Security Staff Acquisition & Development, Channel, Content

Tech Data CEO: StreamOne Is Critical to Automation, Digital Transformation

When it comes to automation and digital processes, Tech Data will continue to invest heavily in StreamOne while also leveraging some acquired cloud assets from the Avnet Technology Services acquisition of 2017, according to CEO Richard Hume -- who succeeded Bob Dutkowsky in June.

Richard Hume, CEO, Tech Data
Tech Data CEO Richard Hume

"StreamOne for the most part was an organic investments that we’ve been making for the greater part of eight years," Hume said during Tech Data's Q2 fiscal 2019 earnings call on Thursday. "And we’re pretty comfortable with that approach."

Still, he conceded, Tech Data also leverages some Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) capabilities from the ATS deal of 2017. Plus, Hume left the door open for potential acquisitions that address cloud, automation and digital transformation opportunities.

"As we move into the future, if we see acquisition opportunities or partnership opportunities to -- that will allow us to accelerate our content in our digital platforms we’ll absolutely consider that," he said. "But to-date you should think about most of our build being of an organic sense. And again, when we think about our StreamOne platform in particular, we’re really confident and comfortable with that capability as it relates to the competitive landscape."

Tech Data vs. Cloud Distribution, Digital Rivals

That's a bold statement. StreamOne completes against Ingram Micro Cloud -- which includes Cloud Referral, Cloud Marketplace and CloudBlue capabilities. All of the other major distributors also have cloud services arms these days. And Pax8, a cloud distribution upstart, is growing fast with so-called Stax solutions for partners.

At the same time, partners and vendors are demanding more StreamOne capabilities -- and they want those new features and functions at a faster pace, Hume concedes. "But we give up nothing to competition as it relates to the skills and functions that we provide."

The overall digitization opportunity, he adds, spans the entire business and every process everywhere. As a result, each Tech Data geography has their own priority list to pursue. The goal for each region: Drive process improvement within each of business, based on what will give them the best return for the dollar, he says. And again, most of that progress has involved organic Tech Data R&D -- rather than acquisitions.

For the company's Q2 ended July 31, 2018:

  • Net sales were $8.9 billion, up 10 percent compared to the prior-year quarter.
  • Net income was $75.9 million, compared to $47.5 million in the prior-year quarter.

The revenue figures beat Wall Street's expectations, while the profit figure was a bit short of Wall Street's expectations, SeekingAlpha reports.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.