Shares of Santa Ana’s Ingram Micro Inc., the world’s top distributor of technology goods, slightly fell in afterhours trading Thursday after the company gave a worse-than-expected outlook for the current quarter.
The stock fell more than 2% in afterhours New York Stock Exchange trading on a recent market value of about $3 billion.
For the current quarter, Ingram is looking for profits of $59 million to $64 million on sales of $8.5 billion to $8.75 billion.
Analysts are forecasting profits of roughly $65 million on sales of $9 billion.
Ingram’s profit outlook doesn’t include the costs of a restructuring plan,which are expected to be $2 million to $4 million during the second quarter, the company said.
The news comes on the heels of Ingram Micro’s first quarter results, which missed analyst’s profit expectations.
It counted $9 billion in sales, up 4% from a year ago and in line with analysts’ expectations.
The company said it got a boost from a favorable exchange rate for sales outside the U.S., but is seeing softness in North American and European markets.
Ingram Micro saw $64 million in profits, up 73% from $37 million in the same period a year earlier, but missing analysts’ expectation of $68 million.
The company’s increased profit wasn’t a true gain. The year-ago profit figures includes a charge of about $34 million related to a tax dispute on software imports in Brazil that since has been resolved.
Excluding the charge from last year, Ingram Micro would have seen its profits decrease by about 10%.
The company is knee-deep in a cost-cutting program in its slower growth markets, including North America, where it made some job cuts last month.
Chief Executive Greg Spierkel said more cuts are on the way at Ingram’s Europe, Middle East and Africa operations.
“We’ve made good progress on the expense-containment plan instituted earlier this year, but additional steps are necessary in this environment,” he said in a statement.
The restructuring is expected to save the company $18 million to $24 million a year.
Ingram Micro said it expects costs related to the restructuring to total about $11 million to $13 million, the bulk of which are set to be seen in the third quarter.
At the end of the first quarter, the company had $567 million in cash.
