Ingram Micro Q2 Earnings Call Highlights

Key Points

• Record Q2 performance: Ingram Micro reported $14.53 billion in revenue, up 13.6% year over year, while non-GAAP EPS rose 34% to $0.82. Gross profit increased to $959 million and adjusted operating income climbed 40% to $280 million.
• Cloud and AI drove growth: Cloud sales grew 44% on an FX-neutral basis, while GPU and AI infrastructure revenue more than doubled. Growth was broad-based across all regions, led by Asia-Pacific’s 28% increase.
• Positive Q3 outlook amid cash investment: Management expects third-quarter revenue of $13.55 billion to $13.95 billion and non-GAAP EPS of $0.72 to $0.82, supported by continued cloud growth and supply-related pricing benefits. Free cash flow was a $527 million outflow as the company built inventory and invested in working capital.

Ingram Micro NYSE: INGM reported record second-quarter 2026 results, with revenue, gross profit and adjusted earnings per share exceeding the company’s guidance ranges. CEO Paul Bay said the performance represented the company’s best second quarter to date, supported by growth across its business lines, regions and customer categories.

Net sales totaled $14.53 billion, up 13.6% year over year in U.S. dollars and 12.6% on an FX-neutral basis. Gross profit rose to $959 million from $839 million in the prior-year period, while non-GAAP diluted EPS increased 34% year over year to $0.82. Adjusted income from operations reached $280 million, up 40% from a year earlier, including the effect of a prior-year charge related to held-for-sale accounting.

“Our growth was widespread across all geographies, customer categories, and our three primary lines of business,” CFO Mike Zilis said. He said gross-profit-dollar growth and operating efficiency helped non-GAAP net income grow at more than twice the rate of gross profit.

Cloud and AI Infrastructure Support Growth

Cloud was Ingram Micro’s fastest-growing line of business, with FX-neutral sales growth of 44%, aided by demand for infrastructure-as-a-service and cybersecurity offerings. The growth rate included an 11% year-over-year impact from the company’s previously disclosed CloudBlue divestiture, which closed in the third quarter of 2025.

Advanced Solutions revenue increased 13% on an FX-neutral basis, driven by demand for GPU and AI infrastructure products, storage and cybersecurity. Client and Endpoint Solutions grew 12% FX-neutral, benefiting from demand for notebooks, desktops and components.

Bay said the company is participating in AI infrastructure and data-center buildouts, with activity spanning servers, storage and, to a lesser extent in the quarter, networking. Zilis said GPU and AI infrastructure deals are often dependent on product availability and can be weighted toward the latter part of a quarter.

Sales of GPU and AI infrastructure products more than doubled year over year on a consolidated basis. While those transactions generally carry lower margins, Zilis said they are low-cost to serve and working-capital efficient. Excluding GPU and AI infrastructure deals, second-quarter gross margin was 6.90%, more than 20 basis points above the comparable prior-year figure excluding such deals.

Ingram Micro’s overall gross margin was 6.60%, up 4 basis points year over year. The company said the growth of lower-margin Asia-Pacific sales and AI infrastructure fulfillment activity affected consolidated margin mix. Adjusted return on invested capital improved by roughly 240 basis points year over year.

Regional Growth and Xvantage Adoption

All four regions recorded growth, led by Asia-Pacific, where FX-neutral sales climbed 28%. Latin America grew 19%, while North America sales increased 6% to $5.28 billion. EMEA sales totaled $3.75 billion and rose 5% on an FX-neutral basis.

Asia-Pacific accounted for 30% of total net revenue and became the company’s second-largest region by both net sales and operating margin, according to Zilis. The region was also Ingram Micro’s largest worldwide by operating income in the quarter. Bay said Asia-Pacific is now the company’s second-highest operating-margin region, while Latin America remains its highest-margin region.

The company continued to highlight adoption of its Xvantage digital platform, which Bay described as an intelligent operating system that combines automation, data intelligence and embedded AI. Time spent on Xvantage rose approximately 40% year over year, while average order value increased 12% and average revenue per customer grew 23%.

In the 10 countries with the most mature Xvantage implementations, Ingram Micro recorded double-digit year-over-year gains in gross profit and gross margin per go-to-market employee, alongside lower operating expenses, Bay said. Xvantage is now deployed in 22 countries, and roughly 75% of revenue in those countries is processed through the platform, though markets are at differing stages of implementation.

• Global self-service orders reached 2.4 million, up 12% year over year.
• Email-to-Order volumes increased 43%, processing approximately $1.4 billion in revenue through AI-enabled workflows.
• IDA, the company’s Intelligent Digital Assistant, generated about $1 billion in second-quarter net revenue, or nearly 7% of company revenue.

Bay said IDA-supported opportunities converted at nearly four times the rate of traditional quotes and carried a higher mix of Advanced Solutions and subscription categories. The company remains on track toward its goal of having IDA contribute a double-digit percentage of revenue by year-end.

AI Enablement and Supply Conditions

Ingram Micro said its Enable AI program continued to expand as customers move from evaluating AI to developing business cases and deployments. The company said the number of customers participating in the program increased more than 60% sequentially, while the number moving into AI business-case deployment nearly doubled.

Bay said the long-term AI opportunity extends beyond enterprise GPU infrastructure, encompassing cloud environments, security, data management and integration services needed to support scalable AI deployments. The company also introduced Model Context Protocol, or MCP, to allow AI agents to securely access Xvantage data, services and workflows. MCP adoption increased 50% in June, while usage more than tripled, according to Bay.

Management said higher average selling prices, customer order pull-forwards, longer product lead times and potential demand elasticity from price increases collectively benefited second-quarter revenue by an estimated 2% to 3%, near the high end of that range. The company expects a similar net revenue impact in the third quarter.

Bay said pricing visibility and predictability have improved as vendors extend the duration of price quotes in some cases. He added that some small and midsize customers are breaking larger infrastructure projects into phases, while other previously delayed projects have begun moving forward.

Third-Quarter Outlook and Cash Flow

For the third quarter, Ingram Micro forecast net sales of $13.55 billion to $13.95 billion, representing more than 9% year-over-year growth at the midpoint. It projected gross profit of $910 million to $955 million and non-GAAP diluted EPS of $0.72 to $0.82.

The outlook assumes a roughly 2% to 3% net revenue benefit from supply-related factors and a $0.01 to $0.02 EPS effect from the continuing conflict in the Middle East. Management expects continued double-digit cloud growth, upper-single-digit growth in Client and Endpoint Solutions, and mid- to upper-single-digit growth in Advanced Solutions without assuming outsized GPU and AI infrastructure activity.

Second-quarter adjusted free cash flow was an outflow of $527 million as the company invested in working capital to support growth and made strategic purchases ahead of further price increases and possible memory-related supply shortages. Zilis said net working capital stood at 26 days, three days better than the prior-year period, and the company expects heightened inventory exiting the second quarter to sell through over the remainder of the year.

Ingram Micro ended the quarter with $809 million in cash and cash equivalents, $3.8 billion in debt and a net-debt-to-EBITDA ratio of 2.0 times. The company also raised its quarterly dividend by 2.4% sequentially, to be paid in the third quarter.

About Ingram Micro (NYSE:INGM)

Ingram Micro, headquartered in Irvine, California, is a global technology distributor and supply chain services provider. Listed on the New York Stock Exchange under the ticker INGM, the company connects leading technology manufacturers, cloud providers and channel partners through an integrated portfolio of products and services. Ingram Micro's end-to-end solutions span product distribution, cloud enablement, e-commerce, logistics and lifecycle management, enabling customers of all sizes to bring new technology to market efficiently.

The company's offerings are organized across several core areas.

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