Ingram Micro Q3 Sales Rise 21% as Q4 Guidance Increases

Ingram Micro Holding Corp. (NYSE: INGM) reported record fiscal third-quarter 2026 sales and raised its fourth-quarter guidance and full-year outlook, as broad-based business growth and lower operating expenses as a share of revenue helped earnings rise faster than the top line.

For the 13 weeks ended September 26, net sales increased 20.8% year over year to $15.2 billion, exceeding the high end of the company’s guidance. Gross profit rose 14.6% to $997 million, while adjusted income from operations advanced 24.9% to $322 million. Operating expenses represented 4.62% of net sales, an improvement of 51 basis points from a year earlier.

GAAP net income increased to $131.1 million from $99.5 million, and GAAP diluted earnings per share rose to $0.57 from $0.42. On a non-GAAP basis, net income climbed 24.8% to $210.6 million, while diluted EPS increased 26.4% to $0.91 from $0.72. Adjusted EBITDA rose 16.2% to $390.1 million.

Cash generation also improved sharply during the quarter. Adjusted free cash flow was $249.5 million, compared with an outflow of $109.9 million in the prior-year period, reflecting a smaller use of cash for working capital. However, adjusted free cash flow for the first 39 weeks remained negative at $1.24 billion, versus a $531.9 million outflow a year earlier, as working-capital investment reached $1.53 billion.

Growth Across Business Lines

All four of Ingram Micro’s reported lines of business posted higher third-quarter sales. Advanced Solutions led with 40.0% growth, followed by Lifecycle at 34.7%, Cloud at 31.0% and Client and Endpoint Solutions at 9.8%.

The business mix carries different profitability and working-capital characteristics. Client and Endpoint Solutions, which generally represents about 58% to 62% of sales, has low- to mid-single-digit gross margins and a highly automated operating model. Advanced Solutions typically accounts for 36% to 40% of sales and generates margins ranging from the mid-single digits to low double digits. Cloud and Lifecycle each represent about 1% to 2% of sales but carry higher gross margins. The company noted that AI infrastructure and graphics processing unit sales have lower margins but attractive returns on invested capital.

For the first three quarters of fiscal 2026, net sales rose 16.0% to $43.7 billion and gross profit increased 13.6% to $2.9 billion. Non-GAAP net income advanced 26.8% to $577 million, and non-GAAP diluted EPS rose 27.8% to $2.48. Adjusted EBITDA increased to $1.08 billion from $927.0 million.

Xvantage Adoption and AI Commerce

Ingram Micro highlighted increased adoption of its Xvantage digital platform. Average Xvantage revenue per customer rose 39% year over year in the quarter, while self-service order penetration reached about 70%, up more than 10 percentage points. Its Email-to-Order service processed $1.6 billion of revenue, a 33% increase, and the company said its Intelligence and Digital Automation capabilities generated approximately $1.5 billion of net revenue, or about 10% of the quarterly total.

The company had launched ordering through Model Context Protocol in 12 countries by the end of the quarter. Active customers using the protocol more than tripled from the second quarter, and their year-to-date sales rate was 3.7 times that of customers without the integration.

Fourth-Quarter Guidance

For the fourth quarter, Ingram Micro expects net sales of $17.5 billion to $17.9 billion, representing year-over-year growth of 17.6% to 20.3%. Gross profit is projected at $1.075 billion to $1.115 billion, while non-GAAP diluted EPS is expected to range from $1.05 to $1.15. The company described the sales outlook as its strongest since its initial public offering. Fiscal 2026 contains 53 weeks, giving the fourth quarter one additional week compared with the prior-year period.

Management also reiterated a fiscal 2026-to-2029 framework calling for annualized net sales growth of 4% to 6%, gross profit growth of 5% to 7% and non-GAAP net income growth of 11% to 13%. The framework targets adjusted free cash flow equal to roughly 30% or more of adjusted EBITDA annually and average adjusted return on invested capital of 16% to 17% over four years.

Ingram Micro ended the quarter with $3.1 billion of available liquidity under committed receivables-backed facilities. Total debt was 2.6 times trailing 12-month adjusted EBITDA, down 0.2 turn year over year, while net debt leverage improved by 0.3 turn to 1.9 times. The company used $122 million for share repurchases during the first nine months and paid a $23 million dividend in the third quarter.

The outlook remains subject to economic and geopolitical conditions, tariff and trade-policy changes, technology supply constraints, competition, cybersecurity risks and the company’s ability to deploy Xvantage successfully. Ingram Micro also cited risks related to customer and supplier relationships, international regulation, acquisitions and its controlled-company ownership structure.