Operator: Our next question comes from Adam Tindle with Raymond James.
Rich Hume: Adam, you there?
Adam Tindle: Can you hear me?
Rich Hume: Yes, we can hear you now.
Adam Tindle: Okay. Yes. First one, I wanted to just clarify with Marshall, on the fiscal ’23 revenue guidance, you said 3% to 5% reported. What is that in FX and accounting adjustments of the adjusted growth?
Marshall Witt: Yes, Adam, at least for Q1, it’s as adjusted, constant currency about 5%. It’s difficult to figure out where we think FX will go. Right now, it’s probably going to end up being somewhat of a push because we’re lapping a declining euro year-on-year. So as we progress through this year at $105 million, I think it will end up being somewhat flat, plus or minus $200 million or $300 million quarter two, three and four.
Rich Hume: Yes. And then the 606 adjustments are completely behind us now.
Adam Tindle: All right. Good to know, Rich. On that Q1 outlook, that 5% growth in constant currency. I looked at the last year, I think that like-for-like comparison was about 6%. So looking at a similar growth rate at this time last year, but the environment seems a lot worse from a PC perspective, in particular. Maybe you could just give us any confidence that you have, especially talk about how you’re feeling here relative to that plan based on what you’re seeing here on January 10.
Rich Hume: Okay. So a couple of things. First, when we look at or think about Q4, our Endpoint Solutions segment was marginally down year-on-year. As we think about the first quarter, I would tell you the following. First, we — as we’ve talked before, this — our forecast process builds bottoms up. So we go to country to region to global and so we have that visibility. And usually, the teams have a pretty good feel as to what’s going on, on the ground. It is certainly a more volatile environment now than usual. So obviously, we pay attention to that. As of January 10, I would say that the theme of marginally declining PC segment, our Endpoint Solutions segment and sort of a growing Advanced Solutions segment and the specialized businesses contributing growth as well is the way we think about it.
Adam Tindle: Got it. And just the last one, Rich. You mentioned revenue synergy upon completion of Americas ERP. Just an early look at any sort of timing, ballpark quantification of this do you think that’s going to come from vendors or customers? What do we have to look forward to in terms of revenue synergy when that materializes?
Rich Hume: Yes. So first of all in our prepared comments, we talked about moving over 45% of legacy Tech Data SAP on to CIS. So in the rounding, roughly two-third to 70% of our business now is on the strategic CIS platform in the Americas. So it’s a good chunk that’s now in there. We have begun Adam, to see some of the vendors which were complementary to one side or the other start to take off in those sales lanes, if you will. We think of it as sort of a build, which will grow and grow as we move throughout the year. But we aren’t prepared to comment relative to what the quantification of that is. And we’re in a way to past a couple of more metrics and/or milestones before we provide that visibility. But right now, I kind of view it as the sales teams, as I said, we see real transactions occurring, are getting up to speed with regard to product details, sales plans, et cetera. And we’ll see how that goes moving forward.
Adam Tindle: Okay. Thank you.
Operator: Our next question comes from Ananda Baruah with Loop Capital.
Ananda Baruah: Thank you, guys. Thank you for taking the questions. Happy New Year. Just a couple, if I could. Is there just sort of mix outlook on the year? And I guess, super simplistically, the guidance for Q1, the revenue was sort of totally right in line and bracketing Street. The EPS guide is a little bit softer. And so Marshall, it sounds like a little bit of that is interest rates. What are the other components as well? Or you think Street was just maybe sort of inappropriately set with the —
Marshall Witt: When you compare Q1 to Q1 for us, it’s $33 million higher for interest expense. And then the FX impact is about $500 million, which $0.10 to $0.12. So those two largely contribute to, at least the compare and the discussion year-on-year. And then when we think about our thoughts on mix outlook for ’23, distribution, we expect will continue to show momentum. And we think that the majority of high-growth technology will continue to show momentum with the commentary we had around the hyperscale infrastructure/Hyve, just having a real tough compare to ’22. But still, we expect Hyve to grow. But when you take those into consideration, the mix plays out the way we guided for Q1.
Ananda Baruah: All right. That’s super helpful. And then are you guys thinking about getting active on M&A again? And I guess where an M&A kind of in the stack would you get active like tuck-in versus sort of medium-sized? I’m assuming you wouldn’t do anything big because of the debt and we are in the integration with each other. But where in M&A will you get active this year?
Rich Hume: Yes. Ananda, thanks for the question. As you had stated a transaction that the size of the merger of the company is not necessarily on the radar or something that I would forecast. But as is usually the case, we’re always prospecting and have a pipeline around M&A and predominantly looking to — looking at targets that would allow us to accelerate our strategy. And so they come in sort of two categories. The first one being the traditional one, so I won’t spend a lot of time explaining that. Then we also are very interested in accelerating the capabilities in our cloud platform. And if we find the right IP investment that would allow us to accomplish that, we would consider that along the way. And then as it relates to our interest strategically.
Obviously, Europe is less consolidated. Asia Pacific is even less consolidated. So something were to appear in those theaters, they would be of interest. So that’s how we think about the M&A pretty consistent with what we talked about previously.
Ananda Baruah: That’s really helpful. Thanks a lot guys.
