This new agreement further enhances the reach of the Keepit Partner Network, which empowers resellers, MSPs, and distributors across EMEA, North America, and ANZ to offer secure, cloud-native data protection. To become a Keepit partner in France, contact partner@keepit.com or visit keepit.com/partners. About Keepit Keepit provides a next-level SaaS data protection platform purpose-built for the cloud. Securing data in a vendor-independent cloud safeguards essential business applications, boosts cyber resili ...

J P M O R G A N North America Equity Research 15 December 2025 Hardware & Networking 2026 Outlook: AI Genie Will Keep Giving Boons; Look to EPS Upside Relative to Investors Pricing in Only Modest Acceleration; Top-Picks ANET, APH We have a favorable view on AI stocks for another year heading into 2026 and believe investors should stay the course with their positioning in the sector, as well as stocks positioned to be key AI beneficiaries; albeit, with a different rank order within the AI beneficiary group. ...

Core Insights - Keepit has announced a strategic partnership with Ingram Micro to enhance its market presence in Poland [1] - The collaboration aims to provide robust SaaS data protection solutions to Polish resellers, Managed Service Providers (MSPs), and Managed Security Service Providers (MSSPs) [1] Company Overview - Keepit is a vendor-independent, cloud-native data protection provider [1] - Ingram Micro is recognized as a leading business-to-business platform company within the global technology ecosystem [1] Market Strategy - The partnership is designed to expand Keepit's reach across the Polish IT channel [1] - Ingram Micro will play a crucial role in supporting marketing and distribution efforts for Keepit's services in Poland [1]

Core Insights - Ingram Micro (INGM) is currently viewed as a more attractive investment compared to Enpro (NPO) based on valuation metrics and earnings outlook [3][7] Valuation Metrics - INGM has a forward P/E ratio of 8.00, significantly lower than NPO's forward P/E of 30.41, indicating that INGM may be undervalued [5] - The PEG ratio for INGM is 0.89, while NPO's PEG ratio stands at 2.34, suggesting that INGM offers better value relative to its expected earnings growth [5] - INGM's P/B ratio is 1.3, compared to NPO's P/B of 3.29, further supporting the notion that INGM is a more favorable investment option [6] Analyst Outlook - INGM has a Zacks Rank of 2 (Buy), reflecting an improving earnings estimate revision activity, while NPO holds a Zacks Rank of 3 (Hold) [3][7] - The positive earnings outlook for INGM enhances its attractiveness as a value investment [7]

Core Insights - Ingram Micro reported revenue of $12.6 billion for the quarter ended September 2025, reflecting a year-over-year increase of 7.2% and a surprise of +3.67% over the Zacks Consensus Estimate of $12.16 billion [1] - The company's EPS for the quarter was $0.72, matching the EPS from the same quarter last year, with a surprise of +7.46% over the consensus estimate of $0.67 [1] Revenue Performance - Geographic revenues for Latin America reached $965.89 million, exceeding the average estimate of $893.64 million [4] - EMEA revenues were reported at $3.66 billion, surpassing the average estimate of $3.55 billion [4] - Asia-Pacific revenues amounted to $3.55 billion, exceeding the average estimate of $3.31 billion [4] - North America revenues were $4.43 billion, slightly above the average estimate of $4.4 billion [4] Stock Performance - Ingram Micro's shares have returned -0.8% over the past month, while the Zacks S&P 500 composite has increased by +3.6% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Insights - Ingram Micro reported quarterly earnings of $0.72 per share, exceeding the Zacks Consensus Estimate of $0.67 per share, and matching the earnings from the previous year [1] - The company achieved revenues of $12.6 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 3.67% and showing an increase from $11.76 billion year-over-year [3] Earnings Performance - The earnings surprise for the quarter was +7.46%, with the company having surpassed consensus EPS estimates in all four of the last quarters [2] - Ingram Micro's shares have increased approximately 13.4% since the beginning of the year, compared to a 17.2% gain for the S&P 500 [4] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.87 on revenues of $13.53 billion, and for the current fiscal year, it is $2.77 on revenues of $50.76 billion [8] - The Zacks Rank for Ingram Micro is currently 3 (Hold), indicating expected performance in line with the market in the near future [7] Industry Context - The Technology Services industry, to which Ingram Micro belongs, is currently in the top 35% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [9] - Priority Technology, another company in the same industry, is expected to report quarterly earnings of $0.30 per share, reflecting a year-over-year change of +328.6% [10]

Financial Data and Key Metrics Changes - The company reported revenues of $12.6 billion for Q3 2025, representing a year-over-year increase of 7.2% and exceeding the high end of guidance [4][15] - Non-GAAP diluted earnings per share (EPS) was $0.72, at the high end of guidance, despite a minor impact from a ransomware incident [4][21] - Gross profit for Q3 was $870 million, up from $845 million year-over-year, with gross margins showing a sequential improvement of 34 basis points [19][21] - Adjusted EBITDA for the quarter was $342 million, reflecting a 3% increase in U.S. dollars [21] Business Line Data and Key Metrics Changes - Client and endpoint solutions grew nearly 13% on an FX-neutral basis, driven by strong demand for notebooks and desktops [15][17] - Advanced solutions sales decreased by 4.5% year-over-year, with growth in servers and storage offset by weaker results in virtualization and infrastructure software [15][19] - Cloud revenues saw a 4% decline; however, excluding a non-core divestiture, cloud net revenues were up low single digits year-over-year [16][19] Market Data and Key Metrics Changes - Geographically, Latin America and Asia-Pacific regions experienced robust FX-neutral growth in the low teens year-over-year, while North America grew just over 3% [17] - EMEA showed slight growth on an FX-neutral basis, reflecting a generally softer macro environment in parts of Europe [17] Company Strategy and Development Direction - The company is focused on scaling its Xvantage digital platform and enhancing its AI ecosystem, positioning itself at the center of the $5 trillion global technology landscape [6][7] - The Enable AI program has engaged thousands of customers, providing tools for assessing and deploying AI solutions [10][21] - The company aims to support enterprise customers in their AI transformation journey, leveraging its proprietary AI innovation [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the fourth quarter, expecting continued year-over-year net sales growth and a solid guidance range for revenues [24][54] - The impact of the ransomware incident was estimated to be within 1% to 1.5% of net sales, with a minimal effect on overall operations [14][21] - The company remains optimistic about the SMB segment, which has shown growth over the past three quarters [46][51] Other Important Information - The company returned $18.3 million to stockholders through dividends and announced a 2.6% increase in the quarterly dividend for Q4 [23] - The balance sheet showed net working capital of $4.9 billion, an increase from $4.3 billion year-over-year, driven by higher net sales [22] Q&A Session Summary Question: How should margins be expected to trend going forward? - Management indicated that guidance implies margins in the high 6s, with continued strength in SMB contributing positively [27][28] Question: How should inventory and free cash flow be viewed going forward? - Management noted a sequential decline in inventory and anticipated a solid cash flow quarter in Q4, similar to previous years [32][33] Question: Where is Xvantage seeing the most benefit? - Xvantage is benefiting across both SMB and enterprise segments, with SMB leveraging it for comprehensive business management [40][41] Question: What is the outlook for the PC refresh cycle? - The company is in the later stages of the PC refresh cycle, with potential for AI-powered PCs to extend this cycle [43] Question: What are the expectations for a budget flush exiting 2025? - Management noted a typical seasonal increase in revenues due to budgeting cycles, with a positive outlook for SMB spending [46]

Financial Performance - Q3 2025 - Net sales reached $126 billion, a 72% year-over-year increase[10] - Gross profit amounted to $870 million, up 29% compared to the previous year[10] - Non-GAAP net income was $169 million, representing a 60% increase year-over-year[10] - Adjusted EBITDA totaled $342 million, a 32% increase from the prior year[10] - Non-GAAP diluted EPS stood at $072, exceeding the guidance midpoint by $005[10] Financial Performance - YTD 2025 - Net sales reached $377 billion, an 88% increase year-over-year[13] - Gross profit was $25 billion, up 11% compared to the same period last year[13] - Non-GAAP net income amounted to $455 million, a 98% increase year-over-year[13] - Adjusted EBITDA totaled $927 million, a 29% increase from the prior year[13] - Non-GAAP diluted EPS stood at $194, up 37% year-over-year[13] Q4 2025 Guidance - The company projects net sales between $14 billion and $1435 billion, indicating year-over-year growth of 49% to 75%[35] - Gross profit is expected to range from $935 million to $990 million[35] - Non-GAAP EPS is projected to be between $085 and $095[35]

Financial Performance - Net sales for the thirteen weeks ended September 27, 2025, were $12,603,755, an increase of 7.1% compared to $11,762,628 for the same period in 2024[15] - Gross profit for the thirty-nine weeks ended September 27, 2025, was $2,537,568, representing a slight increase from $2,508,860 in the prior year[15] - Net income for the thirteen weeks ended September 27, 2025, was $99,457, up 29.1% from $76,969 in the same period last year[15] - Basic earnings per share for the thirty-nine weeks ended September 27, 2025, increased to $0.88 from $0.81 in the prior year, reflecting a growth of 8.6%[15] - For the thirty-nine weeks ended September 27, 2025, total net sales reached $37,678,554, a 9.0% increase from $34,639,001 in the same period of 2024[96] - Net income attributable to common stockholders for the thirty-nine weeks ended September 27, 2025, was $206,472, up from $181,106 in 2024, indicating a growth of approximately 14%[103] Assets and Liabilities - Total assets as of September 27, 2025, were $19,223,913, compared to $18,779,690 as of December 28, 2024, indicating a growth of 2.4%[13] - Total liabilities increased slightly to $15,121,538 as of September 27, 2025, from $15,045,815 at the end of 2024[13] - Retained earnings increased to $1,484,725 as of September 27, 2025, from $1,337,399 at the end of 2024, marking a growth of 11%[13] - Total stockholders' equity increased from $3,463,705 on June 29, 2024, to $3,613,905 on September 28, 2024, representing an increase of approximately 4.3%[21] - Total debt as of September 27, 2025, was $3,795,337, an increase from $3,353,140 on December 28, 2024, representing a 13.2% increase[70] Cash Flow and Expenses - Cash provided by operating activities for the thirty-nine weeks ended September 28, 2024, was $23,878, while cash used in operating activities for the same period in 2025 was $(644,428)[23] - Total cash and cash equivalents at the end of the period on September 28, 2024, were $849,472, down from $802,630 at the end of the period on September 27, 2025, indicating a decrease of approximately 5.5%[24] - Compensation expenses for the thirteen weeks ended September 27, 2025, totaled $415,343, slightly up from $409,833 in the same period of 2024[96] - Interest expense for the thirteen weeks ended September 27, 2025, was $81,720, a decrease from $86,254 in the same period of 2024[98] Market Segments - North America segment net sales were $4,425,888 for the thirteen weeks ended September 27, 2025, up from $4,283,677 in the prior year, reflecting a growth of 3.3%[96] - EMEA segment net sales increased to $3,662,309, a rise of 5.5% from $3,470,507 in the same quarter of 2024[96] - Asia-Pacific segment net sales grew by 12.5% to $3,549,666 compared to $3,153,879 in the prior year[96] - Latin America segment net sales increased to $965,892, up 13.0% from $854,565 in the same quarter of 2024[96] Foreign Currency and Tax - The company reported a foreign currency translation adjustment loss of $32,591 for the thirteen weeks ended September 27, 2025[17] - The company reported a net foreign currency exchange loss of $10,207 for the thirteen weeks ended September 27, 2025, compared to a gain of $10,675 in the prior year[98] - Gross unrecognized tax benefits increased to $16,834 as of September 27, 2025, compared to $15,666 at December 28, 2024[80] - The Brazilian subsidiary faces tax assessments totaling approximately $3,148 related to compliance and transaction-tax matters[87] Strategic Initiatives - The company plans to continue expanding its market presence and integrating new technologies into its platform[11] - The company is focused on maintaining its competitive edge amid market volatility and supply constraints[11] - The company plans to adopt new accounting standards effective after December 15, 2024, which are not expected to materially impact consolidated financial statements[49] Employee and Compensation - The company recognized a compensation expense of $4,048,000 for the thirteen weeks ended September 27, 2025, and $11,637,000 for the thirty-nine weeks ended September 27, 2025[57] - The company had 2,419 non-vested time-vesting restricted stock units with a weighted-average grant date fair value of $20.31[57] - The company had 3,684 non-vested performance-vesting restricted stock units with a weighted-average grant date fair value of $17.91 as of September 27, 2025[58] - The compensation expense for performance-vesting restricted stock units was $1,970,000 for the thirteen weeks ended September 27, 2025, and $3,470,000 for the thirty-nine weeks ended September 27, 2025[58] Restructuring and Costs - Restructuring costs for the thirteen weeks ended September 27, 2025, totaled $3,539, with 226 employees affected in North America and EMEA[74] - For the thirty-nine weeks ended September 27, 2025, total restructuring costs were $5,493, with 296 employees impacted[74] - The remaining restructuring liability of $4,759 is expected to be substantially paid by the third quarter of 2026[75]

Financial Performance - Net sales for Q3 2025 reached $12.6 billion, representing a 7.2% increase compared to $11.8 billion in Q3 2024[5] - Gross profit increased to $869.6 million, with a gross margin of 6.90%, down from 7.19% in the prior year[5] - Net income on a GAAP basis was $99.5 million, or $0.42 per share, while non-GAAP net income was $168.7 million, or $0.72 per share[3] - Net income for the thirteen weeks ended September 27, 2025, was $99,457, representing a 29.1% increase from $76,969 in the same period of 2024[31] - Basic earnings per share for the thirty-nine weeks ended September 27, 2025, were $0.88, up from $0.81 in the prior year, indicating a growth of 8.6%[31] - Adjusted EBITDA for the thirty-nine weeks ended September 27, 2025, was $926,958,000, an increase from $900,573,000 in the prior year, representing a growth of 2.9%[38] - The net income for the thirteen weeks ended September 27, 2025, was $99,457,000, up from $76,969,000 in the same period last year, indicating a year-over-year increase of 29.1%[39] - Adjusted net income for the thirty-nine weeks ended September 27, 2025, was $488,461,000, compared to $506,929,000 in the previous year, showing a decrease of 3.6%[39] Sales by Region - North America net sales were $4.4 billion, a 3.3% year-over-year increase, driven by sales of notebooks and servers[6] - EMEA net sales increased by 5.5% to $3.7 billion, with a positive currency translation impact of 5%[9] - Asia-Pacific net sales grew by 12.5% to $3.5 billion, primarily due to strong demand for client and endpoint solutions[11] - Latin America net sales rose by 13.0% to $1.0 billion, supported by growth in client and endpoint solutions[14] Future Guidance - The company expects Q4 2025 net sales guidance between $14.0 billion and $14.35 billion, with non-GAAP diluted EPS projected between $0.85 and $0.95[17] - The company provided guidance for future performance, emphasizing ongoing market expansion and new product development initiatives[36] Dividends and Shareholder Returns - A quarterly dividend of $0.08 per share was declared, reflecting a 2.6% increase from the previous dividend[18] Assets and Liabilities - Total current assets increased to $16,220,383 as of September 27, 2025, compared to $15,801,177 as of December 28, 2024, marking a growth of 2.6%[29] - Total liabilities stood at $15,121,538 as of September 27, 2025, slightly up from $15,045,815 as of December 28, 2024[29] - The company reported a total stockholders' equity of $4,102,375 as of September 27, 2025, an increase from $3,733,875 as of December 28, 2024[29] Operating Expenses - Operating expenses for the thirteen weeks ended September 27, 2025, were $646,134, compared to $627,318 for the same period in 2024, reflecting an increase of 3.9%[31] Cash Flow and Investments - Cash provided by investing activities was $66,139 million for the thirteen weeks ended September 27, 2025, compared to $29,941 million for the same period in 2024, representing a 121.1% increase[35] - Cash used in operating activities was $(146,038) million for the thirteen weeks ended September 27, 2025, compared to $(277,040) million for the same period in 2024, showing a 47.3% improvement[34] - Capital expenditures for the thirteen weeks ended September 27, 2025, were $(28,968) million, down from $(37,955) million in the same period in 2024, indicating a 23.6% decrease[34] - The company reported a decrease in cash and cash equivalents of $(54,038) million for the thirteen weeks ended September 27, 2025, compared to $(79,290) million for the same period in 2024, reflecting a 31.7% improvement[35] - The company reported cash and cash equivalents at the end of the period of $802,630 million, down from $849,472 million at the end of the same period in 2024[35] Risks and Challenges - The company faces various risks including market volatility, supply constraints, and competition, which could impact future performance[25] Operational Efficiency - Adjusted EBITDA and other non-GAAP financial measures were discussed, highlighting the company's focus on operational efficiency and cost structure alignment[36] - The company continues to focus on expanding its market presence and integrating new technologies into its platform, including the development of Ingram Micro Xvantage™[25] Stockholder Equity and Debt - Stockholders' equity as of September 27, 2025, was $4,102,375,000, an increase from $3,613,905,000 in the previous year[39] - The company’s long-term debt as of September 27, 2025, was $3,059,612,000, a decrease from $3,344,033,000 in the previous year[39] Earnings Per Share (EPS) - GAAP diluted EPS for the thirteen weeks ended September 27, 2025, was $0.42, compared to $0.35 for the same period in 2024, representing a 20% increase[44] - Non-GAAP diluted EPS for the thirty-nine weeks ended September 27, 2025, was $1.94, up from $1.87 in 2024, indicating a 3.74% growth[44] - Amortization of intangibles contributed $0.08 to GAAP EPS for the thirteen weeks ended September 27, 2025, down from $0.10 in 2024[44] - Integration, transition, and operational improvement costs added $0.22 to GAAP EPS for the thirteen weeks ended September 27, 2025, compared to $0.21 in 2024[44] - The tax impact of pre-tax adjustments reduced GAAP EPS by $0.10 for the thirteen weeks ended September 27, 2025, compared to a reduction of $0.13 in 2024[44] - Restructuring costs contributed $0.02 to GAAP EPS for the thirteen weeks ended September 27, 2025, consistent with the previous year[44] - Cash-based compensation expense added $0.02 to GAAP EPS for the thirteen weeks ended September 27, 2025, compared to $0.03 in 2024[44] Currency Impact - The company reported a net foreign currency exchange loss of $0.04 for the thirteen weeks ended September 27, 2025, compared to a gain of $0.05 in 2024[44] Forward-Looking Statements - The company is unable to provide a reconciliation of forward-looking GAAP diluted EPS to non-GAAP diluted EPS for fiscal fourth quarter 2025 due to uncertainties[45] - The forward-looking estimates of both GAAP and non-GAAP measures may differ materially from actual results, indicating potential volatility in future financial performance[45]