Synnex Beats 3Q Estimates; Net Income Up 50 Percent

The Fremont, Calif.-based distributor earned $11.5 million, or 38 cents per diluted share, compared with $7.7 million, or 32 cents per share, in the year-ago quarter. Analysts had projected a consensus net income estimate of 34 cents per share.

Sales were $1.34 billion, compared with $1.04 billion in the same period last year. Analysts projected $1.28 billion in revenue.

Distribution revenue was $1.19 billion, a 21 percent increase, while contract assembly sales accounted for $147.4 million, a 184 percent increase from last year.

Gross margins fell 46 basis points to 4.08 percent, due in part to a higher volume of sales to larger customers and the product mix in its contract assembly business, said Bob Huang, president and CEO of Synnex.

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In the fourth quarter, Synnex expects net income between $11.8 million and $12.4 million, or 39 cents to 41 cents per share, on sales between $1.4 billion and $1.45 billion.

Analysts were projecting earnings of 36 cents per share on $1.38 billion in revenue for the fourth quarter.

The results include a onetime non-operating benefit of $700,000, or 2 cents per share, as a settlement of the final purchase price of its MiTAC International acquisition in 2000.

Shares of Synnex closed at $16.10 Wednesday, up 25 cents or 1.5 percent per share.