TD SYNNEX Reports $2.73 EPS in Fiscal Q3, in line with Expectations
Image courtesy of

TD SYNNEX Reports $2.73 EPS in Fiscal Q3, in line with Expectations

TD SYNNEX Corporation reported solid fiscal second quarter 2024 results, with revenue of $13.9 billion and non-GAAP gross billings of $19.3 billion.
Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

TD SYNNEX (NYSE: SNX), a leading global distributor and solutions aggregator for the IT ecosystem, posted revenue of $13.9 billion for the quarter ended May 31, 2024, representing a slight decrease of 0.8% compared to the same period last year.

However, the company’s non-GAAP gross billings, which include costs incurred and netted against revenue related to sales of third-party supplier service contracts and certain fulfillment contracts, grew by 3.1% to $19.3 billion.

The company’s gross margin improved by 13 basis points year-over-year to 6.98%, while non-GAAP gross margin increased by 9 basis points to 6.98%.

Net income for the quarter rose to $144 million, up 7.9% from $133 million in the prior year’s quarter. Diluted earnings per share (EPS) increased by 17.7% to $1.66, while non-GAAP diluted EPS grew by 12.4% to $2.73.

TD SYNNEX’s CEO, Rich Hume, noted, “We continued to see an improving IT spending environment, with a return to year-over-year gross billings growth driven by strength in our core business across both Endpoint and Advanced Solutions and mid-teens growth in Strategic Technologies.”

The company’s financial position remained strong, with $1.17 billion in cash and cash equivalents as of May 31, 2024. TD SYNNEX also demonstrated its commitment to shareholder returns by repurchasing $254 million worth of shares and paying $34 million in dividends during the quarter, representing a 210% increase in total shareholder returns compared to the prior year’s second quarter.

TD SYNNEX Reports Fiscal Q2, in line with Expectations

TD SYNNEX’s fiscal second quarter of 2024 performance largely met or exceeded expectations. The company’s revenue of $13.9 billion fell within its previously provided outlook range of $13.3 billion to $14.9 billion. Non-GAAP gross billings of $19.3 billion came in at the upper end of the company’s guidance of $18.4 billion to $19.6 billion, indicating strong business momentum.

The company’s profitability metrics also aligned with expectations. Both net income of $144 million and non-GAAP net income of $237 million were within the anticipated range. Similarly, diluted EPS of $1.66 and non-GAAP diluted EPS of $2.73 met the company’s outlook.

TD SYNNEX’s performance across its geographic segments was mixed. The Americas segment, which accounted for the largest revenue share, saw a 1.6% year-over-year decline to $8.6 billion. However, non-GAAP gross billings for the region grew by 3.5% to $12.2 billion. The Europe segment experienced a slight revenue decline of 0.8% to $4.4 billion, while the Asia-Pacific and Japan segment showed strong growth with revenue increasing by 6.9% to $964 million.

The company’s focus on strategic technologies and ability to navigate the changing IT landscape contributed to its solid performance. CEO Rich Hume highlighted the mid-teens growth in Strategic Technologies, which underscores TD SYNNEX’s success in capitalizing on emerging market trends and technologies.

SNX Expects Fiscal Q3 Revenue Between $13.3 Billion and $14.9 Billion

Looking ahead, TD SYNNEX guided for its fiscal 2024 third quarter, projecting revenue in the range of $13.3 billion to $14.9 billion. The company expects non-GAAP gross billings to be between $18.9 billion and $20.1 billion for the upcoming quarter.

TD SYNNEX anticipates net income for the third quarter to be in the range of $152 million to $194 million, with non-GAAP net income expected between $219 million and $261 million. Diluted EPS is forecast to be between $1.77 and $2.27, while non-GAAP diluted EPS is expected to range from $2.55 to $3.05.

The company’s guidance reflects cautious optimism about the ongoing recovery in IT spending and its ability to capitalize on growth opportunities in strategic technologies. TD SYNNEX’s focus on maintaining operational efficiency and investing in high-growth areas is expected to drive continued performance improvements.

Additionally, TD SYNNEX announced a quarterly cash dividend of $0.40 per common share, representing a 14% increase from the prior fiscal second quarter. This dividend increase underscores the company’s confidence in its financial position and commitment to delivering value to shareholders.

Disclaimer: The author does not hold or have a position in any securities discussed in the article.