TD SYNNEX Reports Fiscal 2025 First Quarter Results

• Revenue of $14.5 billion, an increase of 4.0% from the prior fiscal first quarter. On a constant currency⁽¹⁾ basis, revenue increased by 6.0% compared to the prior fiscal first quarter.
• Non-GAAP gross billings⁽¹⁾ of $20.7 billion, an increase of 7.5% from the prior fiscal first quarter and at the top end of our outlook. On a constant currency⁽¹⁾ basis, non-GAAP gross billings⁽¹⁾ increased by 9.5% compared to the prior fiscal first quarter.
• Diluted earnings per share ("EPS") of $1.98 and non-GAAP diluted EPS⁽¹⁾ of $2.80, within our outlook.
• Returned $138 million to stockholders in the form of $101 million of share repurchases and $37 million in dividends.
• Announced a quarterly cash dividend of $0.44 per common share, up 10% from the prior fiscal first quarter.

TD SYNNEX (NYSE:SNX) today announced financial results for the fiscal first quarter ended February 28, 2025.

"The strength of our business model allowed us to grow ahead of the market in Q1. Our end-to-end strategy, global reach and specialist go to market approach continues to empower us to capture a wide range of IT spend," said Patrick Zammit, CEO of TD SYNNEX. "Gross billings in constant currency grew by 9.5% year-over-year in Q1 with all regions and major technologies contributing."

Consolidated Financial Highlights for the Fiscal 2025 First Quarter:

Consolidated Fiscal 2025 First Quarter Highlights

• Revenue was $14.5 billion, compared to $14.0 billion in the prior fiscal first quarter, representing an increase of 4.0%. On a constant currency⁽¹⁾ basis, revenue increased by 6.0% compared to the prior fiscal first quarter driven by growth in both our Endpoint Solutions and Advanced Solutions portfolios. A greater percentage of our sales were presented on a net basis, which negatively impacted our revenue compared to the prior fiscal first quarter by approximately 4%.
• Non-GAAP gross billings⁽¹⁾ were $20.7 billion, compared to $19.3 billion in the prior fiscal first quarter, representing an increase of 7.5% and at the top end of our outlook. On a constant currency⁽¹⁾ basis, non-GAAP gross billings⁽¹⁾ increased by 9.5% compared to the prior fiscal first quarter.
• Gross profit was $998 million, compared to $1,006 million in the prior fiscal first quarter.
• Gross margin was 6.9%, compared to 7.2% in the prior fiscal first quarter, primarily due to higher margins in the prior year in strategic technologies and product mix. The presentation of additional revenues on a net basis positively impacted our gross margin by approximately 23 basis points.
• Operating income was $305 million, compared to $303 million in the prior fiscal first quarter. Non-GAAP operating income⁽¹⁾ was $399 million, compared to $425 million in the prior fiscal first quarter.
• Operating margin was 2.1%, compared to 2.2% in the prior fiscal first quarter. Non-GAAP operating margin⁽¹⁾ was 2.7%, compared to 3.0% in the prior fiscal first quarter.
• Diluted EPS was $1.98, compared to $1.93 in the prior fiscal first quarter. Non-GAAP diluted EPS⁽¹⁾ was $2.80, compared to $2.99 in the prior fiscal first quarter.
• Cash used in operations of $748 million, compared to cash provided by operations of $385 million in the prior fiscal first quarter, and negative free cash flow⁽¹⁾ of $790 million, compared to positive free cash flow⁽¹⁾ of $344 million in the prior fiscal first quarter.
• We returned $138 million to stockholders in the form of share repurchases and dividends, compared to $235 million in the prior fiscal first quarter.

Regional Fiscal 2025 First Quarter Highlights

• Americas:
  • Revenue was $8.4 billion, compared to $7.9 billion in the prior fiscal first quarter, representing an increase of 6.2%. On a constant currency⁽¹⁾ basis, revenue increased by 7.0% compared to the prior fiscal first quarter. A greater percentage of our sales were presented on a net basis, which negatively impacted our revenue compared to the prior fiscal first quarter by approximately 2%.
  • Non-GAAP gross billings⁽¹⁾ were $12.4 billion, compared to $11.5 billion in the prior fiscal first quarter, representing an increase of 8.2%. On a constant currency⁽¹⁾ basis, non-GAAP gross billings⁽¹⁾ increased by 9.1% compared to the prior fiscal first quarter.
  • Operating income was $194 million, compared to $160 million in the prior fiscal first quarter. Non-GAAP operating income⁽¹⁾ was $248 million, compared to $240 million in the prior fiscal first quarter.
  • Operating margin was 2.3%, compared to 2.0% in the prior fiscal first quarter. Non-GAAP operating margin⁽¹⁾ was 3.0%, consistent with the prior fiscal first quarter.
• Europe:
  • Revenue was $5.1 billion, an increase of 0.4% compared to the prior fiscal first quarter. On a constant currency⁽¹⁾ basis, revenue increased by 4.3%. A greater percentage of our sales were presented on a net basis, which negatively impacted our revenue compared to the prior fiscal first quarter by approximately 4%.
  • Non-GAAP gross billings⁽¹⁾ were $6.9 billion, compared to $6.6 billion in the prior fiscal first quarter, representing an increase of 4.3%. On a constant currency⁽¹⁾ basis, non-GAAP gross billings⁽¹⁾ increased by 8.1% compared to the prior fiscal first quarter.
  • Operating income was $86 million, compared to $108 million in the prior fiscal first quarter. Non-GAAP operating income⁽¹⁾ was $124 million, compared to $148 million in the prior fiscal first quarter.
  • Operating margin was 1.7%, compared to 2.1% in the prior fiscal first quarter. Non-GAAP operating margin⁽¹⁾ was 2.4%, compared to 2.9% in the prior fiscal first quarter.
• Asia-Pacific and Japan:
  • Revenue was $1.0 billion, compared to $955 million in the prior fiscal first quarter, representing an increase of 5.2%. On a constant currency⁽¹⁾ basis, revenue increased by 7.2% compared to the prior fiscal first quarter. A greater percentage of our sales were presented on a net basis, which negatively impacted our revenue compared to the prior fiscal first quarter by approximately 14%.
  • Non-GAAP gross billings⁽¹⁾ were $1.4 billion, compared to $1.2 billion in the prior fiscal first quarter, representing an increase of 19.5%. On a constant currency⁽¹⁾ basis, non-GAAP gross billings⁽¹⁾ increased by 21.6% compared to the prior fiscal first quarter.
  • Operating income was $25 million, compared to $35 million in the prior fiscal first quarter. Non-GAAP operating income⁽¹⁾ was $27 million, compared to $36 million in the prior fiscal first quarter.
  • Operating margin was 2.5%, compared to 3.6% in the prior fiscal first quarter. Non-GAAP operating margin⁽¹⁾ was 2.7%, compared to 3.8% in the prior fiscal first quarter.

Fiscal 2025 Second Quarter Outlook

The following statements are based on TD SYNNEX's current expectations for the fiscal 2025 second quarter. These statements are forward-looking and actual results may differ materially. Non-GAAP gross billings⁽¹⁾ include the impact of costs incurred and netted against revenue related to sales of third-party supplier service contracts, software as a service arrangements and certain fulfillment contracts, and the remaining non-GAAP financial measures exclude the impact of acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation, and the related tax effects thereon.

Dividend

TD SYNNEX announced today that its Board of Directors declared a quarterly cash dividend of $0.44 per common share. The dividend is payable on April 25, 2025 to stockholders of record as of the close of business on April 11, 2025.

Conference Call and Webcast

TD SYNNEX will host a conference call today to discuss the 2025 fiscal first quarter results at 6:00 AM (PT)/9:00 AM (ET).

A live audio webcast of the earnings call will be accessible at ir.tdsynnex.com and a replay of the webcast will be available following the call.

About TD SYNNEX

TD SYNNEX (NYSE:SNX) is a leading global distributor and solutions aggregator for the IT ecosystem. We're an innovative partner helping more than 150,000 customers in 100+ countries to maximize the value of technology investments, demonstrate business outcomes and unlock growth opportunities. Headquartered in Clearwater, Florida and Fremont, California, TD SYNNEX's over 23,000 co-workers are dedicated to uniting compelling IT products, services and solutions from approximately 2,500 best-in-class technology vendors. Our edge-to-cloud portfolio is anchored in some of the highest-growth technology segments including cloud, cybersecurity, big data/analytics, AI, IoT, mobility and everything as a service.

TD SYNNEX is committed to serving customers and communities, and we believe we can have a positive impact on our people and our planet, intentionally acting as a respected corporate citizen. We aspire to be a diverse and inclusive employer of choice for talent across the IT ecosystem. For more information, visit TDSYNNEX.com, follow our newsroom or find us on LinkedIn, Facebook and Instagram.

⁽¹⁾Use of Non-GAAP Financial Information

In addition to the financial results presented in accordance with GAAP, TD SYNNEX uses and refers to:

• Non-GAAP gross billings, which adjusts revenues to exclude costs related to sales of third-party supplier service contracts, software as a service arrangements and certain fulfillment contracts. Non-GAAP gross billings are a useful non-GAAP metric in understanding the volume of our business activity and serve as an important performance metric in internally managing our operations.
• Revenue and non-GAAP gross billings in constant currency, which adjusts for the translation effect of foreign currencies so that certain financial results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our performance. Financial results adjusted for constant currency are calculated by translating current period activity using the comparable prior year periods' currency conversion rate.
• "Gross to net %" refers to the percentage of adjustments made to non-GAAP gross billings for costs incurred and netted against revenue related to sales of third-party supplier service contracts, software as a service arrangements and certain fulfillment contracts.
• Adjusted selling, general and administrative expenses, which excludes acquisition, integration and restructuring costs, the amortization of intangible assets and share-based compensation expense. TD SYNNEX also uses adjusted selling, general and administrative expenses as a percentage of non-GAAP gross billings, which is a useful metric in considering our selling, general and administrative expenses without the impact of gross to net revenue adjustments to gross billings. Furthermore, TD SYNNEX uses adjusted selling, general and administrative expenses as a percentage of gross profit, which is a useful metric in considering the portion of gross profit retained after selling, general and administrative expenses.
• Non-GAAP operating income and non-GAAP operating margin, which exclude acquisition, integration and restructuring costs, the amortization of intangible assets and share-based compensation expense.
• Earnings before interest, taxes, depreciation and amortization ("EBITDA"), which excludes interest expense and finance charges, net, the provision for income taxes, depreciation, and amortization of intangibles. TD SYNNEX also uses adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") which excludes interest expense and finance charges, net, the provision for income taxes, depreciation, amortization of intangibles, other income (expense), net, acquisition, integration and restructuring costs, and share-based compensation expense.
• Non-GAAP net income and non-GAAP diluted earnings per share, which exclude acquisition, integration and restructuring costs, the amortization of intangible assets, share-based compensation expense, and the related tax effects thereon.
• Free cash flow, which is cash flow from operating activities reduced by purchases of property and equipment. TD SYNNEX uses free cash flow to conduct and evaluate its business because although it is similar to cash flows from operating activities, TD SYNNEX believes free cash flow is an additional useful measure of cash flows since purchases of property and equipment are a necessary component of ongoing operations. Free cash flow reflects an additional way of viewing TD SYNNEX's liquidity that, when viewed with its GAAP results, provides a more complete understanding of factors and trends affecting its cash flows. Free cash flow has limitations as it does not represent the residual cash flow available for discretionary expenditures. For example, free cash flow does not incorporate payments for business acquisitions. Therefore, TD SYNNEX believes it is important to view free cash flow as a complement to its entire Consolidated Statements of Cash Flows.
• Trailing fiscal four quarters return on invested capital ("ROIC"), which is defined as the last four quarters' tax effected operating income divided by the average of the last five quarterly balances of borrowings and equity, net of cash. Adjusted ROIC is calculated by excluding the tax effected impact of non-GAAP adjustments from operating income and by excluding the cumulative tax effected impact of current and prior period non-GAAP adjustments on equity.

In prior periods, TD SYNNEX has excluded other items relevant to those periods for purposes of its non-GAAP financial measures.

Acquisition, integration and restructuring costs, which are expensed as incurred, primarily represent professional services costs for legal, banking, consulting and advisory services, severance and other personnel-related costs, share-based compensation expense and debt extinguishment fees that are incurred in connection with acquisition, integration, restructuring, and divestiture activities. From time to time, this category may also include transaction-related gains/losses on divestitures/spin-off of businesses, costs related to long-lived assets including impairment charges and accelerated depreciation and amortization expense due to changes in asset useful lives, as well as various other costs associated with the acquisition or divestiture.

TD SYNNEX's acquisition activities have resulted in the recognition of finite-lived intangible assets which consist primarily of customer relationships and vendor lists. Finite-lived intangible assets are amortized over their estimated useful lives and are tested for impairment when events indicate that the carrying value may not be recoverable. The amortization of intangible assets is reflected in the Company's Statements of Operations. Although intangible assets contribute to the Company's revenue generation, the amortization of intangible assets does not directly relate to the sale of the Company's products. Additionally, intangible asset amortization expense typically fluctuates based on the size and timing of the Company's acquisition activity. Accordingly, the Company believes excluding the amortization of intangible assets, along with the other non-GAAP adjustments, which neither relate to the ordinary course of the Company's business nor reflect the Company's underlying business performance, enhances the Company's and investors' ability to compare the Company's past financial performance with its current performance and to analyze underlying business performance and trends. Intangible asset amortization excluded from the related non-GAAP financial measure represents the entire amount recorded within the Company's GAAP financial statements, and the revenue generated by the associated intangible assets has not been excluded from the related non-GAAP financial measure. Intangible asset amortization is excluded from the related non-GAAP financial measure because the amortization, unlike the related revenue, is not affected by operations of any particular period unless an intangible asset becomes impaired or the estimated useful life of an intangible asset is revised.

Share-based compensation expense is a non-cash expense arising from the grant of equity awards to employees and non-employee members of the Company's Board of Directors based on the estimated fair value of those awards. Although share-based compensation is an important aspect of the compensation of our employees, the fair value of the share-based awards may bear little resemblance to the actual value realized upon the vesting or future exercise of the related share-based awards and the expense can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions. Given the variety and timing of awards and the subjective assumptions that are necessary when calculating share-based compensation expense, TD SYNNEX believes this additional information allows investors to make additional comparisons between our operating results from period to period.

TD SYNNEX management uses non-GAAP financial measures internally to understand, manage and evaluate the business, to establish operational goals, and in some cases for measuring performance for compensation purposes. These non-GAAP measures are intended to provide investors with an understanding of TD SYNNEX's operational results and trends that more readily enable investors to analyze TD SYNNEX's base financial and operating performance and to facilitate period-to-period comparisons and analysis of operational trends, as well as for planning and forecasting in future periods. Management believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision-making. As these non-GAAP financial measures are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures, and should be read only in conjunction with TD SYNNEX's Consolidated Financial Statements prepared in accordance with GAAP. A reconciliation of TD SYNNEX's GAAP to non-GAAP financial information is set forth in the supplemental tables at the end of this press release.

Safe Harbor Statement

Statements in this news release regarding TD SYNNEX that are not historical facts are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are inherently uncertain, and stockholders and other potential investors must recognize that actual results may differ materially from TD SYNNEX expectations as a result of a variety of factors. These forward-looking statements may be identified by terms such as believe, foresee, expect, may, will, provide, could and should and the negative of these terms or other similar expressions. These forward-looking statements include, but are not limited to, statements about our strategy, demand, plans and positioning, capital allocation, as well as guidance related to the second quarter of 2025. Such forward-looking statements are based upon management's current expectations and include known and unknown risks, uncertainties and other factors, many of which TD SYNNEX is unable to predict or control, that may cause TD SYNNEX actual results, performance, or plans to differ materially from any future results, performance or plans expressed or implied by such forward-looking statements.

These risks and uncertainties include, but are not limited to: the unfavorable outcome of any legal proceedings that have been or may be instituted against us; the ability to retain key personnel; general economic and political conditions; weakness in information technology spending; seasonality; the loss or consolidation of one or more of our significant original equipment manufacturer, or OEM, suppliers or customers; market acceptance and product life of the products we assemble and distribute; competitive conditions in our industry and their impact on our margins; pricing, margin and other terms with our OEM suppliers; our ability to gain market share; variations in supplier-sponsored programs; changes in our costs and operating expenses; the timing and amount of returns to our stockholders via repurchases of our common stock and dividends; changes in foreign currency exchange rates; increased inflation; changes in tax laws; risks associated with our international operations; uncertainties and variability in demand by our reseller and integration customers; supply shortages or delays; any termination or reduction in our supplier finance programs; credit exposure to our reseller customers and negative trends in their businesses; any incidents of theft; the declaration, timing and payment of dividends, and the Board's reassessment thereof; and other risks and uncertainties detailed in our Form 10-K for the fiscal year ended November 30, 2024 and subsequent SEC filings. Statements included in this press release are based upon information known to TD SYNNEX as of the date of this release, and TD SYNNEX assumes no obligation to update information contained in this press release unless otherwise required by law.

Copyright 2025 TD SYNNEX CORPORATION. All rights reserved. TD SYNNEX, the TD SYNNEX Logo, and all other TD SYNNEX company, product and services names and slogans are trademarks or registered trademarks of TD SYNNEX Corporation. Other names and marks are the property of their respective owners.

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David Jordan

Investor Relations

510-668-8436

[email protected]

Emily Moseley

Global Corporate Communications

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