TD SYNNEX Corporation (NYSE:SNX) Q3 2023 Earnings Conference Call September 26, 2023 9:00 AM ET Company Participants Rich Hume - Chief Executive Officer Marshall Witt - Chief Financial Officer Liz Morali - Head of Investor Relations Conference Call Participants Ananda Baruah - Loop Capital Michael Ng - Goldman Sachs Adam Tindle - Raymond James Keith Housum - Northcoast Research Joseph Cardoso - JP Morgan Matt Sheerin - Stifel Ruplu Bhattacharya - Bank of America George Wang - Barclays Patrick Jackson - RBC ...

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents TD SYNNEX Corporation's unaudited consolidated financial statements, detailing key financial performance and position [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$28.0 billion**, total liabilities decreased to **$19.7 billion**, and stockholders' equity increased to **$8.3 billion** Consolidated Balance Sheet Highlights (in thousands) | Account | May 31, 2023 | November 30, 2022 | | :--- | :--- | :--- | | **Total current assets** | $18,721,193 | $20,500,865 | | **Total assets** | **$27,978,948** | **$29,733,998** | | **Total current liabilities** | $14,412,986 | $16,428,721 | | **Total liabilities** | **$19,710,178** | **$21,708,492** | | **Total stockholders' equity** | **$8,268,770** | **$8,025,506** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Quarterly revenue decreased to **$14.1 billion** with net income falling, while six-month net income increased to **$300.1 million** Key Operating Results (in thousands, except per share data) | Metric | Q2 2023 | Q2 2022 | Six Months 2023 | Six Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $14,062,124 | $15,269,791 | $29,187,495 | $30,739,768 | | Gross Profit | $963,410 | $955,789 | $1,966,977 | $1,924,450 | | Operating Income | $252,883 | $252,737 | $551,045 | $475,177 | | Net Income | $133,087 | $148,917 | $300,107 | $281,241 | | Diluted EPS | $1.41 | $1.55 | $3.17 | $2.92 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating activities generated **$604.8 million** in cash, a significant improvement from the prior year's cash usage, driven by working capital changes Cash Flow Summary for Six Months Ended May 31 (in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $604,750 | $(284,482) | | Net cash used in investing activities | $(64,538) | $(46,651) | | Net cash used in financing activities | $(247,087) | $(129,950) | | **Net increase (decrease) in cash** | **$329,223** | **$(473,165)** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes provide details on accounting policies, segment performance, borrowings, and contingencies, including revenue concentration and a new share repurchase program - One customer accounted for **12% and 11% of total revenue** for the three and six months ended May 31, 2023, respectively. Major vendors representing over 10% of revenue in certain periods include Apple, Cisco, and HP Inc[33](index=33&type=chunk) - Acquisition and integration costs related to the Tech Data merger totaled **$34.2 million** for the three months and **$82.0 million** for the six months ended May 31, 2023[48](index=48&type=chunk) - In January 2023, the Board authorized a new three-year, **$1.0 billion share repurchase program**. As of May 31, 2023, **$841.7 million** remained available for future repurchases[102](index=102&type=chunk)[104](index=104&type=chunk) - A fine from the French Competition Authority was reduced on appeal from **€76.1 million to €24.9 million**, which has been paid in full. The company is appealing this matter further[107](index=107&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2023 revenue decline, improved gross margin, flat operating income, strong operating cash flow, and robust liquidity [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Q2 2023 consolidated revenue decreased **7.9%** to **$14.1 billion**, gross margin improved, operating income was flat, and diluted EPS declined Revenue by Segment - Q2 2023 vs Q2 2022 (in thousands) | Segment | Q2 2023 Revenue | Q2 2022 Revenue | % Change | % Change (Constant Currency) | | :--- | :--- | :--- | :--- | :--- | | Americas | $8,699,342 | $9,776,933 | (11.0)% | (10.3)% | | Europe | $4,461,461 | $4,652,611 | (4.1)% | (3.5)% | | APJ | $901,321 | $840,247 | 7.3% | 11.7% | | **Consolidated** | **$14,062,124** | **$15,269,791** | **(7.9)%** | **(7.0)%** | - The decrease in revenue was primarily driven by a decline in the Endpoint Solutions portfolio due to a post-pandemic drop in demand for personal computer ecosystem products. This was partially offset by growth in the Advanced Solutions portfolio and high-growth technologies[137](index=137&type=chunk) - Gross margin increased to **6.85%** in Q2 2023 from **6.26%** in Q2 2022, primarily due to a favorable product and customer mix, including more revenue from Advanced Solutions and high-growth technologies[143](index=143&type=chunk) GAAP vs Non-GAAP Operating Income - Q2 2023 (in thousands) | Metric | Q2 2023 | Q2 2022 | % Change | | :--- | :--- | :--- | :--- | | Operating Income (GAAP) | $252,883 | $252,737 | 0.1% | | Non-GAAP Operating Income | $376,049 | $398,321 | (5.6)% | [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with increased cash, significant operating cash flow, a slightly increased cash conversion cycle, and manageable borrowings Cash Conversion Cycle (in days) | Period | May 31, 2023 | Nov 30, 2022 | May 31, 2022 | | :--- | :--- | :--- | :--- | | DSO | 55 | 53 | 47 | | DIO | 54 | 54 | 54 | | DPO | 85 | 84 | 80 | | **CCC** | **24** | **23** | **21** | - Net cash provided by operating activities was **$604.8 million** for the first six months of 2023, compared to net cash used of **$284.5 million** in the prior year period, primarily due to a decline in sales volumes which resulted in decreases in accounts receivable and inventories[175](index=175&type=chunk) - Financing activities used **$247.1 million** in cash, largely due to **$174.8 million** in common stock repurchases and **$66.2 million** in dividend payments during the first six months of 2023[177](index=177&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) No material changes in the company's market risks have occurred since the previous fiscal year-end, as disclosed in the Annual Report on Form 10-K - No material changes have occurred in the Company's market risks since November 30, 2022[190](index=190&type=chunk) [Item 4. Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[192](index=192&type=chunk) - There were no changes in internal control over financial reporting during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[193](index=193&type=chunk) PART II - OTHER INFORMATION [Item 1A. Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors have occurred since the previous fiscal year-end, as disclosed in the Annual Report on Form 10-K - There have been no material changes to the risk factors disclosed in the Company's 2022 Annual Report on Form 10-K[196](index=196&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) A new **$1.0 billion** share repurchase program was authorized, with **664,000 shares** repurchased during the quarter at an average price of **$90.33** per share - In January 2023, the Board of Directors authorized a new three-year **$1.0 billion** share repurchase program, replacing the prior **$400.0 million** program[197](index=197&type=chunk) Share Repurchases for Quarter Ended May 31, 2023 | Month | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | March 2023 | 0 | N/A | | April 2023 | 460,000 | $91.18 | | May 2023 | 204,000 | $88.40 | | **Total** | **664,000** | **$90.33** | [Item 6. Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including amendments to agreements and required certifications - Exhibits filed include amendments to the Credit Agreement and the Receivables Funding and Administration Agreement, as well as required CEO and CFO certifications under Sarbanes-Oxley[199](index=199&type=chunk)

Financial Data and Key Metrics Changes - Non-GAAP gross profit was $969 million, with a non-GAAP gross margin of 6.9%, up 45 basis points year-over-year [14] - Total adjusted SG&A expense was $593 million, representing 4.2% of revenue, up $8 million year-over-year [14] - Non-GAAP operating income was $376 million, down 5.6% year-over-year, with a non-GAAP operating margin of 2.7%, up 6 basis points year-over-year [14] - Cash and cash equivalents at the end of the quarter were $852 million, with total debt of $4.1 billion [15] - The company returned $93 million to shareholders via dividends and share repurchases [16] Business Line Data and Key Metrics Changes - Endpoint Solutions experienced a decline in demand, while Advanced Solutions and High Growth Technologies saw growth [7][13] - High growth technology areas, including cloud, security, data, AI, IoT, and Hyperscale Infrastructure, grew in the low teens year-over-year [8] - Advanced Solutions technologies continued to see solid demand as customers focused on data center projects and cloud migrations [13] Market Data and Key Metrics Changes - The Americas faced the largest impact from post-pandemic demand declines, particularly in PC ecosystem products [30] - Europe showed resilience with smaller declines in Endpoint Solutions and strong growth in Advanced Solutions [8] - The Asia Pacific region also saw strength in high growth technologies, partially offset by declines in Endpoint Solutions [8] Company Strategy and Development Direction - The company aims to evolve from a traditional distribution partner to a solutions aggregation and orchestration partner [31] - Strategic investments in high growth technologies are one of the four pillars of the company's strategy [31] - The company has realized $200 million in merger-related cost synergies ahead of schedule and expects an additional $50 million in cost optimization [32] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about early signs of stabilization in the macroeconomic environment [11] - The company expects demand for PC ecosystem products to improve, with fiscal Q2 and Q3 representing trough levels for Endpoint Solutions [17] - Management noted that the long-term drivers of IT spending remain intact despite current challenges [11] Other Important Information - The company has added nearly 100 new vendors to its line card since the beginning of the fiscal year [33] - The cash conversion cycle for the second quarter was 24 days, down two days from the previous quarter [38] - The company expects to generate over $1 billion in free cash flow for fiscal 2023 [18] Q&A Session Summary Question: What is the current demand trend and how has it changed since March? - Management noted increased volatility in demand month-on-month, with a decline in Endpoint Solutions volumes attributed to inventory realignment across the supply chain [21] Question: Can you elaborate on the decision to adopt an opportunistic stance on cash deployment? - The company plans to utilize a 10b5-1 program for share repurchases, allowing for opportunistic buying based on stock price changes [23] Question: Are there any current trends in demand or order patterns? - Management indicated that while there are positive trends, the macro environment remains a significant factor influencing demand [54] Question: How do you see the pricing environment evolving? - There is healthy price competition, but ASPs have increased year-over-year, indicating a mix of inflationary impacts and richer configurations [59][109] Question: What is the outlook for Advanced Solutions and high-growth technologies? - Management expects some slowdown in growth due to backlog digestion but remains confident in the long-term growth trajectory [76][102] Question: How is the company positioned for the second half of the year? - Management anticipates a return to normal growth rates in 2024, with expectations of lesser declines in Q3 and Q4 [62][102]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________________________________________________________ FORM 10-Q _______________________________________________________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended February 28, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition perio ...

Statements in this presentation 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 shareholders 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 ...

Financial Data and Key Metrics Changes - Worldwide gross billings for Q1 came in at $20.2 billion, up 1% year-over-year and up 4% in constant currency, while net revenue was $15.1 billion, down 2% year-over-year and up 1% in constant currency [23] - Non-GAAP operating income increased 5% year-over-year, with non-GAAP net income at $279 million and non-GAAP diluted EPS at $2.93, which was at the high end of the previously communicated guidance range for the quarter [25][42] - Total adjusted SG&A expense was $568 million, representing 3.8% of revenue, while non-GAAP operating margin was 2.93%, up 14 basis points year-over-year [32] Business Line Data and Key Metrics Changes - The basket of high-growth technologies, including Hyve, grew in the mid-teens for the quarter, highlighting the strategic importance of these projects [18] - Overall strength in advanced solutions and high-growth technologies helped offset declines in endpoint solutions, resulting in 4% constant currency growth in gross billings [19] - Endpoint solution products saw significant deceleration in demand in the Americas, partially offset by strength in advanced solutions and high-growth technologies [24] Market Data and Key Metrics Changes - In the Americas, revenue declined 4% year-over-year, while Europe increased 5% and APJ increased 26%, all in constant currency [23] - Demand declines in both Europe and Asia-Pacific, Japan were less pronounced compared to North America [7] - The company reported growth in market share in North America and Europe, with IDC and context reports indicating overall market share growth in those regions [19][47] Company Strategy and Development Direction - The company is focused on diversifying its portfolio, investing in data center and networking infrastructure, hybrid cloud, cybersecurity, data analytics, and hyperscale infrastructure [12] - The company expects to navigate rapidly changing market dynamics by leveraging its variable cost structure and diversified portfolio [20] - The company is committed to returning cash to shareholders through share repurchases and dividends, with approximately $900 million remaining on its share repurchase authorization [34][40] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment impacted demand for PCs and related products, with expectations for a more stable endpoint solutions portfolio in the second half of the year [2][27] - The company anticipates continued pressure on endpoint solutions but sees opportunities for growth in advanced solutions and high-growth technologies [27] - Management expressed confidence in delivering over $1 billion in free cash flow for the year, with a significant portion expected to be returned to shareholders [40] Other Important Information - The company published its first Corporate Citizenship Report, demonstrating its commitment to environmental and social goals [26] - The cash conversion cycle for Q1 was 26 days, with expectations for improvement in Q2 [33][71] - Non-GAAP interest expense for Q1 was $78 million, which was $5 million above the outlook [25] Q&A Session Summary Question: Can you talk about the strength in Europe and Asia-Pacific? - Management indicated that they feel they have grown market participation in North America and Europe, with European performance showing less decline in endpoint solutions and more growth in advanced solutions [47][48] Question: What are the views on GDP given current market conditions? - Management noted that recent events may not yet be reflected in GDP reports, but they expect a flattish GDP outlook [56][58] Question: How significant are new technologies like generative AI in your portfolio? - Management stated that while AI has not yet become a material part of their revenue stream, they expect it to manifest in first-of-a-kind offerings before being packaged for broader customer engagement [59][61] Question: What is the current state of channel inventory? - Management acknowledged anecdotal evidence of inventory work down within the channel but noted that they have not yet seen tangible signs of recovery [65] Question: Can you discuss the impact of pricing changes in the device business? - Management confirmed that they have seen price activity in PCs and expect price reductions as supply stabilizes, but it is too early to determine the impact on average selling prices [70] Question: What is the outlook for cash flow and capital allocation? - Management expects positive cash flow in Q2, Q3, and Q4, with a continued focus on a 50/50 allocation between reinvestment and returns to shareholders [87]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________ FORM 10-K ___________________________________________ (Mark One) OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_________________to_________________ Commission File Number: 001-31892 ___________________________________________ TD SYNNEX CORPORATION x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF T ...

TD SYNNEX Corporation (NYSE:SNX) Q4 2022 Earnings Conference Call January 10, 2023 9:00 AM ET Company Participants Liz Morali - Head of IR Rich Hume - CEO Marshall Witt - CFO Conference Call Participants Ruplu Bhattacharya - Bank of America Joseph Cardoso - JPMorgan Sameer Kalucha - RBC Jim Suva - Citigroup Shannon Cross - Credit Suisse Keith Housum - Northcoast Research Adam Tindle - Raymond James Ananda Baruah - Loop Capital Matt Sheerin - Stifel Operator Good morning, my name is Devin and I will be your ...

Washington, D.C. 20549 _______________________________________________________________________ FORM 10-Q _______________________________________________________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION For the quarterly period ended August 31, 2022 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period ...

Investor Presentation September 2022 Safe harbor statement Statements in this presentation regarding TD SYNNEX Corporation which are not historical facts may be 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. These forward-looking statements may be identified by terms such as believe, expect, may, will, provide, could and should and the negative of these terms or other similar expressions. These forward-lookin ...