Business
Avnet Reports First Quarter 2026 Financial Results
First quarter sales of $5.9 billion and diluted EPS of $0.61 Adjusted diluted EPS of $0.84 Return to year-over-year sales growth in the Americas
About this update from Avnet, Inc.
First quarter sales of $5.9 billion and diluted EPS of $0.61 Adjusted diluted EPS of $0.84 Return to year-over-year sales growth in the Americas PHOENIX--(BUSINESS WIRE)-- Avnet, Inc. (Nasdaq: AVT) today announced results for its first quarter ended September 27, 2025. “In the first quarter, our sales and earnings exceeded our expectations, led by double-digit year-over-year sales growth in Farnell and Asia,” said Avnet Chief Executive Officer Phil Gallagher. “While uncertainty continues to impact the market, we remain optimistic about the increasingly positive signs of recovery. Our durable business model, coupled with our strong, diverse supplier line card and customer base, position Avnet to create long-term value for all our stakeholders.” Fiscal First Quarter Key Financial Highlights: Sales of $5.9 billion Fifth consecutive quarter of year-over-year sales growth in Asia Second consecutive quarter of year-over-year growth at Farnell Diluted earnings per share of $0.61 Adjusted diluted earnings per share of $0.84 Operating income margin of 2.4% Adjusted operating income margin of 2.6% Returned $138 million to shareholders from share repurchases, representing 3.2% of shares outstanding Repurchased approximately 8% of outstanding shares over past four quarters Returned $28 million to shareholders in dividends Increased quarterly dividend by 6% compared to fiscal 2025 Key Financial Metrics ($ in millions, except per share data) First Quarter Results (GAAP) Sep – 25 Sep – 24 Change Y/Y Jun – 25 Change Q/Q Sales $ 5,898.6 $ 5,604.2 5.3 % $ 5,617.8 5.0 % Operating Income $ 142.0 $ 142.2 (0.1) % $ 73.5 93.4 % Operating Income Margin 2.4 % 2.5 % (13) bps 1.3 % 110 bps Diluted Earnings Per Share $ 0.61 $ 0.66 (7.6) % $ 0.07 771.4 % First Quarter Results (Non-GAAP)(1) Sep – 25 Sep – 24 Change Y/Y Jun – 25 Change Q/Q Adjusted Operating Income $ 150.7 $ 168.9 (10.8) % $ 142.9 5.5 % Adjusted Operating Income Margin 2.6 % 3.0 % (46) bps 2.5 % 1 bps Adjusted Diluted Earnings Per Share $ 0.84 $ 0.92 (8.7) % $ 0.81 3.7 % Segment and Geographical Mix Sep – 25 Sep – 24 Change Y/Y Jun – 25 Change Q/Q Electronic Components (EC) Sales $ 5,499.7 $ 5,257.1 4.6 % $ 5,231.3 5.1 % EC Operating Income Margin 2.9 % 3.8 % (86) bps 3.0 % (11) bps Farnell Sales $ 398.9 $ 347.1 14.9 % $ 386.5 3.2 % Farnell Operating Income Margin 4.3 % 0.5 % 375 bps 4.3 % 1 bps Americas Sales $ 1,369.9 $ 1,329.9 3.0 % $ 1,327.0 3.2 % EMEA Sales $ 1,665.9 $ 1,668.2 (0.1) % $ 1,599.7 4.1 % Asia Sales $ 2,862.8 $ 2,606.1 9.9 % $ 2,691.1 6.4 % _________________________ (1) A reconciliation of non-GAAP financial measures to GAAP financial measures is presented in the “Non-GAAP Financial Information” section of this press release. Outlook for the Second Quarter of Fiscal 2026 Ending on December 27, 2025 Guidance Range Midpoint Sales $5.85B – $6.15B $6.00B Adjusted Diluted EPS (1) $0.90 – $1.00 $0.95 _________________________ (1) A reconciliation of non-GAAP guidance to GAAP guidance is presented in the “Non-GAAP Financial Information” section of this press release. The above guidance implies sequential sales growth of approximately 2% at the midpoint and assumes sequential sales growth in the Americas and Asia and flat sales in Europe. The above guidance also excludes restructuring, integration and other expenses, foreign currency gains and losses, and certain income tax adjustments. The above guidance assumes similar interest expense to the first quarter of fiscal 2026 and an adjusted effective tax rate of between 21% and 25%. The above guidance assumes 83 million average diluted shares outstanding and average currency exchange rates as shown in the table below: Q2 Fiscal 2026 Q1 Fiscal Q2 Fiscal Guidance 2026 2025 Euro to U.S. Dollar $1.16 $1.17 $1.07 GBP to U.S. Dollar $1.33 $1.35 $1.28 Today’s Conference Call and Webcast Details Avnet will host a conference call and webcast today at 9:00 a.m. PT / Noon ET to discuss its financial results, provide a business update and answer questions. Live conference call: 877-407-8112 (domestic) or 201-689-8840 (international) Live webcast along with slides can be accessed via Avnet’s Investor Relations website at https://ir.avnet.com An audio replay of the webcast will be available after the completion of the call and archived on the website for one year Forward-Looking Statements This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the financial condition, results of operations, and business of the Company. You can find many of these statements by looking for words like “believes,” “projected,” “plans,” “expects,” “anticipates,” “should,” “will,” “may,” “estimates,” or similar expressions. These forward-looking statements are subject to numerous assumptions, risks, and uncertainties. The following important factors, in addition to those discussed elsewhere in the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2025 and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, could affect the Company’s future results of operations, and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements: geopolitical events and military conflicts; pandemics and other health-related crises; competitive pressures among distributors of electronic components; an industry down-cycle in semiconductors; relationships with key suppliers and allocations of products by suppliers; accounts receivable defaults; risks relating to the Company’s international sales and operations, including risks relating to repatriating cash, foreign currency fluctuations, inflation, duties and taxes, tariffs, sanctions and trade restrictions, and compliance with international and U.S. laws; risks relating to acquisitions, divestitures, and investments; adverse effects on the Company’s supply chain, operations of its distribution centers, shipping costs, third-party service providers, customers, and suppliers, including as a result of issues caused by military conflicts, terrorist attacks, natural and weather-related disasters, pandemics and health related crises, warehouse modernization, and relocation efforts; risks related to cyber security attacks, other privacy and security incidents, and information systems failures, including related to current or future implementations, integrations, and upgrades; general economic and business conditions (domestic, foreign, and global) affecting the Company’s operations and financial performance and, indirectly, the Company’s credit ratings, debt covenant compliance, liquidity, and access to financing; constraints on employee retention and hiring; and legislative or regulatory changes. Any forward-looking statement speaks only as of the date on which that statement is made. Except as required by law, the Company assumes no obligation to update any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made. About Avnet As a leading global technology distributor and solutions provider, Avnet has served customers’ evolving needs for more than a century. Through regional and specialized businesses around the world, we support customers and suppliers at every stage of the product lifecycle. We help companies adapt to change and accelerate the design and supply stages of product development. With a unique viewpoint from the center of the technology value chain, Avnet is a trusted partner that solves complex design and supply chain issues so customers can realize revenue faster. Learn more about Avnet at www.avnet.com. (AVT_IR) AVNET, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) First Quarters Ended September 27, September 28, 2025 2024 (Thousands, except per share data) Sales $ 5,898,572 $ 5,604,152 Cost of sales 5,283,807 4,996,785 Gross profit 614,765 607,367 Selling, general and administrative expenses 464,442 438,791 Restructuring, integration, and other expenses 8,291 26,351 Operating income 142,032 142,225 Other expense, net (5,466 ) (3,043 ) Interest and other financing expenses, net (59,762 ) (64,444 ) Income before taxes 76,804 74,738 Income tax expense 25,059 15,782 Net income $ 51,745 $ 58,956 Earnings per share: Basic $ 0.62 $ 0.67 Diluted $ 0.61 $ 0.66 Shares used to compute earnings per share: Basic 82,996 88,092 Diluted 84,462 89,392 Cash dividends paid per common share $ 0.35 $ 0.33 AVNET, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) September 27, June 28, 2025 2025 (Thousands) ASSETS Current assets: Cash and cash equivalents $ 175,465 $ 192,428 Receivables 4,503,478 4,327,450 Inventories 5,420,873 5,235,485 Prepaid and other current assets 227,168 263,374 Total current assets 10,326,984 10,018,737 Property, plant and equipment, net 665,980 667,247 Goodwill 818,109 837,031 Operating lease assets 200,621 201,896 Other assets 402,663 393,642 Total assets $ 12,414,357 $ 12,118,553 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Short-term debt $ 189,311 $ 87,284 Accounts payable 3,688,866 3,487,419 Accrued expenses and other 440,913 497,154 Short-term operating lease liabilities 54,830 56,247 Total current liabilities 4,373,920 4,128,104 Long-term debt 2,795,948 2,574,729 Long-term operating lease liabilities 158,991 159,449 Other liabilities 237,397 244,776 Total liabilities 7,566,256 7,107,058 Shareholders’ equity 4,848,101 5,011,495 Total liabilities and shareholders’ equity $ 12,414,357 $ 12,118,553 AVNET, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) First Quarters Ended September 27, September 28, 2025 2024 (Thousands) Cash flows from operating activities: Net income $ 51,745 $ 58,956 Non-cash and other reconciling items: Depreciation and amortization 16,839 19,883 Amortization of operating lease assets 13,934 13,926 Deferred income taxes (5,868 ) (17,572 ) Stock-based compensation 9,724 10,987 Other, net (13,439 ) 19,337 Changes in (net of effects from businesses acquired and divested): Receivables (192,583 ) (94,393 ) Inventories (216,326 ) (29,230 ) Accounts payable 218,297 213,610 Accrued expenses and other, net (26,907 ) (89,179 ) Net cash flows (used for) provided by operating activities (144,584 ) 106,325 Cash flows from financing activities: Issuance of convertible notes, net of issuance costs 633,750 — (Repayments) borrowings under accounts receivable securitization, net (299,400 ) 27,900 Repayments under senior unsecured credit facility, net (290,861 ) (11,353 ) Borrowings under term loan 266,932 — Borrowings (repayments) under bank credit facilities and other debt, net 10,352 (824 ) Repurchases of common stock (138,308 ) (99,995 ) Dividends paid on common stock (28,464 ) (28,861 ) Other, net 1,137 3,766 Net cash flows provided by (used for) financing activities 155,138 (109,367 ) Cash flows from investing activities: Purchases of property, plant and equipment (24,589 ) (31,776 ) Other, net 80 330 Net cash flows used for investing activities (24,509 ) (31,446 ) Effect of currency exchange rate changes on cash and cash equivalents (3,008 ) (8,932 ) Cash and cash equivalents: — decrease (16,963 ) (43,420 ) — at beginning of period 192,428 310,941 — at end of period $ 175,465 $ 267,521 Non-GAAP Financial Information In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States (“GAAP”), the Company also discloses certain non-GAAP financial information including (i) adjusted operating income, (ii) adjusted other income (expense), (iii) adjusted income before income taxes, (iv) adjusted income tax expense (benefit), and (v) adjusted diluted earnings per share. There are also references to the impact of foreign currency in the discussion of the Company’s results of operations. When the U.S. Dollar strengthens and the stronger exchange rates of the current year are used to translate the results of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is a decrease in U.S. Dollars of reported results. Conversely, when the U.S. Dollar weakens and the weaker exchange rates of the current year are used to translate the results of operations of Avnet’s subsidiaries denominated in foreign currencies, the resulting impact is an increase in U.S. Dollars of reported results. In the discussion of the Company’s results of operations, results excluding this impact are referred to as “constant currency.” Management believes sales in constant currency is a useful measure for evaluating current period performance as compared with prior periods and for understanding underlying trends. In order to determine the translation impact of changes in foreign currency exchange rates on sales, income or expense items for subsidiaries reporting in currencies other than the U.S. Dollar, the Company adjusts the average exchange rates used in current periods to be consistent with the average exchange rates in effect during the comparative period. Management believes that operating income adjusted for restructuring, integration and other expenses, and amortization of acquired intangible assets, is a useful measure to help investors better assess and understand the Company’s operating performance. This is especially the case when comparing results with previous periods or forecasting performance for future periods, primarily because management views the excluded items to be outside of Avnet’s normal operating results or non-cash in nature. Management analyzes operating income without the impact of these items as an indicator of ongoing margin performance and underlying trends in the business. Management also uses these non-GAAP measures to establish operational goals and, in most cases, for measuring performance for compensation purposes. Management measures operating income for its reportable segments excluding restructuring, integration and other expenses, and amortization of acquired intangible assets. Management also believes income tax expense (benefit), net income and diluted earnings per share adjusted for the impact of the items described above, foreign currency gains and losses and certain items impacting income tax expense (benefit) are useful to investors because they provide a measure of the Company’s net profitability on a more comparable basis to historical periods and provide a more meaningful basis for forecasting future performance. Adjustments to income tax expense (benefit) and the effective income tax rate include the effect of changes in tax laws, certain changes in valuation allowances and unrecognized tax benefits, income tax audit settlements and adjustments to the effective tax rate based upon the expected long-term adjusted effective tax rate. Additionally, because of management’s focus on generating shareholder value, of which net profitability is a primary driver, management believes net income and diluted earnings per share excluding the impact of these items provides an important measure of the Company’s net profitability for the investing public. Additional non-GAAP metrics management uses are adjusted operating income margin, which is defined as adjusted operating income divided by sales and the adjusted effective income tax rate, which is defined as adjusted income tax expense divided by adjusted income before income taxes. Any analysis of results and outlook on a non-GAAP basis should be used as a complement to, and in conjunction with, results presented in accordance with GAAP. Fiscal 2026 First Quarter September 27, 2025 ($ in thousands, except per share amounts) GAAP operating income $ 142,032 Restructuring, integration, and other expenses 8,291 Amortization of intangible assets 364 Adjusted operating income 150,687 GAAP other expense, net $ (5,466 ) Foreign currency loss 6,483 Adjusted other income, net 1,017 GAAP income before income taxes $ 76,804 Restructuring, integration, and other expenses 8,291 Amortization of intangible assets 364 Foreign currency loss 6,483 Adjusted income before income taxes 91,942 GAAP income tax expense $ 25,059 Restructuring, integration, and other expenses 2,452 Amortization of intangible assets 85 Foreign currency loss 1,535 Income tax expense items, net (7,984 ) Adjusted income tax expense 21,147 GAAP net income $ 51,745 Restructuring, integration, and other expenses (net of tax) 5,839 Amortization of intangible assets (net of tax) 279 Foreign currency loss (net of tax) 4,948 Income tax expense items, net 7,984 Adjusted net income 70,795 GAAP diluted earnings per share $ 0.61 Restructuring, integration, and other expenses (net of tax) 0.07 Amortization of intangible assets (net of tax) — Foreign currency loss (net of tax) 0.06 Income tax expense items, net 0.10 Adjusted diluted EPS 0.84 Fiscal Quarters Ended Year June 28, March 29, December 28, September 28, 2025* 2025 2025 2024 2024 ($ in thousands, except per share amounts) GAAP operating income $ 514,254 $ 73,452 $ 143,251 $ 155,327 $ 142,225 Restructuring, integration, and other expenses 108,316 69,061 9,110 3,794 26,351 Amortization of intangible assets 1,463 364 364 366 368 Adjusted operating income 624,033 142,877 152,725 159,487 168,944 GAAP other expense, net $ (17,283 ) $ (7,604 ) $ (3,992 ) $ (2,645 ) $ (3,043 ) Foreign currency loss 29,631 12,811 6,933 5,104 4,783 Adjusted other income, net 12,348 5,207 2,941 2,459 1,740 GAAP income before income taxes $ 250,569 $ 7,404 $ 78,144 $ 90,283 $ 74,738 Restructuring, integration, and other expenses 108,316 69,061 9,110 3,794 26,351 Amortization of intangible assets 1,463 364 364 366 368 Foreign currency loss 29,631 12,811 6,933 5,104 4,783 Adjusted income before income taxes 389,979 89,640 94,551 99,547 106,240 GAAP income tax expense (benefit) $ 10,352 $ 1,315 $ (9,775 ) $ 3,030 $ 15,782 Restructuring, integration, and other expenses 20,671 10,397 2,475 1,142 6,657 Amortization of intangible assets 345 86 86 86 87 Foreign currency loss 8,800 3,796 1,762 1,630 1,612 Income tax expense items, net 49,527 5,023 27,199 17,007 298 Adjusted income tax expense 89,695 20,617 21,747 22,895 24,436 GAAP net income $ 240,217 $ 6,089 $ 87,919 $ 87,253 $ 58,956 Restructuring, integration, and other expenses (net of tax) 87,645 58,664 6,635 2,652 19,694 Amortization of intangible assets (net of tax) 1,117 278 278 280 281 Foreign currency loss (net of tax) 20,831 9,015 5,171 3,474 3,171 Income tax expense items, net (49,527 ) (5,023 ) (27,199 ) (17,007 ) (298 ) Adjusted net income 300,283 69,023 72,804 76,652 81,804 GAAP diluted earnings per share $ 2.75 $ 0.07 $ 1.01 $ 0.99 $ 0.66 Restructuring, integration, and other expenses (net of tax) 1.01 0.69 0.08 0.03 0.22 Amortization of intangible assets (net of tax) 0.01 0.00 0.00 0.00 0.00 Foreign currency loss (net of tax) 0.24 0.11 0.06 0.04 0.04 Income tax expense items, net (0.57 ) (0.06 ) (0.31 ) (0.19 ) (0.00 ) Adjusted diluted EPS 3.44 0.81 0.84 0.87 0.92 ________________________________ * May not foot/cross foot due to rounding. Sales in Constant Currency The following table presents the percentage change in sales and the percentage change in sales in constant currency for the first quarter of fiscal year 2026 compared to the first quarter of fiscal year 2025. Quarter Ended September 27, 2025 Sales Year-Year % Sales Change in Year-Year Constant % Change Currency Avnet 5.3 % 3.6 % Avnet by region Americas 3.0 % 3.0 % EMEA (0.1 ) % (5.6 ) % Asia 9.9 % 9.7 % Avnet by segment EC 4.6 % 3.0 % Farnell 14.9 % 12.5 % Segment Financial Information* Quarters Ended September 27, September 28, 2025 2024 ($ in millions, except margins and sales mix) Electronic Components Sales $ 5,499.7 $ 5,257.1 Cost of goods sold $ 4,992.6 $ 4,740.0 Gross profit $ 507.1 $ 517.0 Gross profit margin 9.2 % 9.8 % Operating income $ 159.0 $ 197.4 Operating income margin 2.9 % 3.8 % Farnell Sales $ 398.9 $ 347.1 Cost of goods sold $ 291.2 $ 256.8 Gross profit $ 107.7 $ 90.3 Gross profit margin 27.0 % 26.0 % Operating income $ 17.1 $ 1.9 Operating income margin 4.3 % 0.5 % Total reportable segment operating income $ 176.1 $ 199.3 Corporate expenses (25.4 ) (30.3 ) Restructuring, integration, and other expenses (8.3 ) (26.4 ) Amortization of acquired intangible assets and other (0.4 ) (0.4 ) Avnet operating income $ 142.0 $ 142.2 Sales by geographic area: Americas $ 1,369.9 $ 1,329.9 EMEA 1,665.9 1,668.2 Asia 2,862.8 2,606.1 Avnet sales $ 5,898.6 $ 5,604.2 Sales Mix by geographic area: Americas 23.2 % 23.7 % EMEA 28.2 % 29.8 % Asia 48.5 % 46.5 % ________________________________ * May not foot due to rounding. Guidance Reconciliation The following table presents the reconciliation of non-GAAP adjusted diluted earnings per share guidance to the expected GAAP diluted earnings per share guidance for the second quarter of fiscal 2026. Low End of High End of Guidance Range Guidance Range Adjusted diluted earnings per share guidance $ 0.90 $ 1.00 Restructuring, integration, and other expenses (net of tax) (0.16 ) (0.08 ) GAAP diluted earnings per share guidance $ 0.74 $ 0.92 View source version on businesswire.com: https://www.businesswire.com/news/home/20251029092914/en/ Investor Relations Contact [email protected] Media Relations Contact Liam Creighton, 480-643-5027 [email protected] Source: Avnet