Tech Data 3Q17 Earnings Call Notes

Tech Data’s (TECD) CEO Bob Dutkowsky on Q3 2017 Results

Bought Avnet’s Technology solutions business

“we remain especially excited about the pending acquisition of Avnet’s Technology Solutions business. Since we spoke to you last on September 19, we’ve established an integration management office which consists of key functional leaders from both teams across the regions who are responsible for putting plans in place that will ensure our integration goes smoothly for our customers, vendors and employees. I’m pleased to report that the teams have made good progress on our integration planning effort including two major integration milestones.”

election did have an impact on the environment but it’s not changing the way that we think about our business going forward

“Yes, so first off the impact of the election, I think the election had the whole infrastructure in an unstable environment. How close the election was made it very difficult for management teams and CFOs to project forward? How investments and infrastructure may play out? How tax rates may play out et cetera, et cetera, etcetera? So, I think it had a cooling effect on the market and you may now see that some of that’s been lifted. In terms of the capital impacts on tax rate, we’ve looked back on it and we’ve seen de minimis impact on our business when one of those changes happen. So in terms of our thought process going forward, we don’t have a lot of, it’s not impacting the way we think of the business.”

Tech Data FY 4Q16 Earnings Call Notes

Robert M. Dutkowsky – Chief Executive Officer & Director

Desktop was strong in the Americas

“the desktop was strong in the Americas and the notebook was stronger in Europe. Networking and security was strong in the Americas. So, it’s different by geography. And that’s one of the strengths of our model is the diversity that we have in our line card, whereas we’re aggressively marketing and selling security products into the data center, and we’re selling PCs and laptops and notebooks and mobility products at the same time.”

No issues with PC inventories

“Our inventory levels are in line and we don’t see any issues with PC inventories.”

PC category broader than just windows PCs

“The PC category is broader than just Windows PCs. The Chromebooks and some of the other devices that categorize themselves as PCs all added together, I think, delivered the strength in results there.”

The Apple business is much broader than the iPhone

“Remember, our Apple business is much broader than just the iPhone. It’s the notebooks. It’s the desktops. It’s iPads. It’s Beats. It’s Apple TV. It’s Apple Watch. The Apple product line has gotten much broader than what it was a few years ago. So, there’s a lot more to sell. We’re selling it to more customers, and we’re executing very well and gaining share in selected places.”

IT distributors specializing

“From my perspective, what you’re seeing is that each of the IT distributors are specializing and separating themselves in different areas and in different specializations. The idea that it’s easy to compare us as we diversify further and further from just pick, pack and ship says that we’re finding areas of differentiation to distinguish ourselves in the minds of our vendor partners and our customers. ”

Our areas of focus are different

“Our areas of focus are different than the areas that our competitors have. The line cards that we bring to the market are different. The skill sets that we have are different. The cost structures we have in our internal infrastructures and the capabilities that we have in our IT systems are clearly different. And it gives us each the ability to change and differentiate ourselves in the marketplace.”