TD Synnex revenues rocket 160 per cent folllowing merger

The group continues to see the fruits of its labour as it arrives at more than $15bn in revenues for Q2

Global distributor TD Synnex saw growth in revenues rocket for its fiscal second quarter ending May 31, 2022.

Revenues surged 160.7 per cent from the prior fiscal Q2 to clock in $15.3bn.

The group attributed the growth surge primarily to the completion of its mega-merger bringing together the global businesses of Tech Data and Synnex, which closed on September 1, 2021.

However, it added that on a sequential basis revenues decreased 1.3 per cent compared to the prior quarter.

Meanwhile net income spiked 60 per cent to earn $148.9m.

"Our fiscal Q2 results demonstrate the excellent performance delivered by our team amidst another quarter of strong demand for our technology solutions," said TD Synnex CEO, Rich Hume.

"We are making great strides as TD Synnex and seeing the fruits of our labour as we progress on our merger integration and strategic initiatives to grow across core and high-growth technologies."

TD Synnex business highlights

Hume claimed the company continues to see healthy demand for both endpoint and advanced solutions with revenue increasing year on year.

He added that the PC side of the business continued to grow moderately following the double-digit growth rate seen during the pandemic.

"The weakness, I think, in the overall scheme of the PC category would be in the Chromebook as well as the consumer piece, at least for the foreseeable future," he told viewers on an earnings call transcribed by Seeking Alpha.

"We're heavier weight to the commercial piece. And when you get down to the consumer segment and think about it in the grand scheme of our entire portfolio, it's a single-digit number, a mid-single-digit number estimated.

"So I think that the sentiment of the market, the PC providers have sort of articulated that point of view, and we would reaffirm that that's the way we see it."

Looking at the business regionally, TD's America's distribution business experienced strong year on year top line growth.

"On a year over year basis, our hyperscale infrastructure business declined given tough prior year compares, but grew on an LTM basis consistent with our expectations," Hume continued.

"Our European business also grew year over year in constant currency, albeit at a more measured pace given the current economic and geopolitical conditions in the region."

Fiscal Q3 outlook

The group's current expectations for the fiscal 2022 third quarter sees revenues in the range of $14.5bn to $15.5bn.

While net income is expected to be in the range of $120m to $158m and on a non-GAAP basis, net income is forecast to be between $241m to $279m.