Q2 2025 TD Synnex Corp Earnings Call Transcript
Key Points
- TD Synnex Corp (SNX) reported a strong second quarter with gross billings growing 12% year over year, exceeding the high end of their guidance.
- The company experienced significant growth in software billings, particularly in cloud, cybersecurity, and infrastructure software, with a 20% increase.
- TD Synnex Corp (SNX) was recognized with over 40 honors in the channel, including being named HPE's global distribution partner of the year.
- The company achieved a four-day improvement in its cash conversion cycle and generated approximately $543 million in free cash flow for the quarter.
- TD Synnex Corp (SNX) continues to see strong growth in PCs, driven by the refresh cycle, and has also seen a return to growth in networking after multiple weak quarters.
- Despite strong growth, TD Synnex Corp (SNX) is cautious about the macroeconomic environment, including potential impacts from global trade developments and geopolitical tensions.
- Gross margins declined by 21 basis points year over year, primarily due to unrealized FX losses and program mix.
- The company noted a demand pull forward, particularly in PCs, which may impact future quarters' performance.
- Interest expenses and finance charges were slightly higher than expectations, impacting overall financial performance.
- There is uncertainty regarding the impact of tariffs and other economic factors, leading to a cautious outlook for the second half of the year.
Good morning. My name is Kate, and I will be your conference operator today. I would like to welcome everyone to the TD SYNNEX second quarter fiscal 2025 earnings call. Today's call is being recorded. (Operator Instructions)
At this time, for opening remarks, I would like to pass the call over to David Jordan, Americas CFO and Head of Investor Relations at TD SYNNEX. David, you may begin.
Thank you. Good morning, everyone, and thank you for joining us for today's call. With me today is Patrick Zammit, our CEO; and Marshall Witt, our CFO. Before we continue, let me remind you that today's discussions contain forward-looking statements within the meaning of the federal securities laws, including predictions, estimates, projections, or other statements about future events, including statements about our strategy, demand, plans and positioning, growth, cash flow, capital allocation, and stockholder return, as well as our financial expectations for future fiscal periods.
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