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TD Synnex Corp.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 31 March 2026: press release. Guidance figures: 8 new. The quarter’s numbers.

Key takeaways

  • Revenue grew 18.1 percent: Revenue was $17.2 billion, up from $14.5 billion; constant-currency revenue growth was 13.2 percent. Source
  • Gross billings grew 24.4 percent: Non-GAAP gross billings were $25.8 billion, up 24.4 percent; in constant currency the increase was 19.9 percent. Source
  • EPS roughly doubled; non-GAAP up 68.9%: Diluted EPS was $4.04 against $1.98; non-GAAP diluted EPS was $4.73 against $2.80. Net income was $327 million against $168 million. Source
  • Four reportable segments now reported: Reporting was revised to match how the chief operating decision maker manages the business, assesses performance and allocates resources. Source
  • Gross margin rose to 7.30 percent: Gross profit was $1.25 billion, a gross margin of 7.30 percent against 6.87 percent, up 43 basis points. Source
  • Gross to net rose to 33.4 percent: Gross to net, the share of billings netted against revenue on certain service, SaaS and fulfillment contracts, was 33.4 percent against 29.9 percent. Source
  • Operating cash used rose to $896 million: Net cash used in operating activities was $896 million against $748 million; the inventory change used $1.42 billion of cash. Source
  • Free cash flow was negative $929 million: Free cash flow, after $33 million of purchases of property and equipment, was negative $929 million against negative $790 million. Source

“In the first quarter, we delivered record non-GAAP gross billings and non-GAAP diluted earnings per share”

Patrick Zammit, CEO of TD SYNNEX

Guidance

AreaPeriodFigureAgainst last quarter
Revenue SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$16.1 - $16.9 billionNew
Non-GAAP gross billings SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$24.6 - $25.6 billionNew
Net income SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$234 - $274 millionNew
Non-GAAP net income SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$302 - $342 millionNew
Diluted EPS SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$2.90 - $3.40New
Non-GAAP diluted EPS SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)$3.75 - $4.25New
Diluted weighted-average shares SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)79.8 millionNew
Costs netted against revenue SourceSecond quarter of fiscal 2026 (three months ending May 31, 2026)8.5 - 8.7 billionNew

What changed from last quarter

  • New guidance: Ranges given for the second quarter of fiscal 2026; the prior release gave ranges for the first quarter. Source
  • New: Reportable segments revised to four segments: three geographic distribution regions plus Hyve Solutions as a fourth segment. Source

Results and growth drivers

  • Revenue grew 18.1 percent: Revenue was $17.2 billion, up from $14.5 billion; constant-currency revenue growth was 13.2 percent. Source
  • Gross billings grew 24.4 percent: Non-GAAP gross billings were $25.8 billion, up 24.4 percent; in constant currency the increase was 19.9 percent. Source
  • EPS roughly doubled; non-GAAP up 68.9%: Diluted EPS was $4.04 against $1.98; non-GAAP diluted EPS was $4.73 against $2.80. Net income was $327 million against $168 million. Source
  • Operating income rose 60.7 percent: GAAP operating income was $489 million against $304 million; non-GAAP operating income was $590 million against $399 million. Source
  • Currency added to reported revenue: Changes in foreign currencies added $708.6 million to reported revenue, which is $16.45 billion in constant currency. Source

Segments and regions

  • Four reportable segments now reported: Reporting was revised to match how the chief operating decision maker manages the business, assesses performance and allocates resources. Source
  • Three distribution regions retained: Distribution is reported in three geographic regions: the Americas, Europe, and Asia-Pacific and Japan. Source
  • Hyve Solutions reported separately: Hyve Solutions is the fourth reportable segment and operates globally. Source

“Our results reflect strong performance across both our distribution and Hyve businesses”

Patrick Zammit, CEO of TD SYNNEX

Products and customers

  • Distribution offers broad IT portfolio: Distribution businesses offer hardware, software and systems across the global IT ecosystem. Source
  • Hyve designs and builds infrastructure: Hyve partners with technology companies to design, manufacture and deliver traditional and accelerated compute, cloud and connected infrastructure worldwide. Source
  • Partner-focused value proposition: The company describes itself as helping partners maximize technology investments and reach measurable business outcomes. Source

Costs, margins and pricing

  • Gross margin rose to 7.30 percent: Gross profit was $1.25 billion, a gross margin of 7.30 percent against 6.87 percent, up 43 basis points. Source
  • Gross to net rose to 33.4 percent: Gross to net, the share of billings netted against revenue on certain service, SaaS and fulfillment contracts, was 33.4 percent against 29.9 percent. Source
  • SG&A rose to $763 million: Selling, general and administrative expenses were $763 million against $694 million, with acquisition and restructuring costs of $0.9 million. Source
  • Tax provision roughly doubled: The income tax provision was $95.5 million against $47.3 million; other income was $19.6 million. Source
  • Equity gain excluded from non-GAAP: A $22.4 million realized gain on sale of certain equity securities is in other income and is excluded from non-GAAP net income and EPS. Source
  • Non-GAAP operating margin rose 70 basis points: Non-GAAP operating margin was 3.44 percent against 2.74 percent, excluding restructuring costs, amortization and share-based compensation. Source

“Together, this reinforces the strength of our operating model and our ability to create long-term value for shareholders.”

Patrick Zammit, CEO of TD SYNNEX

Second-quarter ranges and demand

  • Non-GAAP ranges exclude certain items: Non-GAAP second-quarter ranges exclude amortization of intangibles, share-based compensation and related tax effects; non-GAAP gross billings still include netted costs. Source
  • Estimated share count below first quarter: The second-quarter estimate is 79.8 million diluted weighted-average shares, against 80.2 million in the first quarter. Source
  • Net income range below first quarter: The second-quarter GAAP net income range is $234 million to $274 million, compared with $327 million reported for the first quarter. Source

Cash flow and balance sheet

  • Operating cash used rose to $896 million: Net cash used in operating activities was $896 million against $748 million; the inventory change used $1.42 billion of cash. Source
  • Free cash flow was negative $929 million: Free cash flow, after $33 million of purchases of property and equipment, was negative $929 million against negative $790 million. Source
  • Cash balance fell, borrowings rose: Cash and cash equivalents were $1.56 billion, down from $2.44 billion at November 30, 2025, with net revolving borrowings of $113 million. Source
  • Inventories rose to $10.98 billion: Inventories were $10.98 billion against $9.50 billion at November 30, 2025, and accounts receivable were $11.94 billion. Source

Capital and shareholder returns

  • Shareholder returns totaled $118 million: The company returned $118 million to stockholders through about $80 million of share repurchases and $39 million of dividends. Source
  • Quarterly dividend held at $0.48: The quarterly cash dividend is $0.48 per common share, which the company describes as up 9 percent year over year. Source
  • Diluted share count fell year over year: Diluted weighted-average shares were 80.2 million against 84.0 million a year earlier. Source

Strategy and leadership

  • Results build on last year's momentum: Management said the quarter continues execution and momentum established over the past year while expanding profitability. Source
  • Partner alignment credited for results: Management said results reflect continued alignment between its strategy and what partners need. Source
  • CEO pleased with fiscal 2026 start: The chief executive said the company was pleased with how fiscal 2026 started. Source

Coming up, as management said on 31 March 2026

  • Dividend payment and record dates: The declared quarterly dividend is payable April 29, 2026, to holders of record at the close of April 15, 2026. Source
  • Second-quarter period closes May 31: The second-quarter ranges cover the three months ending May 31, 2026. Source

Figures management reported

FigureReported
Products accessible Sourcemore than 200,000 products
Customers supported Sourcemore than 150,000 customers in over 100 countries

Earlier plans management reported on

  • Ahead: Revenue was reported above the high end of prior first-quarter guidance ranges, and gross billings were described the same way. Source
  • Ahead: Non-GAAP diluted EPS was reported above the high end of the prior first-quarter guidance range. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.