TD SYNNEX revenue jumps 37.7% to $21.6B, but operating cash flow swings to a $2.1B outflow

The current filing updates the status of the French competition matter: all appeals were dismissed in May 2026 and the €24.9 million judgment is now final. The baseline indicated the Company was still contesting the matter. This is a factual update reflecting the conclusion of the appeals process.

The company changed its reportable segments from a portfolio-based view to four segments: three geographic distribution regions plus Hyve Solutions. This is a structural change in how management evaluates performance and allocates resources, and prior period results have been recast.

Consolidated revenue grew 37.7% year-over-year in the third quarter and 29.2% for the nine months, a significant acceleration from the prior year's 6.6% and 5.9% growth. The increase is driven by growth in both distribution portfolios and Hyve Solutions.

Operating income increased 67.6% year-over-year in the third quarter and 62.5% for the nine months, a sharp acceleration from the prior year's 26.7% and 16.9% growth. The improvement is attributed to revenue growth and operating leverage.

Cash conversion cycle increased to 31 days from 23 days a year ago, driven by higher days inventory outstanding (70 vs 58) to support Hyve Solutions growth, partially offset by higher days payable outstanding (103 vs 99).

Operating cash flow swung from a $71.3 million inflow to a $2.1 billion outflow, primarily due to a larger increase in inventory to support Hyve Solutions growth and higher accounts receivable from revenue growth.

Share repurchases decreased significantly year-over-year: $292.4 million in the first nine months of fiscal 2026 versus $423.1 million in the prior year period. The remaining authorization declined to $0.9 billion from $292.4M.

Total borrowings increased to $5.5 billion from $4.2 billion a year ago, driven by higher short-term borrowings to fund working capital and the new Europe AR Arrangement. The company also repaid $700 million of senior notes at maturity in August 2026.

The baseline filing discussed the newly enacted OBBBA and its expected non-material impact. The current filing omits this discussion, likely because the legislation is now in effect and its impact is reflected in the higher effective tax rate (25.04% vs 22.66%).

The company revised its reportable segments in the first quarter of fiscal 2026 to align with how the CODM manages the business. This is a new disclosure not present in the baseline. The change had no impact on consolidated results but prior period segment results were recast.

New disclosure describes the goodwill reallocation resulting from the segment change and states that no goodwill impairment existed. This is a new disclosure not present in the baseline.

The amounts of accounts receivable sold under purchase agreements increased from $1.5 billion to $2.1 billion as of August 31, and from $1.2 billion to $1.8 billion as of November 30. Discount fees also increased significantly in the current period compared to the prior year period.

New disclosure describes a warrant issued to a customer for up to 3.2 million shares. The warrant vests based on qualifying payments and results in a non-cash reduction of revenue. This is a significant new transaction not present in the baseline.

New disclosure describes the early adoption of ASU 2025-04 related to share-based consideration issued to customers. This is a new accounting pronouncement adoption not present in the baseline.

The company issued a warrant to Amazon to purchase up to 3.2 million shares, with immediate vesting of 215,871 shares at $0.01 and the remainder vesting in tranches at $191.10 per share based on qualifying payments. The warrant was valued using Black-Scholes and resulted in a $14.5 million reduction to revenue during the period.

Remaining buyback authorization declined from $1.4 billion to $0.9 billion, reflecting program repurchases during the period. The company repurchased 1,484 thousand shares at a weighted-average price of $197.05 under the program, compared to 3,316 thousand shares at $127.58 in the prior year.

The quarterly dividend increased from $0.44 to $0.48 per share, a 9% increase. The record and payment dates shifted slightly but the dividend policy remains subject to board discretion.

Basic EPS increased significantly year-over-year, from $2.76 to $5.20 for the quarter and from $6.95 to $13.41 for the nine-month period, driven by higher net income and lower share count.

Net accounts receivable increased from $10.9 billion to $15.0 billion year-over-year, reflecting higher sales volume and possibly changes in customer payment terms.

The fair value of the company's senior notes increased from $2.3 billion to $2.7 billion as of the current period end, and the note now specifies Level 1 inputs and references Note 9. The increase likely reflects changes in market interest rates or credit spreads.

The current filing introduces a new U.S. accounts receivable securitization program with a maximum borrowing capacity of $1.5 billion, maturing January 20, 2028. This program was not disclosed in the baseline filing.

The company entered into a new European receivables securitization program with a maximum borrowing capacity of €650 million, maturing June 25, 2028. This program was not present in the baseline filing.

The U.S. AR Arrangement was amended after the balance sheet date to increase capacity from $1.5 billion to $3.0 billion, extend maturity, and adjust program fees. This is a new disclosure not present in the baseline.

The current filing shows $1.5 billion outstanding under the U.S. AR Arrangement, while the baseline showed $700 million of senior notes due August 2026. The senior notes were repaid at maturity and replaced by the securitization borrowing.

The current filing discloses $426.4 million outstanding on other short-term borrowings at August 31, 2026, compared to $319.3 million at November 30, 2025. The baseline did not include the current period figure.

The baseline filing contained a separate Note 8 for derivative instruments with detailed disclosures on cash flow hedges, net investment hedges, and non-designated derivatives.

Supplier finance program obligations increased from $2.9 billion to $3.5 billion year-over-year, and from $3.2 billion to $3.7 billion at the prior fiscal year-end. This reflects greater use of vendor financing arrangements.

The entire borrowings note from the prior year is absent in the current filing. This includes detailed disclosures on senior notes, revolving credit facility, term loans, and other borrowings. The removal may be due to a change in note numbering or a decision to omit the note in this quarterly report, but it represents a significant reduction in debt-related disclosure.

The company changed its segment reporting structure from three geographic segments to four segments, adding Hyve Solutions as a separate reportable segment. Prior period segment results have been recast to reflect the new structure. This is a significant change in how management views and reports the business.

The new Hyve Solutions segment is described as providing design, manufacturing, and delivery of compute, cloud, and connected infrastructure. This segment was previously included within the geographic segments and is now broken out separately, giving investors more visibility into this business.

The company provides additional detail on the Hyve Solutions segment by breaking it into Manufacturing and Supply Chain Services. This gives investors a clearer picture of the services offered within this new segment.

The detailed segment financial data for the three and nine months ended August 31, 2025 and 2024 has been removed from the notes. This information is now presented in the MD&A section with the new segment structure, but the specific historical segment operating income figures are no longer in the notes.

The entire Note 13 – Commitments and Contingencies section, which described inventory repurchase obligations, the French Competition Authority matter, the eBizcuss civil lawsuit, and other contingent liabilities, is absent from the current filing. This is a material removal because the underlying litigation and contingent obligations are ongoing and should be disclosed in each periodic report.