Ingram Micro's Q4 sales plunged by nearly a fifth as three factors – including vendor contract changes in Europe – conspired to artificially wipe a collective $1.7bn (£1.2bn) from its top line.
Sales hit $11.3bn for the 13 weeks ended 2 January, down 19 per cent in US dollar terms on an annual comparison.
On top of the usual currency headwinds, three further anomalies made the world's largest distributor's sales appear weaker against the comparable quarter last year.
Most costly for Ingram was the fact its Q4 last year was a week longer, which it said left a $900m hole in sales.
The year-ago quarter also benefitted from about $500m in North American mobility distribution business Ingram elected to exit over the low margins involved, the distributor said
Finally, Ingram said it had negotiated a favourable change in contract terms for some of its high-volume European fulfilment business. This led it to recognise revenue on a net basis, compared with a gross basis as it did last year, which it said left a $300m gap in its top line.
As a result, European sales fell by 19 per cent in dollar terms to $3.38bn.
Despite the sales shrinkage, Ingram's global Q4 non-GAAP operating income held up, falling only modestly, from $247m to $239m year on year and CEO Alain Monié indicated he was pleased with the quarter.
"We had a solid close to a strong year of execution, and we are pleased with the progress we are making against our strategic initiatives," he added.
Ingram's pending acquisition by Chinese conglomerate HNA has received a range of reactions – both positive and negative – since it was announced last week, but Monié said the move would position Ingram to better serve its vendor and reseller customers.
"Upon the closing of the transaction announced last week, we expect to have the ability to accelerate our investments, both organically and through M&A, to enhance and add to our capabilities in high-value IT solutions, mobility life cycle services, commerce and fulfilment solutions and cloud, while also continuing to extend our geographic reach," he said.
Existing European agreement expanded into new region
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