers.
Net sales for the Large Account segment increased by 16.5% to $146.8 million compared to the first quarter of 2010. Excluding ValCom’s sales for the last two weeks of this period, net sales for this segment increased by 15.7% year over year. An increase in the overall volume of orders, from both new and existing customers, drove the increased sales for the quarter.
Net sales to government and education customers (Public Sector segment) increased by 14.0% to $90.3 million compared to the first quarter of 2010. Sales to higher education and federal government customers drove the majority of the double digit year-over-year growth despite budgetary concerns in these institutions.
Net sales to consumers and small office/home office customers by PC Connection Express were $13.8 million in the first quarter of 2011 compared to $14.1 million in the first quarter of 2010. Although sales were slightly lower, gross margin and operating income increased year over year due to our focus on improving operating results.

Quarterly Sales by Product Mix:
Notebooks and PDA sales, the Company’s largest product category, increased by 26% year over year and accounted for 18% of net sales in the first quarter of 2011 compared to 16% of net sales for the first quarter of 2010. Higher unit sales for the quarter drove the year-over-year growth as average selling prices, or ASP’s, decreased slightly year over year.
Desktop/server sales increased by 17% year over year, accounting for 15% of net sales in the first quarter of 2011 and 2010. Desktop sales grew as a result of increased unit sales associated with the continued PC refresh. ASPs for desktops sales also increased, contributing to the year-over-year revenue growth in this category. The increase in desktop sales was partially offset by lower server unit sales compared to the prior year quarter.
Accessories/Other sales increased by 23% year over year, accounting for 13% of net sales in the first quarter of 2011 compared to 12% of net sales for the first quarter of 2010. The Large Account segment grew sales of these products by 44% year over year due in part to mobile computing and point of sale product demand.
Software sales increased by 17% year over year and accounted for 14% of net sales in the first quarter of 2011 compared to 13% of net sales for the first quarter of 2010. The year-over-year growth in software revenue was consistent across our three primary business segments.

Overall gross profit dollars increased by $10.2 million, or 21%, in the first quarter of 2011 compared to the corresponding period a year ago due to increased revenues and gross margin. Consolidated gross margin, as a percentage of net sales, increased by 80 basis points to 12.7% in the first quarter of 2011 compared to the prior year quarter. Improved invoice selling margins and additional vendor consideration as a percentage of net sales in three months ended March 31, 2011 increased overall gross margin compared to the prior year quarter.

Overall annualized sales productivity increased by 6% in the first quarter of 2011 compared to the first quarter of 2010. Sales productivity in both the Large Account and Public Sector segments increased by 16% in the first quarter of 2011 compared to the prior year period. This growth was due to year-over-year increases in sales as sales representative headcount in each segment was largely level compared to the prior year quarter. Productivity for the SMB segment was unchanged year over year, despite its revenue increase, due to the addition of 42 sales representatives compared to the prior year quarter. On a consolidated basis, the total number of sales representatives was 634 at March 31, 2011, compared to 583 at March 31, 2010, and 615 at December 31, 2010.

Total selling, general and administrative expenses for the quarter increased year over year by $6.8 million, or 15%, and increased as a percentage of net sales to 11.1% for the first quarter of 2011 from 10.9% for the first quarter of 2010. The year-over-year dollar increase was attributable to increased variable compensation associated with increased gross profits, investments in sales and support personnel, and acquisition related costs. SG&A expenses for the three months ended March 31, 2011 included $0.5 million in costs related to the ValCom acquisition.

“We are pleased with the leverage demonstrated by our business model, with healthy year-over-year operating and net income gains in the first quarter of 2011 of 80% and 85%, respectively,” said Patricia Gallup, Chairman and Chief Executive Officer. “Our teams worked hard to create opportunity in the marketplace, and each of our reporting segments contributed to our positive performance. We also continued to invest in new opportunities for future growth, including the purchase of ValCom which allows us to further expand our managed service offerings.” Gallup concluded, “As our results demonstrated this quarter, we believe we have the right strategies and leadership in place to build our business and enhance long-term shareholder value.”

About PC Connection, Inc.

PC Connection, Inc., a Fortune 1000 company, owns five sales companies: PC Connection Sales Corporation, MoreDirect, Inc., GovConnection, Inc., PC Connection Express, Inc., and Professional Computer Center, Inc. d/b/a ValCom Technology, headquartered in Merrimack, NH, Boca Raton, FL, Rockville, MD, Portsmouth, NH, and Itasca, IL, respectively. All companies can deliver custom-configured computer systems overnight from PC Connection Services’ ISO 9001:2000 certified technical configuration lab at its distribution center in Wilmington, OH. Investors and media can find more information about PC Connection, Inc. at  http://ir.pcconnection.com .

PC Connection Sales Corporation (800-800-5555), the original business of PC Connection, Inc. serving the small- and medium-sized business sector, is a rapid-response provider of information technology (IT) products and services. It offers more than 150,000 brand-name products through its staff of technically trained sales account managers and catalog telesales representatives, catalogs, and publications, and its website at  www.pcconnection.com .

MoreDirect, Inc. (561-237-3300), www.moredirect.com, provides corporate technology buyers with a comprehensive web-based e-procurement solution and in-depth IT supply-chain expertise, serving as a one-stop source by aggregating more than 300,000 products from the inventories of leading IT wholesale distributors and manufacturers. MoreDirect’s TRAXX™ system is a seamless end-to-end interface that empowers clients to electronically source, evaluate, compare prices, and track related technology product purchases in real-time.

GovConnection, Inc. (800-800-0019) is a rapid-response provider of IT products and services to federal, state, and local government agencies and educational institutions through specialized account managers, catalogs, and publications, and online at  www.govconnection.com .

PC Connection Express, Inc. (888-800-0323) is a rapid-response provider of computer products and consumer electronics to home, home office, and small office users. Customers can purchase the best-known brands in the industry online at  www.pcconnectionexpress.com  or order by calling a trained sales specialist. The subsidiary includes the MacConnection brand (800-800-2222), one of Apple’s largest authorized online resellers at www.macconnection.com .

Professional Computer Center, Inc. d/b/a ValCom Technology (630-285-0500), www.valcomtechnology.com, provides technology services to medium-to-large corporate organizations utilizing its proprietary cloud-based IT service management software, WebSPOC™. Through its experienced technical service personnel ValCom Technology provides network, server, storage, mission-critical onsite support, installation and host of lifecycle services.

pccc-g

“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements that are subject to risks and uncertainties, including, but not limited to, the impact of changes in market demand and the overall level of economic activity and environment, or in the level of business investment in information technology products, competitive products and pricing, product availability and market acceptance, new products, fluctuations in operating results, and the ability of the Company to manage personnel levels in response to fluctuations in revenue, and other risks that could cause actual results to differ materially from those detailed under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2010. More specifically, the statements in this release concerning the Company’s outlook for 2011 and other statements of a non-historical basis (including statements regarding the Company’s ability to grow revenues and increase market share) are forward-looking statements that involve certain risks and uncertainties. Such risks and uncertainties include the ability to realize market demand for and competitive pricing pressures on the products and services marketed by the Company, the continued acceptance of the Company's distribution channel by vendors and customers, continuation of key vendor and customer relationships and support programs, the ability of the Company to integrate the operations of ValCom Technology, and the ability of the Company to hire and retain qualified sales representatives and other essential personnel. The Company assumes no obligation to update the information in this press release or revise any forward-looking statements, whether as a result of any new information, future events, or otherwise.

 	
CONSOLIDATED SELECTED FINANCIAL INFORMATION	 	 	 	 	 	 	 	 	
At or for the Three Months Ended March 31,	 	2011	 	2010	 	 	
(Dollars and shares in thousands, except operating data, P/E ratio, and per share data)	 	 	 	% of
Net Sales	 	 	 	% of
Net Sales	 	%
Change	
 	 	 	 	 	 	 	 	 	 	 	
Operating Data:	 	 	 	 	 	 	 	 	 	 	
Net sales	 	$	461,926	 	 	 	 	$	408,262	 	 	 	 	13	%	
Diluted earnings per share	 	$	0.17	 	 	 	 	$	0.09	 	 	 	 	89	%	
 	 	 	 	 	 	 	 	 	 	 	
Gross margin	 	 	12.7	%	 	 	 	 	11.9	%	 	 	 	 	
Operating margin	 	 	1.6	%	 	 	 	 	1.0	%	 	 	 	 	
Return on equity (1)	 	 	6.9	%	 	 	 	 	4.1	%	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Catalogs distributed	 	 	1,766,000	 	 	 	 	 	2,741,000	 	 	 	 	(36	)%	
Orders entered (2)	 	 	346,000	 	 	 	 	 	335,000	 	 	 	 	3	%	
Average order size (2)	 	$	1,606	 	 	 	 	$	1,472	 	 	 	 	9	%	
 	 	 	 	 	 	 	 	 	 	 	
Inventory turns (1)	 	 	24	 	 	 	 	 	25	 	 	 	 	 	
Days sales outstanding	 	 	47	 	 	 	 	 	48	 	 	 	 	 	

Product Mix:	 	 	 	 	 	 	 	 	 	 	
Notebook & PDA	 	$	83,283	 	 	18	%	 	$	65,953	 	 	16	%	 	26	%	
Desktop/Server	 	 	70,998	 	 	15	 	 	 	60,562	 	 	15	 	 	17	 	
Software	 	 	62,846	 	 	14	 	 	 	53,846	 	 	13	 	 	17	 	
Video, Imaging & Sound	 	 	48,669	 	 	10	 	 	 	54,553	 	 	13	 	 	(11	)	
Net/Com Product	 	 	43,285	 	 	9	 	 	 	37,136	 	 	9	 	 	17	 	
Storage Device	 	 	39,329	 	 	9	 	 	 	33,026	 	 	8	 	 	19	 	
Printer & Printer Supplies	 	 	36,224	 	 	8	 	 	 	38,703	 	 	10	 	 	(6	)	
Memory & System Enhancement	 	 	18,679	 	 	4	 	 	 	16,813	 	 	4	 	 	11	 	
Accessory/Other	 	 	58,613	 	 	13	 	 	 	47,670	 	 	12	 	 	23	 	
 	 	$	461,926	 	 	100	%	 	$	408,262	 	 	100	%	 	13	%	

Net Sales of Enterprise Server and Networking Products (included in the above Product Mix):	
 	 	 	 	 	 	 	 	 	 	 	
 	 	$	161,733	 	 	35	%	 	$	148,398	 	 	36	%	 	9	%	

Stock Performance Indicators:	 	 	 	 	 	 	 	 	 	 	
Actual shares outstanding	 	 	26,673	 	 	 	 	 	26,827	 	 	 	 	 	
Total book value per share	 	$	9.84	 	 	 	 	$	8.87	 	 	 	 	 	
Tangible book value per share	 	$	7.72	 	 	 	 	$	7.00	 	 	 	 	 	
Closing price	 	$	8.86	 	 	 	 	$	6.20	 	 	 	 	 	
Market capitalization	 	$	236,323	 	 	 	 	$	166,327	 	 	 	 	 	
Trailing price/earnings ratio (3)	 	 	10	 	 	 	 	 	16	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
(1) Annualized	
(2) Does not reflect cancellations or returns	
(3) Earnings calculation is based on the trailing four quarters and excludes 2009 special charges.	

 	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
REVENUE AND MARGIN INFORMATION	 	 	 	 	 	 	 	 	 	 	
For the Three Months Ended March 31,	 	2011	 	2010	 	 	
(Dollars in thousands)	 	Net
Sales	 	Gross
Margin (%)	 	Net
Sales	 	Gross
Margin (%)	 	 	
 	 	 	 	 	 	 	 	 	 	 	
SMB	 	$	210,934	 	 	14.3	%	 	$	188,795	 	 	13.8	%	 	 	
Large Account	 	 	146,847	 	 	11.4	 	 	 	126,102	 	 	10.6	 	 	 	
Public Sector	 	 	90,345	 	 	11.5	 	 	 	79,249	 	 	9.8	 	 	 	
Consumer/SOHO	 	 	13,800	 	 	11.2	 	 	 	14,116	 	 	10.3	 	 	 	
Total	 	$	461,926	 	 	12.7	%	 	$	408,262	 	 	11.9	%	 	 	

 	 	 	 	 	 	 	 	 	
CONSOLIDATED STATEMENTS OF INCOME	 	 	 	 	 	 	 	 	
Three Months Ended March 31,	 	2011	 	2010	
(amounts in thousands, except per share data)	 	Amount	 	% of Net Sales	 	Amount	 	% of Net Sales	
 	 	 	 	 	 	 	 	 	
Net sales	 	$	461,926	 	 	100.0	%	 	$	408,262	 	 	 	100.0	%	
Cost of sales	 	 	403,107	 	 	87.3	 	 	 	359,611	 	 	 	88.1	 	
Gross profit	 	 	58,819	 	 	12.7	 	 	 	48,651	 	 	 	11.9	 	
 	 	 	 	 	 	 	 	 	
Selling, general and administrative expenses	 	 	51,290	 	 	11.1	 	 	 	44,474	 	 	 	10.9	 	
Income from operations	 	 	7,529	 	 	1.6	 	 	 	4,177	 	 	 	1.0	 	
 	 	 	 	 	 	 	 	 	
Interest expense	 	 	(41	)	 	-	 	 	 	(99	)	 	 	-	 	
Other, net	 	 	65	 	 	-	 	 	 	75	 	 	 	-	 	
Income tax provision	 	 	(3,059	)	 	0.6	 	 	 	(1,719	)	 	 	0.4	 	
Net income	 	$	4,494	 	 	1.0	%	 	$	2,434	 	 	 	0.6	%	

Earnings per common share:	 	 	 	 	 	 	 	 	
Basic	 	$	0.17	 	 	 	 	$	0.09	 	 	 	
Diluted	 	$	0.17	 	 	 	 	$	0.09	 	 	 	
 	 	 	 	 	 	 	 	 	
Weighted average common shares outstanding:	 	 	 	 	 	 	 	 	
Basic	 	 	26,901	 	 	 	 	 	27,157	 	 	 	
Diluted	 	 	26,986	 	 	 	 	 	27,193	 	 	 	

 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	
CONSOLIDATED BALANCE SHEETS	 	 	 	 	 	March 31,	 	December 31,	
(amounts in thousands)	 	 	 	 	 	2011	 	2010	
 	 	 	 	 	 	 	 	 	
ASSETS	 	 	 	 	 	 	 	 	
Current Assets:	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	58,560	 	 	$	35,374	 	
Accounts receivable, net	 	 	 	 	 	 	217,788	 	 	 	238,011	 	
Inventories	 	 	 	 	 	 	67,698	 	 	 	74,293	 	
Prepaid expenses and other current assets	 	 	4,840	 	 	 	4,210	 	
Deferred income taxes	 	 	3,895	 	 	 	3,813	 	
Income taxes receivable	 	 	 	 	 	 	1,839	 	 	 	1,489	 	
Total current assets	 	 	 	 	 	 	354,620	 	 	 	357,190	 	
Property and equipment, net	 	 	19,285	 	 	 	13,500	 	
Goodwill	 	 	 	 	 	 	51,152	 	 	 	48,060	 	
Other intangibles, net	 	 	 	 	 	 	5,330	 	 	 	1,786	 	
Other assets	 	 	 	 	 	 	537	 	 	 	405	 	
Total Assets	 	 	 	 	 	$	430,924	 	 	$	420,941	 	
 	 	 	 	 	 	 	 	 	
LIABILITIES AND STOCKHOLDERS’ EQUITY	
 	 	 	 	 	 	 	 	 	
Current Liabilities:	 	 	 	 	
Current maturities of capital lease obligation to affiliate	 	$	894	 	 	$	870	 	
Accounts payable	 	 	112,475	 	 	 	114,632	 	
Accrued expenses and other liabilities	 	 	31,345	 	 	 	23,963	 	
Accrued payroll	 	 	10,962	 	 	 	12,652	 	
Total current liabilities	 	 	155,676	 	 	 	152,117	 	
Deferred income taxes	 	 	 	 	 	 	6,475	 	 	 	5,822	 	
Capital lease obligation to affiliate, less current maturities	 	 	1,727	 	 	 	1,960	 	
Other liabilities	 	 	 	 	 	 	4,577	 	 	 	3,403	 	
Total Liabilities	 	 	 	 	 	 	168,455	 	 	 	163,302	 	
Stockholders’ Equity:	 	 	 	 	 	 	 	 	
Common stock	 	 	 	 	 	 	275	 	 	 	275	 	
Additional paid-in capital	 	 	99,207	 	 	 	98,871	 	
Retained earnings	 	 	 	 	 	 	168,569	 	 	 	164,075	 	
Treasury stock at cost	 	 	(5,582	)	 	 	(5,582	)	
Total Stockholders’ Equity	 	 	262,469	 	 	 	257,639	 	
Total Liabilities and Stockholders’ Equity	 	$	430,924	 	 	$	420,941	 	

 	
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY	
Three months ended March 31, 2011 (amounts in thousands)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Common Stock	 	Additional	 	Retained	 	Treasury Stock	 	 	
 	 	Shares	 	Amount	 	Paid-In Capital	 	Earnings	 	Shares	 	Amount	 	Total	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance – January 1, 2011	 	27,507	 	$	275	 	$	98,871	 	$	164,075	 	 	 	(854	)	 	$	(5,582	)	 	$	257,639	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Stock-based compensation expense	 	-	 	 	-	 	 	205	 	 	-	 	 	 	-	 	 	 	-	 	 	 	205	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Issuance of common stock under stock incentive plans	 	20	 	 	-	 	 	131	 	 	-	 	 	 	-	 	 	 	-	 	 	 	131	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income and comprehensive income	 	-	 	 	-	 	 	-	 	 	4,494	 	 	 	-	 	 	 	-	 	 	 	4,494	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance – March 31, 2011	 	27,527	 	$	275	 	$	99,207	 	$	168,569	 	 	 	(854	)	 	$	(5,582	)	 	$	262,469	

 	 	 	 	 	
CONSOLIDATED STATEMENTS OF CASH FLOWS	 	 	 	 	 	 	 	 	
Three Months Ended March 31, (amounts in thousands)	 	2011	 	2010	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash Flows from Operating Activities:	 	 	 	 	 	 	 	 	
Net income	 	$	4,494	 	 	$	2,434	 	 	 	 	 	
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	 	 	 	 	 	
Depreciation and amortization	 	 	1,344	 	 	 	1,572	 	 	 	 	 	
Provision for doubtful accounts	 	 	414	 	 	 	527	 	 	 	 	 	
Stock-based compensation expense	 	 	205	 	 	 	283	 	 	 	 	 	
Deferred income taxes	 	 	571	 	 	 	160	 	 	 	 	 	
Loss on disposal of fixed assets	 	 	3	 	 	 	1	 	 	 	 	 	
Income tax deficiency from stock-based compensation	 	 	-	 	 	 	(9	)	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Changes in assets and liabilities:	 	 	 	 	 	 	 	 	
Accounts receivable	 	 	23,072	 	 	 	21,528	 	 	 	 	 	
Inventories	 	 	6,889	 	 	 	6,634	 	 	 	 	 	
Prepaid expenses and other current assets	 	 	(712	)	 	 	(544	)	 	 	 	 	
Other non-current assets	 	 	(104	)	 	 	131	 	 	 	 	 	
Accounts payable	 	 	(5,205	)	 	 	(17,324	)	 	 	 	 	
Accrued expenses and other liabilities	 	 	(1,842	)	 	 	(1,647	)	 	 	 	 	
Net cash provided by operating activities	 	 	29,129	 	 	 	13,746	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash Flows from Investing Activities:	 	 	 	 	 	 	 	 	
Acquisition of ValCom Technology, net of cash acquired	 	 	(3,745	)	 	 	-	 	 	 	 	 	
Purchases of property and equipment	 	 	(2,120	)	 	 	(692	)	 	 	 	 	
Net cash used for investing activities	 	 	(5,865	)	 	 	(692	)	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash Flows from Financing Activities:	 	 	 	 	 	 	 	 	
Repayment of capital lease obligation to affiliate	 	 	(209	)	 	 	(187	)	 	 	 	 	
Exercise of stock options	 	 	131	 	 	 	-	 	 	 	 	 	
Purchase of treasury shares	 	 	-	 	 	 	(129	)	 	 	 	 	
Net cash used for financing activities	 	 	(78	)	 	 	(316	)	 	 	 	 	
Increase in cash and cash equivalents	 	 	23,186	 	 	 	12,738	 	 	 	 	 	
Cash and cash equivalents, beginning of period	 	 	35,374	 	 	 	46,297	 	 	 	 	 	
Cash and cash equivalents, end of period	 	$	58,560	 	 	$	59,035	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
pccc-g	 	 	 	 	 	 	 	 	 	 	 	 	 	 	

CONTACT:
PC Connection, Inc.
Stephen Baldridge, 603-683-2322
Sr. Vice President of Finance & Corporate Controller