Tech Data's revenue dragged down by European performance
Europe the only geographic region to see sales drop
Tech Data's European revenues tumbled in Q1, following warnings from CEO Rich Hume that the market would continue to slow down this year.
Europe was the only geographic region to suffer a year-on-year sales decline for Tech Data during the three months until 30 April 2019. Revenues in Europe slumped by eight per cent year on year to $4.3bn.
Its Americas segment was meanwhile elevated by a five per cent year-on-year revenue boost to $3.8bn, while Asia Pacific sales leapfrogged by 15 per cent to $310m.
The poor sales performance of Tech Data's largest revenue region, which pulled in 51 per cent of global revenues during the quarter, dragged Tech Data's global business to a sales decline in Q1.
Global revenues slumped by two per cent to $8.4bn for the quarter, but sales grew by three per cent on a constant currency basis.
Tech Data's senior executives have previously warned that a general market slowdown in Europe will affect the group's regional performance. European boss Patrick Zammit cited Brexit, a highly competitive landscape and political unrest as key headwinds for the distributor's European business. CEO Rich Hume meanwhile pointed to a "slowing" economy in Europe during the firm's Q4 earnings call.
The US-based distributor's profit performance was meanwhile more upbeat. Global non-GAAP operating income increased by one per cent to $124.8m. European non-GAAP profits enjoyed a four per cent hike year on year to $45.6m, or 14 per cent in constant currencies, outperforming its Americas arm which suffered a one per cent decline to $84.7m.
In a statement, Hume said he was pleased with Tech Data's performance, pointing to the firm's double-digit earnings per share growth and positive cash flow.
"Our worldwide teams executed well in the quarter, despite market uncertainty," said Hume. "Looking ahead, although IT market growth has slowed somewhat from the year-ago levels, demand continues to be solid, and we remain positive on the overall IT spending outlook," he said.