CLEARWATER — Sluggish demand for many of the IT products it distributes around the world didn't stop Tech Data Corp. from turning in a strong quarter.
Shares in Tampa Bay's largest public company by revenue rose nearly 3 percent on Tuesday after the company beat Wall Street expectations in reporting a fiscal third-quarter profit of $36.5 million.
The global distributor of computers, networks and other IT equipment posted net income of $1.03 per share for the period ended Oct. 31. Adjusted for mergers and acquisitions costs, that translated to net income of $1.44 per share, up 13 percent from a year ago. Analysts surveyed by Zacks Investment Research had anticipated earnings of $1.27 per share.
Revenue rose 1 percent to $6.49 billion.
CEO Robert Dutkowsky said the company's two divisions — the Americas and Europe — both grew in sales and improved the bottom line despite a still "challenging" level of IT demand.
Typically, IT spending rises 4 to 6 percent annually.
"Growth rates are less than average right now. That's a difficult environment for companies to navigate in," Dutkowsky said in an interview with the Tampa Bay Times.
To boost profits amid tight spending, Tech Data has to predict which niches among the 125,000 products it distributes will see greater demand, and capitalize on that. This quarter, Dutkowsky said, PCs were hotter with the rollout of new tablets, new laptops and new desktop computers. Security products for data centers and iPhones continued to be strong, as well.
In its current quarter, Tech Data forecast per-share earnings of $2.11 to $2.21 and revenue of $7.4 billion to $7.6 billion.
Shares in Tech Data have risen nearly 30 percent since the beginning of the year, driven in part by news of its pending $2.6 billion acquisition of Avnet Technology Solutions. The deal, the largest in Tech Data's history, could propel the company into rivaling Publix Super Markets as the largest company in Florida.
Its stock peaked at a new intra-day high Tuesday before closing at $86.40 a share, up $2.35.
Contact Jeff Harrington at [email protected] Follow @JeffMHarrington.