-
Revenue of $14.0 billion, within our outlook of $14.0 - $14.7 billion.
-
Non-GAAP gross billings(1) of $19.3 billion, within our outlook of $19.0 - $20.0 billion.
-
Gross margin and non-GAAP gross margin(1) of 7.20%, up 57 bps and 52 bps, respectively, from
the prior fiscal first quarter.
-
Net income of $172 million, and non-GAAP net income(1) of $266 million.
-
Diluted earnings per share (“EPS”) of $1.93, and non-GAAP diluted EPS(1) of $2.99, at the
upper end of our outlook.
-
Cash provided by operations of $385 million and free cash flow(1) of $344 million, compared
to cash used in operations of $103 million and free cash flow(1) of negative $140 million in
the prior fiscal first quarter.
-
Returned $235 million to shareholders in the fiscal first quarter in the form of $199 million of share
repurchases and $36 million in dividends, representing a 59% increase from the prior fiscal first
quarter.
-
Board of Directors approved a new $2 billion share repurchase authorization, supplementing the existing
program, of which approximately $197 million remains.
-
Announced a quarterly cash dividend of $0.40 per common share, up 14% from the prior fiscal year.
FREMONT, Calif. & CLEARWATER, Fla.--(BUSINESS WIRE)--
TD SYNNEX (NYSE: SNX) today announced financial results for the fiscal first quarter ended February 29, 2024.
Consolidated Financial Highlights for the Fiscal 2024 First Quarter:
|
|
|
|
Q1 FY24
|
|
Q1 FY23
|
|
Net Change from Q1 FY23
|
Revenue ($M)
|
|
$
|
13,975.3
|
|
|
$
|
15,125.4
|
|
|
(7.6
|
)%
|
Non-GAAP gross billings ($M)(1)
|
|
$
|
19,266.7
|
|
|
$
|
20,202.2
|
|
|
(4.6
|
)%
|
Gross profit ($M)
|
|
$
|
1,005.8
|
|
|
$
|
1,003.6
|
|
|
0.2
|
%
|
Non-GAAP gross profit ($M)(1)
|
|
$
|
1,005.8
|
|
|
$
|
1,011.0
|
|
|
(0.5
|
)%
|
Gross margin
|
|
|
7.20
|
%
|
|
|
6.63
|
%
|
|
57 bps
|
Non-GAAP gross margin(1)
|
|
|
7.20
|
%
|
|
|
6.68
|
%
|
|
52 bps
|
Operating income ($M)
|
|
$
|
302.6
|
|
|
$
|
298.2
|
|
|
1.5
|
%
|
Non-GAAP operating income ($M)(1)
|
|
$
|
424.6
|
|
|
$
|
442.9
|
|
|
(4.1
|
)%
|
Operating margin
|
|
|
2.17
|
%
|
|
|
1.97
|
%
|
|
20 bps
|
Non-GAAP operating margin(1)
|
|
|
3.04
|
%
|
|
|
2.93
|
%
|
|
11 bps
|
Net income ($M)
|
|
$
|
172.1
|
|
|
$
|
167.0
|
|
|
3.1
|
%
|
Non-GAAP net income ($M)(1)
|
|
$
|
266.2
|
|
|
$
|
279.2
|
|
|
(4.7
|
)%
|
Diluted EPS
|
|
$
|
1.93
|
|
|
$
|
1.75
|
|
|
10.3
|
%
|
Non-GAAP Diluted EPS(1)
|
|
$
|
2.99
|
|
|
$
|
2.93
|
|
|
2.1
|
%
|
“We generated strong results in our fiscal first quarter, driven by our expansive portfolio and an improving IT
demand environment. This resulted in record margins, EPS at the upper end of our expectations, healthy free cash
flow and robust capital returned to shareholders,” said Rich Hume, CEO of TD SYNNEX. “We are leveraging our
strong relationships across the business partner ecosystem along with our robust core and strategic technology
portfolios to accelerate growth for our partners, while continuing to produce strong returns for our
shareholders.”
Consolidated Fiscal 2024 First Quarter Highlights
-
Revenue was $14.0 billion, compared to $15.1 billion in the prior fiscal first quarter, representing a
decrease of 7.6% and within our outlook. On a constant currency(1) basis, revenue decreased by
8.3% compared to the prior fiscal first quarter. A greater percentage of our revenue was presented on a net
basis, which negatively impacted our revenue compared to the prior fiscal first quarter by approximately 3%.
-
Non-GAAP gross billings(1) were $19.3 billion, compared to $20.2 billion in the prior fiscal
first quarter.
-
Gross profit was $1,006 million, compared to $1,004 million in the prior fiscal first quarter. Non-GAAP
gross profit(1) was $1,006 million, compared to $1,011 million in the prior fiscal first quarter.
-
Gross margin was 7.2%, compared to 6.6% in the prior fiscal first quarter. Non-GAAP gross
margin(1) was 7.2%, compared to 6.7% in the prior fiscal first quarter. The presentation of
additional revenues on a net basis positively impacted our gross margin and non-GAAP gross
margin(1) by approximately 23 basis points.
-
Operating income was $303 million, compared to $298 million in the prior fiscal first quarter. Non-GAAP
operating income(1) was $425 million, compared to $443 million in the prior fiscal first quarter.
-
Operating margin was 2.2%, compared to 2.0% in the prior fiscal first quarter. Non-GAAP operating
margin(1) was 3.0%, compared to 2.9% in the prior fiscal first quarter.
-
Diluted EPS was $1.93, compared to $1.75 in the prior fiscal first quarter. Non-GAAP diluted
EPS(1) was $2.99, compared to $2.93 in the prior fiscal first quarter, at the upper end of our
outlook.
-
Cash provided by operations of $385 million, and free cash flow(1) of $344 million, compared to
cash used in operations of $103 million and free cash flow(1) of negative $140 million in the
prior fiscal first quarter.
-
We returned $235 million to shareholders in the form of share repurchases and dividends, up 59% from the
prior fiscal first quarter.
Regional Fiscal 2024 First Quarter Highlights
-
Americas:
-
Revenue was $7.9 billion, compared to $8.6 billion in the prior fiscal first quarter, representing a
decrease of 8.5%. On a constant currency(1) basis, revenue decreased by 8.6% compared to
the prior fiscal first quarter. A greater percentage of our revenue was presented on a net basis,
which negatively impacted our revenue compared to the prior fiscal first quarter by approximately
4%.
-
Non-GAAP gross billings(1) were $11.5 billion, compared to $12.0 billion in the prior
fiscal first quarter, representing a decrease of 4.5%.
-
Operating income was $160 million, compared to $180 million in the prior fiscal first quarter.
Non-GAAP operating income(1) was $240 million, compared to $266 million in the prior
fiscal first quarter.
-
Operating margin was 2.0%, compared to 2.1% in the prior fiscal first quarter. Non-GAAP operating
margin(1) was 3.0%, compared to 3.1% in the prior fiscal first quarter.
-
Europe:
-
Revenue was $5.1 billion, compared to $5.5 billion in the prior fiscal first quarter, representing a
decrease of 7.3%. On a constant currency(1) basis, revenue decreased by 9.5% compared to
the prior fiscal first quarter. A greater percentage of our revenue was presented on a net basis,
which negatively impacted our revenue compared to the prior fiscal first quarter by approximately
2%.
-
Non-GAAP gross billings(1) were $6.6 billion, compared to $7.0 billion in the prior
fiscal first quarter, representing a decrease of 5.4%.
-
Operating income was $108 million, compared to $88 million in the prior fiscal first quarter.
Non-GAAP operating income(1) was $148 million, compared to $143 million in the prior
fiscal first quarter.
-
Operating margin was 2.1%, compared to 1.6% in the prior fiscal first quarter. Non-GAAP operating
margin(1) was 2.9%, compared to 2.6% in the prior fiscal first quarter.
-
Asia-Pacific and Japan:
-
Revenue was $955 million, compared to $966 million in the prior fiscal first quarter, representing a
decrease of 1.2%. On a constant currency(1) basis, revenue increased by 1.7% compared to
the prior fiscal first quarter.
-
Non-GAAP gross billings(1) were $1,159 million, compared to $1,177 million in the prior
fiscal first quarter, representing a decrease of 1.6%.
-
Operating income was $35 million, compared to $30 million in the prior fiscal first quarter.
Non-GAAP operating income(1) was $36 million, compared to $33 million in the prior fiscal
first quarter.
-
Operating margin was 3.6%, compared to 3.2% in the prior fiscal first quarter. Non-GAAP operating
margin(1) was 3.8%, compared to 3.4% in the prior fiscal first quarter.
Fiscal 2024 Second Quarter Outlook
The following statements are based on TD SYNNEX’s current expectations for the fiscal 2024 second quarter. These
statements are forward-looking and actual results may differ materially. Non-GAAP gross billings(1)
include the impact of costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts, and the remaining non-GAAP
financial measures exclude the impact of acquisition, integration and restructuring costs, amortization of
intangible assets, share-based compensation, and the related tax effects thereon.
|
|
Q2 2024 Outlook
|
Revenue
|
|
$13.3 - $14.9 billion
|
Non-GAAP gross billings(1)
|
|
$18.4 - $19.6 billion
|
Net income
|
|
$139 - $183 million
|
Non-GAAP net income(1)
|
|
$219 - $263 million
|
Diluted earnings per share
|
|
$1.59 - $2.09
|
Non-GAAP diluted earnings per share(1)
|
|
$2.50 - $3.00
|
Estimated outstanding diluted weighted average shares
|
|
86.8 million
|
Share Repurchase Announcement
The TD SYNNEX Board of Directors has approved a share repurchase program of up to $2 billion of its common
stock, supplementing the existing program of which approximately $197 million remains. Stock repurchases may be
made at management's discretion from time to time through open market or privately negotiated transactions,
including pursuant to one or more Rule 10b5-1 trading plans adopted in accordance with Rule 10b5-1 of the
Securities Exchange Act of 1934.
Dividend
TD SYNNEX announced today that its Board of Directors declared a quarterly cash dividend of $0.40 per common
share. The dividend is payable on April 26, 2024 to stockholders of record as of the close of business on April
12, 2024.
Conference Call and Webcast
TD SYNNEX will host a conference call today to discuss the 2024 fiscal first quarter results at 6:00 AM
(PT)/9:00 AM (ET).
A live audio webcast of the earnings call will be accessible at ir.tdsynnex.com and a replay of the webcast will
be available following the call.
About TD SYNNEX
TD SYNNEX (NYSE: SNX) is a leading global distributor and solutions aggregator for the IT ecosystem. We’re an
innovative partner helping more than 150,000 customers in 100+ countries to maximize the value of technology
investments, demonstrate business outcomes and unlock growth opportunities. Headquartered in Fremont,
California, and Clearwater, Florida, TD SYNNEX’s 23,000 co-workers are dedicated to uniting compelling IT
products, services and solutions from 2,500+ best-in-class technology vendors. Our edge-to-cloud portfolio is
anchored in some of the highest-growth technology segments including cloud, cybersecurity, big data/analytics,
AI, IoT, mobility and everything as a service.
TD SYNNEX is committed to serving customers and communities, and we believe we can have a positive impact on our
people and our planet, intentionally acting as a respected corporate citizen. We aspire to be a diverse and
inclusive employer of choice for talent across the IT ecosystem. For more information, visit TDSYNNEX.com,
follow our newsroom or find us on LinkedIn, Facebook and Instagram.
(1)Use of Non-GAAP Financial Information
In addition to the financial results presented in accordance with GAAP, TD SYNNEX refers to revenues on a
constant currency basis which adjusts for the translation effect of foreign currencies so that certain financial
results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby
facilitating period-to-period comparisons of our performance. Financial results adjusted for constant currency
are calculated by translating current period activity using the comparable prior year periods’ currency
conversion rate. TD SYNNEX uses non-GAAP gross billings, which adjusts revenues to exclude costs related to
sales of third-party supplier service contracts, software as a service arrangements and certain fulfillment
contracts. Non-GAAP gross billings are a useful non-GAAP metric in understanding the volume of our business
activity and serve as an important performance metric in internally managing our operations. TD SYNNEX uses
non-GAAP gross profit and non-GAAP gross margin which exclude purchase accounting adjustments. TD SYNNEX uses
adjusted selling, general and administrative expenses which is a non-GAAP financial measure that excludes
acquisition, integration and restructuring costs, the amortization of intangible assets and share-based
compensation expense. TD SYNNEX uses non-GAAP operating income and non-GAAP operating margin which are non-GAAP
financial measures that exclude acquisition, integration and restructuring costs, the amortization of intangible
assets, share-based compensation expense and purchase accounting adjustments. TD SYNNEX also uses non-GAAP net
income and non-GAAP diluted earnings per share, which are non-GAAP financial measures that exclude acquisition,
integration and restructuring costs, the amortization of intangible assets, share-based compensation expense,
purchase accounting adjustments, and the related tax effects thereon. Further, the Company uses adjusted
earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) which excludes other income
(expense), net, acquisition, integration and restructuring costs, share-based compensation expense and purchase
accounting adjustments. In prior periods, TD SYNNEX has excluded other items relevant to those periods for
purposes of its non-GAAP financial measures.
Acquisition, integration and restructuring costs, which are expensed as incurred, primarily represent
professional services costs for legal, banking, consulting and advisory services, severance and other
personnel-related costs, share-based compensation expense and debt extinguishment fees that are incurred in
connection with acquisition, integration, restructuring, and divestiture activities. From time to time, this
category may also include transaction-related gains/losses on divestitures/spin-off of businesses, costs related
to long-lived assets including impairment charges and accelerated depreciation and amortization expense due to
changes in asset useful lives, as well as various other costs associated with the acquisition or divestiture.
TD SYNNEX’s acquisition activities have resulted in the recognition of finite-lived intangible assets which
consist primarily of customer relationships and vendor lists. Finite-lived intangible assets are amortized over
their estimated useful lives and are tested for impairment when events indicate that the carrying value may not
be recoverable. The amortization of intangible assets is reflected in the Company’s Statements of Operations.
Although intangible assets contribute to the Company’s revenue generation, the amortization of intangible assets
does not directly relate to the sale of the Company’s products. Additionally, intangible asset amortization
expense typically fluctuates based on the size and timing of the Company’s acquisition activity. Accordingly,
the Company believes excluding the amortization of intangible assets, along with the other non-GAAP adjustments,
which neither relate to the ordinary course of the Company’s business nor reflect the Company’s underlying
business performance, enhances the Company’s and investors’ ability to compare the Company’s past financial
performance with its current performance and to analyze underlying business performance and trends. Intangible
asset amortization excluded from the related non-GAAP financial measure represents the entire amount recorded
within the Company’s GAAP financial statements, and the revenue generated by the associated intangible assets
has not been excluded from the related non-GAAP financial measure. Intangible asset amortization is excluded
from the related non-GAAP financial measure because the amortization, unlike the related revenue, is not
affected by operations of any particular period unless an intangible asset becomes impaired or the estimated
useful life of an intangible asset is revised.
Share-based compensation expense is a non-cash expense arising from the grant of equity awards to employees and
non-employee members of the Company’s Board of Directors based on the estimated fair value of those awards.
Although share-based compensation is an important aspect of the compensation of our employees, the fair value of
the share-based awards may bear little resemblance to the actual value realized upon the vesting or future
exercise of the related share-based awards and the expense can vary significantly between periods as a result of
the timing of grants of new stock-based awards, including grants in connection with acquisitions. Given the
variety and timing of awards and the subjective assumptions that are necessary when calculating share-based
compensation expense, TD SYNNEX believes this additional information allows investors to make additional
comparisons between our operating results from period to period.
Purchase accounting adjustments are primarily related to the impact of recognizing the acquired vendor and
customer liabilities related to the merger with Tech Data at fair value. These adjustments benefited our
non-GAAP operating income through the third fiscal quarter of fiscal 2023 based on historical settlement
patterns with our vendors and in accordance with the timing defined in our policy for releasing vendor and
customer liabilities we deem remote to be paid.
Trailing fiscal four quarters ROIC is defined as the last four quarters’ tax effected operating income divided
by the average of the last five quarterly balances of borrowings and equity, net of cash. Adjusted ROIC is
calculated by excluding the tax effected impact of non-GAAP adjustments from operating income and by excluding
the cumulative tax effected impact of current and prior period non-GAAP adjustments on equity.
TD SYNNEX also uses free cash flow, which is cash flow from operating activities, reduced by purchases of
property and equipment. TD SYNNEX uses free cash flow to conduct and evaluate its business because, although it
is similar to cash flow from operations, TD SYNNEX believes it is an additional useful measure of cash flows
since purchases of property and equipment are a necessary component of ongoing operations. Free cash flow
reflects an additional way of viewing TD SYNNEX’s liquidity that, when viewed with its GAAP results, provides a
more complete understanding of factors and trends affecting its cash flows. Free cash flow has limitations as it
does not represent the residual cash flow available for discretionary expenditures. For example, free cash flow
does not incorporate payments for business acquisitions. Therefore, TD SYNNEX believes it is important to view
free cash flow as a complement to its entire Consolidated Statements of Cash Flows.
TD SYNNEX management uses non-GAAP financial measures internally to understand, manage and evaluate the
business, to establish operational goals, and in some cases for measuring performance for compensation purposes.
These non-GAAP measures are intended to provide investors with an understanding of TD SYNNEX’s operational
results and trends that more readily enable investors to analyze TD SYNNEX’s base financial and operating
performance and to facilitate period-to-period comparisons and analysis of operational trends, as well as for
planning and forecasting in future periods. Management believes these non-GAAP financial measures are useful to
investors in allowing for greater transparency with respect to supplemental information used by management in
its financial and operational decision-making. As these non-GAAP financial measures are not calculated in
accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other
companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for the
comparable GAAP measures, and should be read only in conjunction with TD SYNNEX’s Consolidated Financial
Statements prepared in accordance with GAAP. A reconciliation of TD SYNNEX’s GAAP to non-GAAP financial
information is set forth in the supplemental tables at the end of this press release.
Safe Harbor Statement
Statements in this news release regarding TD SYNNEX that are not historical facts are “forward-looking
statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Such forward-looking statements are inherently uncertain, and shareholders and other
potential investors must recognize that actual results may differ materially from TD SYNNEX expectations as a
result of a variety of factors. These forward-looking statements may be identified by terms such as believe,
foresee, expect, may, will, provide, could and should and the negative of these terms or other similar
expressions. These forward-looking statements include, but are not limited to, statements about our strategy,
demand, plans and positioning, capital allocation, as well as guidance related to the second quarter of 2024.
Such forward-looking statements are based upon management’s current expectations and include known and unknown
risks, uncertainties and other factors, many of which TD SYNNEX is unable to predict or control, that may cause
TD SYNNEX actual results, performance, or plans to differ materially from any future results, performance or
plans expressed or implied by such forward-looking statements.
These risks and uncertainties include, but are not limited to: the unfavorable outcome of any legal proceedings
that have been or may be instituted against us; the ability to retain key personnel; general economic and
political conditions; continued or increased weakness in information technology spending; seasonality; the loss
or consolidation of one or more of our significant original equipment manufacturer, or OEM, suppliers or
customers; market acceptance and product life of the products we assemble and distribute; competitive conditions
in our industry and their impact on our margins; pricing, margin and other terms with our OEM suppliers; our
ability to gain market share; variations in supplier-sponsored programs; changes in our costs and operating
expenses; the timing and amount of returns to our shareholders via repurchases of our common stock and
dividends; changes in foreign currency exchange rates; increased inflation; changes in tax laws; risks
associated with our international operations; uncertainties and variability in demand by our reseller and
integration customers; supply shortages or delays; any termination or reduction in our floor plan financing
arrangements; credit exposure to our reseller customers and negative trends in their businesses; any incidents
of theft; the declaration, timing and payment of dividends, and the Board’s reassessment thereof; and other
risks and uncertainties detailed in our Form 10-K for the fiscal year ended November 30, 2023 and subsequent SEC
filings. Statements included in this press release are based upon information known to TD SYNNEX as of the date
of this release, and TD SYNNEX assumes no obligation to update information contained in this press release
unless otherwise required by law.
Copyright 2024 TD SYNNEX CORPORATION. All rights reserved. TD SYNNEX, the TD SYNNEX Logo, and all other
TD SYNNEX company, product and services names and slogans are trademarks or registered trademarks of TD SYNNEX
Corporation. Other names and marks are the property of their respective owners.
TD SYNNEX Corporation
|
Consolidated Balance Sheets
|
(Currency and share amounts in thousands, except par value)
|
(Amounts may not add or compute due to rounding)
|
(Unaudited)
|
|
|
|
|
|
|
|
February 29, 2024
|
|
November 30, 2023
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,030,946
|
|
|
$
|
1,033,776
|
|
Accounts receivable, net
|
|
|
8,902,803
|
|
|
|
10,297,814
|
|
Receivables from vendors, net
|
|
|
914,910
|
|
|
|
964,334
|
|
Inventories
|
|
|
7,091,146
|
|
|
|
7,146,274
|
|
Other current assets
|
|
|
640,901
|
|
|
|
642,238
|
|
Total current assets
|
|
|
18,580,706
|
|
|
|
20,084,436
|
|
Property and equipment, net
|
|
|
459,093
|
|
|
|
450,024
|
|
Goodwill
|
|
|
3,902,232
|
|
|
|
3,904,170
|
|
Intangible assets, net
|
|
|
4,162,437
|
|
|
|
4,244,314
|
|
Other assets, net
|
|
|
695,561
|
|
|
|
729,870
|
|
Total assets
|
|
$
|
27,800,029
|
|
|
$
|
29,412,814
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Borrowings, current
|
|
$
|
926,739
|
|
|
$
|
983,585
|
|
Accounts payable
|
|
|
12,372,749
|
|
|
|
13,347,281
|
|
Other accrued liabilities
|
|
|
1,955,444
|
|
|
|
2,407,896
|
|
Total current liabilities
|
|
|
15,254,932
|
|
|
|
16,738,762
|
|
Long-term borrowings
|
|
|
3,082,367
|
|
|
|
3,099,193
|
|
Other long-term liabilities
|
|
|
493,031
|
|
|
|
498,656
|
|
Deferred tax liabilities
|
|
|
867,524
|
|
|
|
893,021
|
|
Total liabilities
|
|
|
19,697,854
|
|
|
|
21,229,632
|
|
Stockholders’ equity:
|
|
|
|
|
Preferred stock, $0.001 par value, 5,000 shares authorized, no shares issued or outstanding
|
|
|
—
|
|
|
|
—
|
|
Common stock, $0.001 par value, 200,000 shares authorized, 99,012 shares issued as of both
February 29, 2024 and November 30, 2023
|
|
|
99
|
|
|
|
99
|
|
Additional paid-in capital
|
|
|
7,438,820
|
|
|
|
7,435,274
|
|
Treasury stock, 12,171 and 10,343 shares as of February 29, 2024 and November 30, 2023,
respectively
|
|
|
(1,138,919
|
)
|
|
|
(949,714
|
)
|
Accumulated other comprehensive loss
|
|
|
(539,072
|
)
|
|
|
(507,248
|
)
|
Retained earnings
|
|
|
2,341,247
|
|
|
|
2,204,771
|
|
Total stockholders' equity
|
|
|
8,102,175
|
|
|
|
8,183,182
|
|
Total liabilities and equity
|
|
$
|
27,800,029
|
|
|
$
|
29,412,814
|
|
|
TD SYNNEX Corporation
|
Consolidated Statements of Operations
|
(Currency and share amounts in thousands, except per share amounts)
|
(Amounts may not add or compute due to rounding)
|
(Unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Revenue
|
|
$
|
13,975,253
|
|
|
$
|
15,125,371
|
|
Cost of revenue
|
|
|
(12,969,487
|
)
|
|
|
(14,121,804
|
)
|
Gross profit
|
|
|
1,005,766
|
|
|
|
1,003,567
|
|
Selling, general and administrative expenses
|
|
|
(671,545
|
)
|
|
|
(654,223
|
)
|
Acquisition, integration and restructuring costs
|
|
|
(31,649
|
)
|
|
|
(51,182
|
)
|
Operating income
|
|
|
302,572
|
|
|
|
298,162
|
|
Interest expense and finance charges, net
|
|
|
(75,891
|
)
|
|
|
(80,200
|
)
|
Other expense, net
|
|
|
(2,884
|
)
|
|
|
(156
|
)
|
Income before income taxes
|
|
|
223,797
|
|
|
|
217,806
|
|
Provision for income taxes
|
|
|
(51,669
|
)
|
|
|
(50,786
|
)
|
Net income
|
|
$
|
172,128
|
|
|
$
|
167,020
|
|
Earnings per common share:
|
|
|
|
|
Basic
|
|
$
|
1.94
|
|
|
$
|
1.76
|
|
Diluted
|
|
$
|
1.93
|
|
|
$
|
1.75
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
Basic
|
|
|
87,891
|
|
|
|
94,259
|
|
Diluted
|
|
|
88,203
|
|
|
|
94,539
|
|
|
TD SYNNEX Corporation
|
Regional Financial Highlights - Fiscal 2024 First Quarter
|
(Currency in millions)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
|
|
|
|
Q1 FY24
|
|
Q1 FY23
|
|
Net Change from
Q1 FY23
|
Americas
|
|
|
|
|
|
|
Revenue
|
|
$
|
7,903.1
|
|
|
$
|
8,638.7
|
|
|
(8.5
|
)%
|
Non-GAAP gross billings(1)
|
|
$
|
11,506.3
|
|
|
$
|
12,043.9
|
|
|
(4.5
|
)%
|
Operating income
|
|
$
|
159.7
|
|
|
$
|
179.5
|
|
|
(11.0
|
)%
|
Non-GAAP operating income(1)
|
|
$
|
240.3
|
|
|
$
|
266.4
|
|
|
(9.8
|
)%
|
Operating margin
|
|
|
2.02
|
%
|
|
|
2.08
|
%
|
|
(6) bps
|
Non-GAAP operating margin(1)
|
|
|
3.04
|
%
|
|
|
3.08
|
%
|
|
(4) bps
|
|
|
|
|
|
|
|
Europe
|
|
|
|
|
|
|
Revenue
|
|
$
|
5,117.3
|
|
|
$
|
5,520.4
|
|
|
(7.3
|
)%
|
Non-GAAP gross billings(1)
|
|
$
|
6,601.4
|
|
|
$
|
6,980.9
|
|
|
(5.4
|
)%
|
Operating income
|
|
$
|
108.3
|
|
|
$
|
88.2
|
|
|
22.8
|
%
|
Non-GAAP operating income(1)
|
|
$
|
147.8
|
|
|
$
|
143.4
|
|
|
3.1
|
%
|
Operating margin
|
|
|
2.12
|
%
|
|
|
1.60
|
%
|
|
52 bps
|
Non-GAAP operating margin(1)
|
|
|
2.89
|
%
|
|
|
2.60
|
%
|
|
29 bps
|
|
|
|
|
|
|
|
Asia-Pacific and Japan
|
|
|
|
|
|
|
Revenue
|
|
$
|
954.9
|
|
|
$
|
966.2
|
|
|
(1.2
|
)%
|
Non-GAAP gross billings(1)
|
|
$
|
1,159.0
|
|
|
$
|
1,177.3
|
|
|
(1.6
|
)%
|
Operating income
|
|
$
|
34.6
|
|
|
$
|
30.5
|
|
|
13.4
|
%
|
Non-GAAP operating income(1)
|
|
$
|
36.4
|
|
|
$
|
33.1
|
|
|
10.0
|
%
|
Operating margin
|
|
|
3.62
|
%
|
|
|
3.15
|
%
|
|
47 bps
|
Non-GAAP operating margin(1)
|
|
|
3.82
|
%
|
|
|
3.42
|
%
|
|
40 bps
|
|
|
|
|
|
|
|
(1) A reconciliation of TD SYNNEX’s GAAP to non-GAAP financial information is set
forth in the supplemental tables at the end of this press release.
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Revenue in constant currency
|
|
|
|
|
Consolidated
|
|
|
|
|
Revenue
|
|
$
|
13,975,253
|
|
|
$
|
15,125,371
|
Impact of changes in foreign currencies
|
|
|
(102,478
|
)
|
|
|
—
|
Revenue in constant currency
|
|
$
|
13,872,775
|
|
|
$
|
15,125,371
|
|
|
|
|
|
Americas
|
|
|
|
|
Revenue
|
|
$
|
7,903,096
|
|
|
$
|
8,638,704
|
Impact of changes in foreign currencies
|
|
|
(10,843
|
)
|
|
|
—
|
Revenue in constant currency
|
|
$
|
7,892,253
|
|
|
$
|
8,638,704
|
|
|
|
|
|
Europe
|
|
|
|
|
Revenue
|
|
$
|
5,117,252
|
|
|
$
|
5,520,437
|
Impact of changes in foreign currencies
|
|
|
(119,360
|
)
|
|
|
—
|
Revenue in constant currency
|
|
$
|
4,997,892
|
|
|
$
|
5,520,437
|
|
|
|
|
|
Asia-Pacific and Japan
|
|
|
|
|
Revenue
|
|
$
|
954,905
|
|
|
$
|
966,230
|
Impact of changes in foreign currencies
|
|
|
27,725
|
|
|
|
—
|
Revenue in constant currency
|
|
$
|
982,630
|
|
|
$
|
966,230
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP gross billings
|
|
|
|
|
Consolidated
|
|
|
|
|
Revenue
|
|
$
|
13,975,253
|
|
$
|
15,125,371
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
5,291,480
|
|
|
5,076,822
|
Non-GAAP gross billings
|
|
$
|
19,266,733
|
|
$
|
20,202,193
|
|
|
|
|
|
|
|
Americas
|
|
|
|
|
Revenue
|
|
$
|
7,903,096
|
|
$
|
8,638,704
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
3,603,247
|
|
|
3,405,240
|
Non-GAAP gross billings
|
|
$
|
11,506,343
|
|
|
12,043,944
|
|
|
|
|
|
Europe
|
|
|
|
|
Revenue
|
|
$
|
5,117,252
|
|
$
|
5,520,437
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
1,484,128
|
|
|
1,460,494
|
Non-GAAP gross billings
|
|
$
|
6,601,380
|
|
$
|
6,980,931
|
|
|
|
|
|
Asia-Pacific and Japan
|
|
|
|
|
Revenue
|
|
$
|
954,905
|
|
$
|
966,230
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
204,105
|
|
|
211,088
|
Non-GAAP gross billings
|
|
$
|
1,159,010
|
|
$
|
1,177,318
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP gross profit & non-GAAP gross margin
|
|
|
|
|
Revenue
|
|
$
|
13,975,253
|
|
|
$
|
15,125,371
|
|
|
|
|
|
|
Gross profit
|
|
$
|
1,005,766
|
|
|
$
|
1,003,567
|
|
Purchase accounting adjustments
|
|
|
—
|
|
|
|
7,450
|
|
Non-GAAP gross profit
|
|
$
|
1,005,766
|
|
|
$
|
1,011,017
|
|
|
|
|
|
|
Gross margin
|
|
|
7.20
|
%
|
|
|
6.63
|
%
|
Non-GAAP gross margin
|
|
|
7.20
|
%
|
|
|
6.68
|
%
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Adjusted selling, general and administrative expenses
|
|
|
|
|
Revenue
|
|
$
|
13,975,253
|
|
|
$
|
15,125,371
|
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
5,291,480
|
|
|
|
5,076,822
|
|
Non-GAAP gross billings
|
|
$
|
19,266,733
|
|
|
$
|
20,202,193
|
|
|
|
|
|
|
Selling, general and administrative expenses(1)
|
|
$
|
703,194
|
|
|
$
|
705,405
|
|
Acquisition, integration and restructuring costs
|
|
|
31,649
|
|
|
|
51,182
|
|
Amortization of intangibles
|
|
|
72,877
|
|
|
|
73,023
|
|
Share-based compensation
|
|
|
17,490
|
|
|
|
13,074
|
|
Adjusted selling, general and administrative expenses
|
|
$
|
581,178
|
|
|
$
|
568,126
|
|
|
|
|
|
|
Selling, general and administrative expenses as a percentage of revenue
|
|
|
5.03
|
%
|
|
|
4.66
|
%
|
Adjusted selling, general and administrative expenses as a percentage of non-GAAP gross billings
|
|
|
3.02
|
%
|
|
|
2.81
|
%
|
(1) Includes acquisition, integration and restructuring costs, which are presented
separately on the Consolidated Statements of Operations.
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP operating income & non-GAAP operating margin - Consolidated
|
|
|
|
|
Revenue
|
|
$
|
13,975,253
|
|
|
$
|
15,125,371
|
|
|
|
|
|
|
Operating income
|
|
$
|
302,572
|
|
|
$
|
298,162
|
|
Acquisition, integration and restructuring costs
|
|
|
31,649
|
|
|
|
51,182
|
|
Amortization of intangibles
|
|
|
72,877
|
|
|
|
73,023
|
|
Share-based compensation
|
|
|
17,490
|
|
|
|
13,074
|
|
Purchase accounting adjustments
|
|
|
—
|
|
|
|
7,450
|
|
Non-GAAP operating income
|
|
$
|
424,588
|
|
|
$
|
442,891
|
|
|
|
|
|
|
Operating margin
|
|
|
2.17
|
%
|
|
|
1.97
|
%
|
Non-GAAP operating margin
|
|
|
3.04
|
%
|
|
|
2.93
|
%
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP operating income & non-GAAP operating margin - Americas
|
|
|
|
|
Revenue
|
|
$
|
7,903,096
|
|
|
$
|
8,638,704
|
|
|
|
|
|
|
Operating income
|
|
$
|
159,682
|
|
|
$
|
179,505
|
|
Acquisition, integration and restructuring costs
|
|
|
27,372
|
|
|
|
35,133
|
|
Amortization of intangibles
|
|
|
41,453
|
|
|
|
42,414
|
|
Share-based compensation
|
|
|
11,798
|
|
|
|
9,362
|
|
Non-GAAP operating income
|
|
$
|
240,305
|
|
|
$
|
266,414
|
|
|
|
|
|
|
Operating margin
|
|
|
2.02
|
%
|
|
|
2.08
|
%
|
Non-GAAP operating margin
|
|
|
3.04
|
%
|
|
|
3.08
|
%
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP operating income & non-GAAP operating margin - Europe
|
|
|
|
|
Revenue
|
|
$
|
5,117,252
|
|
|
$
|
5,520,437
|
|
|
|
|
|
|
Operating income
|
|
$
|
108,325
|
|
|
$
|
88,205
|
|
Acquisition, integration and restructuring costs
|
|
|
3,952
|
|
|
|
14,583
|
|
Amortization of intangibles
|
|
|
30,802
|
|
|
|
29,985
|
|
Share-based compensation
|
|
|
4,763
|
|
|
|
3,176
|
|
Purchase accounting adjustments
|
|
|
—
|
|
|
|
7,450
|
|
Non-GAAP operating income
|
|
$
|
147,842
|
|
|
$
|
143,399
|
|
|
|
|
|
|
Operating margin
|
|
|
2.12
|
%
|
|
|
1.60
|
%
|
Non-GAAP operating margin
|
|
|
2.89
|
%
|
|
|
2.60
|
%
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP operating income & non-GAAP operating margin - Asia-Pacific and Japan
|
|
|
|
|
Revenue
|
|
$
|
954,905
|
|
|
$
|
966,230
|
|
|
|
|
|
|
Operating income
|
|
$
|
34,565
|
|
|
$
|
30,452
|
|
Acquisition, integration and restructuring costs
|
|
|
325
|
|
|
|
1,466
|
|
Amortization of intangibles
|
|
|
622
|
|
|
|
624
|
|
Share-based compensation
|
|
|
929
|
|
|
|
536
|
|
Non-GAAP operating income
|
|
$
|
36,441
|
|
|
$
|
33,078
|
|
|
|
|
|
|
Operating margin
|
|
|
3.62
|
%
|
|
|
3.15
|
%
|
Non-GAAP operating margin
|
|
|
3.82
|
%
|
|
|
3.42
|
%
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Currency in thousands, except per share amounts)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Adjusted EBITDA
|
|
|
|
|
Net income
|
|
$
|
172,128
|
|
$
|
167,020
|
Interest expense and finance charges, net
|
|
|
75,891
|
|
|
80,200
|
Provision for income taxes
|
|
|
51,669
|
|
|
50,786
|
Depreciation(1)
|
|
|
27,742
|
|
|
31,654
|
Amortization of intangibles
|
|
|
72,877
|
|
|
73,023
|
EBITDA
|
|
$
|
400,307
|
|
$
|
402,683
|
Other expense, net
|
|
|
2,884
|
|
|
156
|
Acquisition, integration and restructuring costs
|
|
|
31,254
|
|
|
45,029
|
Share-based compensation
|
|
|
17,490
|
|
|
13,074
|
Purchase accounting adjustments
|
|
|
—
|
|
|
7,450
|
Adjusted EBITDA
|
|
$
|
451,935
|
|
$
|
468,392
|
(1) Includes depreciation recorded in acquisition, integration, and restructuring
costs.
|
|
|
Three Months Ended
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Non-GAAP net income & non-GAAP diluted EPS(1)
|
|
|
|
|
Net income
|
|
$
|
172,128
|
|
|
$
|
167,020
|
|
Acquisition, integration and restructuring costs
|
|
|
31,649
|
|
|
|
53,424
|
|
Amortization of intangibles
|
|
|
72,877
|
|
|
|
73,023
|
|
Share-based compensation
|
|
|
17,490
|
|
|
|
13,074
|
|
Purchase accounting adjustments
|
|
|
—
|
|
|
|
7,450
|
|
Income taxes related to the above
|
|
|
(27,921
|
)
|
|
|
(34,756
|
)
|
Non-GAAP net income
|
|
$
|
266,223
|
|
|
$
|
279,235
|
|
|
|
|
|
|
Diluted EPS(1)
|
|
$
|
1.93
|
|
|
$
|
1.75
|
|
Acquisition, integration and restructuring costs
|
|
|
0.36
|
|
|
|
0.56
|
|
Amortization of intangibles
|
|
|
0.81
|
|
|
|
0.76
|
|
Share-based compensation
|
|
|
0.20
|
|
|
|
0.14
|
|
Purchase accounting adjustments
|
|
|
—
|
|
|
|
0.08
|
|
Income taxes related to the above
|
|
|
(0.31
|
)
|
|
|
(0.36
|
)
|
Non-GAAP Diluted EPS(1)
|
|
$
|
2.99
|
|
|
$
|
2.93
|
|
(1) Diluted EPS is calculated using the two-class method. Unvested restricted stock
awards granted to employees are considered participating securities. For purposes of calculating
Diluted EPS, net income allocated to participating securities was approximately 0.9% and 0.8% of
net income for the three months ended February 29, 2024 and February 28, 2023, respectively.
|
|
TD SYNNEX Corporation
|
Reconciliation of GAAP to Non-GAAP financial measures
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
Three Months Ended
|
(Currency in thousands)
|
|
February 29, 2024
|
|
February 28, 2023
|
Free cash flow
|
|
|
|
|
Net cash provided by (used in) operating activities
|
|
$
|
384,709
|
|
|
$
|
(102,795
|
)
|
Purchases of property and equipment
|
|
|
(41,088
|
)
|
|
|
(37,278
|
)
|
Free cash flow
|
|
$
|
343,621
|
|
|
$
|
(140,073
|
)
|
|
|
Forecast
|
|
|
Three Months Ending May 31, 2024
|
(Currency in millions, except per share amounts)
|
|
Low
|
|
High
|
Net income
|
|
$
|
139
|
|
|
$
|
183
|
|
Acquisition, integration and restructuring costs
|
|
|
18
|
|
|
|
18
|
|
Amortization of intangibles
|
|
|
75
|
|
|
|
75
|
|
Share-based compensation
|
|
|
11
|
|
|
|
11
|
|
Income taxes related to the above
|
|
|
(24
|
)
|
|
|
(24
|
)
|
Non-GAAP net income
|
|
$
|
219
|
|
|
$
|
263
|
|
|
|
|
|
|
Diluted EPS(1)
|
|
$
|
1.59
|
|
|
$
|
2.09
|
|
Acquisition, integration and restructuring costs
|
|
|
0.20
|
|
|
|
0.20
|
|
Amortization of intangibles
|
|
|
0.86
|
|
|
|
0.86
|
|
Share-based compensation
|
|
|
0.12
|
|
|
|
0.12
|
|
Income taxes related to the above
|
|
|
(0.27
|
)
|
|
|
(0.27
|
)
|
Non-GAAP Diluted EPS(1)
|
|
$
|
2.50
|
|
|
$
|
3.00
|
|
(1) Diluted EPS is calculated using the two-class method. Unvested restricted stock
awards granted to employees are considered participating securities. Net income allocable to
participating securities is estimated to be approximately 0.9% of the forecast net income for
the three months ending May 31, 2024.
|
|
|
Forecast
|
|
|
Three Months Ending
|
(Currency in billions)
|
|
May 31, 2024
|
Non-GAAP gross billings
|
|
Low
|
|
High
|
Revenue
|
|
$
|
13.3
|
|
$
|
14.9
|
Costs incurred and netted against revenue related to sales of third-party supplier service
contracts, software as a service arrangements and certain fulfillment contracts
|
|
|
5.1
|
|
|
4.7
|
Non-GAAP gross billings
|
|
$
|
18.4
|
|
$
|
19.6
|
|
TD SYNNEX Corporation
|
Calculation of Financial Metrics
|
Return on Invested Capital (“ROIC”)
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
|
|
February 29, 2024
|
|
February 28, 2023
|
ROIC
|
|
|
|
|
Operating income (trailing fiscal four quarters)
|
|
$
|
1,082,442
|
|
|
$
|
1,126,595
|
|
Income taxes on operating income(1)
|
|
|
(222,351
|
)
|
|
|
(237,869
|
)
|
Operating income after taxes
|
|
$
|
860,091
|
|
|
$
|
888,726
|
|
|
|
|
|
|
Total invested capital comprising equity and borrowings, less cash (last five quarters average)
|
|
$
|
11,405,681
|
|
|
$
|
11,857,925
|
|
|
|
|
|
|
ROIC
|
|
|
7.5
|
%
|
|
|
7.5
|
%
|
|
|
|
|
|
Adjusted ROIC
|
|
|
|
|
Non-GAAP operating income (trailing fiscal four quarters)
|
|
$
|
1,624,021
|
|
|
$
|
1,735,073
|
|
Income taxes on non-GAAP operating income(1)
|
|
|
(364,991
|
)
|
|
|
(401,326
|
)
|
Non-GAAP operating income after taxes
|
|
$
|
1,259,030
|
|
|
$
|
1,333,747
|
|
|
|
|
|
|
Total invested capital comprising equity and borrowings, less cash (last five quarters average)
|
|
$
|
11,405,681
|
|
|
$
|
11,857,925
|
|
Tax effected impact of cumulative non-GAAP adjustments (last five quarters average)
|
|
|
1,172,514
|
|
|
|
742,036
|
|
Total non-GAAP invested capital (last five quarters average)
|
|
$
|
12,578,195
|
|
|
$
|
12,599,961
|
|
|
|
|
|
|
Adjusted ROIC
|
|
|
10.0
|
%
|
|
|
10.6
|
%
|
(1) Income taxes on GAAP operating income was calculated using the effective
year-to-date tax rates during the respective periods. Income taxes on non-GAAP operating income
was calculated by excluding the tax effect of taxable and deductible non-GAAP adjustments using
the effective year-to-date tax rate during the respective periods.
|
|
TD SYNNEX Corporation
|
Calculation of Financial Metrics
|
Cash Conversion Cycle
|
(Currency in thousands)
|
(Amounts may not add or compute due to rounding)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
February 29, 2024
|
|
February 28, 2023
|
Days sales outstanding
|
|
|
|
|
|
|
Revenue
|
|
(a)
|
|
$
|
13,975,253
|
|
$
|
15,125,371
|
Accounts receivable, net
|
|
(b)
|
|
|
8,902,803
|
|
|
9,357,059
|
Days sales outstanding
|
|
(c) = ((b)/(a))*the number of days during the period
|
|
|
58
|
|
|
56
|
|
|
|
|
|
|
|
Days inventory outstanding
|
|
|
|
|
|
|
Cost of revenue
|
|
(d)
|
|
$
|
12,969,487
|
|
$
|
14,121,804
|
Inventories
|
|
(e)
|
|
|
7,091,146
|
|
|
8,372,834
|
Days inventory outstanding
|
|
(f) = ((e)/(d))*the number of days during the period
|
|
|
50
|
|
|
53
|
|
|
|
|
|
|
|
Days payable outstanding
|
|
|
|
|
|
|
Cost of revenue
|
|
(g)
|
|
$
|
12,969,487
|
|
$
|
14,121,804
|
Accounts payable
|
|
(h)
|
|
|
12,372,749
|
|
|
12,997,681
|
Days payable outstanding
|
|
(i) = ((h)/(g))*the number of days during the period
|
|
|
87
|
|
|
83
|
|
|
|
|
|
|
|
Cash conversion cycle
|
|
(j) = (c)+(f)-(i)
|
|
|
21
|
|
|
26
|
Source: TD SYNNEX