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]

Financial Performance - Net sales for the thirteen weeks ended September 28, 2024, were $11,762,628, a decrease of 1.4% compared to $11,925,373 for the same period in 2023[9] - Gross profit for the thirteen weeks ended September 28, 2024, was $845,492, down from $854,844 in the prior year, reflecting a gross margin of approximately 7.2%[9] - Net income for the thirteen weeks ended September 28, 2024, was $76,969, a decrease of 11.3% from $86,783 in the same period last year[11] - Basic and diluted earnings per share for the thirteen weeks ended September 28, 2024, were $0.35, compared to $0.39 for the same period in 2023[9] - Operating expenses for the thirteen weeks ended September 28, 2024, were $627,318, slightly up from $623,352 in the prior year[9] - Income from operations for the thirteen weeks ended September 28, 2024, was $218,174, up from $212,402 in 2023, representing a 2.0% increase[82] Equity and Liabilities - Total stockholders' equity increased to $3,613,905 as of September 28, 2024, from $3,506,289 at December 30, 2023[7] - The company reported total liabilities and stockholders' equity of $18,562,723 as of September 28, 2024, compared to $18,420,314 at December 30, 2023[7] - Total debt decreased to $3,838,451 million from $3,923,608 million, with a significant repayment of $150,000 million on the Term Loan Credit Facility[65] Cash Flow and Capital Expenditures - Cash provided by operating activities for the quarter was $23,878,000, a decrease from $59,764,000 in the prior year, indicating a decline of approximately 60%[20] - Total capital expenditures for the quarter were $106,643,000, down from $164,986,000 in the same period last year, showing a reduction of about 35%[20] - Capital expenditures for the thirteen weeks ended September 28, 2024, totaled $36,972, a decrease of 39.2% from $60,779 in the same period of 2023[82] Foreign Currency and Adjustments - The company experienced a foreign currency translation adjustment gain of $85,371 for the thirteen weeks ended September 28, 2024, compared to a loss of $107,689 in the same period last year[11] - The company reported a foreign currency translation adjustment loss of $107,689,000 for the quarter ended September 30, 2023[16] - The company recorded a net foreign currency exchange loss of $9,322 for the thirteen weeks ended September 28, 2024, compared to a loss of $10,033 for the same period in 2023[51] Tax and Legal Matters - The effective tax rate for the Thirteen Weeks Ended September 28, 2024, was 35.4%, up from 27.9% for the same period in 2023[70] - The Brazilian subsidiary faces tax assessments totaling Brazilian Reais 40,606 ($7,460) in principal and penalties, with a reasonably possible loss of Brazilian Reais 764,917 ($140,530)[75] - The company has recorded a contingent liability related to a fine of €19,500 imposed by the French Competition Authority, with approximately $20,000 already paid[75] - The company is involved in various ongoing legal claims and investigations, which may materially affect its financial condition and results of operations[73] Market Strategy and Operations - The company plans to continue expanding its market presence and integrating new technologies into its platform[5] - The company is focused on retaining key personnel and adapting to industry changes, including supply constraints in technology categories[5] - The company operates in four geographic segments: North America, EMEA, Asia-Pacific, and Latin America, with segment profit measured by income from operations[78] Shareholder Returns - The company declared dividends of $10,462,000 in the previous year, which decreased to $6,174,000 in the current year, indicating a reduction of about 41%[20] - Cash dividends paid to minority interest stockholders were $6,174 for the thirty-nine weeks ended September 28, 2024, compared to $10,462 for the same period in 2023[34] Employee Compensation and Awards - The company recognized compensation expense for cash awards amounting to $6,087 for the thirteen weeks ended September 28, 2024, compared to $6,057 for the same period in 2023[44] - As of September 28, 2024, the unrecognized compensation costs related to cash awards were $39,328, expected to be recognized over a remaining weighted-average period of approximately 1.6 years[44] - Ingram Micro reported a total of 67,598 cash awards non-vested as of December 30, 2023, with 1,895 granted and 851 vested by March 30, 2024, resulting in 67,316 non-vested awards[43] Interest Rate Exposure - Company is exposed to interest rate changes on long-term debt, with a potential annual expense increase of approximately $8,817 or decrease of $12,600 for a 1% change in interest rates[143] - Each one-eighth percentage point change in interest rates would result in a change of approximately $5,825 in annual interest expense under the Term Loan Credit Facility and ABL Credit Facilities[143] - Company aims to finance its business at competitive interest rates while moderating exposure to interest cost volatility[143] - Following the cessation of LIBOR on June 30, 2023, the company amended agreements to establish a 5.317% upper limit on SOFR interest rates[143] Miscellaneous - The company revised its cash flow statement for the thirty-nine weeks ended September 30, 2023, to correct previously identified errors[39] - The company completed an IPO on October 25, 2024, issuing 11,600,000 shares at $22.00 per share, resulting in net proceeds of approximately $233,110 after expenses[87]

Financial Performance - Net sales for the fiscal third quarter 2024 were $11.8 billion, a decrease of 1.4% compared to $11.9 billion in the prior fiscal third quarter[6]. - Gross profit was $845.5 million, down from $854.8 million in the prior fiscal third quarter, with a gross margin of 7.19%, slightly up from 7.17%[6][7]. - Net income on a GAAP basis was $77.0 million, or $0.35 per diluted share, compared to $86.8 million, or $0.39 per diluted share in the prior year[5][11]. - Non-GAAP net income was $159.2 million, or $0.72 per diluted share, compared to $148.6 million, or $0.67 per diluted share in the prior year[5][11]. - Income from operations was $218.2 million, an increase from $212.4 million in the prior fiscal third quarter, with an income from operations margin of 1.85%[9][10]. - Adjusted EBITDA was $331.6 million, compared to $314.0 million in the prior fiscal third quarter[10]. - Net income for the thirteen weeks ended September 28, 2024, was $76,969, a decrease of 11.3% from $86,783 in the prior year[34]. - Basic and diluted earnings per share for Class A and Class B shares were $0.35 for the thirteen weeks ended September 28, 2024, down from $0.39 in the same period of 2023[34]. - Adjusted Income from Operations for the thirteen weeks ended September 28, 2024, was $253,949,000, down 4.3% from $265,481,000 in the prior year[47]. - Adjusted EBITDA for the thirty-nine weeks ended September 28, 2024, was $900,573,000, down 1.9% from $917,702,000 for the same period in 2023[48]. - Adjusted net income for the thirty-nine weeks ended September 28, 2024, was $506,929,000, a decrease of 6.3% from $540,740,000 for the same period in 2023[51]. Cash Flow and Operations - Cash used in operations was $277.0 million, with adjusted free cash flow at $(254.6) million, an improvement from $(281.5) million in the prior fiscal third quarter[8]. - Year-to-date cash provided by operations was $23.9 million, with adjusted free cash flow at $106.1 million, compared to $59.8 million and $6.5 million in the same period in 2023[13]. - Cash provided by operating activities was $(277,040,000) for the thirteen weeks ended September 28, 2024, compared to $(256,008,000) for the same period in 2023[36]. - Cash and cash equivalents at the end of the period were $849,472,000, a slight decrease from $864,627,000 at the end of the same period in 2023[38]. - Cash and cash equivalents as of September 28, 2024, were $(849,472,000), slightly improved from $(864,627,000) as of September 30, 2023[49]. - Adjusted free cash flow for the thirty-nine weeks ended September 28, 2024, was $106,112,000, compared to $6,473,000 for the same period in 2023[55]. Assets and Liabilities - Total current assets increased to $15,481,854 as of September 28, 2024, compared to $15,354,317 as of December 30, 2023[32]. - Total liabilities stood at $14,948,818 as of September 28, 2024, slightly up from $14,914,025 at the end of the previous year[31]. - Retained earnings increased to $1,254,283 as of September 28, 2024, compared to $1,079,776 at the end of 2023, reflecting a growth of approximately 16.2%[33]. - The company reported a total of $2,643,807 in additional paid-in capital as of September 28, 2024, down from $2,655,776 at the end of 2023[33]. - Long-term debt as of September 28, 2024, was $3,344,033,000, a decrease from $3,619,081,000 as of September 30, 2023[49]. Future Outlook - For the fiscal fourth quarter 2024, the company expects net sales between $13.0 billion and $13.5 billion, with non-GAAP diluted EPS guidance of $0.85 to $0.98[22]. - The company provided forward-looking estimates of non-GAAP diluted EPS for fiscal Q4 2024, but cannot reconcile these to GAAP diluted EPS due to uncertainties[58]. - A one-time charge of $32.4 million ($0.14 per share) will impact GAAP diluted EPS in October 2024, related to the conversion of the participation plan to share-based compensation[58]. - The charge mentioned will be excluded from calculations of non-GAAP diluted EPS, Adjusted EBITDA, and non-GAAP net income[58]. Strategic Focus - The company is focused on expanding its technical reach and scope through its Xvantage platform, aiming for profitable growth and quality of net sales[5]. - The company continues to focus on integrating acquisitions and expanding its market presence, despite facing various risks and uncertainties[29].