Avnet (AVT) BofA Securities 2024 Global Technology Conference summary

Macro environment and demand trends

• Asia and China have shown signs of stabilization post-Lunar New Year, with sequential growth implied in June quarter guidance.

• Europe was the strongest region but is now experiencing double-digit demand declines; Americas are also softening.

• Industrial remains the strongest market but is starting to soften; transportation is softer but relatively resilient.

• Demand softness is attributed to inventory corrections and excess inventories at customers.

Visibility, backlog, and book-to-bill

• Customer forecast visibility remains consistent, with shorter lead times leading to less long-term visibility.

• Backlog is down year-over-year due to shorter lead times and softer demand, but book-to-bill is improving as orders come in.

• Book-to-bill is trending up in Asia, nearing parity, while the West remains softer; IP&E is stable and improving.

Regional investment and growth focus

• Investments in China have increased, focusing on transportation and renewables, viewing it as a long-term market.

• Japan is a key investment area with higher margins and strong performance; Taiwan, a major part of Asia business, is recovering.