SYNNEX Profit Rises Near 33% - Update

(RTTNews) - Business services provider SYNNEX Corp. (SNX), Wednesday reported a near 33 percent jump in third-quarter profit, helped by better operating margins and higher revenue that exceeded Wall Street estimates.

The company provided some soft earnings outlook for the third quarter, while revenue is indicated to top expectations.

Commenting on the quarterly results, CEO Kevin Murai said, "Our Distribution segment posted strong sales growth and operating margin, and our GBS segment continued its trend of double-digit sales growth".

SYNNEX provides distribution and business process outsourcing services to resellers, retailers, and original equipment manufacturers.

The Fremont, California-based company posted quarterly net earnings of $47 million or $0.19 per share, compared with $35 million or $0.93 per share last year.

Diluted earnings-per-share results for the recent quarter reflect the impact of conversion premium. Excluding this, adjusted earnings for the quarter were $1.24 per share.

On average, eight analysts polled by Thomson Reuters expected earnings of $0.95 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the third quarter grew 6 percent to $2.73 billion from $2.6 billion a year ago, topping analysts' expectations of $2.72 billion.

Operating margin for the quarter climbed 11 basis points to 2.32 percent.

For the fourth quarter, SYNNEX expect earnings in the range of $43 million to $44.4 million, or $1.14 to $1.18 per share, and revenue of $2.925 billion to $3.025 billion. Analysts currently expect earnings of $1.18 per share on revenue of $2.93 billion for the quarter.

Earlier this month, SYNNEX agreed to acquire IBM's customer relationship management business process outsourcing unit for $505 million.

SYNNEX shares closed Wednesday at $62.04, down $0.49 or 0.78%, on a volume of 304 thousand shares.