Q1 2025 Performance Highlights - Net sales reached $123 billion, up 108% year-over-year on an FX neutral basis, exceeding guidance by 56%[14, 10] - Adjusted income from operations was $229 million, a 66% increase year-over-year[14] - Non-GAAP net income increased by 66% year-over-year to $144 million[14] - Adjusted EBITDA was $291 million, a 01% increase year-over-year[14] - Non-GAAP diluted EPS was $061, exceeding guidance by $005[14] Financial Position - The company repaid $125 million of debt in Q1 2025, bringing the total repayment to $169 billion since 2022[10, 32] - Available liquidity under the Revolving Credit Facility is $35 billion[33] - Net Debt / Q1 2025 TTM Adjusted EBITDA decreased to 20x, down from 23x in Q1 2024[33] Xvantage Digital Platform - The platform facilitated 12 million searches for hardware, software, cloud, and services[20] - Self-serve orders more than tripled year-over-year[21] - Thousands of dormant customers were reactivated through the platform[22] Q2 2025 Guidance - Net revenue is projected to be between $11765 billion and $12165 billion, representing year-over-year growth of 19% to 54%[35] - Non-GAAP diluted EPS is expected to be between $053 and $063[35]

Part I. Financial Information [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited statements show an 8.3% YoY net sales increase to $12.3 billion and revisions to prior period financials [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased slightly to $18.63 billion while stockholders' equity increased to $3.86 billion Key Balance Sheet Accounts | Account | March 29, 2025 ($ thousands) | December 28, 2024 ($ thousands) | | :--- | :--- | :--- | | **Total Current Assets** | 15,648,116 | 15,801,177 | | **Total Assets** | **18,628,470** | **18,779,690** | | **Total Current Liabilities** | 11,166,283 | 11,306,531 | | **Total Liabilities** | **14,765,767** | **15,045,815** | | **Total Stockholders' Equity** | **3,862,703** | **3,733,875** | [Condensed Consolidated Statements of Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Net sales grew to $12.28 billion, driving net income up to $69.2 million from $49.6 million YoY Key Income Statement Metrics | Metric | Thirteen Weeks Ended March 29, 2025 ($ thousands) | Thirteen Weeks Ended March 30, 2024 ($ thousands) | | :--- | :--- | :--- | | **Net Sales** | 12,280,843 | 11,334,934 | | **Gross Profit** | 828,762 | 834,938 | | **Income from Operations** | 200,864 | 170,121 | | **Net Income** | **69,189** | **49,552** | | **Diluted EPS** | $0.29 | $0.22 | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Comprehensive income reached $143.4 million, reversing a $34.5 million loss from the prior year Comprehensive Income (Loss) Summary | Metric | Thirteen Weeks Ended March 29, 2025 ($ thousands) | Thirteen Weeks Ended March 30, 2024 ($ thousands) | | :--- | :--- | :--- | | Net Income | 69,189 | 49,552 | | Foreign currency translation adjustment | 74,423 | (83,899) | | **Comprehensive Income (Loss)** | **143,441** | **(34,518)** | [Condensed Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity rose to $3.86 billion, driven by net income and positive currency adjustments - Key changes in stockholders' equity for Q1 2025 include **net income of $69.2 million**, dividends declared of $17.4 million, and a positive foreign currency translation adjustment of $74.4 million[21](index=21&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash used in operations was $200.4 million, reflecting increased investment in working capital Key Cash Flow Activities | Cash Flow Activity | Thirteen Weeks Ended March 29, 2025 ($ thousands) | Thirteen Weeks Ended March 30, 2024 ($ thousands) | | :--- | :--- | :--- | | Cash used in operating activities | (200,430) | (100,266) | | Cash provided by investing activities | 58,291 | 24,107 | | Cash provided by financing activities | 96,759 | 3,516 | | **Decrease in cash and cash equivalents** | **(36,764)** | **(90,913)** | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, contingencies, and revisions to prior statements due to fraudulent activity - Previously issued financial statements for Q1 2024 were revised due to fraudulent activity, resulting in a **$10.6M reduction in Net Sales** and a **$4.4M reduction in Net Income**[45](index=45&type=chunk)[46](index=46&type=chunk)[48](index=48&type=chunk) - Total debt stood at **$3.48 billion** as of March 29, 2025, following a voluntary repayment of **$125 million** on its Term Loan Credit Facility[68](index=68&type=chunk) - The company faces potential losses from legal proceedings, including **$147.7 million in Brazil** and **$115.5 million in Saudi Arabia**[82](index=82&type=chunk)[83](index=83&type=chunk)[85](index=85&type=chunk) - A cash dividend of **$0.074 per share** ($17.4 million total) was paid in March 2025, with a subsequent dividend of **$0.076 per share** declared in May[41](index=41&type=chunk)[100](index=100&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net sales grew 8.3% to $12.3 billion, with operating margin improving to 1.64% despite lower gross margin [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Sales growth was driven by Asia-Pacific and North America, while operating margin improved on cost control Net Sales by Region | Region | Net Sales Q1 2025 ($M) | YoY % Change | | :--- | :--- | :--- | | North America | 4,434.6 | 9.8% | | EMEA | 3,424.7 | 0.6% | | Asia-Pacific | 3,618.2 | 20.1% | | Latin America | 803.4 | (8.5)% | | **Total** | **12,280.8** | **8.3%** | - **Gross margin decreased by 62 basis points** YoY, driven by a shift in product and geographic mix towards lower-margin categories[120](index=120&type=chunk) - **Operating income margin increased by 14 basis points** YoY to 1.64%, primarily due to lower SG&A expenses and reduced restructuring costs[121](index=121&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk) - **Asia-Pacific operating margin decreased 40 basis points** due to geographic mix, a higher concentration of mobility sales, and a competitive market in India[126](index=126&type=chunk) [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) The company ended Q1 with $881.6 million in cash after increased working capital investment and debt repayment Key Liquidity Metrics | Metric | March 29, 2025 ($ thousands) | December 28, 2024 ($ thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | 881,637 | 918,401 | | Working Capital Dollars | 4,312,934 | 4,142,013 | - Cash used in operating activities was **$200.4 million** in Q1 2025, primarily reflecting investment in working capital, particularly inventory[135](index=135&type=chunk) - Financing activities provided net cash of **$96.8 million**, driven by net proceeds from credit facilities, partially offset by a **$125 million** term loan repayment[137](index=137&type=chunk) - The company has total financing capacity of approximately **$7.5 billion**, of which **$3.5 billion** was outstanding at quarter-end[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages foreign currency and interest rate risks, with key interest rate cap agreements expiring - The Value-at-Risk (VaR) for foreign exchange risk indicates a maximum potential one-day loss of **$2.42 million** as of March 29, 2025[158](index=158&type=chunk) - A **1% change in interest rates** would impact annual interest expense by approximately **$8.2 million** on variable-rate debt[159](index=159&type=chunk) - **Interest rate cap agreements** used to mitigate risk on the Term Loan Credit Facility expired on March 31, 2025, and have not been renewed[160](index=160&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were deemed not effective due to previously disclosed material weaknesses - Management concluded that disclosure controls and procedures were **not effective** as of March 29, 2025[161](index=161&type=chunk) - The ineffectiveness is due to previously identified material weaknesses in the **risk assessment process** and controls over **software license accounting**[163](index=163&type=chunk) - A remediation plan is ongoing, but **no material changes** to internal controls were made during the quarter[165](index=165&type=chunk)[166](index=166&type=chunk) Part II. Other Information [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates information on legal matters from Note 10 of the financial statements - Information on legal proceedings is incorporated by reference from **Note 10, 'Commitments and Contingencies'**[167](index=167&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors from its latest Annual Report - There have been **no material changes** to risk factors since the last Annual Report[168](index=168&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - **None reported** for the period[169](index=169&type=chunk) [Defaults Upon Senior Securities](index=43&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - **None reported**[170](index=170&type=chunk) [Mine Safety Disclosures](index=43&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - **Not applicable**[171](index=171&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No director or executive officer trading arrangements were adopted, modified, or terminated during the quarter - No director or executive officer trading plans (Rule 10b5-1) were **adopted, modified, or terminated** in Q1 2025[172](index=172&type=chunk) [Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including required certifications and data files - Lists filed exhibits, including **CEO/CFO certifications** and XBRL data[173](index=173&type=chunk)

[First Quarter 2025 Financial Highlights](index=1&type=section&id=Ingram%20Micro%20Reports%20Fiscal%20First%20Quarter%202025%20Financial%20Results) [Overview & Management Commentary](index=1&type=section&id=1.1%20Overview%20%26%20Management%20Commentary) Ingram Micro reported strong Q1 2025 results with **$12.3 billion** net sales and **$0.61** non-GAAP EPS, reflecting strategic execution Q1 2025 Performance vs. Guidance | Metric | Actual Result | Guidance Range | | :--- | :--- | :--- | | Net Sales (Millions) | $12,281 | $11,425 - $11,825 | | Gross Profit (Millions) | $828.8 | $785 - $835 | | Non-GAAP Diluted EPS ($) | $0.61 | $0.51 - $0.61 | - Management attributes the strong performance to proven execution during market volatility and targeted investments in automation and the AI-powered Xvantage platform[2](index=2&type=chunk) - The company repaid an incremental **$125 million** of its term loan during the quarter[3](index=3&type=chunk) - The quarterly dividend was increased by **2.7%** to **$0.076** per share[3](index=3&type=chunk) [Consolidated Financial Results](index=2&type=section&id=1.2%20Consolidated%20Fiscal%20First%20Quarter%202025%20Financial%20Highlights) Consolidated net sales rose **8.3%** to **$12.3 billion**, with gross margin declining to **6.75%** but operating income increasing to **$200.9 million** Consolidated Financials (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales (Millions) | $12,280.8 | $11,334.9 | +8.3% | | Gross Profit (Millions) | $828.8 | $834.9 | -0.7% | | Gross Margin (%) | 6.75% | 7.37% | -62 bps | | Income from Operations (Millions) | $200.9 | $170.1 | +18.1% | | Net Income (Millions) | $69.2 | $49.6 | +39.5% | | Non-GAAP Net Income (Millions) | $144.2 | $135.2 | +6.6% | | Diluted EPS ($) | $0.29 | $0.22 | +31.8% | | Non-GAAP Diluted EPS ($) | $0.61 | $0.61 | 0.0% | - The year-over-year decrease in gross margin was driven by a sales mix shift towards lower-margin client/endpoint solutions, large enterprise customers, and the lower-margin Asia-Pacific region[5](index=5&type=chunk) - Foreign currency translation had a negative impact of approximately **2.4%** on the year-over-year net sales comparison[5](index=5&type=chunk) - Cash used in operations was **$200.4 million**, compared to **$100.3 million** in the prior year, partly due to a strategic investment in inventory ahead of potential cost increases[6](index=6&type=chunk) [Regional Performance](index=3&type=section&id=Regional%20Fiscal%20First%20Quarter%202025%20Financial%20Highlights) [North America](index=3&type=section&id=2.1%20North%20America) North America net sales grew **9.8%** to **$4.4 billion**, with operating income increasing to **$84.4 million** and margin improving to **1.90%** North America Performance (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales (Billions) | $4.4 | $4.0 | | Income from Operations (Millions) | $84.4 | $59.9 | | Operating Margin (%) | 1.90% | 1.48% | - Sales growth was driven by client and endpoint solutions (PCs, tablets) and advanced solutions (server, infrastructure software, cybersecurity), as well as cloud-based solutions[7](index=7&type=chunk) [EMEA](index=3&type=section&id=2.2%20EMEA) EMEA net sales increased **0.6%** to **$3.4 billion**, with operating income rising to **$57.3 million** and margin improving to **1.67%** EMEA Performance (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales (Billions) | $3.4 | $3.4 | | Income from Operations (Millions) | $57.3 | $49.0 | | Operating Margin (%) | 1.67% | 1.44% | - Foreign currency translation had an approximate **2%** negative impact on year-over-year net sales[9](index=9&type=chunk) [Asia-Pacific](index=3&type=section&id=2.3%20Asia-Pacific) Asia-Pacific net sales grew **20.1%** to **$3.6 billion**, but operating income declined to **$46.3 million** due to mix shift and competition Asia-Pacific Performance (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales (Billions) | $3.6 | $3.0 | | Income from Operations (Millions) | $46.3 | $50.6 | | Operating Margin (%) | 1.28% | 1.68% | - The decrease in operating margin was primarily due to a mix shift towards the lower-margin China market, a higher concentration of mobility sales, and a competitive market in India[12](index=12&type=chunk) [Latin America](index=4&type=section&id=2.4%20Latin%20America) Latin America net sales decreased **8.5%** to **$0.8 billion** due to currency, while operating income remained stable at **$23.0 million** Latin America Performance (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales (Billions) | $0.8 | $0.9 | | Income from Operations (Millions) | $23.0 | $24.5 | | Operating Margin (%) | 2.86% | 2.78% | - The **8.5%** decrease in net sales was primarily driven by an **8.2%** negative impact from currency translation rates[13](index=13&type=chunk) [Business Outlook and Shareholder Returns](index=4&type=section&id=Business%20Outlook%20and%20Shareholder%20Returns) [Fiscal Second Quarter 2025 Outlook](index=4&type=section&id=3.1%20Fiscal%20Second%20Quarter%202025%20Outlook) Q2 2025 outlook projects net sales between **$11.765 billion** and **$12.165 billion**, with non-GAAP diluted EPS between **$0.53** and **$0.63** Q2 2025 Guidance | Metric | Low | High | | :--- | :--- | :--- | | Net sales (Millions) | $11,765 | $12,165 | | Gross profit (Millions) | $800 | $850 | | Non-GAAP Diluted EPS ($) | $0.53 | $0.63 | - The Q2 2025 guidance assumes an effective non-GAAP tax rate of approximately **29%** and **235.2 million** diluted shares outstanding[16](index=16&type=chunk) [Dividend](index=4&type=section&id=3.2%20Dividend) The board approved a **2.7%** increase in quarterly cash dividend to **$0.076** per share, payable June 3, 2025 - The Board of Directors declared a cash dividend of **$0.076** per share, a **2.7%** increase from the prior quarterly dividend of **$0.074**[17](index=17&type=chunk) - The dividend is payable on June 3, 2025, to stockholders of record as of May 20, 2025[17](index=17&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) [Condensed Consolidated Balance Sheets](index=7&type=section&id=4.1%20Condensed%20Consolidated%20Balance%20Sheets) Total assets were **$18.63 billion** as of March 29, 2025, with liabilities decreasing to **$14.77 billion** and equity increasing to **$3.86 billion** Key Balance Sheet Items | Account | March 29, 2025 (Thousands) | December 28, 2024 (Thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $881,637 | $918,401 | | Inventory | $5,036,283 | $4,699,483 | | Total current assets | $15,648,116 | $15,801,177 | | Total assets | $18,628,470 | $18,779,690 | | Accounts payable | $9,616,860 | $10,005,824 | | Long-term debt | $3,031,637 | $3,168,280 | | Total liabilities | $14,765,767 | $15,045,815 | | Total stockholders' equity | $3,862,703 | $3,733,875 | [Condensed Consolidated Statements of Income](index=8&type=section&id=4.2%20Condensed%20Consolidated%20Statements%20of%20Income) Net sales reached **$12.28 billion**, with gross profit at **$828.8 million**; operating income rose to **$200.9 million**, and net income increased **39.5%** Income Statement Summary (Thirteen Weeks Ended) | Account | March 29, 2025 (Thousands) | March 30, 2024 (Thousands) | | :--- | :--- | :--- | | Net sales | $12,280,843 | $11,334,934 | | Gross profit | $828,762 | $834,938 | | Income from operations | $200,864 | $170,121 | | Income before income taxes | $100,403 | $76,681 | | Net income | $69,189 | $49,552 | | Diluted earnings per share ($) | $0.29 | $0.22 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=4.3%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash used in operations was **$200.4 million**, primarily due to working capital changes, while financing activities provided **$96.8 million** Cash Flow Summary (Thirteen Weeks Ended) | Activity | March 29, 2025 (Thousands) | March 30, 2024 (Thousands) | | :--- | :--- | :--- | | Cash used in operating activities | ($200,430) | ($100,266) | | Cash provided by investing activities | $58,291 | $24,107 | | Cash provided by financing activities | $96,759 | $3,516 | | Decrease in cash and cash equivalents | ($36,764) | ($90,913) | - Key financing activities included a **$125 million** repayment of Term Loans and paying **$17.4 million** in dividends[32](index=32&type=chunk) [Supplemental Information](index=10&type=section&id=Supplemental%20Information) [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=5.1%20Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP to non-GAAP financial measures, showing adjustments for items like amortization and restructuring costs Reconciliation of Net Income to Non-GAAP Net Income (Q1 2025) | Description | Amount (Thousands) | | :--- | :--- | | **Net income (GAAP)** | **$69,189** | | Amortization of intangibles | $21,430 | | Restructuring costs | $1,933 | | Net foreign currency exchange loss | $23,717 | | Integration, transition and operational improvement costs | $34,083 | | Other adjustments (compensation, etc.) | $19,582 | | Tax impact of adjustments | ($25,754) | | **Non-GAAP Net Income** | **$144,180** | Reconciliation of GAAP EPS to Non-GAAP EPS (Q1 2025) | Description | Per Share Amount ($) | | :--- | :--- | | **Diluted EPS (GAAP)** | **$0.29** | | Amortization of intangibles | $0.09 | | Restructuring costs | $0.01 | | Net foreign currency exchange loss | $0.10 | | Integration, transition and operational improvement costs | $0.15 | | Other adjustments (compensation, etc.) | $0.08 | | Tax impact of adjustments | ($0.11) | | **Non-GAAP Diluted EPS** | **$0.61** | - The company states it is unable to provide a reconciliation for its forward-looking non-GAAP EPS guidance because certain items are difficult to predict and estimate[41](index=41&type=chunk)

Core Insights - Kirby McInerney LLP is investigating potential claims against Ingram Micro Holding Corporation regarding possible violations of federal securities laws and unlawful business practices [1] Financial Performance - Ingram conducted its initial public offering on October 24, 2024, with shares priced at $22.00 each [3] - On March 4, 2025, Ingram reported its fourth quarter and full year 2024 financial results, indicating a material impact from two charges exceeding $20 million, including over $9 million for inventory write-offs [4] - Following the financial results announcement, Ingram's share price fell by $1.16, closing at $19.82 on March 5, 2025, down from $20.98 the previous day [4]

Part I [Business Overview](index=5&type=section&id=Item%201.%20Business) Ingram Micro is a global IT solutions provider focused on digital transformation, emerging technologies, and operational efficiency, with international operations generating **66% of FY2024 net sales** - Ingram Micro is a leading global IT solutions provider with four reportable geographic segments: North America, EMEA, Asia-Pacific, and Latin America[22](index=22&type=chunk) - The company's strategic priorities focus on digital transformation through its Xvantage platform, growth in emerging technologies like cybersecurity and AI, and enhancing profitability via operational improvements and automation[26](index=26&type=chunk) - International operations are a significant part of the business, generating approximately **66% of consolidated net sales** in Fiscal Year 2024[38](index=38&type=chunk) Key Supplier Concentration (FY2024) | Vendor | Percentage of Consolidated Net Sales | | :--- | :--- | | Apple Inc. | ~19% | | HP Inc. | ~10% | - As of December 28, 2024, the company had approximately **23,500 full-time associates** and utilized about **5,250 temporary workers**[44](index=44&type=chunk) [Risk Factors](index=12&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks from internal control weaknesses, Xvantage platform development, substantial indebtedness, geopolitical tensions, and the influence of its controlling shareholder - The company has identified **material weaknesses in its internal control over financial reporting**, which could adversely affect investor confidence and the stock price[59](index=59&type=chunk)[191](index=191&type=chunk) - Significant resources are being invested in the Ingram Micro Xvantage digital platform; its success is critical, and failure could adversely impact the business[61](index=61&type=chunk) - The company's **substantial indebtedness** requires a significant portion of cash flows for debt service, potentially limiting operational funding and strategic acquisitions[127](index=127&type=chunk)[128](index=128&type=chunk) - Platinum Equity controls approximately **90% of the voting power**, making Ingram Micro a "controlled company" exempt from certain NYSE corporate governance requirements, which may create conflicts of interest[180](index=180&type=chunk)[183](index=183&type=chunk) - The business is exposed to geopolitical risks, including U.S.-China trade tensions and tariffs, which could increase product prices and impact demand; net sales in China were **$4.0 billion** in Fiscal Year 2024[97](index=97&type=chunk)[110](index=110&type=chunk) [Cybersecurity](index=48&type=section&id=Item%201C.%20Cybersecurity) The company maintains a formal data protection program aligned with NIST and ISO 27001, overseen by the board and Audit Committee, with no material cybersecurity incidents reported - The company has a formal data protection program based on the NIST Cybersecurity Framework and ISO 27001, which is regularly reviewed and audited[218](index=218&type=chunk) - Cybersecurity governance includes oversight from the full board of directors and the Audit Committee, with a CISO leading the program and reporting directly to the board as needed[223](index=223&type=chunk) - No cybersecurity threats or incidents, individually or in aggregate, have materially affected the company during the periods covered by this report[222](index=222&type=chunk) [Properties](index=49&type=section&id=Item%202.%20Properties) The company occupies **281 facilities globally**, totaling **12.6 million square feet**, primarily leased, with its corporate headquarters in Irvine, California - The company occupies **281 facilities** totaling **12.6 million square feet**, with the vast majority being leased[223](index=223&type=chunk) - Facilities are distributed across its geographic regions: North America (**35**), EMEA (**98**), Asia-Pacific (**116**), and Latin America (**32**)[223](index=223&type=chunk) [Legal Proceedings](index=49&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in routine legal proceedings, none of which are expected to have a material adverse effect beyond financial statement disclosures - The company is involved in routine legal proceedings but does not expect them to have a material adverse effect, beyond what is disclosed in the financial statement notes[225](index=225&type=chunk) Part II [Market for Common Equity and Related Matters](index=50&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Ingram Micro's common stock began trading on the NYSE in October 2024, with its IPO raising **$233.1 million** for debt repayment and a **$0.074 per share** quarterly dividend declared - The company's common stock began trading on the NYSE under the symbol "INGM" on **October 24, 2024**[227](index=227&type=chunk)[228](index=228&type=chunk) - On **March 4, 2025**, the board declared a quarterly cash dividend of **$0.074 per share**[231](index=231&type=chunk) - Net proceeds from the October 2024 IPO were approximately **$233.1 million**, which were used to repay **$233.1 million** of debt outstanding under the Term Loan Credit Facility[234](index=234&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=52&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) FY2024 consolidated net sales were **$48.0 billion**, a **0.1% decrease**, with gross margin declining to **7.18%** and income from operations falling to **$817.9 million**, while cash from operations significantly increased to **$333.8 million** [Results of Operations](index=57&type=section&id=Results%20of%20Operations) FY2024 net sales decreased to **$48.0 billion**, with gross margin declining to **7.18%** and income from operations falling to **$817.9 million**, primarily due to mix shifts and higher restructuring costs Consolidated Financial Performance (FY2024 vs. FY2023) | Metric | Fiscal Year 2024 | Fiscal Year 2023 | Change | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $47,983.7M | $48,040.4M | ($56.7M) | (0.1)% | | Gross Profit | $3,444.9M | $3,547.1M | ($102.2M) | (2.9)% | | Gross Margin | 7.18% | 7.38% | (20 bps) | N/A | | Income from Operations | $817.9M | $944.3M | ($126.4M) | (13.4)% | | Operating Margin | 1.70% | 1.97% | (27 bps) | N/A | | Net Income | $264.2M | $352.7M | ($88.5M) | (25.1)% | Net Sales by Segment (FY2024 vs. FY2023) | Segment | FY2024 Sales | FY2023 Sales | Change (%) | | :--- | :--- | :--- | :--- | | North America | $17,373.0M | $18,195.7M | (4.5)% | | EMEA | $14,260.3M | $14,481.1M | (1.5)% | | Asia-Pacific | $12,756.8M | $11,573.5M | 10.2% | | Latin America | $3,593.6M | $3,790.2M | (5.2)% | - The decrease in gross margin was driven by a sales mix shift from higher-margin advanced solutions to lower-margin client and endpoint solutions, particularly in North America and EMEA, and a geographic shift towards the lower-margin Asia-Pacific region[276](index=276&type=chunk) - Restructuring costs increased to **$38.4 million** in FY2024 from **$18.8 million** in FY2023, related to efforts to enhance organizational efficiency[278](index=278&type=chunk) [Liquidity and Capital Resources](index=62&type=section&id=Liquidity%20and%20Capital%20Resources) FY2024 cash from operations significantly increased to **$333.8 million**, total debt decreased to **$3.35 billion**, and the company maintained strong liquidity with a **$3.5 billion** undrawn ABL facility Cash Flow Summary (FY2024 vs. FY2023) | Cash Flow Activity | Fiscal Year 2024 | Fiscal Year 2023 | | :--- | :--- | :--- | | Operating Activities | $333.8M | $58.8M | | Investing Activities | $105.5M | ($17.7M) | | Financing Activities | ($391.3M) | ($477.9M) | - Total debt was **$3.35 billion** as of December 28, 2024, down from **$3.92 billion** at the end of the prior year[452](index=452&type=chunk) - The company has a **$3.5 billion** ABL Revolving Credit Facility, which was undrawn as of December 28, 2024, with its maturity extended to September 2029[301](index=301&type=chunk)[456](index=456&type=chunk) - As of December 28, 2024, cash and cash equivalents totaled **$918.4 million**, with approximately **93%** residing in operations outside of the United States[295](index=295&type=chunk) [Critical Accounting Estimates](index=65&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates involve significant judgments in revenue recognition, inventory valuation, business combinations, goodwill impairment, and income tax estimations - Key critical accounting estimates include revenue recognition, inventory valuation, business combinations, goodwill impairment, and income taxes[311](index=311&type=chunk)[312](index=312&type=chunk) - Revenue is recognized when control of products transfers to customers, with service revenues, including from the CloudBlue platform, representing less than **10% of total net sales**[314](index=314&type=chunk)[315](index=315&type=chunk) - Goodwill is tested for impairment annually in the fourth quarter, with no impairment charges recorded in FY2024 or FY2023[322](index=322&type=chunk)[324](index=324&type=chunk) [Market Risk Disclosures](index=68&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages foreign currency and interest rate risks through derivatives, with a VaR of **$551,000** for currency risk and a **$9.1 million to $9.3 million** impact for a 1% interest rate change - The company uses forward contracts to manage foreign currency exchange risk, with a Value-at-Risk (VaR) model estimating the maximum potential one-day loss in fair value at **$551,000** as of December 28, 2024[331](index=331&type=chunk)[332](index=332&type=chunk) - A hypothetical **1% change in interest rates** would impact annual interest expense by approximately **$9.1 million to $9.3 million** due to variable-rate debt exposure[333](index=333&type=chunk) - To mitigate interest rate risk, the company has entered into interest rate cap agreements to establish an upper limit on the SOFR interest rate for a substantial portion of its Term Loan Credit Facility borrowings[334](index=334&type=chunk) [Financial Statements and Supplementary Data](index=70&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) Audited consolidated financial statements are presented under U.S. GAAP, with key notes detailing policies, debt, segments, and contingencies, including a disclosed fraudulent activity in India leading to Q1 2024 revisions Consolidated Financial Highlights | (In thousands) | Dec 28, 2024 | Dec 30, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Total Current Assets | $15,801,177 | $15,354,317 | | Total Assets | $18,779,690 | $18,420,314 | | **Liabilities & Equity** | | | | Total Current Liabilities | $11,306,531 | $10,663,131 | | Total Liabilities | $15,045,815 | $14,914,025 | | Total Stockholders' Equity | $3,733,875 | $3,506,289 | - Note 17 discloses fraudulent activity within the India Professional Services business, which resulted in misstatements of net sales, cost of sales, and other accounts, leading to a revision of the Q1 2024 statements[538](index=538&type=chunk)[539](index=539&type=chunk) - Note 8 details restructuring costs of **$38.4 million** in FY2024, primarily for employee termination benefits related to headcount reductions aimed at enhancing organizational efficiency[479](index=479&type=chunk)[480](index=480&type=chunk) - Note 9 outlines significant contingent liabilities, including tax assessments in Brazil totaling a reasonably possible loss of **R$843 million ($136 million)** and a tax assessment in Saudi Arabia with a reasonably possible loss of **SAR 160 million ($42.6 million)**[485](index=485&type=chunk)[490](index=490&type=chunk) [Controls and Procedures](index=114&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of December 28, 2024, due to two material weaknesses in internal control over financial reporting, with a remediation plan underway - Management identified **two material weaknesses** in internal control over financial reporting as of December 28, 2024[558](index=558&type=chunk) - The weaknesses are: 1) an ineffective risk assessment process for evolving business areas, and 2) inadequate controls for identifying and accounting for multi-period software license agreements[558](index=558&type=chunk) - Due to these material weaknesses, the principal executive and financial officers concluded that disclosure controls and procedures were not effective[555](index=555&type=chunk) - A remediation plan is underway, involving policy revisions and additional training, to address the identified weaknesses[560](index=560&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=116&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The company's leadership includes CEO Paul Bay, with Platinum Equity's majority ownership classifying it as a "controlled company" and exempting it from certain NYSE governance requirements - The company's leadership includes CEO Paul Bay and Chairperson of the Board Alain Monié[566](index=566&type=chunk) - Ingram Micro is a "controlled company" under NYSE rules because Platinum Equity holds a majority of the voting power, exempting it from certain governance requirements[607](index=607&type=chunk)[613](index=613&type=chunk) - The board has determined that directors Felicia Alvaro, Jakki Haussler, Leslie Heisz, and Sharon Wienbar are independent[608](index=608&type=chunk) [Executive Compensation](index=126&type=section&id=Item%2011.%20Executive%20Compensation) FY2024 executive compensation was performance-based, with the EIP funded at **74.19% of target**, and new equity awards granted under the 2024 Stock Incentive Plan following the IPO NEO Summary Compensation (FY2024) | Name | Position | Total Compensation ($) | | :--- | :--- | :--- | | Paul Bay | CEO | 17,463,003 | | Michael Zilis | CFO | 12,235,825 | | Scott Sherman | EVP, Human Resources | 8,687,935 | | Augusto Aragone | EVP, Secretary & General Counsel | 7,934,258 | | Alain Monié | Former Executive Chairman | 2,377,159 | - The 2024 Annual Executive Incentive Program (EIP) was funded at **74.19% of target**, based on achieving non-GAAP EBITDAR of **$1.301 billion** against a target of **$1.410 billion**[655](index=655&type=chunk)[657](index=657&type=chunk) - In connection with the IPO, the company terminated its 2021 Participation Plan and granted new time-based (RSUs) and performance-based (PSUs) restricted stock units under the new 2024 Stock Incentive Plan[637](index=637&type=chunk)[662](index=662&type=chunk) - The company maintains an Executive Change in Control Severance Plan with "double-trigger" benefits and an Executive Officer Severance Policy for terminations without cause outside of a change-in-control context[674](index=674&type=chunk)[678](index=678&type=chunk) [Security Ownership](index=151&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of February 25, 2025, Platinum Equity, LLC affiliates beneficially owned **89.8%** of the company's common stock, while executive officers and directors as a group owned less than **1%** - As of February 25, 2025, investment vehicles affiliated with Platinum Equity, LLC beneficially own **210,952,854 shares**, representing **89.8%** of the company's common stock[722](index=722&type=chunk)[725](index=725&type=chunk) - All executive officers and directors as a group beneficially own **2,045,955 shares**, representing less than **1%** of the class[722](index=722&type=chunk) - Under the 2024 Stock Incentive Plan, **3,601,768 securities** are to be issued upon vesting of outstanding awards, and **15,920,477 securities** remain available for future issuance as of December 28, 2024[723](index=723&type=chunk) [Related Party Transactions](index=153&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The company has key agreements with controlling stockholder Platinum Equity, including an Investor Rights Agreement and a terminated Corporate Advisory Services Agreement, with related party transactions reviewed by the Audit Committee - The company has an Investor Rights Agreement with Platinum, granting it the right to nominate a majority of the board of directors as long as it owns at least **50%** of the stock[726](index=726&type=chunk) - A Corporate Advisory Services Agreement with Platinum Advisors was terminated upon the IPO, with the company paying **$20.4 million** in fees under this agreement in Fiscal Year 2024[728](index=728&type=chunk) - The company has adopted a written policy requiring the Audit Committee to review and approve or ratify related person transactions[735](index=735&type=chunk) [Principal Accountant Fees and Services](index=155&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) PricewaterhouseCoopers LLP billed **$16.8 million** in total fees for FY2024, a significant increase driven by **$15.3 million** in audit fees related to IPO and registration services Accountant Fees (FY2024 vs. FY2023) | Service Type | 2024 Fees | 2023 Fees | | :--- | :--- | :--- | | Audit | $15,305,635 | $9,539,540 | | Audit-Related | $250,000 | $143,505 | | Tax | $1,246,644 | $1,381,428 | | **Total** | **$16,802,279** | **$11,064,473** | - The Audit Committee has established policies for pre-approving all audit and non-audit services provided by the independent accounting firm[740](index=740&type=chunk)

Financial Data and Key Metrics Changes - In Q4 2024, the company achieved a year-over-year top-line growth of nearly 3.5% on an FX-neutral basis, with net sales of $13.34 billion, up 2.5% year-over-year in US dollars [6][32] - Full-year 2024 net sales were $48.0 billion, roughly flat versus 2023, and up 0.3% on an FX-neutral basis [25] - Non-GAAP net income for Q4 was $113.1 million, compared to $220.9 million in the same period last year, with non-GAAP diluted EPS at $0.92 [41][42] Business Line Data and Key Metrics Changes - Client and endpoint solutions saw growth both year-over-year and quarter-over-quarter, while Advanced Solutions was impacted by slowness in networking [7][9] - Advanced Solutions experienced solid momentum in server and storage, but networking remained soft [32] - The company recorded restructuring costs equaling 8 basis points of net sales in 2024, reflecting efforts to enhance organizational efficiency [28] Market Data and Key Metrics Changes - North America net sales were $4.767 billion, up 3.0% in US dollars, driven by strength across all lines of business [35] - EMEA net sales were down 1.5% year-over-year, primarily due to weakness in advanced solutions [36] - Asia Pacific net sales were $3.60 billion, up 7.8% year-over-year, driven by strength in client endpoint solutions [36] Company Strategy and Development Direction - The company aims to be a leader in digital transformation, focusing on high-margin and complex solutions in advanced solutions and cloud businesses [19][20] - Continued investment in the Xvantage platform, which has been rolled out in 16 countries, is a key part of the strategy to enhance customer experience and operational efficiency [13][14] - The company is committed to driving quality of revenue and optimizing working capital while achieving operational excellence [22][51] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining top-line growth in 2025, despite challenges in certain markets like India [22][47] - The company noted a competitive environment impacting margins, particularly in India, but remains focused on profitable growth [49][50] - Management highlighted the importance of adapting to macroeconomic conditions and maintaining a strong balance sheet [43][46] Other Important Information - The company plans to pay a quarterly cash dividend of $0.074 per share in Q1 2025 [45] - The board approved a one-year share repurchase plan for up to $75 million of common stock [45] - The company has repaid $483 million of its term loan balance in 2024, with a total repayment of $1.56 billion since early 2022 [46] Q&A Session Summary Question: What is driving the momentum in large enterprise sales? - Management indicated that growth in large enterprise sales was observed across all regions, not just North America, with a notable refresh cycle in notebooks and desktops [55][56] Question: What gives confidence for top-line growth in 2025? - Management cited strong momentum in endpoint solutions and signs of recovery in networking, along with positive indicators from large vendors [64][65] Question: Are there any one-time costs affecting Q1 profitability guidance? - Management clarified that the guidance reflects margin factors, particularly competitive pressures in India, rather than notable one-time costs [67][69] Question: How is the company addressing the competitive pricing environment in India? - Management emphasized a focus on quality of revenue and selective participation in deals that meet profitability expectations [101][106] Question: What is the outlook for the SMB market? - Management noted that the SMB market was down but expected a recovery as advanced solutions and networking improve [114][115] Question: What is the status of the public sector business? - Management indicated that public sector sales were down globally but expected a return to growth as conditions stabilize [123][124] Question: How is working capital expected to be managed in Q1? - Management highlighted a seasonal pattern in working capital, with a focus on collections from Q4 sales and maintaining free cash flow [125][128]

Financial Performance - Fourth quarter net sales reached $13.3 billion, a 2.5% increase year-over-year, with a 3.3% increase on an FX neutral basis[3] - Fourth quarter net income was $83.1 million, with non-GAAP net income of $213.1 million, resulting in diluted EPS of $0.36 and non-GAAP diluted EPS of $0.92[3] - Full year net sales totaled $48.0 billion, a slight decrease of 0.1% from the prior fiscal year, impacted by foreign currency translation[20] - Net sales for fiscal year 2024 were $47,983,671, a decrease of 2.2% compared to $48,040,364 in 2023[45] - Net income for fiscal year 2024 was $264,222, a decline of 25% from $352,712 in 2023[45] - Basic and diluted earnings per share for fiscal year 2024 were both $1.18, compared to $1.59 in 2023, representing a decrease of 26%[45] - The company reported a net income of $83,116,000 for the thirteen weeks ended December 28, 2024, down from $136,524,000 in the same period of 2023[55] Cash Flow and Capital Expenditures - Full year adjusted free cash flow was $443.3 million, with cash provided by operations totaling $333.8 million[3] - Cash provided by operations increased significantly to $333.8 million from $58.8 million in the prior fiscal year[25] - Capital expenditures for fiscal year 2024 were $142,703, down from $201,535 in 2023[48] - Capital expenditures for the fiscal year ended December 28, 2024, were $142,703,000, compared to $201,535,000 in 2023[57] Profitability Metrics - Gross profit for the fourth quarter was $936.1 million, with a gross margin of 7.01%, down from 7.52% in the prior year[6] - Income from operations for the fourth quarter was $248.5 million, with an income from operations margin of 1.86%, down from 2.54% in the prior year[6] - Adjusted EBITDA for the fourth quarter was $418.1 million, compared to $435.4 million in the prior year[6] - Adjusted EBITDA was $1,318.6 million, down from $1,353.1 million in the prior year[25] - Income from operations margin decreased to 1.70% from 1.97% in the prior fiscal year, primarily due to a shift towards lower-margin solutions[25] - Adjusted EBITDA for the fiscal year ended December 28, 2024, was $1,318,634,000, down 2.5% from $1,353,092,000 in the previous year[52] Regional Sales Performance - North America net sales increased to $4.7 billion, driven by strength in PCs, server, and storage, while EMEA net sales decreased by 1.5% to $4.1 billion[7][10] - Asia-Pacific net sales increased to $12.8 billion from $11.6 billion year-over-year, driven by growth in smartphones and consumer electronics[25] - Latin America net sales decreased to $3.6 billion from $3.8 billion, impacted by declines in advanced solutions[28] - Income from operations margin in Latin America improved to 3.33% from 2.47% due to stronger gross margins and effective expense management[30] Shareholder Returns - The company declared a cash dividend of $0.074 per share, payable on March 25, 2025[3] - A share repurchase plan of up to $75 million has been approved, expiring on February 26, 2026[33] Guidance and Future Outlook - Fiscal first quarter 2025 guidance for net sales is projected between $11,425 million and $11,825 million, with non-GAAP diluted EPS guidance of $0.51 to $0.61[31] - The company plans to focus on restructuring costs and integration initiatives to align its cost structure in certain markets moving forward[50] - The company is unable to provide a reconciliation of forward-looking GAAP diluted EPS to non-GAAP diluted EPS for fiscal first quarter 2025 due to unpredictability of certain information[60] - The forward-looking estimates of both GAAP and non-GAAP measures may differ materially from actual results, indicating potential volatility in future financial performance[60] Restructuring and Costs - The company incurred restructuring costs of $38,354,000 for the fiscal year ended December 28, 2024, compared to $18,797,000 in 2023[52] - Integration, transition, and operational improvement costs contributed $0.26 to GAAP EPS for the thirteen weeks ended December 28, 2024[58] - Tax impact of pre-tax adjustments reduced EPS by $0.14 for the thirteen weeks ended December 28, 2024[58] Foreign Currency Impact - The company reported a net foreign currency exchange loss of $22,901 in fiscal year 2024, compared to a loss of $42,070 in 2023[45] - The company reported a net foreign currency exchange loss of $0.03 for the thirteen weeks ended December 28, 2024[58]

Group 1 - Henson Group has been awarded the Ingram Micro Managed Services Provider of the Year at the 2024 Ingram Micro ONE Innovation Summit for its exceptional expertise and innovation across multiple solution areas [1][3] - The award recognizes Henson Group's commitment to customer satisfaction and its role as an industry leader in providing cloud solutions [3][5] - Henson Group serves various industries, including financial services, retail, manufacturing, healthcare, and technology, and has helped over 1,000 companies [5][6] Group 2 - The company offers comprehensive cloud solutions, including Azure Spend Management, Azure Environment Monitoring & Tuning, and Azure Optimization [4][8] - Henson Group is a six-time Microsoft Partner of the Year and holds multiple Microsoft-certified competencies, including the exclusive Azure Expert MSP certification [6][8] - The leadership team emphasizes the importance of strong partnerships and the relentless pursuit of excellence in delivering cloud solutions that drive significant value for clients [6][8]

Core Insights - Ingram Micro (NYSE: INGM) is a recent IPO that has not received significant attention but possesses substantial scale and free cash flow generation capabilities [1] - The company plays an essential role in the tech service industry and has a resilient working capital model, particularly in adverse macroeconomic conditions [1] Company Overview - Ingram Micro has a strong position in the tech service industry, indicating its importance in the supply chain and technology distribution [1] - The company’s ability to generate free cash flow is a key strength, suggesting financial stability and potential for reinvestment or shareholder returns [1] Market Position - The working capital model of Ingram Micro is highlighted as particularly resilient, which may provide a competitive advantage during economic downturns [1] - The company’s scale allows it to navigate challenges in the tech service sector effectively [1]

Financial Data and Key Metrics Changes - In Q3 2024, the company reported net sales of $11.76 billion, a decrease of 1.4% year-over-year, primarily due to lower sales in North America and Latin America, partially offset by growth in Asia-Pacific [17][22] - Gross profit was $845.5 million, representing 7.19% of net sales, an increase of 2 basis points from the previous year, driven by a shift towards higher-margin cloud-based solutions [26] - Non-GAAP net income for the quarter was $159.2 million, compared to $148.6 million in the same period last year, with Q3 non-GAAP diluted EPS at $0.72 [32] Business Line Data and Key Metrics Changes - Client and endpoint solutions and advanced solutions faced macro headwinds, while cloud and other categories experienced double-digit growth [20][21] - The cloud segment has grown to a double-digit share of global gross profit, indicating a strategic shift towards higher-margin products [19] Market Data and Key Metrics Changes - North America net sales were $4.3 billion, down from $4.6 billion year-over-year, primarily due to declines in client and endpoint solutions [22] - EMEA net sales totaled $3.5 billion, a slight decrease of 0.1% year-over-year, while Asia-Pacific net sales increased by 8.8% to $3.2 billion, driven by strong growth in mobility distribution [24] Company Strategy and Development Direction - The company aims to transform into a platform company, focusing on customer-centric solutions and leveraging investments in AI and cloud technologies [9][10] - A significant investment of over $600 million has been made in the cloud business and marketplace over the past decade, alongside more than 40 acquisitions to enhance technical resources and market expertise [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the stabilization of the IT market, anticipating a rebound in PC and networking spending in 2025 [38] - The company forecasts Q4 2024 net sales in the range of $13.0 billion to $13.5 billion, representing approximately 2% year-over-year growth at the midpoint [39] Other Important Information - Adjusted free cash flow was negative $254.6 million for the quarter, typical for Q3 due to inventory investments for seasonal sales [35] - The company plans to initiate a quarterly cash dividend beginning in Q1 2025, reflecting confidence in financial stability [36] Q&A Session Summary Question: Expectations for a rebound in PC spend and networking in 2025 - Management noted that networking is expected to improve, and the PC refresh cycle has shown consistent improvement throughout the year [44][45] Question: Thoughts on product mix for Q4 and 2025 - Management indicated that while advanced solutions faced headwinds, they expect growth in servers, storage, and cybersecurity, with cloud continuing to show good growth [48][49] Question: Update on geographic expansion since becoming a public company - The company has focused on extending geographic reach and capitalizing on scale, with significant growth in emerging markets [53][55] Question: Operating margin expectations going into 2025 - Management highlighted ongoing cost reductions and investments in growth areas, expecting continued improvement in operating margins over time [57][59] Question: Competitive pricing dynamics in the market - Management acknowledged pockets of pricing pressure but stated it is not impacting the company globally [61]