Ingram Micro (INGM) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales were $11.76 billion, down 1.4% year-over-year, with declines in North America and Latin America offset by 8.8% growth in Asia-Pacific.

• Gross margin improved to 7.19% from 7.17% year-over-year, driven by a shift to higher-margin cloud and services.

• Net income was $77.0 million (GAAP) and $159.2 million (non-GAAP); diluted EPS was $0.35 (GAAP) and $0.72 (non-GAAP).

• Adjusted EBITDA was $331.6 million, up from $314.0 million year-over-year.

• Completed IPO in October 2024, raising $233.1 million in net proceeds, used to repay term loan debt.

Financial highlights

• Q3 gross profit was $845.5 million (7.19% of net sales), up two basis points year-over-year.

• Adjusted income from operations was $253.9 million, with a margin of 2.16%.

• Adjusted free cash flow was negative $254.6 million for Q3, but positive $106.1 million year-to-date.

• Return on invested capital for Q3 was 4.7%, down from 5.5% year-over-year; adjusted ROIC was 11.2%, down from 12.4%.

• Net working capital at quarter-end was $4.3 billion.

Outlook and guidance

• Q4 net sales forecasted at $13.0–$13.5 billion, representing ~2% year-over-year growth at the midpoint.

• Q4 gross profit expected between $935–$985 million; non-GAAP diluted EPS projected at $0.85–$0.98.

• Q4 non-GAAP tax rate is inflated by one-time compensation impacts, reducing non-GAAP EPS by $0.04.

• Anticipates paying a quarterly cash dividend starting Q1 2025, subject to board approval.

• Tax rates in Q4 impacted by one-time items, expected to normalize in 2025.