Ingram Micro's (INGM) Q3 revenue is expected to reach the higher end of its guidance, driven by high-single-digit growth in PC and notebook sales, RBC Capital Markets said in a Tuesday note previewing the company's Q3 results.

The growth is driven by refresh cycles and customers upgrading due to Windows operating system end-of-life announcements, as well as steady expansion in its Advanced Solutions business and cloud services markets, RBC analysts said.

In the Advanced Solutions segment, the analysts said they expect continued "strong demand" in server, storage, cyber, and graphics processing units, while in the networking segment, they anticipate a growth of low single digits to mid single digits.

They project gross margins to improve compared to the previous quarter as one-off headwinds related asset sales will not recur. However, margin pressures from product, customer, and geographic sales mix are expected to persist, they said.

RBC is modeling an adjusted EPS estimate of $0.68, compared with the consensus estimate of $0.67, as well as revenue growth of 4.5% to $12.92 billion, above the consensus of $12.24 billion.

RBC kept its outperform rating with a price target of $25.

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