• Net Sales: Fiscal year 2024 net sales were $48.0 billion, up 0.3% on an FX-neutral basis.
• Gross Profit: Full year 2024 gross profit was $3.44 billion, representing 7.18% of net sales.
• Operating Expenses: Full year operating expenses were $2.45 billion, or 5.10% of net sales.
• Non-GAAP Net Income: $627.9 million for fiscal year 2024.
• Non-GAAP Diluted EPS: $2.79 for fiscal year 2024.
• Adjusted EBITDA: $1.32 billion in 2024 compared to $1.35 billion in 2023.
• Q4 Net Sales: $13.34 billion, up 2.5% year-over-year in U.S. dollars.
• Q4 Gross Margin: 7.01%, down 51 basis points versus prior year.
• Q4 Non-GAAP Net Income: $213.1 million.
• Q4 Non-GAAP Diluted EPS: $0.92.
• Q4 Adjusted EBITDA: $418.1 million.
• Adjusted Free Cash Flow: $443.3 million for the full year 2024.
• Dividend: Quarterly cash dividend of $0.074 per share approved for Q1 2025.
• Debt Repayment: Paid down $483 million of term loan balance in 2024.

• Warning! GuruFocus has detected 2 Warning Sign with CRDO.

Release Date: March 04, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ingram Micro Holding Corp (NYSE:INGM) achieved a year-over-year top line growth of nearly 3.5% in Q4 2024, with particular strength in Asia Pacific and Latin America.
• The company saw robust performance in cloud and client and endpoint solutions, with both growing year-over-year and quarter-over-quarter.
• Ingram Micro Holding Corp (NYSE:INGM) has invested over $600 million in building capabilities and technologies in cloud, laying the foundation for their AI-driven digital experience platform, Xvantage.
• The company won over 100 industry awards in 2024, including AWS Global Partner of the Year and HPE Distributor of the Year.
• Ingram Micro Holding Corp (NYSE:INGM) maintained a strong focus on working capital management, improving their annual net debt to adjusted EBITDA leverage ratio by more than 0.4 times since Q3 2024.

Negative Points

• Advanced Solutions faced challenges due to slowness in networking, impacting overall performance.
• The company experienced a competitive environment in India, leading to notable drops in margin and impacting profitability.
• Gross margins were down 51 basis points year-over-year in Q4 2024, driven by a higher mix of sales towards enterprise customers and a competitive environment.
• Operating expenses remained elevated due to investments in digital initiatives, impacting overall profitability.
• The public sector and small and medium-sized business segments showed weakness, affecting overall sales performance.

Q & A Highlights

Q: Can you discuss the momentum with large enterprise customers, particularly in North America, and any insights on the PC refresh cycle? A: Paul Bay, CEO: The large enterprise momentum was observed across all regions, not just North America. In North America, we saw growth in client endpoint solutions, advanced solutions, and cloud. The PC refresh cycle is primarily driven by Windows refresh and aging systems, with some influence from AI PCs. This trend is global, with large enterprise customers contributing significantly to this growth.

Q: Given the current volatile market, what gives you confidence in returning to top-line growth in 2025? A: Paul Bay, CEO: We exited 2024 with strong momentum in client endpoint solutions and expect networking to rebound in 2025. IDC forecasts an 8% growth in networking, and our leading indicators from large vendors show improvement. We also see continued strength in cloud, server storage, and cybersecurity, which supports our confidence in sustained growth.

Q: Are there any one-time costs affecting your Q1 profitability guidance, and what are the cost headwinds for 2025? A: Unidentified Company Representative: There are no notable one-offs; the margin factors, particularly in India, are driving the decline. We face a competitive environment globally, impacting margins. However, we continue to optimize costs and expect further reductions announced in December to take effect, providing momentum on the cost side throughout the year.

Q: How are tariffs impacting demand, and how do you manage potential cost increases? A: Paul Bay, CEO: The tariff situation is fluid, but we typically pass through these costs. The impact on demand depends on price elasticity and end-user tolerance. Some vendors are diversifying manufacturing to mitigate impacts. We are exploring strategic inventory opportunities to support our global customer base.

Q: How is Ingram Micro leveraging the Xvantage platform in 2025, particularly with hyperscalers like AWS? A: Paul Bay, CEO: We have integrated with AWS to enhance deployment ease and continue to work with all hyperscalers. Metrics show increased end-user engagement, reactivation of dormant customers, and a doubling of self-service orders, indicating improved ease of use and operational efficiency.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.