Ingram Micro Reports: Tech Spending Outlook Remains Fuzzy

 |  Includes: CDWC, DVMT, IM
by: William Trent, CFA

Ingram Micro Inc. (NYSE:IM), the world’s largest technology distributor, announced financial results for the second quarter, which ended June 30, 2007. Worldwide sales for the quarter were $8.19 billion, an 11 percent increase from $7.40 billion in the prior-year period and an all-time record for a second quarter. The translation impact of the relatively stronger European currencies had an approximate three percentage-point effect on comparisons to the prior year.

8% growth ex currency is the type of fairly bland result we have been seeing from tech companies for a long time. I had been turning hopeful as CDW Corp.’s (CDWC) sales growth accelerated, and some of the economic indicators suggested a bottoming out. But EMC’s (EMC) results and the durable goods report are throwing cold water on the thesis. Ingram didn’t make things worse, but it didn’t make them better either.