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Ingram Micro (INGM) Q4 FY25 earnings call: guidance and Q&A

Earnings call· Dec 2025 (Q4 FY25)· Information Technology· Mar 2, 2026

Source: earnings call transcript

Executive summary

Ingram Micro Q4 FY25 — Strong Revenue Growth and Record Free Cash Flow

Ingram Micro concluded Q4 FY25 with robust revenue growth across all regions and record free cash flow, driven by strong execution and the Xvantage platform. While a sales mix shift towards lower-margin products impacted gross margins, the company's strategic focus on AI and advanced solutions, coupled with operational efficiencies from Xvantage, positions it for future profitable growth and margin expansion. Management remains confident in navigating market challenges and leveraging its global reach.

Highlights

5

  • Q4 revenue grew by 11.5%, exceeding the high end of guidance.

  • Q4 adjusted free cash flow reached $1.6 billion, the highest quarterly level in over a decade.

  • Full-year 2025 net sales increased by 9.5% to $52.6 billion.

  • Adjusted EBITDA for FY25 was $1.36 billion, up from $1.32 billion in 2024.

  • Net debt to adjusted EBITDA leverage ratio improved sequentially from 2.2x to 1.0x.

Concerns

3

  • Q4 gross profit margin decreased by 51 basis points year-over-year to 6.50% due to sales mix shift to lower-margin client and endpoint solutions and higher growth in Asia Pacific.

  • AI-related project sales drove a 15+ basis point impact on Q4 gross margins.

  • Mobility subcategory within Client and Endpoint Solutions is forecast to be down year-over-year in Q1 FY26.

Guidance & targets

CategoryTargetConfidence
Net Sales
$12.45 billion to $12.80 billion
high materiality
High
Client and Endpoint Solutions Growth
flat to low single-digit growth
medium materiality
Medium
Advanced Solutions Growth
low to mid-single-digit growth
medium materiality
Medium
Cloud Growth
double-digit growth
medium materiality
High
Gross Profit
$840 million to $895 million
high materiality
High
Non-GAAP Diluted EPS
$0.67 to $0.75 per diluted share
high materiality
High
Adjusted EBITDA to Free Cash Flow Conversion
well over 30%
high materiality
High
IDA Revenue as % of Total Revenue
double-digit percentage
medium materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Total Company
Up 9.0% on an FX-neutral basis. Saw year-over-year increases across all geographic segments.
$52.6 billion9.5%——
Asia Pacific
Drove solid double-digit growth throughout the year. Gross margin averaged roughly 250 basis points less than the overall company average, but with much better cost to serve.
—solid double-digit growth——
Total Company
Up 9.1% on an FX-neutral basis. Exceeded high end of guidance.
$14.88 billion11.5%——
Advanced Solutions
Returned to growth on an FX-neutral basis, driven by server, storage, cybersecurity, and large-scale enterprise deals in GPU and AI infrastructure products.
—11.3%——
Client and Endpoint Solutions
Strong demand for notebooks and desktops as refresh cycle continued.
—8.8%——
Asia Pacific
Led geographic growth on an FX-neutral basis. Benefited from large enterprise, GPU and AI infrastructure projects.
—14.6%——
North America
Benefited from large enterprise, GPU and AI infrastructure projects. Saw strong growth in server and storage categories, and strength in client and endpoint solutions driven by PCs.
$5.10 billion9.3%——
EMEA
Up 5.9% on an FX-neutral basis, with growth across all lines of business, including strong double-digit growth in cloud.
$4.63 billion13.9%——
Latin America
Up 1.2% in constant currency, driven by strength in sales of client and endpoint solutions, partially offset by softer results in advanced solutions and cloud.
$1.08 billion6.6%——
SMB
Fourth consecutive quarter of sequential growth.
——sequential growth—

INGM operating KPIs by quarter

INGM operating KPIs stated on its earnings calls, by fiscal quarter
KPIThis call Dec 2025 Q4 FY25 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.

Product announcements

ProductTypeDetails
ETO (E-mail to Order)milestone
Enable AIlaunch
Sales Brief Agentexpansion

Risks & headwinds

Sales mix shift to lower-margin products Q4 FY25

Q4 gross profit down 51 basis points year-over-year

Mitigation:Expect mix to improve favorably from a margin perspective as client and endpoint solution sales moderate and we execute on advanced solutions and cloud initiatives.

Impact of AI-related project sales on gross margin Q4 FY25

drove an impact in Q4 of more than 15 basis points on gross margins

Mitigation:These projects are strategically important for long-term AI accessibility and complementary services capabilities that yield greater profit.

Tariffs, interest rates, and geopolitical uncertainty FY25

navigated through complex issues

Mitigation:Tariffs are passed through; company has a track record of navigating uncertain markets due to global reach and scale.

Cybersecurity incident July [2025]

effectively remediated within days

Mitigation:Effectively remediated within days, demonstrating resilience.

Mobility subcategory decline Q1 FY26

forecast to be down year-over-year

Mitigation:Offset by continued strong demand in PC refresh and growth in advanced solutions and cloud.

Price increases and supply constraints Q1 FY26

ASPs increase

Mitigation:Working with OEM partners on strategic buy-ins; exploring alternative solutions like build-to-order to minimize pricing impacts and leverage current inventory.

What to watch in Q1 FY26

PC Refresh Cycle Duration

next quarter
Current middle to back half, could go well into 2026
Target continued strong demand and unit replacement

Why it matters

The duration of the PC refresh cycle impacts Client and Endpoint Solutions revenue and overall mix.

I would define it as we're in the middle to the beginning of maybe the back half of the refresh. There's still hundreds of millions of units that need to be replaced out there, which implies that there's still a refresh that could go well into 2026.

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Q&A highlights

Unpack the exact drivers for Q1 revenue guidance, specifically regarding PC refresh, AI/GPU sales, and Asia Pacific.

Q1 Client and Endpoint Solutions (CES) growth is flat to low single-digit due to strong PC refresh comparables and a forecast decline in mobility sales. Advanced Solutions (AS) is expected to grow low to mid-single digits, driven by server, storage, and cyber, with no notable large GPU deals assumed. Cloud is guided for double-digit growth. ASPs are increasing, but supply constraints might offset some revenue growth.

“But the compare is certainly a much bigger compare to Q1 of last year, where we also saw great strength in that category. We also had quite a bit of mobility sales in our Q1 of last year. So our mobility subcategory, which is the second biggest, we don't break out the specifics of the subcategories, but it's the second biggest within CES, and that's actually forecast to be down year-over-year.”

asked by Erik Woodring · answered by Michael Zilis

2 min read 5 chapters

Detailed narrative

Xvantage Platform Evolution and Impact

Ingram Micro's Xvantage platform, built over three years with proprietary data, a real-time global data mesh, and over 400 embedded AI/ML models, is central to its digital transformation. The platform is progressing through three phases: OpEx efficiency, top-line growth, and data-driven margin enhancement. In 2025, it meaningfully scaled critical enablement capabilities, with self-service orders up over 100% and average revenue per customer on Xvantage increasing 14% sequentially and over 30% year-over-year.

AI Strategy and Monetization

The company is leveraging its AI Factory for product ingestion, data enrichment, intelligent pricing, forecasting, and agentic workflows, improving sales productivity and cost to serve. Its intelligent digital assistant (IDA) enabled over 0.5 million proactive engagements in 2025, converting over 100,000 opportunities into billions of dollars in orders, with a nearly 3x normal conversion ratio and higher-value products. The new Agentic Assistant, Sales Brief Agent, is being expanded globally in H1 2026 to identify new opportunities and assist with value proposition development.

PC Refresh Cycle and Market Dynamics

The PC refresh cycle continued strongly through Q4 FY25, with double-digit growth, and is expected to extend well into 2026, as hundreds of millions of units still need replacement. However, the company is monitoring price elasticity and potential impacts from rising component costs. Management is working with vendors on alternative solutions like build-to-order to minimize pricing impacts and leverage existing inventory, benefiting from its global reach to navigate supply and demand dynamics.

Geographic Performance and Mix Shift

In Q4 FY25, all four regions experienced FX-neutral growth, led by APAC with 14.6% year-over-year growth and North America with 9.3%. Full-year 2025 net sales increased 9.5%, with APAC driving solid double-digit growth. The company noted a significant sales mix shift towards lower-margin client and endpoint solutions and higher growth from Asia Pacific, which has lower average gross margins but also lower cost to serve.

Capital Allocation and Debt Reduction

Ingram Micro maintained its capital allocation strategy, focusing on debt reduction, organic investment in Xvantage, and shareholder returns. The company repaid an additional $200 million of its term loan in February 2026, bringing total repayments to $1.89 billion since early 2022. This deleveraging improved the net debt to adjusted EBITDA ratio to 1.0x. The dividend was also sequentially raised by 2.5% per quarter, and a $100 million share buyback was authorized for additional shares from Platinum.

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