Avnet (AVT) Tops Q3 EPS by 2c

Avnet (NYSE: AVT) reported Q3 EPS of $1.01, $0.02 better than the analyst estimate of $0.99. Revenue for the quarter came in at $6.17 billion versus the consensus estimate of $6.31 billion.

GUIDANCE:

Avnet sees Q4 2016 EPS of $0.95-$1.05, versus the consensus of $1.13. Avnet sees Q4 2016 revenue of $5.95-6.55 billion, versus the consensus of $6.55 billion.

Rick Hamada, Chief Executive Officer, commented, “Our sequential revenue decline was slightly below our normal seasonality given an expected drop in high volume supply chain engagements in our Asia region of Electronics Marketing (EM) coupled with weaker than expected demand in certain legacy technologies at Technology Solutions (TS). These combined impacts led to an overall sequential revenue decline of approximately 10%. Despite these elements of softness, we did experience stronger than typical sequential gains in our western regions at EM and notable growth within areas of our TS portfolio. Enterprise gross profit margin increased 44 basis points year over year to 11.9% with contributions from both operating groups. This improvement in gross profit margin was offset by the decline in revenue as adjusted operating income dollars declined 10.9% year over year and adjusted operating income margin decreased 10 basis points. Given the overall trends through our March quarter, we have initiated incremental, focused expense management where we have gaps to our expectations while continuing to invest in clearly identified areas of current and future growth. With our strong competitive position at the center of the technology supply chain, we will continue to leverage our broad range of resources and financial strength in expanding new markets, including the Internet of Things, embedded solutions, and third platform technologies.”

For earnings history and earnings-related data on Avnet (AVT) click here.

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