The talking point from Ingram Micro’s second-quarter results was always going to be the response to the ransomware attack that hit the firm in early July.
The disite indicated that the performance was at the top end of expectations for the three months ended 28 June, with net sales coming in at $12.8bn and net income on a GAAP basis of $37.8m.
Just a matter of days after the quarter ended, the channel player was hit by a ransomware attack on 5 July that caused disruption to the business that weekend and has caused concerns since.
Paul Bay, Ingram Micro’s CEO, directly addressed the attack in the comments he made around the Q2 numbers: “The ransomware attack in early July tested our resilience as a company and had no impact on our June quarter results. Our Xvantage digital experience platform played a critical role in accelerating our recovery and continues to strengthen our business, enhancing how we serve customers, vendors and partners with greater agility and insight.
“Although some uncertainty remains regarding the potential impact on our business and future results…I want to emphasise that the incident had no impact on our Q2 results. To recap, in early July, we identified ransomware on certain internal systems, and we quickly took our systems offline, watched an investigation with top cyber security experts and notified law enforcement with respect to the incident.
“Certain data was exfiltrated from our systems and conducted in conjunction with this incident, we have engaged a third-party data analysis firm to assist us in reviewing the relevant data. This process is ongoing and complex,” he added on the firm’s results webcast.
“Should we determine that personal information was affected, we will provide notification based off relevant regulation,” he added. “The investigation into the cyber incident remains ongoing, and we continue to monitor our systems closely.”
In terms of the numbers, Bay said the quarter had been a decent one: “We delivered solid second-quarter results, with net sales growth in all four geographic regions and across our three primary lines of business.”
When it came to the performance across EMEA, net sales came in at $3.5bn – an improvement on the previous year of 4.8%. Exchange rates played into its favour, but that growth was largely fuelled by increased demand for client and endpoint solutions. The firm saw increases in sales of desktops, notebooks and components. Advanced solutions, specialty and server net sales also contributed sales during Q2 across the EMEA region.
Strong sales of desktops and notebooks was echoed in the North American region, with Ingram also enjoying sever and storage growth. That contributed to a 13.7% year-over-year (YoY) increase in net sales to $5.0bn from $4.4bn.
Bay said the distributor has invested $600m in cloud and had developed the Xvantage platform the take the business forward, adding: “The more than $600m investment that Ingram Micro has made in cloud, which has been the strategic to our long-term vision, enabled us to be the first to launch a comprehensive Cloud Marketplace and learn early on from our cloud business.
“Instead of building fragmented marketplaces, we have unified our cloud marketplaces within our expanded platform ecosystem to provide a single pane of glass for hardware, software, cloud and service solutions.”
He talked on the webcast of the move the distributor was making to become a platform company and the progress it was making through the three stages to get there.
“The first phase, which we are already delivering on is to remove friction, to streamline operations and drive OPEX efficiency,” he said. “The second phase, which we are in the process of rolling out, leverages AI to automate and optimise demand signals, enabling more proactive go-to-market strategies and accelerating top line growth.
“The third phase will unlock greater value for our customers and our vendor partners by matching supply and demand more intelligently, using data to drive growth and further enhance margins and operating leverage. It is during this phase that we expect to fully realise a flywheel network effect. Though this takes time, we continue to grow and remain profitable as we move through these phases.”
