Ingram Micro’s first quarter drew a negative market reaction after GAAP earnings per share fell short of Wall Street’s expectations, even as revenue surpassed consensus forecasts. Management pointed to robust growth in client and endpoint solutions, especially in North America and Asia Pacific, as key drivers of sales momentum. CFO Michael Zilis acknowledged that gross margin pressures reflected a higher mix of large enterprise sales, which tend to be lower margin, and ongoing competitive challenges in markets like India. While automation and cost actions improved operating expense leverage, the benefits were not enough to offset the impact of product and geographic mix on profitability.
Is now the time to buy INGM? Find out in our full research report (it’s free).
Ingram Micro (INGM) Q1 CY2025 Highlights:
- Revenue: $12.28 billion vs analyst estimates of $11.61 billion (8.3% year-on-year growth, 5.8% beat)
- EPS (GAAP): $0.29 vs analyst expectations of $0.40 (26.9% miss)
- Adjusted EBITDA: $290.8 million vs analyst estimates of $279.2 million (2.4% margin, 4.1% beat)
- Revenue Guidance for Q2 CY2025 is $11.97 billion at the midpoint, above analyst estimates of $11.8 billion
- Operating Margin: 1.6%, in line with the same quarter last year
- Market Capitalization: $5.13 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Ingram Micro’s Q1 Earnings Call
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Samik Chatterjee (JPMorgan): Asked about the divergence in demand trends between SMB and large enterprise customers. CEO Paul Bay explained that while SMB demand remains muted, large enterprise pipelines are strong, with ongoing conversations supporting optimism for continued enterprise project activity.
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Eric Woodring (Morgan Stanley): Inquired about the degree of Q1 sales pull-forward ahead of potential tariffs. CFO Michael Zilis noted only a minimal pull-forward, primarily in PC refresh activity, and clarified that longer-term projects were delayed rather than canceled.
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Ananda Baruah (Loop Capital): Sought clarity on the global rollout and operational impact of xVantage. Bay detailed that xVantage is live in 20 countries, with triple the self-service order volume year-over-year, and emphasized ongoing expansion is driving both customer engagement and operational leverage.
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Ruplu Bhattacharya (Bank of America): Questioned the outlook for gross margin in light of product mix and regional growth. Zilis responded that margins are expected to remain pressured unless SMB and advanced solutions growth accelerate, as current trends favor lower-margin geographies and customer segments.
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Maggie Nolan (William Blair): Asked about the expected duration of tariff-related buying behavior changes and operating expense outlook. Zilis indicated the impact is hard to predict and depends on final policy outcomes, while cost leverage benefits from automation and prior restructuring are largely realized.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be monitoring (1) the expansion and measurable adoption of xVantage and cloud offerings across additional countries and customer segments, (2) the stability of demand among SMBs compared to large enterprise customers in response to economic and trade policy shifts, and (3) the company’s ability to maintain gross margin stability as sales mix and geographic contributions evolve. The handling of potential new tariffs and the resulting inventory and pricing strategies will also be important signposts.
Ingram Micro currently trades at $21.84, up from $19.71 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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