Synnex Profit Rises, Strong Q2 Outlook; Shares Surge

(RTTNews) - Business services provider Synnex Corp. (SNX), Wednesday reported a 15 percent increase in first-quarter profit, reflecting strong growth across all business segments. Earnings for the quarter trumped Wall Street expectations, as did revenues. Moving ahead, the company provided strong outlook for the second quarter. Following the news, shares of Synnex surged 15 percent in extended trading hours.

Fremont, California-based Synnex's first-quarter profit rose to $38.4 million or $1.01 per share from $33.4 million or $0.88 per share last year. Adjusted earnings improved to $1.25 per share from $0.91 per share last year. On average, eight analysts polled by Thomson Reuters expected earnings of $0.94 per share for the quarter. Analysts' estimates typically exclude special items.

Synnex's revenues for the quarter grew to $3.03 billion from $2.46 billion last year. Seven analysts had a consensus revenue estimate of $2.77 billion for the quarter.

Commenting on the results, Chief Executive Kevin Murai said, "I am pleased to report results reflecting strong growth across all business segments, with our IT business delivering revenue growth ahead of our expectations. During the quarter, we had a successful initial close of the IBM CRM acquisition with the majority of employees and business successfully brought on board."

In September last year, Synnex agreed to buy IBM's customer relationship management business process outsourcing unit for $505 million.

Looking forward to the second quarter, the company expects adjusted earnings of $1.34 to $1.38 per share with revenues between $3.1 billion and $3.2 billion. Analysts currently expect second-quarter earnings of $1.14 per share on revenues of $3.01 billion.

SNX closed Thursday's trading at $62.42, down $0.97 or 1.53%, on the NYSE. The stock however, surged $9.78 or 15.67% in after-hours trade.