Avnet (AVT) 51st Nasdaq London Investor Conference summary

Company overview and competitive positioning

• Operates as a global distributor of technology and services, connecting over one million customers with leading suppliers in 140 countries.

• Diversified across industrial, transportation, aerospace, defense, consumer, compute, and data center markets, with no single market or supplier exceeding 10% of business.

• Core strengths include design chain and supply chain expertise, supported by a stable, experienced leadership team.

• Geographic revenue split: Asia 40-45%, Europe 35%, Americas the remainder.

• End-to-end solutions and global scale enable service to a broad customer base, from OEMs to engineers.

Market cycle, inventory, and supply chain trends

• Current cycle marked by elevated inventories, especially in Europe, delaying normalization.

• Progress is being made to reduce inventory, with strong supplier relationships aiding navigation through shortages and excesses.

• Customers now place greater value on supply chain optimization, with increased appreciation for distribution partners.

• Visibility into customer demand is typically strong for one quarter out, less than six months, down from over a year during shortages.

• Supply chains are becoming more localized, with expansion outside China to regions like Vietnam, Malaysia, and Mexico.

Financial performance and outlook

• Recent quarterly revenue was $5.6 billion, with a shift toward Asia (up 14% sequentially) and softness in Europe (down 13%).

• Cash generation remains strong, with over $800 million generated in the past four quarters and $106 million in the last quarter.

• Countercyclical balance sheet enables share buybacks and a 6% dividend increase.

• Free cash flow is expected to remain positive as inventory is reduced and capital requirements stay low.

• Commitment to reduce share count by 5% this year, continuing a decade-long trend.