SYNNEX Misses Q1 Expectations, Shares Slide

Shares of

dropped more than 3 percent in after-hours trading after the company reported weaker-than-expected results for its fiscal first quarter. The Fremont, California-based company posted quarterly earnings of $46.3 million, or $1.16 per share, compared to $38.4 million, or $1.00 per share, in the year-ago period. Excluding items, the company's non-GAAP earnings rose to $1.46 per share from $1.24 per share. Its revenue climbed 5.8 percent to $3.2 billion. However, analysts were expecting earnings of $1.52 per share on revenue of $3.42 billion. Technology Solutions revenue slipped 1.3 percent organically to $2.9 billion in the latest quarter, while Concentrix revenue surged to $341.8 million from $127.0 million in the year-ago quarter. In the latest quarter, operating income rose to $78.9 million from $$632.0 million, while operating margin widened to 2.47 percent from 2.05 percent. Cash flow from operations was around $200 million in the latest quarter, compared to $35 million used in operations in the year-ago quarter. "We are pleased to report another record quarter of financial results for SYNNEX. We continue to deliver revenue growth, increased earnings and margin expansion," stated Kevin Murai, President and Chief Executive Officer. "While our results are very good, we did not meet our stated goals for this quarter. Fortunately, we believe the aspects related to this shortfall are short term and our core Technology Solutions and Concentrix businesses remain solid." For the second quarter, SYNNEX expects adjusted earnings of $1.50 to $1.56 per share, on revenue of $3.375 billion to $3.475 billion. Analysts had projected earnings of $1.59 per share on revenue of $3.57 billion. The average estimate among 15 Estimize users was for earnings of $1.59 per share and revenue of $3.52 billion for the fiscal first quarter. Synnex shares dipped 3.17 percent to $74.80 in the after-hours trading session.