Arrow Electronics (ARW) Q4 2024 earnings summary

Executive summary

• Q4 2024 sales reached $7.3 billion, exceeding guidance, with non-GAAP EPS of $2.97 and operating margin of 3.8%.

• FY 2024 consolidated sales were $27.9 billion, with non-GAAP diluted EPS of $10.56, reflecting resilience amid industry correction.

• ECS segment delivered year-over-year growth in billings, gross profit, and operating income, driven by demand in hybrid cloud, cybersecurity, and AI data centers.

• Global Components faced softness in Consumer, Compute, and Communications, but saw stability in Transportation and growth in Industrial.

• Inventory management and cost efficiency initiatives improved financial performance and cash flow.

Financial highlights

• Q4 2024 consolidated sales were $7.3 billion, down 7% year-over-year but above guidance; non-GAAP operating income was $274 million.

• Q4 2024 non-GAAP net income was $158 million; diluted EPS was $2.97; gross margin was 11.0%.

• Full-year 2024 sales were $27.92 billion, down 16% year-over-year; non-GAAP net income was $568 million.

• Cash flow from operations was $326 million in Q4 and $1.1 billion for the full year.

• Share repurchases totaled $50 million in Q4 and $250 million for the full year; gross debt at $3.1 billion.

Outlook and guidance

• Q1 2025 sales expected between $5.98 billion and $6.58 billion; non-GAAP diluted EPS guidance is $1.30 to $1.50.

• Global Components Q1 sales guidance: $4.35–$4.75 billion; ECS Q1 sales: $1.63–$1.83 billion.

• Foreign currency expected to reduce Q1 2025 sales by $138–$140 million and EPS by $0.13 year-over-year.

• Interest and other expense forecasted at $60–$65 million; tax rate assumption of 23–25%.

• Gross margins expected to remain relatively stable sequentially.