Tech Data Beats Q2 Expectations

Tech Data Corp (NASDAQ: TECD) reported stronger-than-expected results for its second quarter on Thursday. The Clearwater, Florida-based company reported quarterly net income of $76.4 million, or $2.09 per share, compared to $39.3 million, or $1.03 per share, in the year-ago quarter. Excluding one-time items, the company's earnings came in at $1.43 per share.Its revenue slipped around 4 percent year-over-year to $6.58 billion from $6.84 billion. However, analysts were expecting earnings of $0.96 per share on revenue of $6.07 billion.The average estimate among 4 Estimize users was for earnings of $1.00 per share and revenue of $6.1 billion.The Americas net sales rose 1 percent to $2.7 billion in the quarter, while Europe net sales dropped 7 percent to $3.8 billion.Gross profit shrank to $325.3 million, or 4.94 percent of net sales, from $351.4 million, or 5.14 percent of net sales.Its operating margin expanded to 1.61 percent from 0.99 percent."Tech Data delivered excellent results for the second quarter of fiscal 2016," said Robert M. Dutkowsky, chief executive officer. "Throughout the quarter, we focused on optimizing our operations and capturing the opportunities in a dynamic IT market. This focus, as well as great execution by our teams in both regions, produced solid year-over-year sales growth in local currencies. Higher sales drove excellent operating leverage, resulting in record Q2 non-GAAP net income and record non-GAAP earnings per share. In the first half of fiscal 2016, we grew non-GAAP earnings per share by 21 percent, despite facing significant foreign currency headwinds."For the third quarter, Tech Data projects local currency sales to rise in mid-single digits in the Americas, and expects local currency sales growth in mid- to high-single digits in Europe.Tech Data shares slipped 0.55 percent to close at $56.27 yesterday.