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Ingram Micro (INGM) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Information Technology· Jul 30, 2026

Source: earnings call transcript

Executive summary

Ingram Micro Q2 FY26 — Record Performance Driven by Xvantage and AI Infrastructure

Ingram Micro delivered a record second quarter, exceeding financial commitments through disciplined execution and the growing impact of its Xvantage digital platform. The company saw widespread growth across all segments and geographies, bolstered by strong demand for AI infrastructure and cloud solutions. Strategic investments in Xvantage and Enable AI are driving operational efficiencies and positioning Ingram Micro to capitalize on evolving technology trends, despite ongoing supply chain dynamics and working capital investments.

Highlights

5

  • Net revenue of $14.5 billion, significantly above guidance ranges.

  • Adjusted operating income grew nearly 40% year-over-year.

  • Adjusted EPS of $0.82, up 34% year-over-year and well above guidance.

  • Xvantage platform drove 40% increase in time spent, 12% increase in average order value, and 23% increase in average revenue per customer.

  • IDA generated approximately $1 billion in net revenue, nearly 7% of the company's net revenue.

Concerns

4

  • GPU and AI infrastructure deals contributed a 30 basis points headwind to gross margin.

  • Middle East conflict had an estimated $0.01 to $0.03 impact on Q2 EPS.

  • Free cash flow outflow of $527 million in Q2 FY26 due to strategic inventory investments and ASP inflation.

  • Supply constraints and longer lead times continue to impact sales closure cycles.

Guidance & targets

CategoryTargetConfidence
Net Sales
$13.55 billion to $13.95 billion
high materiality
High
Gross Profit
$910 million to $955 million
medium materiality
High
Non-GAAP Diluted EPS
$0.72 to $0.82
high materiality
High
Net Revenue Benefit from Supply Constraints
roughly 2% to 3%
medium materiality
High
Middle East Conflict Impact on EPS
roughly $0.01 to $0.02
low materiality
High
IDA Revenue Contribution
double-digit revenue contribution
medium materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Cloud
Fastest growing line of business, bolstered by strength in Infrastructure-as-a-Service and cybersecurity. Impacted by an 11% year-over-year effect related to the divestiture of CloudBlue in Q3 2025.
—44% FX-neutral——
Advanced Solutions
Driven by demand for GPU and AI infrastructure product sets, as well as storage and cybersecurity.
—13% FX-neutral——
Client and Endpoint Solutions
Driven by strong demand for notebooks, desktops, and components. PC notebooks remained very healthy, growing double digits. Solid single-digit, high single-digit growth in smartphones components and consumer electronics.
—12% FX-neutral——
North America
Benefited from sales of GPU and AI infrastructure product sets.
Net Revenue Contribution: 36%
$5.28 billion6%——
Asia Pacific
Led geographic growth. Second highest operating margin region. Benefited from sales of GPU and AI infrastructure product sets. Turnaround in India successful.
Net Revenue Contribution: 30%Gross Margin YoY Change: up 27 bpsOperating Income: Largest region worldwide
—28% FX-neutral—4.47% gross margin
EMEA
Robust growth in cloud, Client and Endpoint Solutions, and Advanced Solutions.
Net Revenue Contribution: 26%
$3.75 billion5% FX-neutral——
Latin America
Strong double-digit growth.
Net Revenue Contribution: 8%
—19%—Most profitable region by operating margin

INGM operating KPIs by quarter

INGM operating KPIs stated on its earnings calls, by fiscal quarter
KPI Dec 2025 Q4 FY25This call Jun 2026 Q2 FY26Change vs prior quarter
Customers
165K+ Our associates' ability to deliver to over 165,000 customers and 1,500 vendor partners in 57 countries during this time is truly a testament to their talent, determination and resilience. Source: earnings call transcript
165K+ These types of global partnerships play to our strength, including global and local presence, our CoEs or Centers of Excellence, extensive certifications across technologies, and more than 165,000 customers serving millions of end businesses. Source: earnings call transcript
—

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Orderbook & backlog

IDA Net Revenue $1 billion Q2 FY26

Represents net revenue generated through the Intelligent Digital Assistant (IDA) platform, with opportunities converting at nearly 4x the rate of traditional quotes. Goal is double-digit revenue contribution by year-end.

Product announcements

ProductTypeDetails
Model Context Protocol (MCP)launch
Enable AI Programexpansion
Enable AI OEM Acceleratelaunch
Xvantage Patentsmilestone

Deals & partnerships

HPE Global distribution partnership

Ingram Micro became one of two global distribution partners for HPE as it moves to a unified distribution model designed to deliver greater simplicity and consistency for partners across lines of business and geographies.

Google Cloud Collaboration on Xvantage platform and AI models

Working together to remove complexity from IT distribution with the Xvantage platform, giving enterprises the ability to transform customer service. Partnering further to bring Gemini models and agentic AI to more organizations.

Leading Neocloud Access for Enable AI program

Enable AI now includes access to one of the world's leading Neoclouds, creating a direct path into mission-critical AI training and inference workloads for larger enterprise customers.

Risks & headwinds

Middle East Conflict Q2 FY26, Q3 FY26

$0.01 to $0.03 impact on Q2 EPS; $0.01 to $0.02 impact on Q3 EPS

Mitigation:Team continued to execute through the prolonged conflict.

Supply Constraints and Longer Lead Times Q2 FY26, Q3 FY26

2% to 3% net revenue benefit (from combined factors including ASP increases and pull forwards, offset by longer lead times and demand elasticity)

Mitigation:Strategic procurement of certain product categories to get ahead of ASP increases and potential memory-related supply shortages. Improved visibility as vendors extend price quote durations (up to 30 days).

ASP Increases and Demand Elasticity Q2 FY26

ASPs driving ~16% sequential increase in inventory on a U.S. dollar basis. Part of 2-3% net revenue benefit.

Mitigation:Passing through costs, strategic opportunistic purchases. Some customers breaking large projects into smaller phases rather than cancelling.

GPU and AI Infrastructure Gross Margin Headwind Q2 FY26

30 bps headwind on gross margin

Mitigation:These deals remain very low cost to serve and working capital efficient, contributing to a 240 bps improvement in adjusted ROIC.

What to watch in Q3 FY26

IDA Revenue Contribution

By end of year (FY26)
Current ~$1 billion (nearly 7% of net revenue)
Target Double-digit revenue contribution

Why it matters

Indicates the scaling and monetization of the Xvantage platform and AI-driven sales, a key strategic initiative.

IDA, our Intelligent Digital Assistant, continued to demonstrate measurable business value, generating approximately $1 billion in net revenue in Q2, nearly 7% of the company's net revenue, ahead of pace on our goal of double-digit revenue contribution by the end of the year.

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Q&A highlights

Characterize GPU deals and performance of ex-GPU demand, especially CPU, within the Advanced Solutions segment.

GPU/AI infrastructure deals contributed significantly to upside, especially in APAC, across storage, server, and networking. Ex-GPU demand also saw good growth across all lines of business, geographies, and customer segments. GPU deals are low-cost to serve and working capital efficient, often closing late in the quarter.

“We're absolutely participating in what we define as the AI infrastructure data center build-outs that are happening. A lot of that came in Asia-Pacific, which was part of the results.”

asked by Katherine Murphy · answered by Paul Bay

2 min read 6 chapters

Detailed narrative

Xvantage Platform Evolution and Impact

Xvantage is evolving into an intelligent operating system, embedding AI, automation, and data intelligence. This led to a 40% increase in time spent, 12% higher average order value, and 23% growth in average revenue per customer. Self-service orders reached 2.4 million (up 12% YoY), and Email-to-Order processed $1.4 billion in revenue (up 43% YoY). The Intelligent Digital Assistant (IDA) generated $1 billion in net revenue, nearly 7% of the company's total, with opportunities converting at 4x the traditional rate. Two additional patents were granted for Xvantage, reinforcing its differentiation in consumer-like end-user interface and AI-powered alerts.

AI Strategy and Enable AI Program

Ingram Micro is moving customers from AI interest to practical deployment through its Enable AI program, which saw over 60% Q-o-Q growth in engaged customers and almost 100% increase in those moving to business case deployment. The program helps identify high-value use cases, build proofs of concept, and accelerate deployment, similar to how the company scaled cloud opportunities. This includes partnerships with key OEMs and Neoclouds to support mid-market MSPs and larger enterprise customers, with a focus on monetizing AI beyond infrastructure.

Strong Financial Performance and Operating Leverage

The company delivered record Q2 results, with net revenue of $14.53 billion, gross profit of $959 million, and adjusted EPS of $0.82, all exceeding guidance. Gross profit dollars grew faster than revenue, and adjusted operating income increased nearly 40% YoY, demonstrating significant operating leverage. This was driven by disciplined execution, operating efficiency, and the benefits of Xvantage automation, which allows for growth without matching top-line growth in operating expenses.

Geographic and Segment Growth

All four regions (North America, Asia Pacific, EMEA, Latin America) and three primary lines of business (Cloud, Advanced Solutions, Client and Endpoint Solutions) experienced double-digit revenue growth. Asia Pacific led with 28% FX-neutral growth, becoming the second-highest operating margin region and largest in operating income. Cloud was the fastest-growing line of business at 44% FX-neutral growth, bolstered by IaaS and cybersecurity, despite an 11% YoY impact from the CloudBlue divestiture.

Strategic Partnerships and Vendor Rationalization

Ingram Micro is observing a trend of vendor partners, such as HPE, rationalizing their distribution ecosystems to "do more with less." The company's global presence, Centers of Excellence, extensive certifications, and Xvantage platform position it as a strategic partner for these vendors, enabling long-term co-investment and consistent service delivery across geographies. Google Cloud also validated its partnership with Ingram Micro for simplifying IT distribution and bringing Gemini models to more organizations.

Sustainability Achievements

The company highlighted significant progress towards its "10 to 0 goals," including a cumulative 45% reduction in operational greenhouse gas emissions over three years. It achieved its 2030 target of diverting over 90% of waste from landfill and reduced safety incidents by over 70% since 2020. The 2025 Sustainable Impact Report is expected to be released in a few weeks, detailing further progress.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.