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Business at the world’s largest technology distributor Ingram Micro (NYSE:
IM) in Q1 looked like a normal seasonal quarter, with sales weaker in January
and stronger in the final month of March. The only difference was that
sales were down more than 20 percent from the same period a year ago.

It’s a pattern that’s been repeated across the technology industry in recent
quarters as companies report sales declines of 20 percent or more from the same
period a year ago. But the return to that normal pattern of better sales at the
end of the quarter provided some encouragement to Ingram Micro CEO
Greg Spierkel.

“We saw a significant step down in January,” he tells Channel Insider. “But
that step down has not gotten worse. The normal seasonality started taking
hold. The world hasn’t gotten worse.”

And that’s been the resounding cry of hope: Flat is the new up. Everyone is
trying to get to flat.

Ingram Micro reported sales of $6.75 billion for the quarter, a 21 percent
decline from the $8.58 billion for the same period a year ago. The translation
impact of weaker foreign currencies had an approximate 8 percent negative
effect on comparisons to the prior year.

Ingram Micro posted Q1 net income of $27.5 million, or 17 cents per diluted
share, compared with net income of $64.1 million, or 37 cents per diluted share
in the same period a year ago. In spite of the wide gulf, Ingram Micro pointed
out that gross margin was 5.65 percent, essentially flat with the prior-year

Spierkel says that while there’s no sign of things getting better in the next
quarter or two, it doesn’t look like they are getting worse. A return to
positive growth may take until the end of 2009.

Some of that may come from the Obama administration’s economic stimulus
package. Spierkel says that several large IT vendors are talking to federal and
state decision makers as they craft how the funds will be allocated.

“There are a lot of things we are excited about,” Spierkel tells Channel
Insider. And while there won’t be an $800 billion jolt in 2009, he says, the IT
industry is likely to start feeling some positive impact from the stimulus
package by year end. The total spending in the package is likely to be
stretched out over three to five years, he says.

Technology areas that remain strong, according to Spierkel, include netbooks, GPS,
data center optimization technologies around virtualization and security