In its inaugural Cloud Summit yesterday in Dallas, Texas, the largest information technology (IT) product distributor, Ingram Micro Inc. ([url=http://www.zacks.com/stock/quote/im]IM[/url]), announced a new services initiative named Cloud Conduit, which connects its North American channel partners with leading and emerging cloud computing providers including Independent Software Vendors (ISVs), cloud hosting companies and system integrators.

The Cloud Summit and 4th annual Seismic Partner Conference (June 7-June 9), hosted by IM, has been focusing on issues relating to how managed service providers (MSPs) and IT solution providers will be competitive and profitable as the industry shifts towards cloud computing.

The members of Ingram Micro's new Cloud Conduit Advisory Council include Rackspace Holdings ([url=http://www.zacks.com/stock/quote/rax]RAX[/url]), Amazon Web Services ([url=http://www.zacks.com/stock/quote/amzn]AMZN[/url]), CA Inc. ([url=http://www.zacks.com/stock/quote/ca]CA[/url]), Citrix Systems ([url=http://www.zacks.com/stock/quote/ctxs]CTXS[/url]), McAfee Inc. ([url=http://www.zacks.com/stock/quote/mfe]MFE[/url]), Microsoft Corp. ([url=http://www.zacks.com/stock/quote/msft]MSFT[/url]) and salesforce.com ([url=http://www.zacks.com/stock/quote/crm]CRM[/url]).

At the Cloud Conduit program, IM's channel partners will be provided with a comprehensive portfolio of cloud-specific enablement resources and service offerings including Infrastructure-as-a-Service (IaaS), educational tools and resources such as face-to-face engagements, business development resources, sales training and webinars.

Moreover, as a part of the program, IM will join with Amazon Web Services, Rackspace Hosting and salesforce.com, in an initiative to blend the managed IT services model and cloud computing for greater industry adoption and understanding of cloud computing and better IT services.

The company will use Amazon Web Service’s on-demand, pay as you go, cloud computing services to help its customers and solution providers to innovate and accelerate the delivery of new applications at reduced costs.

The company will also provide support to CRM’s AppExchange ISVs with the former’s channel development, marketing and channel sales services.

Lastly, under a strategic partnership, IM will offer Rackspace's managed and cloud hosting solutions through its Service Division. The new distribution relation will help Rackspace’s services to reach IM’s more than 1,600 Seismic partners throughout North America, as well as its general solution provider base. As the part of agreement, Rackspace will also chip into simplifying the distribution process with required resources and training sessions.

We believe that IM will be able to gain its lost market share in North America and Europe. Additionally, IM’s increasing exposure to emerging cloud computing markets should help the company grab a leadership position.

The company reported strong first quarter revenue of $8.09 billion, up from $6.75 billion in the prior-year quarter, led by strong contributions across all geographic regions and currency tailwinds.

However, for the second quarter, though the company expects revenue to be seasonally softer than the first quarter attributable to spring holidays, it believes that solid operating leverage and better expense cost control management will continue to deliver solid results.

We maintain our short-term Buy recommendation on IM.