- 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 $0.40 per common share,
up 14% from the prior fiscal year.
TD SYNNEX (NYSE: SNX) today announced financial results for the
fiscal first quarter ended February 29, 2024.
Consolidated Financial Highlights for
the Fiscal 2024 First Quarter:
Q1 FY24
Q1 FY23
Net Change from Q1
FY23
Revenue ($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
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240326922145/en/
Liz Morali Investor Relations 510-668-8436 ir@tdsynnex.com
Bobby Eagle Global Corporate Communications 727-538-5864
bobby.eagle@tdsynnex.com
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