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F500-2021-168-Avnet

Founded by Charles Avnet in 1921, the company today is one of the world's leaders in manufacturing electronic components that can be used for improving autonomous vehicles' power efficiency and Lidar detection. The company also offers a wide range of technology services to help with processes like supply chain, logistics, and software.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-169-Avnet

This distributor and retailer of tech components and IT services was founded in 1921 and is headquartered in Phoenix.

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This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

Fortune Global 500

This year's Fortune 500 marks the 63rd running of the list.

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This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

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Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Key Financials (last Fiscal Year)

Revenues ($M)

Profits ($M)

Assets ($M)

Total Stockholder Equity ($M)

Profit Ratios

Profit as % of Revenues

Profits as % of Assets

Profits as % of Stockholder Equity

Sector

Industry

Current All-Star Rank

Previous All-Star Rank

Industry Rank

Previous Industry Rank

Overall Score

Innovation

People Management

Use of Corporate Assets

Social Responsibility

Quality of Management

Financial Soundness

Long-Term Investment Value

Quality of Products/Services

Global Competitiveness

Earnings Per Share (last Fiscal Year)

Earnings Per Share ($)

EPS % Change (from prior fiscal year)

EPS % Change (5 year annual rate)

EPS % Change (10 year annual rate)

Total Return

Total Return to Investors (last year)

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Total Return to Investors (10 year, annualized)

Avnet is a distributor of electronic components and an electronic solutions provider. The company serves a wide range of clients in the automotive, medical, defense, aerospace, telecommunications, and industrial sectors. Founded in 1921, the company operates in 140 countries across North America, Europe, and Asia.

Q4 2026

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Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Avnet (AVT): Company Profile, Stock Price, News, Rankings

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Avnet

avnet

Welcome to the Avnet First Quarter Fiscal Year 2026 Earnings Call. I would now like to turn the floor over to Lisa Mueller, Director of Investor Relations for Avnet. Please go ahead.

Thank you, Operator. I'd like to welcome everyone to Avnet's First Quarter Fiscal Year 2026 Earnings Conference Call. This morning, Avnet released financial results for the first quarter of fiscal year 2026, and the release is available on the Investor Relations section of Avnet's website, along with a slide presentation, which you may access at your convenience. As a reminder, some of the information contained in the news release and on this conference call contain forward-looking statements that involve risks, uncertainties, and assumptions that are difficult to predict. Such forward-looking statements are not a guarantee of performance, and the company's actual results could differ materially from those contained in such statements. Several factors that could cause or contribute to such differences are described in detail in Avnet's most recent Form 10-Q and 10-K and subsequent filings with the SEC.

These forward-looking statements speak only as of the date of this presentation, and the company undertakes no obligation to publicly update any forward-looking statements or supply new information regarding the circumstances after the date of this presentation. Please note, unless otherwise stated, all results provided will be non-GAAP measures. The full non-GAAP to GAAP reconciliation can be found in the press release issued today, as well as in the appendix slides of today's presentation and posted on the Investor Relations website. Today's call will be led by Phil Gallagher, Avnet's CEO, and Ken Jacobson, Avnet's CFO. With that, let me turn the call over to Phil Gallagher. Phil?

Thank you, Lisa, and thank you everyone for joining us on our First Quarter Fiscal Year 2026 Earnings Call. We are off to a solid start in the new fiscal year. In the first quarter, we achieved sales of $5.9 billion above guidance and an adjusted EPS of $0.84, near the high end of guidance. Our performance was led by strength in Asia and Farnell, which both had double-digit year-on-year growth. Sales in our Americas region grew year-on-year for the first time since fiscal 2023. While sales in our EMEA region were flat with the year-ago quarter, they did grow better than seasonal on a sequential basis, as did all of our regions. From a demand perspective, in the quarter, we saw strength in certain key vertical segments, most notably transportation, compute, and communication. Overall, semiconductor lead times and pricing continue to be stable for most technologies.

That said, we do see extended lead times and price increases in memory, storage, and certain interconnect products, particularly those supporting data center and AI buildouts. On the IP&E side, lead times also continue to be stable. Our book-to-bill ratio improved globally, led by Asia and the Americas, and all regions were above parity. Our backlog is growing, and we continue to see customers placing orders within lead times, which is a sign of a strengthening market. Cancellations have remained at normal levels. In the quarter, we had a modest increase in inventory to support sales growth in Asia and certain supply chain opportunities, although we did see improvement in days of inventory on hand. We remain focused on balancing these growth opportunities with reductions in the near term and optimizing the inventory we have on hand. Now, turning to our electronic components results.

At the top line, our electronic components sales increased on a sequential and year-on-year basis due to a generally improving demand environment led by Asia and the Americas. In Asia, sales grew sequentially and year-on-year and now represent just over half of EC sales. This marks our fifth consecutive quarter of year-on-year sales growth in the region, driven by strength across the communication and transportation end markets. The Americas is showing signs of recovery, with sales growing both sequentially and year-on-year. Sales were strongest in the industrial and communications end markets, followed by transportation and consumer. In EMEA, sales were basically flat year-on-year and higher sequentially, which is better than seasonal for the region. Bookings improved as the region returned from its summer slowdown. The industrial and communications end markets showed year-on-year growth, while compute grew both sequentially and year-on-year. We are optimistic about continued modest improvement in Q2.

We continue to see healthy design-wind activity and momentum in demand creation. We've recorded solid increases in demand creation revenues and gross profit hours for the quarter. We are also pleased with progress in our IP&E product sales. As we mentioned in the past, IP&E is one of our higher margin businesses. Sales have been steady with improving margins and doing particularly well in Asia. Now, turning to Farnell. Farnell delivered sequential and year-on-year growth and experienced similar sales trends to EC, with strengthening in Asia and the Americas. Operating margin remained stable sequentially, due mostly to increased sales of the onboard components offset by higher sales of single-board computers and test and measurements, which tend to be a bit lower in margin. The team continues to execute on their strategy, including enhancing digital capabilities and leveraging Avnet's core ecosystem for new and additional opportunities.

While there is still plenty of work to do, we are pleased with Farnell's progress, especially given its improved performance, while the macro environment in Europe, its largest region, has yet to fully recover. To conclude, we are encouraged by the increasing number of positive signs in our business. We feel good about the recovery in Asia-Pac and progress in the Americas. Conditions in EMEA are stabilizing and modestly improving. While geopolitical and market uncertainties remain, we believe our strong supplier line card and diverse customer base and the strength of the end markets they serve position us well as the market recovers. During the quarter, I spent some time with the leadership teams from several of our supplier partners, both in the U.S. and Europe. Most recently, I attended the Electronic Components Industry Association (ECIA) conference in Chicago.

Consistent with our views, our supplier partners are also seeing several positive signs, including lead times extending in certain technologies and discussions on actual or potential price increases. Maintaining and strengthening our supplier relationships through these challenging times has helped us navigate the market, which also translates into increased value for our end customers. It is times like these that I am especially thankful for our dedicated and experienced team across our whole organization, who have led us through this prolonged market cycle. I want to thank them for their efforts that continue to reinforce Avnet's position at the center of the technology supply chain, helping our customers and suppliers navigate complexity and unlock new opportunities. With that, I'll turn it over to Ken to dive deeper into our first quarter results. Ken?

Thank you, Phil, and good morning, everyone. We appreciate your interest in Avnet and for joining our first quarter earnings call. Our sales for the first quarter were approximately $5.9 billion, above the high end of guidance of our range and up 5% both year over year and sequentially. Regionally, on a year-over-year basis, sales increased 10% in Asia and 3% in the Americas. Sales in EMEA were flat year over year and were down 6% in constant currency. From an operating group perspective, electronic components sales increased 5% year over year and sequentially. Farnell sales increased 50% year over year and 3% sequentially. For the first quarter, gross margin of 10.4% was 42 basis points lower year over year and 15 basis points lower sequentially. The year-over-year decline is primarily driven by declines in the Western regions, partially offset by improvements at Farnell.

The sequential decline in gross margin is primarily driven by a decline in Europe, partially offset by improvements in the Americas, Asia, and Farnell. The sequential gross margin declines in EMEA were primarily driven by a less favorable product and customer mix compared to last quarter. The regional mix shift to Asia also had a negative effect on EC gross margin year over year and sequentially. Sales from the Asia region represent 49% of first quarter sales in fiscal 2026, compared to 47% in the year-ago quarter and 48% last quarter. Farnell gross margin increased both sequentially and year over year, in part due to improved product mix of on-the-board components. Turning to operating expenses, SG&A expenses were $464 million in the quarter, up $26 million year over year, and up $13 million sequentially.

Foreign currency negatively impacted operating expenses by approximately $5 million sequentially and $11 million year over year. The expected increase in sequential SG&A expenses was primarily driven by the additional sales volume and from higher salary expenses due to employee raises that took effect in the first quarter of fiscal 2026. As a percentage of gross profit dollars, SG&A expenses were flat sequentially at 76%. Overall, first quarter operating expenses were as anticipated. As we move through fiscal 2026, we expect expenses to be well controlled, but would expect modest increases with sales growth as the market recovery unfolds. For the first quarter, we reported adjusted operating income of $151 million, and our adjusted operating margin was 2.6%. By operating group, electronic components operating income was $159 million, and EC operating margin was 2.9%.

The sequential decline in EC operating margin of 11 basis points was primarily due to higher SG&A expenses. Farnell operating income was $17 million, and operating income margin was 4.3%. Operating income margin was up approximately 375 basis points year over year and flat sequentially. Turning to expenses below operating income, first quarter interest expense of $60 million decreased by $5 million year over year and was up $1 million sequentially. Our adjusted effective income tax rate was 23% in the quarter, as expected. Adjusted diluted earnings per share of $0.84 was at the high end of our expectations for the quarter. Turning to the balance sheet and liquidity. During the quarter, working capital increased $160 million sequentially, primarily driven by a $176 million increase in receivables. The increase in inventories of $185 million was offset by a corresponding $201 million increase in accounts payable.

Excluding the impact of currency, working capital increased by $198 million sequentially. Working capital days decreased four days quarter over quarter to 95 days. Inventory days decreased by three days sequentially to 92 days. Our return on working capital increased 36 basis points sequentially from higher operating income. The increase in inventories and corresponding increase in accounts payable is primarily driven by increases in the Americas to support supply chain services engagements and increases in Asia to support overall growth. Overall, the quality and aging of our inventory continues to improve. We remain focused on reducing inventory levels where elevated, noting that we also want to ensure our electronic components and Farnell businesses have the right inventory in our distribution centers to position ourselves appropriately as the market recovers and as lead times extend for certain products.

Our increase in working capital led to an increase in debt of $323 million. We used $145 million of cash for operations in the quarter, primarily due to the increase in receivables to support the growth in Asia revenues. From a cash flow perspective, increases in inventory were offset by increases in accounts payable. With regards to our capital allocation, we have a consistent, disciplined approach. We continue to deploy cash in a manner that generates what we believe will have the greatest long-term return on investment for our shareholders, prioritizing reinvestments in the business and returning excess cash to shareholders. During the quarter, cash used for CapEx was $25 million, within our expected quarterly levels. We ended the quarter with a gross leverage of 4.0 times, and we had approximately $1.7 billion of available committed borrowing capacity.

We will continue to prioritize lowering our leverage to appropriate and historical levels in order to maintain a strong balance sheet, which we continue to believe is an important aspect of having a sustainable and profitable distribution business. We anticipate reducing our leverage to approximately 3.0 times over the next year. We increased our quarterly dividend by approximately 6% to $0.35 per share. We have increased our dividend in each of the last 12 fiscal years. We have more than doubled our dividend in the past 10 fiscal years, which is an average annual dividend increase of more than 10%. In the quarter, we repurchased approximately 2.6 million shares, totaling $138 million, including $100 million of shares repurchased in connection with our convertible debt issuance. We repurchased 3% of outstanding shares in the first quarter and have repurchased 8% of outstanding shares over the past four quarters.

Book value per share decreased to approximately $57 a share. Turning to guidance for the second quarter of fiscal 2026, we're guiding sales in the range of $5.85 billion-$6.15 billion and diluted earnings per share in the range of $0.90-$1.00. Our second quarter guidance considers the uncertainty that continues to impact the market and implies a sequential sales increase of 2% at the midpoint. This guidance assumes sequential sales growth in the Americas and Asia, with flattish sales in Europe. This guidance also assumes similar interest expense compared to the first quarter, an effective tax rate of between 21% and 25%, and 83 million shares outstanding on a diluted basis. In closing, our team continues to execute well against the areas we can control, and we still have opportunities for improvement.

Given today's rapidly changing market conditions, our team continues to demonstrate the value we bring to our customers and suppliers. We remain confident our approach through this market downturn will benefit our stakeholders in the long term. With that, I will turn it over to the operator to open it up for questions. Operator?

Thank you. We'll now be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question is from William Stein with Truist Securities.

Great. Thank you for taking my question. Congrats on the good quarter and outlook. First, I wanted to ask, Phil, you mentioned revenue in the data center, I think AI application category. I suspect your exposure there is still relatively small compared to your overall sales. Can you just bring us up to speed on that metric, please?

Sure can. Thanks, Will. I appreciate the question. Yeah, it is relatively small. Our exposure to the hyperscalers is, on a grand scheme, I don't know, maybe in Asia 7% of our business, give or take, Will, of Asia-Pac, where most of that's happening right now for us. The reason I bring it up is, it's well beyond the GPUs and even the FPGAs. The opportunities we're seeing in storage, connectivity, power, cooling, connectors, that's where we're seeing the opportunity for us right now. I think the big value for where we sit in the technology supply chain is it's going to enable what are really the downstream opportunities that are going to be massive, in particular in our MCU/MPU area, where you're going to get the applications out on the edge.

That's where our customers, that's a sweet spot for us, whether it be predictive maintenance, smart wearables, smart agriculture, smart security and surveillance, etc. We talk about AI. Yeah, we're playing in it today. We're selling into the data center, into the hyperscalers. Today, our customers are also selling into the hyperscalers. As we're calling on anybody in power, power management, etc., you're seeing some guys announce in the EMS provider space some nice growth here. We're going to participate in that as well, right? Hope that answers the question. We're excited about it.

It sounds like 7% of your Asia sales. As a follow-up on a different topic, inventory days in the quarter were flattish. I think you called out down a couple of days sequentially, but my model says roughly flattish. It's not a huge difference anyway, but we expected this number to be down more meaningfully. Maybe I just got a little bit ahead of myself, but that drove cash flows negative in the quarter. You talked about investing for future growth and other things. Maybe I'm just hoping you can help set expectations going forward a bit here. Should we expect this relatively higher number of inventory days to persist for longer term, maybe even perpetually, or should we expect inventory days to come down over time? Thank you.

I think, you know, first, I think you kind of calculated end-of-quarter inventory. We use an average inventory, so there's a little bit of difference in terms of how we measure the inventory days. I think we're continuing to see a trend of declines, you know, in the EC business. We're down roughly 10 days, you know, year over year. Inventory went up a little bit, you know, partially in Asia, and that's, you know, we don't have all the right inventory to service where the growth is, right? You're investing in certain inventory, but there's still opportunities, including in Asia, where we need to get inventory down, which will help the days as well. For the supply chain services, we're actually seeing that business come back a little bit. It was down in FY2025, and we're seeing that come back a little bit.

Some of that's going to turn this quarter. There's still opportunity to go after inventory where it's in excess and to kind of drive the inventory down a little bit. At the same time, as the sales grow, the days should improve. I think the expectations are still there. It was a little higher than we had anticipated coming into the end of the quarter, but there's nothing of concern or anything in terms of a longer-term trend that we would see because of what happened towards the end of the quarter.

Yeah, I'll add to that. Will, the quality of the inventory is good. The aging and the quality is good. We have no concerns there. Our longer-term goal will get back into the 80s. We know we want to continue, you know, bring it down a little bit while still making investments, right? We still need to do that. Inventory is not a bad thing, and distribution is actually a good thing. I think to get the days down into the 80s as we continue to drive the top line up.

Just one follow-up to that. Quantification, 80s, like in a year, in three years? Any sort of a trajectory you can give us would be helpful. Thank you.

When we talk about, you know, an eight in front of it, I think by next quarter, exit of the quarter at roughly 91, 92 days, we think we'll be with an eight in front of it next quarter and then, you know, kind of gradual trajection down.

Our next question is from Joe Burke with Wells Fargo Securities.

Yeah, thanks for taking the question. You know, you called out EMEA being better than seasonal in the September quarter, and then, you know, thinking that it could be flattish for December. I can appreciate that seasonality is a little bit difficult to kind of call right now, but how do we think about, I guess, the demand profile of that for the December quarter and kind of your visibility relative to seasonality in EMEA?

Yeah, so I'll go first. Thanks, Joe. Positive, I mean, so, but modest. I think we use the word modest. You know, December quarter is usually not a growth quarter sequentially in Asia, to your question on seasonality. This quarter, we're expecting modest growth. Why is that? We believe Europe's about hitting the bottom. I mean, it's been a tough several years in Europe, as you know. We're seeing the bookings positive now for a couple of quarters. Backlog's building. Based on that, we think we'll see some modest growth in September to December in Europe.

Got it. Just trying to think about, you know, now that the total business has returned to year-over-year growth, how should we think about just incremental margins for the business? Appreciating, obviously, that geographic mix matters, but Americas turning to year-over-year growth, I think, is a positive.

Yeah, Joe, I think it's a positive in terms of, you know, that'll start to give some more, you know, operating leverage there and kind of start to expand the operating margins. How we look at it is the guidance implies, you know, flat gross margin year over year, which we think is good. There's still some things we want to, you know, do in terms of mix, but as well as, you know, EMEA had gross margin down this quarter, but I think flat year over year, at least, is, you know, holding our own in gross margin. I think next quarter, we should see a seasonal mix shift, right?

Part of it depends on what the Lunar New Year looks like for Asia, but just seasonal growth in the West should have a nice impact to gross margin, which should then have some operating margin impact, all things being equal. Not ready to talk about third quarter yet, but book-to-bill ratios are healthy right now.

Thanks for that. Maybe just as one last follow-up, in the prepared remarks, you talked about suppliers seeing potential for price increases. I was wondering if you could maybe provide any more color on that front and just any additional details.

Yeah, without getting too specific, Joe, it's in certain technologies because lead times overall are pretty unchanged. I mean, you have some modest increase in lead times. For sure, some of the, let's call it the interconnect and maybe the power types of products going into the data center and hyperscalers are starting to see a little inflation. For sure, with memory, right? With HBM taking off, there's definitely some lead time issues in memory. I believe we'll start seeing price increases there as well. Some selective higher-end technology suppliers have been calling out potential increases as well, which is called in the higher-end MCU space.

The only other thing I'd say, Joe, is that input costs are still high, so overall ASPs are holding up pretty well. Thank you.

Thank you. Our next question is from Ruplu Bhattacharya with Bank of America.

Hi, thanks for taking my questions. I want to ask a couple more questions on margins. If I look at core segment margins, they were down 10 bps sequentially on $250 million higher sales sequentially. From the guide, it looks like the trends are the same with Asia growing and Americas growing as well, whereas Europe is flat. Ken, when we think about core business margins, how should we think about that over the next couple of quarters and what needs to happen for the margins there in the core business to get above 4%? Do you think that can happen in fiscal 2026? I have a follow-up.

Yeah, Ruplu, I'm not sure that I would want to call fiscal 2026 core margins. I guess it's possible depending on where the mix shifts in the fourth quarter. I think what I would say is, again, we're managing gross margin at the business unit level, trying to drive that, a little discipline in where the EMEA margin was at. We understand it's a few different things going on there, but nothing to be concerned with in terms of a longer-term deterioration of the gross margin in Europe. We should see some improvement in gross margin as we have a seasonal mix shift. I think, again, if Asia is going to be 50% of our business, it's going to take a little longer in terms of growth with the West to kind of get the operating margin to that 4% level.

We'll continue to focus on each business and making sure they're being consistent with their gross margin. We would expect going into the second half of the year, we're at least going to get the seasonal mix shift that would occur absent Asia continuing to reach record levels. The guidance implies record sales in Asia.

Okay. No, that makes sense. Can I ask the same question on margins for Farnell? If Europe remains flat from a revenue standpoint, can you still see Farnell margins continue to grow 50 bps? I think you were targeting. Does it depend on the overall revenue, or is it more dependent on mix? I think you called out some mix impacts this quarter. How should we think about Farnell margins going forward?

Yeah, from a gross margin perspective, Ruplu, I would think about Farnell being a little different than the core business. Regionally, EMEA still has the best margin, but that's more because they sell more semiconductors and IP&E products, right, relative to the U.S. and Asia. In general, each region has a pretty healthy gross margin there. Regional mix isn't as impactful to Farnell, but product mix is impactful. There's still some runway to go on Farnell gross margin as the broader market recovers and the mix improves in on-the-board components. We saw a little bit of uptick here, but I think there's still some runway there to go. Again, going into the third quarter, in the March quarter, you would have seasonality impacting Farnell as well because most of their business is in the West. They would still have that kind of seasonality in terms of sales demand.

Yeah, Ruplu, just to build on Ken's point and reemphasize it, their mix is both regional, not as big a deal, although the tailwind that we were kind of counting on for Farnell in the September quarter out of Europe didn't come. September kind of just didn't happen like we had expected. That dampened it a little bit. You got to Ken's point that on-board components, you know, semis, IP&E run at a higher margin than the test, the measurement, and MRO. There's a mix issue there. We're starting to see it improve, but as the on-board components increase, that runs a higher margin business. That all said, our expectation is to continue to grind it out at Farnell and continue to see modest improvement sequentially quarter on quarter, whether through revenue, profit, or OpEx.

Got it. Can I sneak one more in for you, Phil? You mentioned demand creation revenues and IP&E. What are those each as a percentage of revenue? I'm assuming these are higher margin businesses. I mean, what is the margin delta with the core business? Can they be meaningful drivers for margin upside over the next couple of quarters? Thanks.

Yeah, the range, I'll give you a range, Ruplu, I think is what we typically do. In the IP&E, it's called 15%-20% of our total components business, roughly. Demand creation in the 28%-33%, you know, depending on the quarter, demand creation revenue, and call it 300 bps-400 bps incremental margin. Keep in mind on the demand creation, to get that 300 bps-400 bps, we also have more costs, right? Because we have FAEs and, you know, the technical support and things along those lines. It's not, you know, it doesn't all drop because we have to make investments for the suppliers with the technical front end.

Okay. Got it. Thanks for all the details. Appreciate it.

Our next question is from Melissa Ann Dailey Fairbanks with Raymond James & Associates.

Hey, guys. Thanks so much for taking my questions. I wanted to start off first with some questions around the transport business. Phil, I think you highlighted that as being one of the areas where you saw some favorable trends. Was that across all geographies, or was it kind of more limited to the areas where you saw growth in Asia and the Americas?

Yeah. Hey, Melissa. How are you doing? It depends on year on year or quarter on quarter. It was up in both in Asia, right? In the Americas, we saw it up sequentially, down a little bit year on year. Europe was negative in both, as you might imagine.

Sure. Do you have any kind of visibility into what your exposure to either pure EV or hybrid versus that traditional supply chain for ICE vehicles?

I don't have that off the top. It would definitely be higher in the EV in Asia. Asia would be heavier EV. Americas would be higher combustible, and Europe would be somewhere probably in between.

Okay, that was a bit of a trick question, and I didn't expect you to have that.

Maybe one quick follow-up on the data center business, especially as you're getting deeper into some of these higher-value components, whether it's the memory, the storage, you know, the FPGA, the interconnect products. Is there any change in linearity with either how the bookings come through for that business, or is it still just kind of book and ship and you see turns in the quarter?

Yeah, no, most of those will be a supply chain arrangement. Okay, Melissa. For the most part, we're going to see it, which probably, for the most part, show up as a turns in the quarter because we're managing forecast. When the forecast flags shipment, we kind of book and bill at the same time. You know what I mean? A lot of that we don't show in the bookings, long-term bookings. It kind of happens same day, almost, frankly, once they pull it and we ship it. In other words, it's not really, it's not inflating. It's not inflating the bookings unrealistically.

Okay. Gotcha. Thanks very much. That's all for me, guys.

Thank you. There are no further questions at this time. I'd like to hand the floor back over to Phil Gallagher for any closing comments.

Great. Thank you. I want to thank you and everyone for attending today's earnings call. I look forward to speaking to you again at our second quarter fiscal year 2026 earnings report in January. Have a great holiday.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

Avnet (AVT) Q1 2026 Earnings Call Transcript

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