Fiscal 2026 Third Quarter
Filed Sep 24, 2026TD SYNNEX Reports Record Fiscal 2026 Third Quarter Results
Revenue, non-GAAP gross billings, operating income, and non-GAAP diluted EPS increased year over year, while revenue, gross billings, and non-GAAP diluted EPS were above the high end of outlook. GAAP and non-GAAP operating margins expanded despite a year-over-year decline in gross margin.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| RevenueGAAP | $21.56B | – | 37.7% |
| Revenue in constant currencynon-GAAP | $21,658,369 | – | 38.4% |
| Non-GAAP gross billingsnon-GAAP | $31.83B | – | 40.0% |
| Non-GAAP gross billings in constant currencynon-GAAP | $31,945,478 | – | 40.5% |
| Gross profitGAAP | $1.43B | – | 26.2% |
| Gross marginGAAP | 6.61% | – | (61) bps |
| Gross to net %non-GAAP | (32.3)% | – | (120) bps |
| Selling, general and administrative expensesGAAP | $782,535 | – | – |
| Operating incomeGAAP | $643M | – | 67.6% |
| Operating marginGAAP | 2.98% | – | 53 bps |
| Operating incomenon-GAAP | $736M | – | 55.1% |
| Operating marginnon-GAAP | 3.42% | – | 39 bps |
| Interest expense and finance charges, netGAAP | $(120,518) | – | – |
| Other income (expense), netGAAP | $32,889 | – | – |
| Income before income taxesGAAP | $555,250 | – | – |
| Provision for income taxesGAAP | −$139.0M | – | – |
| Net incomeGAAP | $416M | – | 83.5% |
| Net incomenon-GAAP | $456M | – | 53.9% |
| Basic earnings per common shareGAAP | $5.20 | – | – |
| Diluted EPSGAAP | $5.18 | – | 89.1% |
| Diluted EPSnon-GAAP | $5.68 | – | 58.7% |
| Net cash (used in) provided by operating activitiesGAAP | $(916,717) | – | – |
| Purchases of property and equipmentGAAP | $(58,884) | – | – |
| Free cash flownon-GAAP | $(975,601) | – | – |
| Nine-month revenueGAAP | $58,294,417 | – | – |
| Nine-month operating incomeGAAP | $1,651,601 | – | – |
| Nine-month net incomeGAAP | $1,077,243 | – | – |
| Nine-month diluted EPSGAAP | $13.37 | – | – |
| Nine-month non-GAAP operating incomenon-GAAP | $1,941,029 | – | – |
| Nine-month non-GAAP net incomenon-GAAP | $1,228,855 | – | – |
| Nine-month non-GAAP diluted EPSnon-GAAP | $15.25 | – | – |
| Nine-month free cash flownon-GAAP | $(2,237,047) | – | – |
Fiscal 2026 Fourth Quarter outlook
- Revenue$21.8 - $22.6 billion
- NoteNon-GAAP gross billings: $31.4 - $32.4 billion
- NoteNet income: $368 - $408 million
- NoteNon-GAAP net income: $454 - $494 million
- NoteDiluted earnings per share: $4.58 - $5.08
- NoteNon-GAAP diluted earnings per share: $5.65 - $6.15
- NoteEstimated outstanding diluted weighted average shares: 79.2 million
Capital returns
- Returned $139 million to stockholders in the form of approximately $100 million of share repurchases and $38 million in dividends.
- Repurchases of common stock: $(100,271).
- Dividends paid: $(38,378).
- Declared quarterly cash dividend of $0.48 per common share, payable on October 30, 2026 to stockholders of record as of the close of business on October 16, 2026.
- The quarterly cash dividend of $0.48 per common share was up 9% year over year.
What drove it
- Distribution and Hyve both performed above expectations and grew above market.
- Enterprise AI adoption is progressing toward broader production deployments.
- Data center modernization remains a priority as organizations prepare for next-generation infrastructure requirements.
- AI is driving new security, governance, and compliance requirements across technology environments.
- Revenue increased 38.4% in constant currency and non-GAAP gross billings increased 40.5% in constant currency.
Concerns
- GAAP gross margin was 6.61%, compared with 7.22%, a decline of (61) bps.
- Gross to net % was (32.3)%, compared with (31.1)%, a change of (120) bps.
- Quarterly net cash used in operating activities was $(916,717), and quarterly free cash flow was $(975,601).
- Accounts receivable and inventories were $14,953,804 and $15,291,597, respectively, as of August 31, 2026.
- Interest expense and finance charges, net were $(120,518), compared with $(91,188).
What to watch
- Delivery against fiscal 2026 fourth-quarter revenue outlook of $21.8 - $22.6 billion.
- Delivery against fiscal 2026 fourth-quarter non-GAAP gross billings outlook of $31.4 - $32.4 billion.
- Delivery against fiscal 2026 fourth-quarter non-GAAP diluted EPS outlook of $5.65 - $6.15.
- Gross-margin performance following the reported 6.61% GAAP gross margin.
- Operating cash flow, inventory, accounts receivable, revolving-credit borrowings, and cash balances.
- Progress of enterprise AI deployments, data center modernization, and AI-related security, governance, and compliance demand.
Balance sheet and cash flow
- Cash and cash equivalents: $749,302 as of August 31, 2026, compared with $2,435,389 as of November 30, 2025.
- Borrowings, current: $1,926,400 as of August 31, 2026, compared with $1,018,321 as of November 30, 2025.
- Long-term borrowings: $3,595,337 as of August 31, 2026, compared with $3,592,130 as of November 30, 2025.
- Accounts receivable, net: $14,953,804 as of August 31, 2026, compared with $11,707,581 as of November 30, 2025.
- Inventories: $15,291,597 as of August 31, 2026, compared with $9,504,340 as of November 30, 2025.
- Net cash (used in) provided by operating activities: $(916,717), compared with $246,141.
- Free cash flow: $(975,601), compared with $213,920.
- Net borrowings on revolving credit loans: $1,500,057, compared with $136,391.
- Principal payments on long-term debt: $(700,226).
- Cash and cash equivalents at end of period: $749,302, compared with $874,350.
Analysis
TD SYNNEX reported a record fiscal 2026 third quarter, with GAAP revenue of $21,558 million, up 37.7% year over year, and non-GAAP gross billings of $31,828 million, up 40.0%. Constant-currency revenue increased 38.4% and constant-currency non-GAAP gross billings increased 40.5%. Management said Distribution and Hyve both performed above expectations and grew above market, while the release identified enterprise AI adoption, data center modernization, and AI-related security, governance, and compliance needs as demand supports.
Profit growth outpaced revenue growth. GAAP operating income increased 67.6% to $643 million and non-GAAP operating income increased 55.1% to $736 million. GAAP operating margin rose 53 bps to 2.98%, while non-GAAP operating margin rose 39 bps to 3.42%. GAAP net income was $416 million, up 83.5%, and non-GAAP net income was $456 million, up 53.9%. GAAP diluted EPS was $5.18 and non-GAAP diluted EPS was $5.68, with the latter above the high end of the company's outlook.
Gross-margin and cash-flow results warrant attention. Gross profit rose to $1,425 million, but GAAP gross margin declined to 6.61% from 7.22%. Gross to net % was (32.3)% versus (31.1)%. Net cash used in operating activities was $(916,717) and free cash flow was $(975,601), compared with operating cash flow of $246,141 and free cash flow of $213,920 in the prior-year quarter. Accounts receivable and inventories stood at $14,953,804 and $15,291,597 as of August 31, 2026, while cash and cash equivalents were $749,302.
Capital allocation included approximately $100 million of share repurchases and $38 million in dividends during the quarter, and the board declared a $0.48 per-share quarterly cash dividend payable on October 30, 2026. Current borrowings were $1,926,400 and long-term borrowings were $3,595,337 at quarter end. Financing activities included $1,500,057 of net borrowings on revolving credit loans and $(700,226) of principal payments on long-term debt.
For fiscal 2026 fourth quarter, TD SYNNEX guided revenue to $21.8 - $22.6 billion and non-GAAP gross billings to $31.4 - $32.4 billion. It forecast GAAP diluted EPS of $4.58 - $5.08 and non-GAAP diluted EPS of $5.65 - $6.15, based on estimated outstanding diluted weighted average shares of 79.2 million. The guide provides no gross-margin, operating-expense, or tax-rate outlook.
Management, verbatim
We delivered another record quarter, with Distribution and Hyve both performing above our expectations and growing above market.
Patrick Zammit, CEO of TD SYNNEX
Enterprise AI adoption is progressing toward broader production deployments. Data center modernization remains a priority as organizations prepare for next-generation infrastructure requirements, while AI is driving new security, governance, and compliance requirements across technology environments. We believe these trends expand our opportunities across Distribution and Hyve and support our confidence in our long-term growth potential.
Patrick Zammit, CEO of TD SYNNEX
Not in the filing
stated, not guessed- Quantified revenue, growth rates, and margins for the Distribution and Hyve segments were not provided.
- Prior-quarter figures and quarter-over-quarter changes for reported third-quarter metrics were not provided.
- Fiscal 2026 fourth-quarter gross-margin guidance was not provided.
- Fiscal 2026 fourth-quarter operating-expense guidance was not provided.
- Fiscal 2026 fourth-quarter tax-rate guidance was not provided.
- Previous-release outlook was not provided, so comparison of actual results with prior guidance is unavailable.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.