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What changed in TD SYNNEX CORP's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of TD SYNNEX CORP's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+279 added−270 removedSource: 10-K (2024-01-26) vs 10-K (2023-01-24)

Top changes in TD SYNNEX CORP's 2023 10-K

279 paragraphs added · 270 removed · 197 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

52 edited+27 added−12 removed52 unchanged
Biggest changeThe SEC maintains an Internet site at http://www.sec.gov that contains our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports, if any, or other filings filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, and our proxy and information statements. 11 Table of Contents
Biggest changeThe SEC maintains an Internet site at http://www.sec.gov that contains our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports, if any, or other filings filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, and our proxy and information statements. 11 Table of Contents Information About our Executive Officers The following table sets forth information regarding our current executive officers: Name Age Position Richard Hume 64 Chief Executive Officer Dennis Polk 57 Hyve Solutions Executive Michael Urban 59 President, Americas Marshall Witt 58 Chief Financial Officer Patrick Zammit 57 Chief Operating Officer David Vetter 64 Chief Legal Officer Simon Leung 58 Chief Business Officer John Henry 49 Chief Accounting Officer Richard Hume is our Chief Executive Officer .
As a result of the Merger, on October 22, 2021, we filed with the Secretary of State of the State of Delaware a Certificate of Amendment to the Company’s Restated Certificate of Incorporation to change our corporate name from SYNNEX Corporation to TD SYNNEX Corporation, effective November 3, 2021.
On October 22, 2021, as a result of the Merger we filed with the Secretary of State of the State of Delaware a Certificate of Amendment to the Company’s Restated Certificate of Incorporation to change our corporate name from SYNNEX Corporation to TD SYNNEX Corporation, effective November 3, 2021.
Many of our OEM suppliers offer us limited protection from the loss in value of our inventory due to technological change or a supplier’s price reduction. Under many of these agreements, we have a limited period of time to return or exchange products or claim price protection credits.
Many of our OEM suppliers offer us limited protection from the loss in value of our inventory due to a supplier’s price reduction or technological change. Under many of these agreements, we have a limited period of time to return or exchange products or claim price protection credits.
We make available free of charge, on or through our website, our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports, if any, or other filings filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after electronically filing or furnishing these reports with the Securities and Exchange Commission, or SEC.
We make available free of charge, on or through our website, our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports, if any, or other filings filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after electronically filing or furnishing these reports with the Securities and Exchange Commission ("SEC").
In particular, we maintain EDI, XML, web-based communication links and mobile platform applications with many of our reseller and retail customers to enable them to search for products, check real-time pricing, inventory availability and specifications, place and track orders, receive invoices and process returns. Competition We operate in a highly competitive global environment.
In particular, we maintain EDI, XML, API, and web-based communication links and mobile platform applications with many of our reseller and retail customers to enable them to search for products, check real-time pricing, inventory availability and specifications, place and track orders, receive invoices and process returns. Competition We operate in a highly competitive global environment.
We also lease products to our reseller customers and their end-users and provide device-as-a-service to end-users. The availability and terms of our financing services are subject to our credit policies or those of third-party financing providers to our customers. Marketing Services.
We also lease products to our reseller customers and their end-users and provide DaaS, or Device-as-a-Service, to end-users. The availability and terms of our financing services are subject to our credit policies or those of third-party financing providers to our customers. Marketing Services.
We distribute IT hardware, software, and systems including personal computing devices and peripherals, mobile phones and accessories, printers, server and datacenter infrastructure, hybrid cloud, security, networking, communications and storage solutions, and system components.
We aggregate and distribute IT hardware, software, and systems including personal computing devices and peripherals, mobile phones and accessories, printers, server and datacenter infrastructure, hybrid cloud, security, networking, communications and storage solutions, and system components.
As of November 30, 2022 and 2021, no single customer comprised more than 10% of the consolidated accounts receivable balance. While we do not believe that the loss of any single customer would have a material adverse effect on us, such loss could result in an adverse impact on certain of our businesses.
As of November 30, 2023 and 2022, no single customer comprised more than 10% of the consolidated accounts receivable balance. While we do not believe that the loss of any single customer would have a material adverse effect on us, such loss could result in an adverse impact on certain of our businesses.
We have sales and marketing professionals in close geographic proximity to our customers and OEM suppliers. 7 Table of Contents Our Operations We operate 194 distribution and administrative facilities globally. Our distribution processes are highly automated to ensure timely order fulfillment and accuracy and enhance the efficiency of our warehouse operations and back office administration.
We have sales and marketing professionals in close geographic proximity to our customers and OEM suppliers. 7 Table of Contents Our Operations We operate 168 distribution and administrative facilities globally. Our distribution processes are highly automated to ensure timely order fulfillment and accuracy, and enhance the efficiency of our warehouse operations and back office administration.
Information contained on our website is not a part of this Report. We have adopted a code of ethics applicable to our co-workers including our principal executive, financial and accounting officers, and it is available free of charge, on our website’s investor relations page.
Information contained on our website is not a part of this Report. We have adopted a code of conduct applicable to our co-workers including our principal executive, financial and accounting officers, and it is available free of charge, on our website’s investor relations page.
See Note 13 – Segment Information to the Consolidated Financial Statements included in Item 8 of this Report for additional financial information related to international and domestic operations. Seasonality Our operating results are affected by the seasonality of the IT products industry.
See Note 12 – Segment Information to the Consolidated Financial Statements included in Item 8 of this Report for additional financial information related to international and domestic operations. Seasonality Our operating results are affected by the seasonality of the IT products industry.
Total direct compensation is generally positioned within a competitive range of the market median, with differentiation based on tenure, skills, proficiency, and performance to attract and retain key talent. Co-worker Engagement We regularly collect feedback to measure co-worker engagement, to better understand and improve the co-worker experience and to identify opportunities to continually strengthen our culture.
Total direct compensation is generally positioned within a competitive range of the market median, with differentiation based on tenure, skills, proficiency, and performance to attract and retain key talent. 10 Table of Contents Co-worker Engagement We regularly collect feedback to measure co-worker engagement, to better understand and improve the co-worker experience and to identify opportunities to continually strengthen our culture.
Our solutions cover all end-user customer needs, including, pure public cloud solutions in productivity and collaboration, IaaS, or Infrastructure as a Service, PaaS, or Platform as a Service, SaaS, or Software as a Service, Security, Mobility, IoT and other hybrid solutions.
Our solutions cover all end-user customer needs, including, pure public cloud solutions in productivity and collaboration, IaaS, or Infrastructure as a Service, PaaS, or Platform as a Service, SaaS, or Software as a Service, Security, Mobility, AI and other hybrid solutions.
Item 1. Business Overview We are a leading global distributor and solutions aggregator for the information technology ("IT") ecosystem. We serve a critical role, bringing products from the world's leading and emerging technology vendors to market, and helping our customers create solutions best suited to maximize business outcomes for their end-user customers.
Item 1. Business Overview We are a Fortune 100 corporation and a leading global distributor and solutions aggregator for the information technology ("IT") ecosystem. We serve a critical role, bringing products from the world's leading and emerging technology vendors to market, and helping our customers create solutions best suited to maximize business outcomes for their end-user customers.
We also face competition from our OEM suppliers that sell directly to resellers, retailers and end-users. The distribution industry has historically undergone, and continues to undergo, consolidation. Over the years, a number of providers within the IT distribution 9 Table of Contents industry exited or merged with other providers.
We also face competition from our OEM suppliers that sell directly to resellers, retailers and end-users. The distribution industry has historically undergone, and continues to undergo, consolidation. Over the years, a number of providers within the IT distribution industry exited or merged with other providers.
Our suppliers include leading IT systems, system components and peripherals, software, communications and security equipment, networking equipment, UCC and consumer electronics manufacturers. We purchase these and other complementary products from our suppliers and sell them to our reseller and retail customers. We perform a similar function for our distribution of licensed software products.
Our suppliers include leading IT systems, system components and peripherals, software, communications and security equipment, and networking equipment manufacturers. We purchase these and other complementary products from our suppliers and sell them to our reseller and retail customers. We perform a similar function for our distribution of licensed software products.
We also provide comprehensive IT solutions in key vertical markets such as government and healthcare and we provide specialized service offerings that increase efficiencies in the areas of global computing components, logistics services and supply chain management. One customer accounted for 10%, 17% and 23% of our total revenue in fiscal years 2022, 2021 and 2020, respectively.
We also provide comprehensive IT solutions in key vertical markets such as government and healthcare and we provide specialized service offerings that increase efficiencies in the areas of global computing components, logistics services and supply chain management. One customer accounted for 11%, 10% and 17% of our total revenue in fiscal years 2023, 2022 and 2021, respectively.
We group the majority of our offerings into two primary solutions portfolios, Endpoint Solutions and Advanced Solutions which are comprised of the following: Endpoint Solutions Portfolio: • Our Endpoint Solutions portfolio primarily includes personal computing devices and peripherals, mobile phones and accessories, printers, supplies, and endpoint technology software.
We group the majority of our offerings into two primary solutions portfolios, Endpoint Solutions and Advanced Solutions which are comprised of the following: 4 Table of Contents Endpoint Solutions Portfolio: • Our Endpoint Solutions portfolio primarily includes personal computing devices and peripherals, mobile phones and accessories, printers, supplies, and endpoint technology software.
Our global strategy is to deliver higher value by focusing on the following strategic priorities: • Invest in high-growth technologies such as hybrid cloud, security, analytics/Internet of Things ("IoT"), hyperscale infrastructure, and services. • Strengthen our end-to-end portfolio of products, services and solutions, including technology-as-a-service and recurring revenue models. • Transform our company digitally through greater automation and advanced analytics, which we believe will enhance the customer experience, broaden our customer base, increase sales and augment our presence in high growth technologies. • Expand our global footprint and enhance the operational excellence of our businesses around the world.
Our global strategy is to deliver higher value by focusing on the following strategic priorities: • Invest in high-growth technologies such as hybrid cloud, security, data analytics, artificial intelligence ("AI"), hyperscale infrastructure, and services. • Strengthen our end-to-end portfolio of products, services and solutions, including technology-as-a-service and recurring revenue models. • Transform our company digitally through greater automation and advanced analytics, which we believe will enhance the customer experience, broaden our customer base, increase sales and augment our presence in high-growth technologies. • Expand our global footprint and enhance the operational excellence of our businesses around the world.
We want to know what is working well, what we can do better and how well our co-workers understand and are practicing our cultural values. 10 Table of Contents Training and Development Human capital development underpins our efforts to execute our strategy and continue to distribute, design, integrate and market innovative products and services.
We want to know what is working well, what we can do better and how well our co-workers understand and are practicing our cultural values. Training and Development Human capital development underpins our efforts to execute our strategy and continue to distribute, design, integrate and market innovative products and services.
We maintain EDI connections with our OEM suppliers to send purchase 8 Table of Contents orders, receive purchase order status and receive notification once the product has shipped from our supplier.
We maintain EDI connections with our OEM suppliers to send purchase orders, receive purchase order status and receive notification once the product has shipped from our supplier.
We generally design and integrate IT systems, data center servers and networking solutions and IT appliances, by incorporating system components purchased directly from vendors or obtained from our distribution inventory. Some of our design and integration solutions facilities are ISO 9001:2015 and ISO 14001:2015 certified.
We generally design and integrate IT systems, data center servers and networking solutions and IT appliances, by incorporating system components either purchased directly from vendors, obtained from our distribution inventory or through a customer-owned procurement model. Some of our design and integration solutions facilities are ISO 9001:2015 and ISO 14001:2015 certified.
Purchasing Product cost represents our single largest expense and IT product inventory is one of our largest working capital investments. Furthermore, product procurement from our OEM suppliers is a highly complex process that involves incentive programs, rebate programs, price protection, volume and early payment discounts and other arrangements. Consequently, efficient and effective purchasing operations are critical to our success.
Purchasing Product cost represents our single largest expense and IT product inventory is one of our largest working capital investments. Furthermore, product procurement from our OEM suppliers is a highly complex process that involves incentive programs, rebate programs, price protection, volume and early payment discounts and other arrangements.
We compete with a variety of regional, national and international IT product distributors and manufacturers. We compete against several distributors in the Americas market, including Arrow Electronics, Inc. (“Arrow”), Ingram Micro, Inc. and ScanSource, Inc. and, to a lesser extent, regional distributors.
We compete with a variety of regional, national and international IT product distributors and manufacturers. 9 Table of Contents We compete against several distributors in the Americas market, including Arrow Electronics, Inc. (“Arrow”), Ingram Micro, Inc. and ScanSource, Inc. and regional distributors.
Our full turn-key service offering is modular in nature and is designed to cover all aspects of the logistics life cycle including, transportation management, inventory optimization, complementary product matching, reverse logistics, asset refurbishment and disposal and strategic procurement. Cloud Services.
We also offer full turn-key logistics solutions designed to address the needs of large volume or specialty logistics services. Our full turn-key service offering is modular in nature and is designed to cover all aspects of the logistics life cycle including, transportation management, inventory optimization, complementary product matching, reverse logistics, asset refurbishment and disposal and strategic procurement. Cloud Services.
Our chief operating decision maker has a leadership structure aligned with the geographic regions of the Americas, Europe and Asia-Pacific and Japan (“APJ”) and reviews and allocates resources based on these geographic regions. As a result, as of September 1, 2021 we began operating in three reportable segments based on our geographic regions: the Americas, Europe and APJ.
Our chief executive officer, who is also our chief operating decision maker, has a leadership structure aligned with the geographic regions of the Americas, Europe and Asia-Pacific and Japan (“APJ”) and reviews and allocates resources based on these geographic regions. As a result, we operate in three reportable segments based on our geographic regions: the Americas, Europe and APJ.
Women represent 27% of our board of directors, 27% of our leadership at the director and above level, and 42% of our total co-worker base. Additionally, 55% of our board of directors is ethnically diverse or gender diverse. We are committed to increasing diversity in our workforce.
Women represent 31% of our Board of Directors including our chair of the board, 28% of our leadership at the director and above level, and 43% of our total co-worker base. Additionally, 54% of our Board of Directors is ethnically diverse or gender diverse. We are committed to increasing diversity in our workforce.
Our purchasing group works closely with many areas of our organization, especially our product managers who work closely with our OEM suppliers and our sales force, to understand the volume and mix of IT products that should be purchased.
Consequently, efficient and effective purchasing operations are critical to our success. 8 Table of Contents Our purchasing group works closely with many areas of our organization, especially our product managers who work closely with our OEM suppliers and our sales force, to understand the volume and mix of IT products that should be purchased.
We are committed to fostering a diverse and inclusive workplace that attracts and retains exceptional talent. Through ongoing co-worker development, comprehensive compensation and benefits, and a focus on health, safety and co-worker well-being, we strive to help our co-workers in all aspects of their lives so they can do their best work.
Through ongoing co-worker development, comprehensive compensation and benefits, and a focus on health, safety and co-worker well-being, we strive to help our co-workers in all aspects of their lives so they can do their best work.
Advanced Solutions Portfolio: • Our Advanced Solutions portfolio primarily includes data center technologies such as hybrid cloud, security, storage, networking, servers, advanced technology software and converged and hyper-converged infrastructure. Our Advanced Solutions portfolio also includes our specialized solution businesses, such as Global Computing Components. Our high-growth technologies solutions, along with our services offerings, span our Endpoint and Advanced Solutions portfolios.
Advanced Solutions Portfolio: • Our Advanced Solutions portfolio primarily includes data center technologies such as hybrid cloud, security, storage, networking, servers, advanced technology software and hyperscale infrastructure. Our high-growth technologies solutions, along with our services offerings, span our Endpoint and Advanced Solutions portfolios.
We have sophisticated pick, pack and ship operations, which allows us to efficiently receive shipments from our OEM suppliers and quickly fill orders for our reseller and retail customers.
We have sophisticated pick, pack and ship operations, which allows us to efficiently receive shipments from our OEM suppliers and quickly fill orders for our reseller and retail customers. We generally stock or otherwise have access to the inventory of our OEM suppliers to satisfy the demands of our reseller and retail customers.
On March 22, 2021, we entered into an agreement and plan of merger (the “Merger Agreement”) which provided that legacy SYNNEX Corporation would acquire legacy Tech Data Corporation, a Florida corporation (“Tech Data”) through a series of mergers, which would result in Tech Data becoming an indirect subsidiary of TD SYNNEX Corporation (collectively, the "Merger").
We also design and deliver purpose-built server, storage and networking solutions for the hyperscale infrastructure market. 3 Table of Contents On March 22, 2021, we entered into an agreement and plan of merger (the “Merger Agreement”) which provided that legacy SYNNEX Corporation would acquire legacy Tech Data Corporation, a Florida corporation (“Tech Data”) through a series of mergers, which would result in Tech Data becoming an indirect subsidiary of TD SYNNEX Corporation (collectively, the "Merger").
For example, during fiscal year 2017, we acquired the Westcon-Comstor Americas distribution business and Tech Data acquired the Technology Solutions operating group of Avnet Inc. (“Avnet”), and in fiscal year 2021 we acquired Tech Data. We have participated in this consolidation and expect to continue to assess opportunities.
For example, during fiscal year 2017, we acquired the Westcon-Comstor Americas distribution business and Tech Data acquired the Technology Solutions operating group of Avnet Inc. (“Avnet”). We have participated in this consolidation and expect to continue to assess opportunities. As we enter new business areas, we may encounter increased competition from our current competitors and/or new competitors.
We set our sales price based on the market supply and demand characteristics for each particular product or bundle of products we distribute and services we provide. We are highly dependent on the end-market demand for IT products, and on our partners’ strategic initiatives and business models.
We set our sales price based on the market supply and demand characteristics for each particular product or bundle of products we distribute and services we provide.
The expenses charged by these financing companies are subsidized either by our OEM suppliers or paid by us. We generally receive payment from these financing companies within 15 to 30 days from the date of sale, depending on the specific arrangement. Information Technology Our IT systems manage the entire order cycle, including processing customer orders, customer billing and payment tracking.
The expenses charged by these financing companies are subsidized either by our OEM suppliers or paid by us. We receive payment from these financing companies based on agreed upon terms that depend on the specific arrangement. Information Technology Our IT systems manage the entire order cycle, including processing customer orders, customer billing and payment tracking.
Therefore, we believe it is important to provide a broad, end-to-end portfolio, with deep capabilities across the computing continuum to help customers manage the increasingly complex IT ecosystem 4 Table of Contents and deliver the solutions and business outcomes the market desires.
As a result, customers are seeking greater integration of products, services and solutions that tie technologies together. Therefore, we believe it is important to provide a broad, end-to-end portfolio, with deep capabilities across the computing continuum to help customers manage the increasingly complex IT ecosystem and deliver the solutions and business outcomes the market desires.
Segment results for all prior periods have been restated for comparability to the Company’s current reportable segments. For financial information by segment, refer to Note 13 – Segment Information, to the Consolidated Financial Statements in Item 8. We have been in business since 1980 and have headquarters in both Clearwater, Florida and Fremont, California.
For financial information by segment, refer to Note 1 2 – Segment Information, to the Consolidated Financial Statements in Item 8. We have been in business since 1980 and have headquarters in both Clearwater, Florida and Fremont, California.
Our end market strategy is to continue expanding internationally on a selective basis in order to provide our distribution capabilities to OEM suppliers in locations that meet their regional requirements.
International Operations Approximately 47% of our consolidated revenue for fiscal year 2023 was generated by our international operations. Our end market strategy is to continue expanding internationally on a selective basis in order to provide our distribution capabilities to OEM suppliers in locations that meet their regional requirements.
Human Capital Resources As of November 30, 2022, we had approximately 23,500 full-time co-workers. Given the variability in our business and the quick response time required by customers, it is critical that we are able to rapidly ramp-up and ramp-down our operational capabilities to maximize efficiency.
Given the variability in our business and the quick response time required by customers, it is critical that we are able to rapidly ramp-up and ramp-down our operational capabilities to maximize efficiency. As a result, we use temporary or contract workers, who totaled approximately 5,000 as of November 30, 2023, on a full-time equivalent basis.
Our Products and Suppliers We offer a comprehensive catalog of more than 200,000 technology products (as measured by active SKU's) from more than 1,500 original equipment manufacturers (“OEM”), suppliers of high-growth technologies such as converged and hyper-converged infrastructure, cloud, security, data/analytics/IoT and services. This enables us to offer comprehensive solutions to our reseller and retail customers.
Our Products and Suppliers We offer a comprehensive catalog of more than 200,000 technology products (as measured by active SKU's) from more than 2,500 original equipment manufacturers (“OEM”), suppliers of traditional technologies such as personal computing devices, mobile phones and accessories, and high-growth technologies such as cloud, security, data/analytics, AI and hyperscale infrastructure.
The following table provides revenue generated from products purchased from vendors that exceeded 10% of our consolidated revenue for the periods indicated (as a percent of consolidated revenue): Twelve Months Ended November 30, 2022 November 30, 2021 November 30, 2020 Apple, Inc. 11 % N/A (1) N/A (1) HP Inc. 10 % 12 % 15 % __________________ ( 1) Revenue generated from products purchased from this vendor was less than 10% of consolidated revenue during the period presented. 5 Table of Contents We have distribution agreements with most of our suppliers, including Apple Inc. and HP Inc.
The following table provides revenue generated from products purchased from vendors that exceeded 10% of our consolidated revenue for the periods indicated (as a percent of consolidated revenue): Twelve Months Ended November 30, 2023 November 30, 2022 November 30, 2021 Apple, Inc. 11 % 11 % N/A (1) HP Inc.
Our reseller customers include value-added resellers (“VARs”), corporate resellers, government resellers, system integrators, direct marketers, retailers and managed service providers (“MSPs”). Resellers are classified primarily by their end-user customers. End-users include large corporations or enterprises, federal, state and local governments, SMBs, and individual consumers. In addition, resellers vary greatly in size and geographic reach.
Resellers are classified primarily by their end-user customers. End-users include large corporations or enterprises, federal, state and local governments, SMBs, and individual consumers. In addition, resellers vary greatly in size and geographic reach. Our reseller customers buy from us and other distributors. Our larger reseller customers also buy certain products directly from OEM suppliers.
Conversely, our vendor agreements generally do not restrict us from selling similar products manufactured by competitors, nor do they require us to sell a specified quantity of product.
The agreements are also generally short-term, subject to periodic renewal, and often contain provisions permitting termination by either our supplier or us without cause upon relatively short notice. Conversely, our vendor agreements generally do not restrict us from selling similar products manufactured by competitors, nor do they require us to sell a specified quantity of product.
Our reseller customers buy from us and other distributors. Our larger reseller customers also buy certain products directly from OEM suppliers. System integrators offer services in addition to product resale, primarily in systems customization, integration, and deployment. Retailers serve mostly individual end-users and to a small degree, small office/home office customers.
System integrators offer services in addition to product resale, primarily in systems customization, integration, and deployment. Retailers serve mostly individual end-users and to a small degree, small office/home office customers. We also provide systems design and integration solutions for data center servers and networking solutions built specific to our customers’ workloads and data center environments.
As we enter new business areas, we may encounter increased competition from our current competitors and/or new competitors. We constantly seek to expand our business into areas primarily related to our core distribution as well as other support, logistics and related value-added services, both organically and through strategic acquisitions.
We constantly seek to expand our business into areas primarily related to our core distribution as well as other support, logistics and related value-added services, both organically and through strategic acquisitions. Human Capital Resources As of November 30, 2023, we had approximately 23,000 full-time co-workers.
In support of this, TD SYNNEX has committed to the Science Based Targets Initiative (SBTi) Business Ambition Pledge with the goal to achieve net-zero greenhouse gas ("GHG") emissions by 2045. We are committed to embedding a culture of sustainability across our organization and increasing our sustainability initiatives and supporting our customers and vendors.
In support of this, TD SYNNEX had previously committed to the Science Based Targets Initiative ("SBTi") Business Ambition Pledge with the goal to achieve net-zero greenhouse gas ("GHG") emissions by 2045. In support of that commitment, in fiscal year 2023, we submitted near-term and long-term emissions-reduction targets to SBTi for validation.
We have established a Global Responsibility Steering Committee to help drive these efforts. Additional human capital information will be included in our inaugural Corporate Citizenship Report which will be available in the near future on our website. Information contained in our Corporate Citizenship Report and website is not deemed part of this Annual Report on Form 10-K.
Additional human capital and environmental information was included in our Corporate Citizenship Report which is available on our website. Information contained in our Corporate Citizenship Report and website is not deemed part of this Annual Report on Form 10-K. Available Information Our website is http://www.tdsynnex.com.
In both of these cases, we offer design, integration, test and other production value-added solutions such as thermal testing, power-draw efficiency testing, burn-in, quality and logistics support. Logistics Services. We provide logistics support to our reseller customers such as outsourced fulfillment, virtual distribution and direct ship to end-users.
Our service offerings include the following: Systems Design and Integration Solutions. We provide our customers with systems design and full rack integration solutions, build-to-order, and configure-to-order assembly capabilities. We offer design, integration, test and other production value-added solutions such as thermal testing, power-draw efficiency testing, burn-in, quality and logistics support. 6 Table of Contents Logistics Services.
Historically, price protection and stock rotation privileges, as well as our inventory management procedures, have helped reduce the risk of loss of inventory value. We monitor our inventory levels and attempt to time our purchases to maximize our protection under supplier programs. Our Customers Our products are marketed globally to an active reseller base of more than 150,000 customers.
We monitor our inventory levels and attempt to time our purchases to maximize our protection under supplier programs. 5 Table of Contents Our Customers Our products are marketed globally to an active reseller base of more than 150,000 customers. Our reseller customers include value-added resellers (“VARs”), corporate resellers, government resellers, system integrators, direct marketers, retailers and managed service providers (“MSPs”).
As of November 30, 2022, we had approximately 23,500 full-time co-workers worldwide. Our Strategy Digital transformation and the migration to cloud computing is reshaping our industry, enabling businesses and consumers to evaluate, procure, acquire, and consume technology products and services in a variety of ways.
Our Strategy Digital transformation and the migration to cloud computing is reshaping our industry, enabling businesses and consumers to evaluate, procure, acquire, and consume technology products and services in a variety of ways. Hybrid models of IT consumption, supporting both physical and virtual delivery methods are emerging, as hardware and software-based solutions become increasingly combined.
Other logistics support activities we provide include generation of customized shipping documents, multi-level serial number tracking for customized, configured products and online order and shipment tracking. We also offer full turn-key logistics solutions designed to address the needs of large volume or specialty logistics services.
We provide logistics support to our reseller customers such as outsourced fulfillment, virtual distribution and direct ship to end-users. Other logistics support activities we provide include generation of customized shipping documents, multi-level serial number tracking for customized, configured products and online order and shipment tracking.
As a result, we use temporary or contract workers, who totaled approximately 5,000 as of November 30, 2022, on a full-time equivalent basis. Certain of our co-workers in various countries outside of the United States are subject to laws providing representation rights to co-workers through workers' councils.
Certain of our co-workers in various countries outside of the United States are subject to laws providing representation rights to co-workers through workers' councils. We are committed to fostering a diverse and inclusive workplace that attracts and retains exceptional talent.
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We also provide systems design and integration solutions. 3 Table of Contents On December 1, 2020, we completed the previously announced separation of our customer experience services business (the “Separation”), which was accomplished by the distribution of one hundred percent of the outstanding common stock of Concentrix Corporation (“Concentrix”).
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This enables us to offer comprehensive solutions to our reseller and retail customers.
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Our stockholders received one share of Concentrix common stock for every share of our common stock held at the close of business on the record date. Concentrix is now an independent public company trading under the symbol “CNXC” on the Nasdaq Stock Market.
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N/A (1) 10 % 12 % __________________ ( 1) Revenue generated from products purchased from this vendor was less than 10% of consolidated revenue during the period presented. We have distribution agreements with most of our suppliers, including Apple Inc. and HP Inc. These agreements usually provide for nonexclusive distribution rights and pertain to specific geographic territories.
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After the Separation, we do not beneficially own any shares of Concentrix’ common stock and beginning December 1, 2020, we no longer consolidate Concentrix within our financial results or reflect the financial results of Concentrix within our continuing results of operations. We distributed a total of approximately 51.6 million shares of Concentrix common stock to our stockholders.
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Historically, price protection and stock rotation privileges, as well as our inventory management procedures, have helped reduce the risk of loss of inventory value.
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In connection with the Separation, we entered into a separation and distribution agreement, as well as various other agreements with Concentrix that provide a framework for the relationships between the parties going forward, including among others an employee matters agreement, a tax matters agreement, and a commercial agreement, pursuant to which Concentrix has continued to provide services to us following the Separation.
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Our gross margin has fluctuated annually due to changes in the mix of products we offer, the percentage of revenue that is presented on a net basis, customers we sell to, incentives and rebates received from our OEM suppliers, competition, seasonality, replacement of lower margin business, inventory obsolescence, and lower costs associated with increased efficiencies.
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The historical results of operations and financial positions of Concentrix are reported as discontinued operations in our Consolidated Financial Statements. For further information on discontinued operations, see Note 5 - Discontinued Operations, to the Consolidated Financial Statements in Item 8.
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Generally, when our revenue becomes more concentrated on limited products or customers, our gross margin tends to decrease due to increased pricing pressure from OEM suppliers or reseller customers. We are highly dependent on the end-market demand for IT products, and on our partners’ strategic initiatives and business models.
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We previously had two reportable segments as of November 30, 2020: Technology Solutions and Concentrix. After giving effect to the Separation on December 1, 2020, we operated in a single reportable segment. After completion of the Merger, we reviewed our reportable segments as there was a change in our chief executive officer, who is also our chief operating decision maker.
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We are committed to embedding a culture of sustainability across our organization, increasing our sustainability initiatives and supporting our customers and vendors. We engage in and continue to explore a range of sustainability projects that support our decarbonization journey such as renewables, energy conservation measures, environmental management systems and waste minimization projects.
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Hybrid models of IT consumption, supporting both physical and virtual delivery methods are emerging, as hardware and software-based solutions become increasingly combined. As a result, customers are seeking greater integration of products, services and solutions that tie technologies together.
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We have a Corporate Citizenship Steering Committee in place to help drive our strategy around these efforts in addition to multiple working groups that focus on areas such as the Circular Economy and Sustainable Transportation & Logistics. We currently have over 40 Green Teams in place to support sustainability efforts at our locations globally.
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These agreements usually provide for nonexclusive distribution rights and pertain to specific geographic territories. The agreements are also generally short-term, subject to periodic renewal, and often contain provisions permitting termination by either our supplier or us without cause upon relatively short notice.
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Mr. Hume joined Tech Data in March 2016 as Executive Vice President, Chief Operating Officer. In June 2018, Mr. Hume was appointed as Chief Executive Officer of Tech Data and in September 2021 in conjunction with the Merger he was appointed as Chief Executive Officer of TD SYNNEX. Prior to joining Tech Data, Mr.
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We also provide systems design and integration solutions for data center servers and networking solutions built specific to our customers’ workloads and data center environments.
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Hume was employed for more than thirty years at International Business Machines Corporation ("IBM"), (NYSE: IBM), a multinational computer hardware, middleware and software company. Most recently, from January 2015 to February 2016, Mr. Hume served as General Manager and Chief Operating Officer of Infrastructure and Outsourcing at IBM. Prior to that position, from January 2012 to January 2015, Mr.
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We generally stock or otherwise have access to the inventory of our OEM suppliers to satisfy the demands of our reseller and retail customers. 6 Table of Contents Our service offerings include the following: Systems Design and Integration Solutions. We provide our customers with systems design and full rack integration solutions, build-to-order, and configure-to-order assembly capabilities.
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Hume served as General Manager, Europe where he led IBM’s multi-brand European organization. From 2008 to 2011, Mr. Hume served as General Manager, Global Business Partners, directing the growth and channel development initiatives for IBM’s Business Partner Channel. Mr. Hume holds a Bachelor of Science degree in Accounting from Pennsylvania State University.
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International Operations Approximately 45% of our consolidated revenue for fiscal year 2022 was generated by our international operations. As a result of the Merger, we have expanded both our domestic and international operations.
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Dennis Polk has served as a member of our Board of Directors since February 2012 and as our Hyve Solutions Executive since September 2021. Mr. Polk joined TD SYNNEX in 2002 and served as President and Chief Executive Officer of TD SYNNEX from March 2018 to September 2021.
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We engage in and continue to explore a range of sustainability projects such as renewable energy, use of light emitting diode (LED) technologies, waste minimization projects and ISO 14001 at several of our facilities. We also offer trade-in, recycling and refurbishment services on a range of IT equipment to end-users through agreements with our resellers and retail partners.
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Prior to that position, he served as Chief Operating Officer, Chief Financial Officer and Senior Vice President of Corporate Finance of TD SYNNEX. In conjunction with the Merger in September 2021, Mr. Polk was appointed as Executive Chair of the Board of Directors, and he served as Executive Chair until September 1, 2023. Michael Urban is our President, Americas. Mr.
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Urban joined TD SYNNEX in February 2019 and served as President, Worldwide Technology Solutions Distribution until the Merger. Prior to joining TD SYNNEX, Mr. Urban was employed by Tech Data from September 2012 until January 2019, most recently serving as Corporate Vice President of Strategy, Transformation, and Global Vendor Management. Prior to Tech Data, Mr.
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Urban served in progressive leadership roles including Chairman and Chief Executive Officer at Actebis Holding GmbH, an IT services company. Mr. Urban received a Bachelor of Science degree in Engineering from Paderborn University in Germany. Mr. Urban will be resigning as President, Americas effective as of March 1, 2024.
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Marshall Witt is our Chief Financial Officer and has served in this capacity since April 2013. Prior to joining TD SYNNEX, Mr. Witt was Senior Vice President of Finance and Controller with FedEx Freight, Inc., a freight services company. During his fifteen year tenure with FedEx Corporation (NYSE: FDX), a multinational transportation, e-commerce and business services company, Mr.
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Witt held progressive financial and operational roles. Prior to FedEx Corporation, he held accounting and finance leadership positions including five years with KPMG LLP, a professional services firm, as an audit manager for banking and transportation clients. Mr.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

61 edited+6 added−18 removed168 unchanged
Biggest changeIncreasing attention on environmental, social and governance ("ESG") matters may have a negative impact on our business, impose additional costs on us, and expose us to additional risks. Companies are facing increasing attention from investors, customers, partners, consumers and other stakeholders relating to ESG matters, including environmental stewardship, social responsibility, diversity and inclusion, racial justice and workplace conduct.
Biggest changeCompanies are facing increasing attention from investors, customers, partners, consumers and other stakeholders relating to ESG matters, including environmental stewardship, social responsibility, diversity and inclusion, racial justice and workplace conduct. In addition, organizations that provide information to investors on corporate governance and related matters have developed ratings processes for evaluating companies on their approach to ESG matters.
Additionally, the Company entered into an Investor Rights Agreement at the closing of the Merger, which provides that the board of directors be comprised of eleven directors, and that affiliates of Apollo have the right to nominate (i) up to four directors, if Apollo and its affiliates own 30% or more of the outstanding shares of TD SYNNEX common stock; (ii) up to three directors if Apollo and its affiliates own between 20% and 30% of the outstanding shares of TD SYNNEX common stock; (iii) up to two directors, if Apollo and its affiliates own between 10% and 20% of the outstanding shares of TD SYNNEX common stock; or (iv) up to one director, if Apollo and its affiliates own between 5% and 10% of the outstanding shares of TD SYNNEX common stock.
Additionally, the Company entered into an Investor Rights Agreement at the closing of the Merger, which provides that the board of directors be comprised of at least eleven directors, and that affiliates of Apollo have the right to nominate (i) up to four directors , if Apollo and its affiliates own 30% or more of the outstanding shares of TD SYNNEX common stock; (ii) up to three directors if Apollo and its affiliates own between 20% and 30% of the outstanding shares of TD SYNNEX common stock; (iii) up to two directors, if Apollo and its affiliates own between 10% and 20% of the outstanding shares of TD SYNNEX common stock; or (iv) up to one director, if Apollo and its affiliates own between 5% and 10% of the outstanding shares of TD SYNNEX common stock.
If we cannot make scheduled payments on our debt, we will be in default and, as a result: • our lenders could declare all outstanding principal and interest to be due and payable; • the lenders under our credit agreements could terminate their commitments to loan us money and, in the case of any secured credit arrangements, foreclose against the assets securing their borrowings; 18 Table of Contents • we could be forced to raise additional capital through the issuance of additional, potentially dilutive securities; and • we could be forced into bankruptcy or liquidation, which is likely to result in delays in the payment of our indebtedness and in the exercise of enforcement remedies related to our indebtedness.
If we cannot make scheduled payments on our debt, we will be in default and, as a result: • our lenders could declare all outstanding principal and interest to be due and payable; • the lenders under our credit agreements could terminate their commitments to loan us money and, in the case of any secured credit arrangements, foreclose against the assets securing their borrowings; • we could be forced to raise additional capital through the issuance of additional, potentially dilutive securities; and 20 Table of Contents • we could be forced into bankruptcy or liquidation, which is likely to result in delays in the payment of our indebtedness and in the exercise of enforcement remedies related to our indebtedness.
We extend credit to our customers for a significant portion of our sales to them and they have a period of time, generally 30 days after the date of invoice, to make payment. However, in certain cases, for some of our larger customers, we offer longer terms of payment.
We extend credit to our customers for a significant portion of our sales to them and they have a period of time, generally 30 days after the date of invoice, to make payment. However, in certain cases, for some of our customers, we offer longer terms of payment.
Our acquisition strategy involves a number of risks, including: • difficulty in successfully integrating acquired operations, IT systems, customers, OEM supplier relationships, products, services and businesses with our operations; 14 Table of Contents • risk that the acquired businesses will fail to maintain the quality of services that we have historically provided; • loss of key co-workers of acquired operations or inability to hire key co-workers necessary for our expansion; • diversion of our capital and management attention away from other business issues; • increase in our expenses and working capital requirements; • in the case of acquisitions that we may make outside of the United States, difficulty in operating in foreign countries and over significant geographical distances; • other financial risks, such as potential liabilities of the businesses we acquire; and • our due diligence process may fail to identify significant issues with the acquired company’s product and service quality, financial disclosures, accounting practices or internal control deficiencies.
Our acquisition strategy involves a number of risks, including: • difficulty in successfully integrating acquired operations, IT systems, customers, OEM supplier relationships, products, services and businesses with our operations; • risk that the acquired businesses will fail to maintain the quality of services that we have historically provided; • loss of key co-workers of acquired operations or inability to hire key co-workers necessary for our expansion; • diversion of our capital and management attention away from other business issues; • increase in our expenses and working capital requirements; • in the case of acquisitions that we may make outside of the United States, difficulty in operating in foreign countries and over significant geographical distances; • other financial risks, such as potential liabilities of the businesses we acquire; and • our due diligence process may fail to identify significant issues with the acquired company’s product and service quality, financial disclosures, accounting practices or internal control deficiencies.
We currently have a disaster recovery plan and carry property damage and business interruption insurance; however, they may not be sufficient to compensate for losses that may occur. 17 Table of Contents A portion of our revenue is financed by floor plan financing companies and any termination or reduction in these financing arrangements could increase our financing costs and harm our business and operating results.
We currently have a disaster recovery plan and carry property damage and business interruption insurance; however, they may not be sufficient to compensate for losses that may occur. 19 Table of Contents A portion of our revenue is financed by floor plan financing companies and any termination or reduction in these financing arrangements could increase our financing costs and harm our business and operating results.
In future years, our operating results may be below our expectations or those of our public market analysts or investors, which would likely cause our share price to decline. 12 Table of Contents We are subject to uncertainties and variability in demand by our customers, which could decrease revenue and adversely affect our operating results, and we have customer contracts with provisions that could cause fluctuations in our revenue.
In future years, our operating results may be below our expectations or those of our public market analysts or investors, which would likely cause our share price to decline. 14 Table of Contents We are subject to uncertainties and variability in demand by our customers, which could decrease revenue and adversely affect our operating results, and we have customer contracts with provisions that could cause fluctuations in our revenue.
More generally, these geopolitical, social and economic conditions could result in increased volatility in the United States and worldwide financial markets and economy. For example, increased instability may enhance volatility in currency exchange rates, cause our customers or potential customers to delay or reduce spending on our products or services, and limit our suppliers’ access to credit.
More generally, these geopolitical, social and economic conditions could result in increased volatility in the United States and worldwide financial markets and economies. For example, increased instability may enhance volatility in currency exchange rates, cause our customers or potential customers to delay or reduce spending on our products or services, and limit our suppliers’ access to credit.
Our effective tax rate could be adversely affected by several factors, many of which are outside of our control, including: • changes in income before taxes in various jurisdictions in which we operate that have differing statutory tax rates; • changing tax laws, regulations, and/or interpretations of such tax laws in multiple jurisdictions; • effect of tax rate on accounting for acquisitions and dispositions; • issues arising from tax audit or examinations and any related interest or penalties; and 23 Table of Contents • uncertainty in obtaining tax holiday extensions or expiration or loss of tax holidays in various jurisdictions.
Our effective tax rate could be adversely affected by several factors, many of which are outside of our control, including: • changes in income before taxes in various jurisdictions in which we operate that have differing statutory tax rates; • changing tax laws, regulations, and/or interpretations of such tax laws in multiple jurisdictions; • effect of tax rate on accounting for acquisitions and dispositions; • issues arising from tax audit or examinations and any related interest or penalties; and • uncertainty in obtaining tax holiday extensions or expiration or loss of tax holidays in various jurisdictions.
For example, as of November 30, 2022 , we had access to $3.5 billion in unused commitments under the TD SYNNEX revolving credit facility (as defined below). If new debt is added to our current debt levels, the related risks that we now face could intensify.
For example, as of November 30, 2023 , we had access to $3.5 billion in unused commitments under the TD SYNNEX revolving credit facility (as defined below). If new debt is added to our current debt levels, the related risks that we now face could intensify.
However, the resolution of certain of these matters could be material to our operating results for any particular period. For further information regarding our current litigation matters, refer to Note 18 – Commitments and Contingencies, to the Consolidated Financial Statements in Item 8.
However, the resolution of certain of these matters could be material to our operating results for any particular period. For further information regarding our current litigation matters, refer to Note 17 – Commitments and Contingencies, to the Consolidated Financial Statements in Item 8.
As of November 30, 2022 , we had $4.1 billion in outstanding short and long-term borrowings under term loans, our Senior Notes, lines of credit, accounts receivable securitization programs and finance leases, excluding trade payables.
As of November 30, 2023 , we had $4.1 billion in outstanding short and long-term borrowings under term loans, our Senior Notes, lines of credit, accounts receivable securitization programs and finance leases, excluding trade payables.
As of November 30, 2022, MiTAC Incorporated, a privately-held company based in Taiwan and a separate entity from MiTAC Holdings, directly and indirectly owned approximately 15.7% of Synnex Technology International and approximately 8.4% of MiTAC Holdings. As of November 30, 2022, MiTAC Holdings directly and indirectly owned 1.0% of Synnex Technology International.
As of November 30, 2023, MiTAC Incorporated, a privately-held company based in Taiwan and a separate entity from MiTAC Holdings, directly and indirectly owned approximately 15.7% of Synnex Technology International and approximately 8.4% of MiTAC Holdings. As of November 30, 2023, MiTAC Holdings directly and indirectly owned 1.0% of Synnex Technology International.
We completed an evaluation of the effectiveness of our internal control over financial reporting for fiscal year 2022, and we have an ongoing program to perform the system and process evaluation and testing necessary to continue to comply with these requirements.
We completed an evaluation of the effectiveness of our internal control over financial reporting for fiscal year 2023, and we have an ongoing program to perform the system and process evaluation and testing necessary to continue to comply with these requirements.
Changes to those rules or the questioning of current practices may adversely affect our reported financial results or the way we conduct our business. Item 1B. Unresolved Staff Comments None. 26 Table of Contents
Changes to those rules or the questioning of current practices may adversely affect our reported financial results or the way we conduct our business. Item 1B. Unresolved Staff Comments None. 28 Table of Contents
Additionally, such attacks could compromise our, or our customers' or vendors', intellectual property or confidential information or result in fraud or other financial loss. For example, in July 2021, SYNNEX announced publicly that a threat actor had gained access to SYNNEX' systems. That incident did not have a material impact to the business.
Additionally, such attacks could compromise our, or our customers' or vendors', intellectual property or confidential information or result in fraud or other financial loss. For example, in July 2021, we announced publicly that a threat actor had gained access to our systems. That incident did not have a material impact to the business.
If we cannot proportionately decrease our cost structure in response to competitive price pressures, our business and operating results could suffer. We also receive purchase discounts and rebates from OEM suppliers based on various factors, including sales or purchase volume and breadth of customers.
If we cannot proportionately decrease our cost structure in response to competitive price pressures, our business and operating results could suffer. 15 Table of Contents We also receive purchase discounts and rebates from OEM suppliers based on various factors, including sales or purchase volume and breadth of customers.
This concentration of investment and voting power could discourage others from initiating a potential merger, takeover or other change of control transaction that may otherwise be beneficial to TD SYNNEX and its stockholders, which could adversely affect the market price of TD SYNNEX common stock.
This concentration of investment and voting power could discourage others from initiating a potential merger, takeover or other change of 21 Table of Contents control transaction that may otherwise be beneficial to TD SYNNEX and its stockholders, which could adversely affect the market price of TD SYNNEX common stock.
The realization of any or all of these risks could have a significant adverse effect on our financial results. We rely on independent shipping companies for delivery of products, and price increases or service interruptions from these carriers could adversely affect our business and operating results.
The realization of any or all of these risks could have a significant adverse effect on our financial results. 24 Table of Contents We rely on independent shipping companies for delivery of products, and price increases or service interruptions from these carriers could adversely affect our business and operating results.
Because some rebates from OEM suppliers are based on percentage increases in sales of products, it may become more difficult for us to achieve the percentage growth in sales 13 Table of Contents required for larger discounts due to the current size of our revenue base.
Because some rebates from OEM suppliers are based on percentage increases in sales of products, it may become more difficult for us to achieve the percentage growth in sales required for larger discounts due to the current size of our revenue base.
Changes in foreign currency exchange rates and limitations on the convertibility of foreign currencies could adversely affect our business and operating results. Approximately 45%, 37% and 24% of our revenues in fiscal years 2022, 2021 and 2020, respectively, were generated outside the United States. Most of our international revenue, cost of revenue and operating expenses are denominated in foreign currencies.
Changes in foreign currency exchange rates and limitations on the convertibility of foreign currencies could adversely affect our business and operating results. Approximately 47%, 45% and 37% of our revenues in fiscal years 2023, 2022 and 2021, respectively, were generated outside the United States. Most of our international revenue, cost of revenue and operating expenses are denominated in foreign currencies.
We have significant operations in our facilities located in the Americas, Europe and APJ. Certain of our facilities, including one of our corporate headquarters locations in Clearwater, Florida, are located in geographic areas that heighten our exposure to hurricanes, tropical storms and other severe weather events.
We have significant operations in our facilities located in the Americas, Europe and APJ. Certain of our facilities, including our corporate headquarters locations in Clearwater, Florida and Fremont, California, are located in geographic areas that heighten our exposure to hurricanes, tropical storms, earthquakes and other severe weather events.
There could be potential conflicts of interest between us and MiTAC Holdings Corporation and its affiliates, which could affect our business and operating results. As of November 30, 2022 , MiTAC Holdings Corporation (“MiTAC Holdings”) and its affiliates owned approximately 9.7% of our common stock.
There could be potential conflicts of interest between us and MiTAC Holdings Corporation and its affiliates, which could affect our business and operating results. As of November 30, 2023 , MiTAC Holdings Corporation (“MiTAC Holdings”) and its affiliates owned approximately 9.3% of our common stock.
In addition, MiTAC Holdings directly and indirectly owned approximately 14.1% of MiTAC Incorporated and Synnex Technology International directly and indirectly owned approximately 18.4% of MiTAC Incorporated as of November 30, 2022. Synnex Technology International indirectly through its ownership of Peer Developments Limited owned approximately 4.1% of our outstanding common stock as of November 30, 2022 .
In addition, MiTAC Holdings directly and indirectly owned approximately 14.1% of MiTAC Incorporated and Synnex Technology International directly and indirectly owned approximately 18.4% of MiTAC Incorporated as of November 30, 2023. Synnex Technology International indirectly through its ownership of Peer Developments Limited owned approximately 3.9% of our outstanding common stock as of November 30, 2023 .
One customer accounted for 10%, 17% and 23% of our total revenue in fiscal years 2022, 2021 and 2020. The loss of one of our significant customers could result in an adverse impact on our business.
One customer accounted for 11%, 10% and 17% of our total revenue in fiscal years 2023, 2022 and 2021. The loss of one of our significant customers could result in an adverse impact on our business.
Softening demand for our products and services caused by an ongoing economic downturn and over-capacity may impact our revenue, as well the salability of inventory and collection of reseller and retail customer accounts receivable.
Softening demand for our products and services caused by economic downturns and over-capacity may impact our revenue, as well the salability of inventory and collection of reseller and retail customer accounts receivable.
In response to both the July 2021 and the July 2022 threat, we engaged in remedial and preventative actions to remove the threat actor and prevent further unauthorized access to our network, analyzed the information that the threat actors accessed, enhanced our data security and governance program, added additional protective security layers and are cooperating with law enforcement authorities.
In response to these threats, we engaged in remedial and preventative actions to remove the threat actor and prevent further unauthorized access to our network, analyzed the information that the threat actors accessed, enhanced our data security and governance program, added additional protective security layers and are cooperating with law enforcement authorities.
In July 2022, we became aware that a sophisticated threat actor gained access to a portion of our networks and systems. After conducting a thorough review of the attack with a leading third-party cybersecurity firm, we determined that the attack did not have a material impact on us.
In July 2022 and September 2023, we became aware that a sophisticated threat actor gained access to a portion of our networks and systems. After conducting a thorough review of those attacks with a leading third-party cybersecurity firm, we determined that those attacks did not have a material impact on us.
The General Data Protection Regulation (“GDPR”) in Europe, the California Consumer Privacy Act and other similar laws have resulted, and will continue to 24 Table of Contents result, in increased compliance costs.
The General Data Protection Regulation (“GDPR”) in Europe, the California Consumer Privacy Act and other similar laws have resulted, and will continue to result, in increased compliance costs.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly. Interest rates in the United States and other countries where we operate increased during fiscal year 2022 and may continue to increase in the future.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly. Interest rates in the United States and other countries where we operate have increased and may continue to increase in the future.
As of November 30, 2022, our executive officers, directors and principal stockholders owned approximately 57% of our outstanding common stock. In particular, Apollo Global Management, Inc. (“Apollo”) and its affiliates owned approximately 45% of our common stock. Apollo is the private equity company that through its affiliates owned Tech Data prior to the Merger.
As of November 30, 2023, our executive officers, directors and principal stockholders owned approximately 43% of our outstanding common stock. In particular, Apollo Global Management, Inc. (“Apollo”) and its affiliates owned approximately 32% of our common stock. Apollo is the private equity company that through its affiliates owned Tech Data prior to the Merger.
The extent of the impact of the COVID-19 pandemic on our future operational and financial performance, including our ability to execute our business strategies and initiatives in the expected time frame, will depend on future developments, including new COVID-19 variants; the effect on our customers and demand for our products and services; our ability to sell and provide our products and services, including as a result of travel restrictions and people working remotely; the ability of our customers to pay for our solutions; any closures of our or our customers’ or partners’ offices and facilities; and the impact of governmental actions or mandates imposed in response to COVID-19, all of which are uncertain and cannot be predicted.
The extent of the impact of any such public health crisis on our future operational and financial performance, including our ability to execute our business strategies and initiatives in the expected time frame, could depend on future developments, including the effect on our customers and demand for our products and services; our ability to sell and provide our products and services, including as a result of travel restrictions and people working remotely; the ability of our customers to pay for our solutions; any closures of our or our customers’ or partners’ offices and facilities; and the impact of governmental actions or mandates imposed in response to any such public health crisis, all of which are uncertain and cannot be predicted.
We are dependent in large part on our ability to retain the services of our key senior executives and other technological and industry experts and personnel. Except for certain of our key executives, we generally do not have employment agreements with our co-workers.
We are dependent in large part on our ability to retain the services of our key senior executives and other technological and industry experts and personnel. Except for certain of our key executives, we generally do not have employment agreements with our co-workers. We also do not carry “key person” insurance coverage for any of our key executives.
For example, sales of HP Inc. products and services comprised approximately 10%, 12% and 15% of our total revenue for fiscal years 2022, 2021 and 2020, respectively, and sales of Apple Inc. products and services comprised approximately 11% of our total revenue for fiscal year 2022.
For example, sales of Apple Inc. products and services comprised approximately 11% of our total revenue for both fiscal years 2023 and 2022, and sales of HP Inc. products and services comprised approximately 10% and 12% of our total revenue for fiscal years 2022 and 2021, respectively.
For example, in 22 Table of Contents fiscal year 2022, several foreign currencies in which we transact business depreciated against the U.S. dollar, including the Euro and the Japanese yen, which adversely affected the results of operations of our Europe and APJ segments for the year.
For example, in the past, several foreign currencies in which we transact business depreciated against the U.S. dollar, including the euro and the Japanese yen, which adversely affected the results of operations of our Europe and APJ segments in that year.
MiTAC Holdings’ and its affiliates’ continuing beneficial ownership of our common stock could create conflicts of interest with respect to a variety of business matters. For example, we currently purchase inventories from MiTAC Holdings and its affiliates.
MiTAC Holdings’ and its affiliates’ continuing beneficial ownership of our common stock could create conflicts of interest with respect to a variety of business matters. For example, we currently purchase inventories from MiTAC Holdings and its affiliates. Similar risks could exist as a result of Matthew F.C.
Worldwide economic conditions remain uncertain due to increased inflation, increases in interest rates, market volatility as a result of political leadership in certain countries, including due to Russia's invasion of Ukraine, and other disruptions to global and regional economies and markets.
Worldwide economic conditions remain uncertain due to the persistence of inflation, elevated interest rates, market volatility as a result of political leadership in certain countries, including due to Russia's invasion of Ukraine, the Israel-Hamas War and other disruptions to global and regional economies and markets.
In the event of the nonperformance by the counterparties, we are exposed to credit losses. 19 Table of Contents Risks Related to Our Relationships with Apollo Global Management, Inc. and MiTAC Holdings Corporation The concentration of ownership of our common stock among our executive officers, directors and principal stockholders could allow them to influence all matters requiring stockholder approval and could delay or prevent a change in control of TD SYNNEX.
Risks Related to Our Relationships with Apollo Global Management, Inc. and MiTAC Holdings Corporation The concentration of ownership of our common stock among our executive officers, directors and principal stockholders could allow them to influence all matters requiring stockholder approval and could delay or prevent a change in control of TD SYNNEX.
Similar risks could exist as a result of Matthew Miau’s positions as our Chairman Emeritus, a member of our Board of Directors, the Chairman of MiTAC Holdings and as a director or officer of MiTAC Holdings’ affiliates. For fiscal year 2022, Mr. Miau received the same compensation as our independent directors. Mr.
Miau’s positions as our Chairman Emeritus, a member of our Board of Directors, the Chairman of MiTAC Holdings and as a director or officer of MiTAC Holdings’ affiliates. For fiscal year 2023, Mr. Miau received the same compensation as our independent directors. Mr.
Unfavorable ESG ratings may lead to negative investor sentiment toward the Company, which could have a negative impact on our stock price and our access to and costs of capital. We have established corporate social responsibility programs aligned with sound environmental, social and governance principles.
Such ratings are used by some investors to inform their investment and voting decisions. Unfavorable ESG ratings may lead to negative investor sentiment toward the Company, which could have a negative impact on our stock price and our access to and costs of capital. We have established corporate social responsibility programs aligned with sound environmental, social and governance principles.
Sales of a substantial number of shares of the Company’s common stock in the 20 Table of Contents public market, or the perception that these sales may occur, could cause the market price of our common stock to decline.
Any additional future sales of a substantial number of shares of the Company’s common stock in the public market, or the perc eption that these sales may occur, could cause the market price of our common stock to decline.
We may be unable to successfully respond to and manage our business in light of industry developments and trends. As end-users migrate to cloud-based IT infrastructure and technology-as-a-service, sales of 21 Table of Contents hardware products may be reduced, thereby negatively impacting our operating results.
We may be unable to successfully respond to and manage our business in light of industry developments and trends. As end-users migrate to cloud-based IT infrastructure and technology-as-a-service, sales of hardware products may be reduced, thereby negatively impacting our operating results. Also crucial to our success in managing our operations is our ability to achieve additional economies of scale.
In addition, until a payment history is established over time with customers in a new geography or region, the likelihood of collecting accounts receivable generated by such operations could be less than our expectations.
In addition, until a payment history is established over time with customers in a new geography or region, the likelihood of collecting accounts receivable generated by such operations could be less than our expectations. As a result, there is a greater risk that reserves set with respect to the collection of such accounts receivable may be inadequate.
We could be negatively impacted by the widespread outbreak of an illness or any other communicable disease, or any other public health crisis that results in economic and trade disruptions, including the disruption of global supply chains. In December 2019, there was an outbreak of a new strain of coronavirus, COVID-19.
We could be negatively impacted by the widespread outbreak of an illness or any other communicable disease, such as the outbreak of COVID-19 that occurred during fiscal 2020, or any other public health crisis that results in economic and trade disruptions, including the disruption of global supply chains.
Certain countries are evaluating their tax policies and regulations, which could affect international business and may have an adverse effect on our overall tax rate, along with increasing the complexity, burden and cost of tax compliance.
We will continue to monitor the pending legislation and implementation that follows by individual countries. 25 Table of Contents Certain countries are evaluating their tax policies and regulations, which could affect international business and may have an adverse effect on our overall tax rate, along with increasing the complexity, burden and cost of tax compliance.
Evidence indicates that the threat actor responsible for this incident is related to, or the same as, the threat actor that previously gained unauthorized access to SYNNEX' systems.
Evidence indicates that the threat actor responsible for these incidents is related to, or the same as, the threat actor that previously gained unauthorized access to our systems in July 2021.
Such delays could also impact our ability to procure critical components required to complete customer orders. In addition, our OEM suppliers may decide to distribute, or to substantially increase their existing distribution business, through other distributors, their own dealer networks, or directly to resellers, retailers or end-users.
In addition, our OEM suppliers may decide to distribute, or to substantially increase their existing distribution business, through other distributors, their own dealer networks, or directly to resellers, retailers or end-users.
We have pursued and intend to continue to pursue strategic acquisitions or investments in new markets and may encounter risks associated with these activities, which could harm our business and operating results.
Any delay could impact our competitive position and result in loss of customer orders, which could impact our financial position and operating results. 16 Table of Contents We have pursued and intend to continue to pursue strategic acquisitions or investments in new markets and may encounter risks associated with these activities, which could harm our business and operating results.
Risks Related to the Macro-Economic and Regulatory Environment The widespread outbreak of an illness or any other communicable disease, or any other public health crisis, could adversely affect our business, results of operations and financial condition.
Our failure to achieve these additional economies of scale or to respond to changes in the IT industry could adversely affect our business and operating results. 23 Table of Contents Risks Related to the Macro-Economic and Regulatory Environment The widespread outbreak of an illness or any other communicable disease, or any other public health crisis, could adversely affect our business, results of operations and financial condition.
Our failure to adhere to or successfully implement processes in response to these and other changing regulatory requirements in this area could result in legal liability or impairment to our reputation in the marketplace, which could have a material adverse effect on our business, financial condition and results of operations.
Our failure to adhere to or successfully implement processes in response to these and other changing regulatory requirements in this area could result in legal liability or impairment to our reputation in the marketplace, which could have a material adverse effect on our business, financial condition and results of operations. 26 Table of Contents Global health and economic, political and social conditions may harm our ability to do business, increase our costs and negatively affect our stock price.
In addition, if we are not able to adequately adapt to the emergence of new technology or customer demand, such as cloud-based IT infrastructure and technology-as-a-service, our future operating results could be adversely affected.
In addition, if we are not able to adequately adapt to the emergence of new technology or customer demand, such as cloud-based IT infrastructure and technology-as-a-service, our future operating results could be adversely affected. 22 Table of Contents We are subject to intense competition, both in the United States and internationally, and if we fail to compete successfully, we will be unable to gain or retain market share.
Any actions by countries in which we conduct business to reverse policies that encourage foreign trade or investment could adversely affect our business. If we fail to realize the anticipated growth of our future international operations, our business and operating results could suffer.
Any actions by countries in which we conduct business to reverse policies that encourage foreign trade or investment could adversely affect our business.
If cash from available sources is insufficient, proceeds from our accounts receivable 15 Table of Contents securitization and revolving credit programs are limited or cash is used for unanticipated needs, we may require additional capital sooner than anticipated.
If cash from available sources is insufficient, proceeds from our accounts receivable securitization and revolving credit programs are limited or cash is used for unanticipated needs, we may require additional capital sooner than anticipated. 17 Table of Contents In the event we are required, or elect, to raise additional funds, we may be unable to do so on favorable terms, or at all, and may incur expenses in raising the additional funds.
In exchange for a fee that is either subsidized by our OEM suppliers or paid by us, we transfer the risk of loss on the sale of our products to the floor plan companies.
In exchange for a fee that is either subsidized by our OEM suppliers or paid by us, we transfer the risk of loss on the sale of our products to the floor plan companies. These arrangements with financing companies allow our business to operate at much lower relative working capital levels than if such programs were not available.
We have experienced a supply shortage of certain products as a result of strong demand or problems experienced by our OEM suppliers, including during fiscal years 2022, 2021 and 2020 due to global supply chain constraints. If shortages or delays persist, the price of those products may increase, or the products may not be available at all.
We have experienced supply shortages of certain products as a result of strong demand or problems experienced by our OEM suppliers. If shortages or delays persist, the price of those products may increase, or the products may not be available at all. Such delays could also impact our ability to procure critical components required to complete customer orders.
As a result, there is a greater risk that reserves set with respect to the collection of such accounts receivable may be inadequate. 25 Table of Contents Furthermore, if our international expansion efforts in any foreign country are unsuccessful, we may decide to cease operations, which would likely cause us to incur additional expense and loss.
Furthermore, if our international expansion efforts in any foreign country are unsuccessful, we may decide to cease operations, which would likely cause us to incur additional expense and loss.
These types of incidents may make it more difficult or expensive for us to obtain insurance coverage in the future.
From time to time, we have experienced incidents of theft at various facilities, water damages to our properties and other casualty events. These types of incidents may make it more difficult or expensive for us to obtain insurance coverage in the future.
We also do not carry “key person” insurance coverage for any of our key 16 Table of Contents executives. We compete for qualified senior management and technical personnel. The loss of, or inability to hire, key executives or qualified co-workers could inhibit our ability to operate and grow our business successfully.
We compete for qualified senior management and technical personnel. The loss of, or inability to hire, key executives or qualified co-workers could inhibit our ability to operate and grow our business successfully. 18 Table of Contents We may experience theft of product from our warehouses, water damage to our properties and other casualty events which could harm our operating results.
Our ability to deliver customized solutions on a timely basis is critical to our success. Any delay could impact our competitive position and result in loss of customer orders, which could impact our financial position and operating results.
Our ability to deliver customized solutions on a timely basis is critical to our success.
We are subject to intense competition, both in the United States and internationally, and if we fail to compete successfully, we will be unable to gain or retain market share. We operate in a highly competitive environment, both in the United States and internationally.
We operate in a highly competitive environment, both in the United States and internationally.
The Organization for Economic Cooperation and Development has been working on the Base Erosion and Profit Shifting Project, and has issued and will continue to issue, guidelines and proposals that may change various aspects of the existing framework under which our tax obligations are determined in many of the countries in which we do business.
The Organization for Economic Cooperation and Development has been working on the Base Erosion and Profit Shifting Project, which would grant additional taxing rights over profits earned by multinational enterprises to the countries in which their products are sold and services rendered.
Removed
We have incurred and will continue to incur significant acquisition and integration-related costs in connection with the Merger. We have incurred a number of non-recurring costs associated with the Merger and combining the operations of Tech Data and SYNNEX, including professional services costs, personnel and other costs, long-lived assets charges and stock-based compensation expense.
Added
On January 30, 2023, we announced the closing of a secondary public offering (the "January Offering") of an aggregate of approximately 5.2 million shares of our common stock that were sold by certain entities managed by Apollo.
Removed
We continue to assess the magnitude of these costs, and additional unanticipated costs may be incurred related to the Merger and the integration of Tech Data and SYNNEX.
Added
Additionally, on October 10, 2023, we entered into an underwriting agreement relating to the secondary public offering (the "October Offering") of an aggregate of approximately 6.8 million shares sold by certain entities managed by affiliates of Apollo and certain entities affiliated with MiTAC Holdings Corporation (collectively, the "Selling Stockholders").
Removed
Although we expect that the elimination of duplicative costs, as well as the realization of other efficiencies related to the integration of the businesses, should allow us to offset integration-related costs over time, this net benefit may not be achieved in the near term, or at all.
Added
In addition, the Selling Stockholders granted the underwriters an option to purchase up to an additional 1,012,500 shares of our common stock. The October Offering was completed on October 13, 2023 and the underwriters exercised their option in full. We did not receive any of the proceeds from the sale of shares in the January Offering or the October Offering.
Removed
As of November 30, 2022, the Europe and APJ reporting units' goodwill balances are $1.3 billion and $74.8 million, respectively, and the fair value of the reporting unit exceeded its carrying value by 6% and 9% as of the annual goodwill impairment testing date, respectively.
Added
Rules adopted in response to this project would establish a global per-country minimum tax of 15%, and the European Union has approved a directive requiring members to adopt similar provisions into their respective domestic laws. These rules would become effective for fiscal years starting on or after December 31, 2023 (fiscal year 2025 for the Company).
Removed
If actual results in our Europe or APJ reporting units are substantially lower than the projections used in our valuation methodology, or if market discount rates substantially increase or our market capitalization substantially decreases, then our future valuations could be adversely affected.
Added
Significant details around the rules are still under formulation and the timing around enactment remains uncertain. Due to these new rules, our income tax expense could be unfavorably impacted as the legislation becomes effective in countries in which we conduct business.
Removed
In the event we are required, or elect, to raise additional funds, we may be unable to do so on favorable terms, or at all, and may incur expenses in raising the additional funds.
Added
If we fail to realize the anticipated growth of our future international operations, our business and operating results could suffer. 27 Table of Contents Increasing attention on environmental, social and governance ("ESG") matters may have a negative impact on our business, impose additional costs on us, and expose us to additional risks.
Removed
We may experience theft of product from our warehouses, water damage to our properties and other casualty events which could harm our operating results. From time to time, we have experienced incidents of theft at various facilities, water damages to our properties and other casualty events.
Removed
We currently receive payment from these financing companies within approximately 15 to 30 days from the date of the sale, which allows our business to operate at much lower relative working capital levels than if such programs were not available.
Removed
The expected replacement of the LIBOR benchmark interest rate and other interbank offered rates with new benchmark rate indices may have an impact on our financing costs. As of November 30, 2022, we had approxim ately $1.4 billion of term loan debt outstanding und er facilities with interest rates based on LIBOR.
Removed
Some of our credit facilities include fallback language that seeks to facilitate an agreement with our lenders on a replacement rate for LIBOR in the event of its discontinuance or that automatically replaces LIBOR with benchmark rates based on the Secured Overnight Financing Rate ("SOFR") or other benchmark replacement rates upon certain triggering events.
Removed
The discontinuation, reform, or replacement of LIBOR or any other benchmark rates may result in fluctuating interest rates that may have a negative impact on our interest expense and our profitability.
Removed
Potential changes to the underlying floating-rate indices and reference rates may have an adverse impact on our liabilities indexed to LIBOR and could have a negative impact on our profitability and cash flows. We continue to evaluate the operational and other effects of such changes, including possible impacts on our accounting for interest rate hedging agreements.
Removed
We have entered into interest rate swaps with financial institutions to effectively convert a portion of our floating rate debt to a fixed interest rate to manage our exposure to fluctuations in interest rates.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe own approximately 2.7 million square feet of property and lease the remainder. Our facilities are located in the following principal markets: the Americas – 76, Europe – 72 and APJ – 46. We have sublet unused portions of some of our facilities. We believe our facilities are well maintained and adequate for current and near future operating needs.
Biggest changeWe own approximately 2.7 million square feet of property and lease the remainder. Our facilities are located in the following principal markets: the Americas – 55, Europe – 69 and APJ – 44. We have sublet unused portions of some of our facilities. We believe our facilities are well maintained and adequate for current and near future operating needs.
Item 2. Properties Our principal executive offices are located in Fremont, California and Clearwater, Florida. Our Fremont property is owned by us, while the Clearwater location is currently leased. We operate distribution, integration, contact center and administrative facilities in different countries. We occupy 194 facilities covering approximately 14.6 million square feet, including warehouse, logistics and administrative facilities.
Item 2. Properties Our principal executive offices are located in Fremont, California and Clearwater, Florida. Our Fremont property is owned by us, while the Clearwater location is currently leased. We operate distribution, integration, contact center and administrative facilities in different countries. We occupy 168 facilities covering approximately 14.1 million square feet, including warehouse, logistics and administrative facilities.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeTech Data agreed with French authorities to make eight equal installment payments in relation to the fine assessed for a total amount of €22.8 million on a quarterly basis from January 2021 through October 2022. Additionally, we provided a third-party surety bond to the Competition Authority to guarantee the payment of the amount of the fine and interest, if applicable.
Biggest changeTech Data agreed with French authorities to make eight equal installment payments in relation to the fine assessed for a total amount of €22.8 million on a quarterly basis from January 2021 through October 2022. On October 6, 2022, the appeals court issued a ruling that reduced the fine imposed on us from €76.1 million to €24.9 million.
As a result of the appeals court ruling, we have determined that the best estimate of probable loss related to this matter as of November 30, 2022 is €24.9 million (approximately $25.7 million as of November 30, 2022), which was paid in full.
As a result of the appeals court ruling, we have determined that the best estimate of probable loss related to this matter as of November 30, 2023 is €24.9 million (approximately $27.3 million as of November 30, 2023), which was paid in full in fiscal year 2022.
We are currently evaluating this matter and cannot currently estimate the probability or amount of any potential loss.
We are currently evaluating this matter and cannot currently estimate the probability or amount of any potential loss. Item 4. Mine Safety Disclosures Not applicable. 29 Table of Contents PART II
On October 6, 2022, the appeals court issued a ruling that reduced the fine imposed on us from €76.1 million to €24.9 million. We continue to contest the arguments of the Competition Authority and have further appealed this matter.
We continue to contest the arguments of the Competition Authority and have further appealed this matter.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table presents information with respect to purchases of common stock by the Company under the share repurchase program during the quarter ended November 30, 2022: Issuer Purchases of Equity Securities (amounts in thousands except per share amounts) Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or program Maximum dollar value of shares that may yet be purchased under the plans or program September 1 - September 30, 2022 118 $ 91.27 118 $ 306,179 October 1 - October 31, 2022 333 86.48 333 277,385 November 1 - November 30, 2022 26 92.15 26 274,984 Total 477 $ 87.98 477 In January 2023, our Board of Directors authorized a new three-year $1.0 billion share repurchase program, replacing the existing $400.0 million share repurchase program, pursuant to which we may repurchase our outstanding common stock from time to time in the open market or through privately negotiated transactions.
Biggest changeThe following table presents information with respect to purchases of common stock by the Company under the share repurchase program during the quarter ended November 30, 2023: Issuer Purchases of Equity Securities (amounts in thousands except per share amounts) Period Total number of shares purchased Average price paid per share (1) Total number of shares purchased as part of publicly announced plans or program Maximum dollar value of shares that may yet be purchased under the plans or program September 1 - September 30, 2023 459 $ 100.45 459 $ 692,672 October 1 - October 31, 2023 3,081 95.10 3,081 399,625 November 1 - November 30, 2023 41 92.15 41 395,875 Total 3,581 $ 95.76 3,581 _________________________ (1) Excludes excise taxes, whether accrued or paid, and excludes broker's commissions. 31 Table of Contents Item 6. [Reserved]
Stock Price Performance Graph The stock price performance graph below, which assumes a $100 investment on November 30, 2017, compares our cumulative total stockholder return, the S&P Midcap 400 Index and Computer and Peripheral Equipment index for the period beginning November 30, 2017 through November 30, 2022.
Stock Price Performance Graph The stock price performance graph below, which assumes a $100 investment on November 30, 2018, compares our cumulative total stockholder return, the S&P Midcap 400 Index and Computer and Peripheral Equipment index for the period beginning November 30, 2018 through November 30, 2023.
The Computer and Peripheral Equipment index is based on the Standard Industrial Classification Code 5045—Wholesale Computer and Computer Peripheral Equipment and Software. The closing price per share of our common stock was $102.30 on November 30, 2022.
The Computer and Peripheral Equipment index is based on the Standard Industrial Classification Code 5045—Wholesale Computer and Computer Peripheral Equipment and Software. The closing price per share of our common stock was $98.64 on November 30, 2023.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock, par value $0.001, is traded on the New York Stock Exchange, or NYSE, under the symbol “SNX.” As of January 16, 2023, our common stock was held by approximately 4,100 stockholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock, par value $0.001, is traded on the New York Stock Exchange, or NYSE, under the symbol “SNX.” As of January 17, 2024, our common stock was held by approximately 2,400 stockholders of record.
Dividends declared per share by fiscal quarter in 2022 and 2021 were as follows: Fiscal Years Ended November 30, 2022 2021 First Quarter $ 0.300 $ 0.200 Second Quarter $ 0.300 $ 0.200 Third Quarter $ 0.300 $ 0.200 Fourth Quarter $ 0.300 $ 0.200 On January 10, 2023, the Company announced a cash dividend of $0.35 per share to stockholders of record as of January 20, 2023, payable on January 27, 2023.
Dividends declared per share by fiscal quarter in 2023 and 2022 were as follows: Fiscal Years Ended November 30, 2023 2022 First Quarter $ 0.350 $ 0.300 Second Quarter $ 0.350 $ 0.300 Third Quarter $ 0.350 $ 0.300 Fourth Quarter $ 0.350 $ 0.300 On January 9, 2024, the Company announced a cash dividend of $0.40 per share to stockholders of record as of January 19, 2024, payable on January 26, 2024.
Repurchases of Equity Securities In June 2020, our Board of Directors authorized a three-year $400.0 million share repurchase program, effective July 1, 2020, pursuant to which we may repurchase our outstanding common stock from time to time in the open market or through privately negotiated transactions.
In January 2023, our Board of Directors authorized a new three-year $1.0 billion share repurchase program (the "new share repurchase program"), replacing the existing $400.0 million share repurchase program, pursuant to which we may repurchase our outstanding common stock from time to time in the open market or through privately negotiated transactions.
Fiscal Years Ended 11/30/2017 11/30/2018 11/30/2019 11/30/2020 11/30/2021 11/30/2022 TD SYNNEX Corporation $ 100.00 $ 60.12 $ 92.82 $ 121.50 $ 162.14 $ 162.37 S&P Midcap 400 Index $ 100.00 $ 100.48 $ 109.38 $ 119.99 $ 151.76 $ 146.77 Computers and Peripheral Equipment $ 100.00 $ 104.19 $ 121.52 $ 132.02 $ 157.40 $ 154.12 30 Table of Contents Securities Authorized for Issuance under Equity Compensation Plans Information regarding the Securities Authorized for Issuance under Equity Compensation Plans can be found under Item 12 of this Report.
Fiscal Years Ended 11/30/2018 11/30/2019 11/30/2020 11/30/2021 11/30/2022 11/30/2023 TD SYNNEX Corporation $ 100.00 $ 154.40 $ 202.10 $ 269.70 $ 270.08 $ 264.11 S&P Midcap 400 Index $ 100.00 $ 108.86 $ 119.42 $ 151.03 $ 146.07 $ 147.77 Computers and Peripheral Equipment $ 100.00 $ 134.71 $ 225.64 $ 244.22 $ 192.94 $ 194.11 30 Table of Contents Securities Authorized for Issuance under Equity Compensation Plans Information regarding the Securities Authorized for Issuance under Equity Compensation Plans can be found under Item 12 of this Report.
Removed
Dividends On September 29, 2014, we announced the initiation of a quarterly cash dividend. Since then, dividends have been declared in January, March, June and September and paid at the end of January, April, July and October.
Added
Dividends We have a history of paying quarterly cash dividends.
Added
Repurchases of Equity Securities In June 2020, our Board of Directors authorized a three-year $400.0 million share repurchase program, effective July 1, 2020.
Added
The prior $400.0 million share repurchase program was terminated on January 4, 2023, when it was replaced by the new share repurchase program, which will expire on January 3, 2026.
Added
On October 10, 2023, we announced the October Offering of an aggregate of 7.8 million shares (which includes approximately 1.0 million additional shares that underwriters had the option to purchase) of which approximately 6.8 million shares were sold by certain entities managed by Apollo Global Management, Inc. and 966 thousand shares were sold by certain entities affiliated with MiTAC Holdings Corporation.
Added
All of the shares in the October Offering were sold by the Selling Stockholders. We did not receive any of the proceeds from the sale of shares by the Selling Stockholders in the October Offering.
Added
Also pursuant to the related underwriting agreement, we repurchased 2.8 million shares from the underwriters as part of the October Offering, at a repurchase price of $95.5135 per share, resulting in a purchase price of approximately $262.7 million (the "Concurrent Share Repurchase").
Added
The Concurrent Share Repurchase was made under our existing share repurchase program, and is included within the activity for the month of October shown in the table below.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of Operations The following table sets forth, for the indicated periods, Consolidated Statement of Operations data as a percentage of revenue: Fiscal Years Ended November 30, Statements of Operations Data: 2022 2021 Revenue 100.00 % 100.00 % Cost of revenue (93.74) % (94.02) % Gross profit 6.26 % 5.98 % Selling, general and administrative expenses (4.21) % (3.65) % Acquisition, integration and restructuring costs (0.36) % (0.35) % Operating income 1.69 % 1.97 % Interest expense and finance charges, net (0.36) % (0.50) % Other (expense) income, net 0.00 % 0.00 % Income before income taxes 1.33 % 1.48 % Provision for income taxes (0.29) % (0.23) % Net income 1.04 % 1.25 % 33 Table of Contents Certain non-GAAP financial information In addition to disclosing financial results that are determined in accordance with GAAP, we also disclose certain non-GAAP financial information, including: • Non-GAAP gross profit, which is gross profit, adjusted to exclude the portion of purchase accounting adjustments that affected cost of revenue. • Non-GAAP gross margin, which is non-GAAP gross profit, as defined above, divided by revenue. • Non-GAAP operating income, which is operating income, adjusted to exclude acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense and purchase accounting adjustments. • Non-GAAP operating margin, which is non-GAAP operating income, as defined above, divided by revenue. • Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) which is net income before interest, taxes, depreciation and amortization, adjusted to exclude other (expense) income, net, acquisition, integration and restructuring costs, share-based compensation expense, and purchase accounting adjustments. • Non-GAAP net income, which is net income, adjusted to exclude acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense, purchase accounting adjustments, legal settlements and other litigation, net, income taxes related to the aforementioned items, as well as a capital loss carryback benefit . • Non-GAAP diluted earnings per common share (“EPS”), which is diluted EPS excluding the per share impact of acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense, purchase accounting adjustments, legal settlements and other litigation, net, income taxes related to the aforementioned items, as well as a capital loss carryback benefit .
Biggest changeWe seek to acquire new OEM relationships, enhance our supply chain and integration capabilities, the services we provide to our customers and OEM suppliers, and expand our geographic footprint. 32 Table of Contents Results of Operations The following table sets forth, for the indicated periods, data as percentages of total revenue: Fiscal Years Ended November 30, Consolidated Statements of Operations Data: 2023 2022 Revenue 100.00 % 100.00 % Cost of revenue (93.13) % (93.74) % Gross profit 6.87 % 6.26 % Selling, general and administrative expenses (4.64) % (4.21) % Acquisition, integration and restructuring costs (0.36) % (0.36) % Operating income 1.87 % 1.69 % Interest expense and finance charges, net (0.50) % (0.36) % Other (expense) income, net 0.00 % 0.00 % Income before income taxes 1.37 % 1.33 % Provision for income taxes (0.28) % (0.29) % Net income 1.09 % 1.04 % Certain Non-GAAP Financial Information In addition to disclosing financial results that are determined in accordance with GAAP, we also disclose certain non-GAAP financial information, including: • Revenue in constant currency, which is revenue adjusted for the translation effect of foreign currencies so that certain financial results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance.
The TD SYNNEX Credit Agreement has a maturity date of September 2026, in the case of the TD SYNNEX revolving credit facility, subject to two one-year extensions upon our prior notice to the lenders and the agreement of the lenders to extend such maturity date. The outstanding amount of our borrowings under the U.S.
The TD SYNNEX Credit Agreement has a maturity date of September 2026 and, in the case of the TD SYNNEX revolving credit facility, subject to two one-year extensions upon our prior notice to the lenders and the agreement of the lenders to extend such maturity date. The outstanding amount of our borrowings under the U.S.
On March 22, 2021, SYNNEX entered into an agreement and plan of merger (the “Merger Agreement”) which provided that legacy SYNNEX Corporation would acquire legacy Tech Data Corporation, a Florida corporation (“Tech Data”) through a series of mergers, which would result in Tech Data becoming an indirect subsidiary of TD SYNNEX Corporation (collectively, the "Merger").
On March 22, 2021, we entered into an agreement and plan of merger (the “Merger Agreement”) which provided that legacy SYNNEX Corporation would acquire legacy Tech Data Corporation, a Florida corporation (“Tech Data”) through a series of mergers, which would result in Tech Data becoming an indirect subsidiary of TD SYNNEX Corporation (collectively, the "Merger").
Contractual Obligations We are contingently liable under agreements, without expiration dates, to repurchase repossessed inventory acquired by flooring companies as a result of default on floor plan financing arrangements by our customers. There have been no material repurchases through November 30, 2022 under these agreements and we are not aware of any pending customer defaults or repossession obligations.
Contractual Obligations We are contingently liable under agreements, without expiration dates, to repurchase repossessed inventory acquired by flooring companies as a result of default on floor plan financing arrangements by our customers. There have been no material repurchases through November 30, 2023 under these agreements and we are not aware of any pending customer defaults or repossession obligations.
From time to time, this category may also include transaction-related gains/losses on divestitures/spin-off of businesses, costs related to long-lived assets including impairment charges and accelerated depreciation and amortization expense due to changes in asset useful lives, as well as various other costs associated with an acquisition or divestiture.
From time to time, this category may also include transaction-related gains/losses on divestitures/spin-off of businesses, costs related to long-lived assets including impairment charges and accelerated depreciation and amortization expense due to changes in asset useful lives, as well as various other costs associated with the acquisition or divestiture.
They also limit our (or our subsidiaries', as applicable) ability to incur additional debt or liens, enter into agreements with affiliates, modify the nature of our business, and merge or consolidate. As of November 30, 2022, we were in compliance with the financial covenant requirements for the above arrangements.
They also limit our (or our subsidiaries', as applicable) ability to incur additional debt or liens, enter into agreements with affiliates, modify the nature of our business, and merge or consolidate. As of November 30, 2023, we were in compliance with the financial covenant requirements for the above arrangements.
Our working capital needs are primarily to finance accounts receivable and inventory. We rely heavily on term loans, sales of accounts receivable, our securitization programs, our revolver programs and trade credit from vendors for our working capital needs. We have financed our growth and cash needs to date primarily through cash generated from operations and financing activities.
Our working capital needs are primarily to finance accounts receivable and inventory. We rely heavily on term loans, sales of accounts receivable, our securitization program, our revolver programs and net trade credit from vendors for our working capital needs. We have financed our growth and cash needs to date primarily through cash generated from operations and financing activities.
The Merger We incurred acquisition, integration and restructuring costs related to the completion of the Merger, including professional services costs, personnel and other costs, long-lived assets charges and stock-based compensation expense. Professional services costs are primarily comprised of IT and other consulting services, as well as legal expenses.
The Merger We incurred acquisition, integration and restructuring costs related to the completion of the Merger, including professional services costs, personnel and other costs, long-lived assets charges and termination fees and stock-based compensation expense. Professional services costs are primarily comprised of IT and other consulting services, as well as legal expenses.
Amounts in certain tables appearing in this Report may not add or compute due to rounding. This section of the Form 10-K generally discusses fiscal 2022 and 2021 items and year-to-year comparisons between fiscal 2022 and 2021.
Amounts in certain tables appearing in this Report may not add or compute due to rounding. This section of the Form 10-K generally discusses fiscal 2023 and 2022 items and year-to-year comparisons between fiscal 2023 and 2022.
Overview We are a leading global distributor and solutions aggregator for the information technology ("IT") ecosystem. We serve a critical role, bringing products from the world's leading and emerging technology vendors to market, and helping our customers create solutions best suited to maximize business outcomes for their end-user customers.
Overview We are a Fortune 100 corporation and a leading global distributor and solutions aggregator for the information technology ("IT") ecosystem. We serve a critical role, bringing products from the world's leading and emerging technology vendors to market, and helping our customers create solutions best suited to maximize business outcomes for their end-user customers.
To increase our market share and better serve our customers, we may further expand our operations through investments or acquisitions. We expect that such expansion would require an initial investment in working capital, personnel, facilities and operations.
To increase our market share and better serve our customers, we may further expand our operations through investments or acquisitions. We expect that any such expansions would require an initial investment in working capital, personnel, facilities and operations.
If in the future our intentions change, and we repatriate the cash back to the United States, we will report in our consolidated financial statements the impact of state and withholding taxes depending upon the planned timing and manner of such repatriation.
If in the future we repatriate foreign cash back to the United States, we will report in our Consolidated Financial Statements the impact of state and withholding taxes depending upon the planned timing and manner of such repatriation.
For further discussion of this legal matter, please refer to Note 18 - Commitments and Contingencies to the Consolidated Financial Statements included in Part II, Item 8 of this report.
For further discussion of this legal matter in France, please refer to Note 17 - Commitments and Contingencies to the Consolidated Financial Statements included in Part II, Item 8 of this Report.
This end-market demand is influenced by many factors including the introduction of new IT products and software by OEMs, replacement cycles for existing IT products, trends toward cloud computing, seasonality, overall economic growth and general business activity.
This end-market demand is influenced by many factors including the introduction of new IT products and software by OEM suppliers, replacement cycles for existing IT products, trends toward cloud computing, overall economic growth and general business activity.
We believe our current cash balances, cash flows from operations and credit availability are sufficient to support our operating activities for at least the next twelve months. Capital Resources Our cash and cash equivalents totaled $522.6 million and $994.0 million as of November 30, 2022 and 2021, respectively.
We believe our current cash balances, cash flows from operations and credit availability are sufficient to support our operating activities for at least the next twelve months. Capital Resources Our cash and cash equivalents totaled $1.0 billion and $522.6 million as of November 30, 2023 and 2022, respectively.
We are also party to a credit agreement, dated as of April 16, 2021 (the "TD SYNNEX Credit Agreement"), pursuant to which we received commitments for the extension of a senior unsecured revolving credit facility not to exceed an aggregate principal amount of $3.5 billion, which revolving credit facility (the "TD SYNNEX revolving credit facility") may, at our request but subject to the lenders' discretion, potentially be increased by up to an aggregate amount of $500.0 million.
We also have a credit agreement, dated as of April 16, 2021 and amended May 22, 2023 (as amended, the "TD SYNNEX Credit Agreement"), pursuant to which we received commitments for the extension of a senior unsecured revolving credit facility not to exceed an aggregate principal amount of $3.5 billion, which revolving credit facility (the "TD SYNNEX revolving credit facility") may, at our request but subject to the lenders' discretion, potentially be increased by up to an aggregate amount of $500.0 million.
Discussions of fiscal 2020 items and year-to-year comparisons between fiscal 2021 and 31 Table of Contents 2020 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 2021 filed with the SEC on January 28, 2022.
Discussions of fiscal 2021 items and year-to-year comparisons between fiscal 2022 and 2021 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended November 30, 2022 filed with the SEC on January 24, 2023.
Revenue is reduced for early payment discounts and volume incentive rebates offered to customers, which are considered variable consideration, at the time of sale based on an evaluation of the contract terms and historical experience.
These provisions are reviewed and adjusted periodically. Revenue is reduced for early payment discounts and volume incentive rebates offered to customers, which are considered variable consideration, at the time of sale based on an evaluation of the contract terms and historical experience.
AR Arrangement and the TD SYNNEX revolving credit facility may fluctuate in response to changes in our working capital and other liquidity requirements. There were no amounts outstanding under the U.S. AR Arrangement and the TD SYNNEX revolving credit facility at November 30, 2022 and 2021.
AR Arrangement and the TD SYNNEX revolving credit facility may fluctuate in response to changes in our working capital and other liquidity requirements. There were no amounts outstanding under the U.S.
At November 30, 2022 and 2021, we had a total of $1.4 billion and $759.9 million, respectively, of trade accounts receivable sold to and held by financial institutions under these programs. Discount fees for these programs in the years ended November 30, 2022 and 2021 totaled $26.2 million and $4.7 million, respectively.
At November 30, 2023 and 2022, we had a total of $864.6 million and $1.4 billion, respectively, of trade accounts receivable sold to and held by financial institutions under these programs. Discount fees for these programs in the years ended November 30, 2023 and 2022 totaled $51.1 million and $26.2 million, respectively.
We had total outstanding borrowings of approximately $4.1 billion as of November 30, 2022 and 2021. Our outstanding borrowings include Senior Notes of $2.5 billion at November 30, 2022 and 2021, and term loans under the term loan facility of the TD SYNNEX Credit Agreement of $1.4 billion and $1.5 billion at November 30, 2022 and 2021, respectively.
Our outstanding borrowings include Senior Notes of $2.5 billion at November 30, 2023 and 2022, and term loans under the term loan facility of the TD SYNNEX Credit Agreement of approximately $1.3 billion and $1.4 billion at November 30, 2023 and 2022, respectively.
The Company expects the duration of these adjustments to benefit our non-GAAP operating income through a portion of fiscal 2023 based on historical settlement patterns with our vendors and in accordance with the timing defined in our policy for releasing vendor and customer liabilities we deem remote to be paid.
These adjustments benefited our non-GAAP operating income through the third fiscal quarter of fiscal 2023 based on historical settlement patterns with our vendors and in accordance with the timing defined in our policy for releasing vendor and customer liabilities we deem remote to be paid.
Our cash and cash equivalents held by international subsidiaries are no longer subject to U.S. federal tax on repatriation into the United States. Repatriation of some foreign balances is restricted by local laws. Historically, we have fully utilized and reinvested all foreign cash to fund our foreign operations and expansion.
Our cash and cash equivalents held by international subsidiaries are no longer subject to U.S. federal tax on repatriation into the United States. Repatriation of some foreign balances is restricted by local laws.
Such arrangements include supplier service contracts, post-contract software support services, cloud computing and software as a service arrangements, certain fulfillment contracts and extended warranty contracts. We consider shipping and handling activities as costs to fulfill the sale of products.
Such arrangements include supplier service contracts, post-contract software support services, cloud computing and software as a service arrangements, certain fulfillment contracts, extended warranty contracts and certain of our systems design and integration solutions arrangements which operate under a customer-owned procurement model. We consider shipping and handling activities as costs to fulfill the sale of products.
Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value and the excess is recognized as an impairment loss.
Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value and the excess is recognized as an impairment loss. No goodwill impairment has been identified for any of the years presented.
Selling, General and Administrative Expenses Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Selling, general and administrative expenses $ 2,627,007 $ 1,154,166 127.6 % Percentage of revenue 4.21 % 3.65 % Our selling, general and administrative expenses consist primarily of personnel costs such as salaries, commissions, bonuses, share-based compensation and temporary personnel costs.
Selling, General and Administrative Expenses Fiscal Years Ended November 30, Percent Change 2023 2022 2023 to 2022 (in thousands) Selling, general and administrative expenses $ 2,672,562 $ 2,627,007 1.7 % Percentage of revenue 4.64 % 4.21 % 36 Table of Contents Our selling, general and administrative expenses consist primarily of personnel costs such as salaries, commissions, bonuses, share-based compensation and temporary personnel costs.
In addition to the treasury efficiencies, these restructurings resulted in a one-time domestic capital loss which would offset certain domestic capital gains when carried back under United States tax law to tax year 2020, resulting in a tax benefit of $45.0 million during fiscal year 2021.
In addition to the treasury efficiencies, these restructurings resulted in a one-time domestic capital loss which would offset certain domestic capital gains when carried back under United States tax law, resulting in an income tax capital loss carryback benefit.
A liability is recorded at the time of sale for estimated product returns based upon historical experience and an asset is recognized for the amount expected to be recorded in inventory upon product return. These provisions are reviewed and adjusted periodically.
Provisions for sales returns and allowances are estimated based on historical data and are recorded concurrently with the recognition of revenue. A liability is recorded at the time of sale for estimated product returns based upon historical experience and an asset is recognized for the amount expected to be recorded in inventory upon product return.
S hare-based compensation expense is a non-cash expense arising from the grant of equity awards to employees and non-employee members of the Company's Board of Directors based on the estimated fair value of those awards. 34 Table of Contents Although share-based compensation is an important aspect of the compensation of our employees, the fair value of the share-based awards may bear little resemblance to the actual value realized upon the vesting or future exercise of the related share-based awards and the expense can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions.
Although share-based compensation is an important aspect of the compensation of our employees, the fair value of the share-based awards may bear little resemblance to the actual value realized upon the vesting or future exercise of the related share-based awards and the expense can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions.
Provision for Income Taxes Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Provision for income taxes $ 175,823 $ 71,416 146.2 % Percentage of income before income taxes 21.26 % 15.31 % Income taxes consist of our current and deferred tax expense resulting from our income earned in domestic and foreign jurisdictions.
Provision for Income Taxes Fiscal Years Ended November 30, Percent Change 2023 2022 2023 vs. 2022 (in thousands) Provision for income taxes $ 162,597 $ 175,823 (7.5) % Percentage of income before income taxes 20.59 % 21.26 % Income taxes consist of our current and deferred tax expense resulting from our income earned in domestic and foreign jurisdictions.
Interest Expense and Finance Charges, Net Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Interest expense and finance charges, net $ 222,578 $ 157,835 41.0 % Percentage of revenue 0.36 % 0.50 % Amounts recorded in interest expense and finance charges, net, consist primarily of interest expense paid on our Senior Notes, our lines of credit, our term loans and our accounts receivable securitization facilities, and fees associated with the sale of accounts receivable, partially offset by income earned on our cash investments.
APJ operating margin and non-GAAP operating margin were relatively flat, compared to the prior fiscal year. 40 Table of Contents Interest Expense and Finance Charges, Net Fiscal Years Ended November 30, Percent Change 2023 2022 2023 vs. 2022 (in thousands) Interest expense and finance charges, net $ 288,318 $ 222,578 29.5 % Percentage of revenue 0.50 % 0.36 % Amounts recorded in interest expense and finance charges, net, consist primarily of interest expense on our Senior Notes, our lines of credit, our term loans and our accounts receivable securitization facilities, and fees associated with the sale of accounts receivable, partially offset by income earned on our cash investments.
We calculate CCC as days of the last fiscal quarter’s revenue outstanding in accounts receivable plus days of supply on hand in inventory, less days of the last fiscal quarter’s cost of revenue outstanding in accounts payable. Our CCC was 23 days and 14 days at the end of fiscal years 2022 and 2021, respectively.
We calculate CCC as days of the last fiscal quarter’s revenue outstanding in accounts receivable plus days of supply on hand in inventory, less days of the last fiscal quarter’s cost of revenue outstanding in accounts payable.
We believe that our available cash and cash equivalents balances, the cash flows expected to be generated from operations and our existing sources of liquidity, will be sufficient to satisfy our current and planned working capital and investment needs, for the next twelve months in all geographies.
We believe that our available cash and cash equivalents balances, cash flows from operations and our existing sources of liquidity, including available capacity under our borrowing facilities, will be sufficient to enable the repayment of $700.0 million of our Senior Notes due in August 2024 and satisfy our current and planned working capital and investment needs, for the next twelve months in all geographies.
We also believe that our longer-term working capital, planned capital expenditures, anticipated stock repurchases, dividend payments and other general corporate funding requirements will be satisfied through cash flows from operations and, to the extent necessary, from our borrowing facilities and future financial market activities. 44 Table of Contents Credit Facilities and Borrowings In the United States, we have an accounts receivable securitization program to provide additional capital for our operations (the "U.S.
We also believe that our longer-term working capital, planned capital expenditures, anticipated stock repurchases, dividend payments and other general corporate funding requirements will be satisfied through cash flows from operations and, to the extent necessary, from our borrowing facilities and future financial market activities.
The tax benefits 47 Table of Contents recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. We recognize interest and penalties related to unrecognized tax benefits in the provision for income taxes.
The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement.
A difficult and challenging economic environment due to the continued impacts of increased inflation, rising interest rates and Russia's invasion of Ukraine, may also lead to consolidation or decline in the IT distribution industry and increased price-based competition.
A difficult and challenging economic environment due to the continued persistence of inflation, elevated interest rates, and market volatility as a result of military conflicts in certain countries may also lead to consolidation or decline in the IT distribution industry and increased price-based competition.
Long-lived asset charges for fiscal year 2022 are primarily comprised of accelerated depreciation and amortization expense of $64.4 million due to changes in asset useful lives in conjunction with the consolidation of certain IT systems, as well as impairment charges.
Long-lived asset charges and termination fees include accelerated depreciation and amortization expense of $17.4 million and $64.4 million during fiscal years 2023 and 2022, respectively, due to changes in asset useful lives in conjunction with the consolidation of certain IT systems.
Acquisition, integration and restructuring expenses related to the GBO 2 Program are primarily comprised of restructuring costs and other costs. Restructuring costs are comprised of severance costs and other associated exit costs, including certain consulting costs. Other costs are primarily comprised of personnel costs, facilities costs and certain professional services fees not related to restructuring activities.
TD SYNNEX continued this program in conjunction with the Company’s integration activities. Acquisition, integration and restructuring expenses related to the GBO 2 Program are primarily comprised of restructuring costs and other costs. Restructuring costs are comprised of severance costs and other associated exit costs, including certain consulting costs.
Dollar which occurred during fiscal year 2022 may continue to adversely affect the operating results of our Europe and APJ segments. Acquisitions We continually seek to augment organic growth in our business with strategic acquisitions of businesses and assets that complement and expand our existing capabilities. We also divest businesses that we deem no longer strategic to our ongoing operations.
Acquisitions We continually seek to augment organic growth in our business with strategic acquisitions of businesses and assets that complement and expand our existing capabilities. We also divest businesses that we deem no longer strategic to our ongoing operations.
AR Arrangement"). Under the terms of the U.S. AR Arrangement, we and our subsidiaries that are party to the U.S. AR Arrangement can borrow up to a maximum of $1.5 billion based upon eligible trade accounts receivable. The U.S. AR Arrangement has a maturity date of December 2024.
AR Arrangement can borrow up to a maximum of $1.5 billion based upon eligible trade accounts receivable. The U.S. AR Arrangement, as amended December 11, 2023, has a maturity date of December 2025.
Economic and Industry Trends Our revenue is highly dependent on the end-market demand for IT products, and on our partners' strategic initiatives and business models.
See Note 3 - Acquisitions to the Consolidated Financial Statements for further information. Economic and Industry Trends We are highly dependent on the end-market demand for IT products, and on our partners' strategic initiatives and business models.
These investments or acquisitions would likely be funded primarily by our existing cash and cash equivalents, additional borrowings, or the issuance of securities. 43 Table of Contents Operating Activities Net cash used in operating activities was $49.6 million during fiscal year 2022, primarily due to an increase in inventories and accounts receivable driven by growth in our business, partially offset by an increase in accounts payable due to timing of payments and increased net income.
These investments or acquisitions would likely be funded primarily by our existing cash and cash equivalents, additional borrowings, or the issuance of securities. Operating Activities Net cash provided by operating activities was $1.4 billion during fiscal year 2023 compared to net cash used in operating activities of $49.6 million during fiscal year 2022.
Goodwill, intangible assets and long-lived assets The values assigned to intangible assets include estimates and judgment regarding expectations for the length of customer relationships acquired in a business combination. Included within intangible assets is an indefinite lived trade name intangible asset.
Shipping revenue is included in revenue when control of the product is transferred to the customer, and the related shipping and handling costs are included in cost of revenue. 46 Table of Contents Goodwill, intangible assets and long-lived assets The values assigned to intangible assets include estimates and judgment regarding expectations for the length of customer relationships acquired in a business combination.
In fiscal year 2022, we recorded additional tax benefits of $8.3 million related to the capital loss carryback. 42 Table of Contents Liquidity and Capital Resources Cash Conversion Cycle Three Months Ended November 30, 2022 November 30, 2021 (Amounts in thousands) Days sales outstanding ("DSO") Revenue (a) $ 16,247,957 $ 15,611,266 Accounts receivable, net (b) 9,420,999 8,310,032 Days sales outstanding (c) = ((b)/(a))*the number of days during the period 53 48 Days inventory outstanding ("DIO") Cost of revenue (d) $ 15,188,238 $ 14,668,096 Inventories (e) 9,066,620 6,642,915 Days inventory outstanding (f) = ((e)/(d))*the number of days during the period 54 41 Days payable outstanding ("DPO") Cost of revenue (g) $ 15,188,238 $ 14,668,096 Accounts payable (h) 13,988,980 12,034,946 Days payable outstanding (i) = ((h)/(g))*the number of days during the period 84 75 Cash conversion cycle ("CCC") (j) = (c)+(f)-(i) 23 14 Cash Flows Our business is working capital intensive.
For purposes of calculating Diluted EPS, net income allocated to participating securities was approximately 0.8% and 0.7% of net income for the fiscal years ended November 30, 2023 and 2022, respectively. 42 Table of Contents Liquidity and Capital Resources Cash Conversion Cycle Three Months Ended November 30, 2023 November 30, 2022 (in thousands) Days sales outstanding ("DSO") Revenue (a) $ 14,407,306 $ 16,247,957 Accounts receivable, net (b) 10,297,814 9,420,999 Days sales outstanding (c) = ((b)/(a))*the number of days during the period 65 53 Days inventory outstanding ("DIO") Cost of revenue (d) $ 13,388,727 $ 15,188,238 Inventories (e) 7,146,274 9,066,620 Days inventory outstanding (f) = ((e)/(d))*the number of days during the period 49 54 Days payable outstanding ("DPO") Cost of revenue (g) $ 13,388,727 $ 15,188,238 Accounts payable (h) 13,347,281 13,988,980 Days payable outstanding (i) = ((h)/(g))*the number of days during the period 91 84 Cash conversion cycle ("CCC") (j) = (c)+(f)-(i) 23 23 Cash Flows Our business is working capital intensive.
Selling, general and administrative expenses increased as a percentage of revenue, compared to the prior year period, primarily due to the impact of the Merger including an increase in personnel costs and amortization of intangible assets.
Selling, general and administrative expenses increased in fiscal year 2023, compared to fiscal year 2022, primarily due to higher personnel costs. Selling, general and administrative expenses increased as a percentage of revenue, compared to the prior year period, primarily due to a decrease in revenue in our Endpoint Solutions portfolio and higher personnel costs.
Related Party Transactions For a summary of related party transactions, see Note 1 4 - Related Party Transactions to the Consolidated Financial Statements included in Part II, Item 8 of this Report.
We recognize interest and penalties related to unrecognized tax benefits in the provision for income taxes. 47 Table of Contents Related Party Transactions For a summary of related party transactions, see Note 13 - Related Party Transactions to the Consolidated Financial Statements included in Part II, Item 8 of this Report.
Gross Profit Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Gross profit $ 3,900,199 $ 1,889,534 106.4 % Gross margin 6.26 % 5.98 % 38 Table of Contents Our gross margin is affected by a variety of factors, including competition, selling prices, mix of products, product costs along with rebate and discount programs from our suppliers, reserves or settlement adjustments, freight costs, inventory losses and fluctuations in revenue.
Gross Profit Fiscal Years Ended November 30, Percent Change 2023 2022 2023 to 2022 Gross Profit and Gross Margin - Consolidated (in thousands) Revenue $ 57,555,416 $ 62,343,810 (7.7) % Gross profit $ 3,956,829 $ 3,900,199 1.5 % Purchase accounting adjustments 15,047 96,128 Non-GAAP gross profit $ 3,971,876 $ 3,996,327 (0.6) % GAAP gross margin 6.87 % 6.26 % Non-GAAP gross margin 6.90 % 6.41 % Our gross margin is affected by a variety of factors, including competition, selling prices, mix of products, the percentage of revenue that is presented on a net basis, product costs along with rebate and discount programs from our suppliers, reserves or settlement adjustments, freight costs, inventory losses and fluctuations in revenue.
Other (Expense) Income, Net Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Other (expense) income, net $ (1,165) $ 1,102 (205.7) % Percentage of revenue 0.00 % 0.00 % Amounts recorded as other (expense) income, net include certain foreign currency transaction gains and losses on certain financing transactions and the related derivative instruments used to hedge such financing transactions, the cost of hedging, investment gains and losses, and other non-operating gains and losses, such as settlements received from class action lawsuits. 41 Table of Contents Other (expense) income, net increased during fiscal year 2022, compared to fiscal year 2021, primarily due to increased costs for foreign exchange hedges coupled with an expanded program and a gain on sale of an investment in the prior year, partially offset by a decrease in our accrual during fiscal year 2022 for a legal matter in France of $10.8 million.
Other Expense, Net Fiscal Years Ended November 30, Percent Change 2023 2022 2023 vs. 2022 (in thousands) Other expense, net $ 206 $ 1,165 (82.3) % Percentage of revenue 0.00 % 0.00 % Amounts recorded as other expense, net include foreign currency transaction gains and losses on certain financing transactions and the related derivative instruments used to hedge such financing transactions, the cost of hedging, investment gains and losses, and other non-operating gains and losses, such as settlements received from class action lawsuits.
There was $193.1 million outstanding on these facilities at November 30, 2022, at a weighted average interest rate of 4.69%, and there was $106.3 million outstanding at November 30, 2021, at a weighted average interest rate of 4.59%.
Our borrowings on these facilities vary within the period primarily based on changes in our working capital. There was $208.7 million outstanding on these facilities at November 30, 2023, at a weighted average interest rate of 7.52%, and there was $193.1 million outstanding at November 30, 2022, at a weighted average interest rate of 4.69%.
For further discussion of this legal matter, please refer to Note 18 - Commitments and Contingencies to the Consolidated Financial Statements included in Part II, Item 8 of this Report.
For further discussion of this legal matter, please refer to Note 17 - Commitments and Contingencies to the Consolidated Financial Statements included in Part II, Item 8 of this report. In connection with the Merger, we restructured our foreign financing structure, as well as select legal entities in anticipation of legally integrating legacy Tech Data and SYNNEX foreign operations.
We have various other committed and uncommitted lines of credit with financial institutions, accounts receivable securitization arrangements, finance leases, short-term loans, term loans, credit facilities and book overdraft facilities, totaling approximately $574.9 million in borrowing capacity as of November 30, 2022. Our borrowings on these facilities vary within the period primarily based on changes in our working capital.
AR Arrangement or the TD SYNNEX revolving credit facility at November 30, 2023 and 2022. 44 Table of Contents We have various other committed and uncommitted lines of credit with financial institutions, finance leases, short-term loans, term loans, credit facilities and book overdraft facilities, totaling approximately $583.1 million in borrowing capacity as of November 30, 2023.
Our income tax expense increased during the fiscal year ended November 30, 2022, as compared to the prior year, due to the increase in income before income taxes, as well as a lower capital loss carryback benefit.
Our income tax expense decreased during the fiscal year ended November 30, 2023, as compared to the prior fiscal year, primarily due to lower income during the period along with a lower effective tax rate.
The increase in our interest expense and finance charges net, during fiscal year 2022, compared to fiscal year 2021, was primarily due to an increase in interest expense from higher average outstanding borrowings as well as higher average interest rates, and increased costs associated with the sale of accounts receivable due to higher discount fees and higher volume of accounts receivable sold, partially offset by the $47 million of acquisition and integration related financing costs in fiscal year 2021.
Our interest expense and finance charges net, increased during fiscal year 2023, compared to fiscal year 2022, primarily due to higher average interest rates, along with increased costs associated with the sale of accounts receivable due to higher discount fees, which totaled $51.1 million and $26.2 million during the fiscal years ended November 30, 2023 and 2022, respectively.
Payments are due as per contract terms and do not contain a significant financing component. Service revenues represents less than 10% of the total revenue for the periods presented. Provisions for sales returns and allowances are estimated based on historical data and are recorded concurrently with the recognition of revenue.
Payments are due as per contract terms and do not contain a significant financing component. In relation to product support, supply chain management and other services that we perform, revenue is recognized over time as the services are performed. Service revenues represents less than 10% of the total revenue for the periods presented.
Personnel and other costs are primarily comprised of costs related to retention and other bonuses, severance and duplicative labor costs, as well as costs related to the settlement of certain outstanding long-term cash incentive awards for Tech Data upon closing of the Merger.
Personnel and other costs are primarily comprised of costs related to retention and other bonuses, severance and duplicative labor costs.
Our systems design and integration solutions business is highly dependent on the demand for cloud infrastructure, and the number of key customers and suppliers in the market. Our business includes operations in the Americas, Europe and APJ, so we are affected by demand for our products in those regions, and the weakening of local currencies relative to the U.S.
Our business includes operations in the Americas, Europe and APJ, so we are affected by demand for our products in those regions, as well as the impact of fluctuations in foreign currency exchange rates compared to the U.S. dollar.
We have had similar borrowing arrangements with various financial institutions throughout our years as a public company. Our credit facilities have a number of covenants and restrictions that require us to maintain specified financial ratios.
We have had similar borrowing arrangements with various financial institutions throughout our years as a public company. We had total outstanding borrowings of approximately $4.1 billion as of November 30, 2023 and 2022.
Our gross profit increased in fiscal year 2022, as compared to the prior fiscal year, primarily driven by an increase in sales as a result of the Merger, as well as product and customer mix. The increase in gross margin during fiscal year 2022, as compared to fiscal year 2021, is primarily due to product and customer mix.
Our gross margin increased during the fiscal year ended November 30, 2023, as compared to the prior fiscal year, primarily due to product mix, including an increase in revenue in our Advanced Solutions portfolio and margin expansion in high-growth technologies, as well as the impact of lower purchase accounting adjustments related to the Merger.
We performed our annual goodwill impairment test as of September 1, 2022 and chose to bypass the qualitative assessment for all reporting units and proceed directly to the quantitative assessment, which indicated that the estimated fair values of our Europe and APJ reporting units exceeded their carrying values by approximately 6% and 9%, respectively.
We performed our annual goodwill impairment test as of September 1, 2023 as a qualitative assessment, and determined that for all reporting units, it was not more likely than not that the fair value of the reporting unit was less than its carrying value.
Stock-based compensation expense primarily relates to costs associated with the conversion of certain Tech Data performance-based equity awards issued prior to the Merger into restricted shares of TD SYNNEX (refer to Note 6 – Share-Based Compensation to the Consolidated Financial Statements for further information) and expenses for certain restricted stock awards issued in conjunction with the Merger. 39 Table of Contents To date, acquisition and integration expenses related to the Merger were composed of the following: Fiscal Years Ended November 30, 2022 2021 (in thousands) Professional services costs $ 29,352 $ 22,288 Personnel and other costs 40,220 33,716 Long-lived assets charges 69,053 22,166 Stock-based compensation 52,171 20,113 Total $ 190,796 $ 98,283 During fiscal 2022, acquisition and integration expenses related to the Merger increased, compared to the prior year period, due to the timing of the Merger as it was completed on September 1, 2021.
Stock-based compensation expense primarily relates to costs associated with the conversion of certain Tech Data performance-based equity awards issued prior to the Merger into restricted shares of TD SYNNEX (refer to Note 5 – Share-Based Compensation to the Consolidated Financial Statements for further information) and expenses for certain restricted stock awards issued in conjunction with the Merger.
Operating margin decreased due to an increase in personnel costs resulting from the Merger, an increase in amortization of intangible assets acquired in connection with the Merger and an increase in acquisition, integration and restructuring costs, partially offset by an increase in gross margin primarily due to product and customer mix.
Europe non-GAAP operating income and non-GAAP operating margin decreased during the fiscal year ended November 30, 2023, compared to the prior fiscal year, primarily due to the impact of the decline in revenues in our Endpoint Solutions portfolio and an increase in personnel costs, partially offset by an increase in gross margin in the region due to product mix.
The increase in fiscal year 2022, compared to fiscal year 2021, was primarily due to our DIO, which was impacted by an increase in inventory to support growth in our business and supply chain constraints, partially offset by a corresponding increase in our DPO.
The increase in cash provided by operating activities was primarily due to favorable changes in working capital driven by the change in inventories. In fiscal year 2022, our inventory increased to support growth in our business in comparison to a decline in our inventory during fiscal year 2023.
Operating Income Fiscal Years Ended November 30, Percent Change 2022 2021 2022 to 2021 (in thousands) Operating income $ 1,050,873 $ 623,218 68.6 % Operating margin 1.69 % 1.97 % Operating income increased during fiscal year 2022, compared to fiscal year 2021, primarily due to increased sales as a result of the Merger and an increase in gross margin primarily due to product and customer mix, partially offset by an increase in personnel costs resulting from the Merger, an increase in amortization of intangible assets acquired in connection with the Merger and an increase in acquisition, integration and restructuring costs.
Consolidated operating margin increased during the fiscal year ended November 30, 2023, compared to the prior fiscal year, primarily due to a decrease in purchase accounting adjustments related to the Merger and an improvement in gross margin due to product mix, partially offset by higher selling, general and administrative expenses as a percentage of revenue due to the decrease in revenues in our Endpoint Solutions portfolio and higher personnel costs.
Net cash provided by operating activities was $809.8 million during fiscal year 2021, primarily due to net income and an increase in accounts payable due to the timing of payments, including the impact of the Merger.
The increase as compared to fiscal year 2022 is primarily due to an increase in integration related capital expenditures due to the Merger. Financing Activities Net cash used in financing activities was $785.9 million and $275.6 million during fiscal years 2023 and 2022, respectively.
Removed
See Note 3 – Acquisitions to the Consolidated Financial Statements for further information. We previously had two reportable segments as of November 30, 2020: Technology Solutions and Concentrix. After giving effect to the previously announced separation of our customer experience services business (the "Separation") on December 1, 2020, we operated in a single reportable segment.
Added
Our results in fiscal 2023 were also negatively impacted by post-pandemic declines in demand for personal computing ecosystem products. Our systems design and integration solutions business is highly dependent on the demand for cloud infrastructure, and the number of key customers and suppliers in the market.
Removed
After completion of the Merger, we reviewed our reportable segments as there was a change in our chief executive officer, who is also our chief operating decision maker.
Added
Revenue in constant currency is calculated by translating the revenue for the fiscal year ended November 30, 2023 in the billing currency using the comparable prior period currency conversion rate.
Removed
Our chief operating decision maker has a leadership structure aligned with the geographic regions of the Americas, Europe and Asia-Pacific and Japan (“APJ”) and reviews and allocates resources based on these geographic regions. As a result, as of September 1, 2021 we began operating in three reportable segments based on our geographic regions: the Americas, Europe and APJ.
Added
Generally, when the dollar either strengthens or weakens against other currencies, the growth at constant currency rates will be higher or lower than growth reported at actual exchange rates. • Non-GAAP gross profit, which is gross profit, adjusted to exclude the portion of purchase accounting adjustments that affected cost of revenue. • Non-GAAP gross margin, which is non-GAAP gross profit, as defined above, divided by revenue. • Non-GAAP operating income, which is operating income, adjusted to exclude acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense and purchase accounting adjustments. • Non-GAAP operating margin, which is non-GAAP operating income, as defined above, divided by revenue. • Non-GAAP net income, which is net income, adjusted to exclude acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense, purchase accounting adjustments, legal settlements and other litigation, net, income taxes related to the aforementioned items, as well as a capital loss carryback benefit . • Non-GAAP diluted earnings per common share (“EPS”), which is diluted EPS excluding the per share impact of acquisition, integration and restructuring costs, amortization of intangible assets, share-based compensation expense, purchase accounting adjustments, legal settlements and other litigation, net, income taxes related to the aforementioned items, as well as a capital loss carryback benefit . 33 Table of Contents Acquisition, integration and restructuring costs, which are expensed as incurred, primarily represent professional services costs for legal, banking, consulting and advisory services, severance and other personnel related costs, share-based compensation expense and debt extinguishment fees that are incurred in connection with acquisition, integration, restructuring and divestiture activities.
Removed
Our three reportable segments each generate revenues from products and services across our Endpoint Solutions and Advanced Solutions portfolios. Segment results for all prior periods have been restated for comparability to our current reportable segments. For financial information by segment, refer to Note 13 – Segment Information, to the Consolidated Financial Statements in Item 8.
Added
S hare-based compensation expense is a non-cash expense arising from the grant of equity awards to employees and non-employee members of our Board of Directors based on the estimated fair value of those awards.
Removed
We have presented limited information by reportable segment within the Management’s Discussion and Analysis of Financial Condition and Results of Operations due to the lack of comparability between periods resulting from the Merger on September 1, 2021.
Added
These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures and should be used as a complement to, and in conjunction with, data presented in accordance with GAAP. 34 Table of Contents Fiscal Years Ended November 30, 2023 and 2022: Revenue The following table summarizes our revenue and change in revenue by segment for the fiscal years ended November 30, 2023 and 2022: Fiscal Years Ended November 30, Percent Change 2023 2022 2023 to 2022 Revenue in constant currency (in thousands) Consolidated Revenue $ 57,555,416 $ 62,343,810 (7.7) % Impact of changes in foreign currencies 99,152 — Revenue in constant currency $ 57,654,568 $ 62,343,810 (7.5) % Americas Revenue $ 34,573,859 $ 38,791,102 (10.9) % Impact of changes in foreign currencies 148,146 — Revenue in constant currency $ 34,722,005 $ 38,791,102 (10.5) % Europe Revenue $ 19,422,297 $ 20,289,211 (4.3) % Impact of changes in foreign currencies (168,747) — Revenue in constant currency $ 19,253,550 $ 20,289,211 (5.1) % APJ Revenue $ 3,559,260 $ 3,263,497 9.1 % Impact of changes in foreign currencies 119,753 — Revenue in constant currency $ 3,679,013 $ 3,263,497 12.7 % Consolidated Commentary During the fiscal year ended November 30, 2023, consolidated revenue decreased by $4.8 billion and consolidated revenue in constant currency decreased by $4.7 billion, as compared to the prior fiscal year.
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Revenue and Cost of Revenue We distribute IT hardware, software, and systems including personal computing devices and peripherals, mobile phones and accessories, server and datacenter infrastructure, hybrid cloud, security, networking, communications and storage solutions, and system components. We also provide systems design and integration solutions.
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The decreases are primarily driven by a decline in our Endpoint Solutions portfolio as the industry experienced a post-pandemic decline in demand for personal computer ecosystem products, partially offset by growth in our Advanced Solutions portfolio.
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In fiscal years 2022 and 2021 approximately 45% and 37% of our revenue, respectively, was generated from our international operations. As a result, our revenue growth is impacted by fluctuations in foreign currency exchange rates.
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A greater percentage of our revenue was presented on a net basis due to changes in product mix, which negatively impacted our revenue growth by approximately 4%. Americas Commentary During the fiscal year ended November 30, 2023, Americas revenue decreased by $4.2 billion and Americas revenue in constant currency decreased by $4.1 billion, as compared to the prior fiscal year.
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In fiscal year 2022, several foreign currencies in which we transact business depreciated against the U.S. dollar, including the Euro and the Japanese yen, which adversely affected the revenue growth of our Europe and APJ segments.
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The decreases are primarily due to a decline in our Endpoint Solutions portfolio in the region as the industry experienced a post-pandemic decline in demand for personal computer ecosystem products, partially offset by growth in our Advanced Solutions portfolio.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAll of our interest rate swaps as of November 30, 2022 are accounted for as cash flow hedges. 48 Table of Contents A one percentage point (100 basis point) variation in average interest rates would have an impact on annual interest expense of $6.2 million based on the Company's outstanding unhedged variable rate debt at November 30, 2022.
Biggest changeA one percentage point (100 basis point) variation in average interest rates would have an impact on annual interest expense of $14.7 million based on the Company's outstanding variable rate debt at November 30, 2023.
To achieve our objective, we use a combination of fixed and variable rate debt. The nature and amount of our long-term and short-term debt can be expected to vary as a result of future business requirements, market conditions and other factors. Certain of our borrowing facilities and securitization arrangements are variable-rate obligations and expose us to interest rate risks.
To achieve our objective, we use a combination of fixed and variable rate debt. The nature and amount of our long-term and short-term debt can be expected to vary as a result of future business requirements, market conditions and other factors. Certain of our borrowing facilities and our securitization arrangement are variable-rate obligations and expose us to interest rate risks.
Equity Price Risk The equity price risk associated with our marketable equity securities as of November 30, 2022 and 2021 is not material in relation to our consolidated financial position, results of operations or cash flows. Marketable equity securities include shares of common stock and are recorded at fair market value based on quoted market prices.
Equity Price Risk The equity price risk associated with our marketable equity securities as of November 30, 2023 and 2022 is not material in relation to our consolidated financial position, results of operations or cash flows. Marketable equity securities include shares of common stock and are recorded at fair market value based on quoted market prices.
Actual future gains and losses associated with our derivative positions may differ materially from the analyses performed as of November 30, 2022, due to the inherent limitations associated with predicting the changes in foreign currency exchange rates and our actual exposures and positions.
Actual future gains and losses associated with our derivative positions may differ materially from the analyses performed as of November 30, 2023, due to the inherent limitations associated with predicting the changes in foreign currency exchange rates and our actual exposures and positions.
The estimated maximum potential one-day loss in fair value, calculated using the VaR model, would be approximately $7.4 million and $3.8 million at November 30, 2022 and 2021, respectively. We believe that the hypothetical loss in fair value of our foreign exchange derivatives would be offset by the gains in the value of the underlying transactions being hedged.
The estimated maximum potential one-day loss in fair value, calculated using the VaR model, would be approximately $3.6 million and $7.4 million at November 30, 2023 and 2022, respectively. We believe that the hypothetical loss in fair value of our foreign exchange derivatives would be offset by the gains in the value of the underlying transactions being hedged.
Gains and losses on marketable equity securities are included in earnings. 49 Table of Contents
Gains and losses on marketable equity securities are included in earnings. 48 Table of Contents
As of November 30, 2022, we had approximately $1.4 billion of outstanding term loan debt subject to variable interest rates and our subsidiaries had approximately $192.3 million in the aggregate outstanding under debt facilities subject to variable interest rates. Certain of our other borrowing facilities and securitization arrangements are variable-rate obligations and expose us to interest rate risks.
As of November 30, 2023, we had approximately $1.3 billion of outstanding term loan debt subject to variable interest rates and our subsidiaries had approximately $208.7 million in the aggregate outstanding under debt facilities subject to variable interest rates.
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To manage interest rate risk on our U.S. dollar-denominated floating-rate debt, we have also entered into interest rate swaps with aggregate notional amounts of $1.0 billion and $1.5 billion as of November 30, 2022 and 2021, respectively, which effectively converted a portion of the floating rate debt to a fixed interest rate.

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