TD Synnex posts first quarterly results since completing merger

Joint company posted revenues of $15.6bn during fourth quarter of 2021

TD Synnex has published its first set of results since the merger between the two was completed last September, posting figures which were "at or better than expectations" - the company claims.

Synnex and Tech Data completed a blockbuster $7.2bn merger last year to create a joint company which became the industry's largest distributor, overtaking Ingram Micro.

Revenue for the fourth quarter of 2021 came in at $15.6bn, an increase of 155.1 per cent due to the impact of the merger, when compared with Tech Data's quarter from the same period during the prior year. Non-GAAP operating income came to $408m compared to $221m.

But on an earnings call for the results, chief financial officer Marshall Witt said revenue for the combined company was down two per cent from the prior year based on a comparison that assumes the merger with Tech Data occurred on 1 September 2020.

"We are pleased with this result, given the tough comparison to prior year, supply chain constraints, and newness of operating as one company as well as an approximate one per cent FX headwind due to the euro weakening against the dollar."

CEO Rich Hume said the company's core distribution business performed "in line" with expectations set in the previous quarter, as did endpoint solutions, despite being "slightly down" year-on-year.

Hume added that government spending saw a "bit of a slowdown", while the education segment was "flat year over year" but in Europe, demand for next-generation solutions was "healthy" and TD Synnex "outgrew the market".

"We had a good performance despite the anticipated challenging supply chain environment, the change attained with our merger and the new fiscal year-end for much of the company," Hume said.

"Strong operational execution by the teams allowed us to optimise our results to the higher end of our guided revenue range.

"Our advanced solutions products and service business saw a continued improvement in the quarter and grew year-over-year, assuming the merger had occurred in the prior year."

For fiscal 2021, Tech Data recorded revenue of $31.6bn, up 58.3 per cent from the prior fiscal year with operating income of $623m compared to $521m in the prior fiscal year.

Revenue for the first quarter of 2022 is expected to be in the range of $14.75bn to $15.7bn, TD Synnex said, with non-GAAP net income of between $245m to $275m and non-GAAP diluted earnings per share of $2.55 to $2.85.