Avnet meets earnings guidance, projects flat quarter

Electronics distributor Avnet said weakening global market conditions impacted its September quarter earnings.
Electronics distributor Avnet said weakening global market conditions impacted its September quarter earnings. (Avnet)

In its first fiscal 2020 quarter ended September, electronics distributor Avnet reported sales $4.6 billion, down from $5.1 billion a year ago, which the company attributed to weakening market conditions worldwide.

Avnet generated GAAP diluted earnings per share from continuing operations of 40 cents per share on an adjusted basis. GAAP operating income margin was 1.4%; and adjusted operating income margin was 2.3%.

“In the first quarter we achieved results within our guidance by managing the business effectively as we worked through an ongoing industry-wide slowdown,” said Bill Amelio, Chief Executive Officer of Avnet, in a statement. “While echoing the short-term caution in our industry, we took steps to position Avnet for long-term growth in our higher margin businesses. We further strengthened our capabilities by broadening our reach and offerings through a strategic IoT acquisition and by forming alliances around the world. We are confident these actions will benefit both our business and our shareholders by laying the groundwork for an accelerated, positive return on investment when the industry rebounds.”

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For the second fiscal quarter ending in December, Avnet is projecting sales of $4.2 to $4.6 billion, with non-GAAP earnings of 35 to 45 cents per share. Avnet’s guidance reflects a sequential decline in sales in the Americas and EMEA regions and stable business trends in Asia, and continued pricing pressure in all businesses.

 

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