In This Article:
-
Revenue Growth: 10% year over year in Q4.
-
Gross Billings: $21.2 billion, up 7.4% year over year.
-
Net Revenue: $15.8 billion, up 10% year over year.
-
Free Cash Flow: $513 million in Q4; $1 billion for the full fiscal year 2024.
-
Gross Profit: $1 billion, or 4.91% of gross billings.
-
Non-GAAP Operating Income: $422 million, or 1.99% of gross billings.
-
Non-GAAP Net Income: $263 million.
-
Non-GAAP Diluted EPS: $3.09.
-
Cash and Cash Equivalents: $1.06 billion.
-
Debt: $3.9 billion.
-
Gross Leverage Ratio: 2.2 times.
-
Net Leverage Ratio: 1.6 times.
-
Dividend Increase: 10% increase to $0.44 per common share.
-
Shareholder Returns: $750 million returned in fiscal 2024, representing 72% of free cash flow.
Release Date: January 10, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
TD Synnex Corp (NYSE:SNX) reported a 10% year-over-year revenue growth and a 7% increase in gross billings for Q4.
-
The company generated $513 million in free cash flow in Q4, meeting its target of $1 billion for the full fiscal year 2024.
-
Strong performance was noted in the cloud, cybersecurity, and data and analytics portfolios, all of which grew by double digits across geographic segments.
-
Hyve, the hyperscale infrastructure business, showed double-digit revenue growth, reflecting improved end-to-end capabilities.
-
The company returned 72% of its free cash flow to shareholders through buybacks and dividends during fiscal year 2024.
Negative Points
-
Despite strong growth, TD Synnex Corp (NYSE:SNX) experienced declining margins, with a 25 basis point decline in gross profit year over year.
-
Hyve's tough year-over-year comparison impacted growth and operating margins, with elevated margins from cost recoveries not repeating this year.
-
Interest expenses were higher than expected due to increased average borrowings throughout the quarter.
-
The macroeconomic and political instability in Europe is creating uncertainty in the market, potentially impacting future growth.
-
The company anticipates a continued margin headwind in Q1 fiscal 2025 due to the previous year's elevated margins in Hyve.
Q & A Highlights
Q: Patrick, with two quarters under your tenure and a Q1 guide, can you elaborate on the balance between growth and profitability, especially with Hyve impacting margins? A: Patrick Zammit, Chief Operating Officer: We are pleased with growth in both distribution and Hyve. Excluding last year's one-off, Hyve showed strong growth in top line, GP, and operating income. We remain committed to profitable growth, and Hyve's margins are accretive to our portfolio. We plan to continue investing in Hyve due to its high return on investment.