Avnet (AVT) investor relations material

Executive summary

• Q1 FY26 sales reached $5.9 billion, up 5.3% year-over-year, exceeding guidance, with adjusted EPS of $0.84 near the high end of expectations; diluted EPS was $0.61.

• Strong double-digit growth in Asia and Farnell, with the Americas returning to year-over-year growth; EMEA was flat.

• Demand strength in transportation and communication verticals; semiconductor lead times and pricing stable for most technologies.

• Book-to-bill ratio improved globally, with all regions above parity and growing backlog.

• Net income was $51.7 million, down 12.2% year-over-year, reflecting lower margins and higher expenses.

Financial highlights

• Gross margin was 10.4%, down 42 bps year-over-year, mainly due to geographic mix and lower margins in EC Americas and EMEA.

• Adjusted operating income was $151 million (2.6% margin), down 10.8% year-over-year; operating income was $142 million (2.4% margin).

• SG&A expenses were $464 million, up 5.9% year-over-year, representing about 76% of gross profit.

• Interest expense was $59.8 million, down $4.7 million year-over-year.

• Net cash used in operating activities was $144.6 million, mainly due to increased working capital needs.

Outlook and guidance

• Q2 FY26 sales guidance: $5.85–$6.15 billion, midpoint $6.00 billion; adjusted diluted EPS guidance: $0.90–$1.00, midpoint $0.95.

• Guidance assumes sequential sales growth in Americas and Asia, flat in EMEA, and similar interest expense to Q1.

• Inventory days expected to decrease into the 80s by next quarter, with gradual improvement thereafter.

• No material adverse impact expected from recent U.S. tax legislation in FY26.