Financial Data and Key Metrics Changes - Consolidated sales for Q3 2024 were $6.8 billion, down 15% year-over-year, but above the midpoint of guidance [21] - Non-GAAP earnings per share for Q3 2024 were $2.38, exceeding the high end of the guided range [25] - Gross margin for Q3 2024 was 11.5%, down approximately 80 basis points sequentially [22] - Non-GAAP operating income was $215 million, representing 3.2% of sales [25] Business Line Data and Key Metrics Changes - Global Components sales were $4.9 billion, down 2% sequentially [21] - Enterprise Computing Solutions (ECS) sales were $1.9 billion, up 7% year-over-year due to favorable product mix [21] - Operating margins for Global Components were 3.9% and for ECS were 4.1%, both on a non-GAAP basis [25] Market Data and Key Metrics Changes - In Asia, there was mixed growth, with stability overall and modest growth in the automotive sector, particularly in China [11] - The Americas saw sequential growth driven by aerospace and defense, while EMEA experienced a broad-based decline [12] - Book-to-bill ratios remained below one overall, with Asia leading the way [33] Company Strategy and Development Direction - The company is focused on supply chain management and design services, expanding centers of excellence in automotive and robotics [19] - In ECS, the ArrowSphere platform is central to the go-to-market model, enhancing customer base and recurring revenue streams [20] - The company plans to reduce annual operating expenses by approximately $90 million to $100 million by 2026, with a focus on geographic realignment [23] Management's Comments on Operating Environment and Future Outlook - Management indicated that the market correction in the components business is more prolonged than expected, with excess inventory levels persisting [10] - The outlook for Q4 reflects ongoing market trends, with expectations of some fluctuations across regions and verticals [15] - Management remains optimistic about the eventual recovery but acknowledges the difficulty in predicting the timing [16] Other Important Information - The company generated $81 million in cash flow from operations in Q3 2024, marking the fifth consecutive quarter of positive cash flow [27] - Net debt at the end of Q3 2024 was $3 billion, lower compared to Q2 [27] - The company plans to exit certain underperforming non-core business lines, estimating approximately $50 million in additional costs [24] Q&A Session Summary Question: Guidance for components and regional performance - Management clarified that Asia is expected to be flat while Western markets may see declines in high single digits [32] Question: Book-to-bill ratios and regional performance - Management confirmed that book-to-bill ratios are below one overall, with Asia performing better [33] Question: Gross margin recovery timeline - Management indicated that gross margins are expected to normalize as the market improves, but timing remains uncertain [36] Question: Customer mix and market recovery - Management noted that recovery typically occurs first in Asia, followed by North America and Europe, with larger customers recovering before smaller ones [40] Question: Asia demand compared to competitors - Management reported modest growth in China, particularly in the EV market, but noted that recovery in the broader industrial mass market has been slower [49] Question: Operating expenses and cost reduction plans - Management confirmed that the $90 million to $100 million in savings is net and will be spread across the organization [50] Question: Product lines performance in ECS - Management highlighted strong growth in hybrid cloud and infrastructure software, contributing to operating margin growth [54] Question: Pricing environment and future concerns - Management stated that pricing remains stable, with no significant reductions from suppliers expected [71] Question: Free cash flow and capital allocation - Management emphasized that the business model remains focused on generating cash, with plans for stock buybacks when appropriate [75]

For the quarter ended September 2024, Arrow Electronics (ARW) reported revenue of $6.82 billion, down 14.8% over the same period last year. EPS came in at $2.38, compared to $4.14 in the year-ago quarter. The reported revenue represents a surprise of +1.21% over the Zacks Consensus Estimate of $6.74 billion. With the consensus EPS estimate being $2.23, the EPS surprise was +6.73%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall ...

Arrow Electronics (ARW) came out with quarterly earnings of $2.38 per share, beating the Zacks Consensus Estimate of $2.23 per share. This compares to earnings of $4.14 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 6.73%. A quarter ago, it was expected that this electronics maker would post earnings of $2.16 per share when it actually produced earnings of $2.78, delivering a surprise of 28.70%. Over the last four quarters, ...

ARROW ELECTRONICS, INC. 9151 EAST PANORAMA CIRCLE CENTENNIAL, CO 80112 303-824-4000 NEWS Exhibit 99.1 Arrow Electronics Reports Third-Quarter 2024 Results -- Sales of $6.8 billion, at high-end of guidance range -- -- Third-Quarter Earnings Per Diluted Share of $1.88; Non-GAAP Earnings Per Diluted Share of $2.38 -- CENTENNIAL, Colo.--(BUSINESS WIRE)- Oct. 31, 2024--Arrow Electronics, Inc. (NYSE:ARW) today announced financial results for its third quarter of 2024. "In the third quarter, the company continued ...

Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher." Who doesn't like betting on fast-moving trending stocks? But determining the right entry point isn't easy. Often, these stocks lose momentum once their valuation moves ...

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers. Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, i ...

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies. Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tr ...

Luis Alvarez Investment summary My previous investment thoughts on Arrow Electronics (NYSE:ARW) (published on 23 May) was a buy rating, as various indicators have pointed to ARW reaching the end of this cycle. I remain buy-rated as the timing of a recovery cycle is getting increasingly visible and, by my estimate, should happen in 4Q24. 2Q24 results update Released a few days ago, ARW once again reported positive results that support my bullish views on the stock. Total revenue was flattish sequentially, co ...

Arrow Electronics (ARW) reported second-quarter 2024 adjusted earnings of $2.78 per share, which beat the Zacks Consensus Estimate by 28.7%. However, the bottom line declined 36.4% on a year-over-year basis (down 36% at cc) due to lower revenues and unfavorable foreign currency exchange rates. In the second quarter, ARW reported revenues of $6.89 billion, down 19% from the year-ago quarter's level (down 19% at cc). However, the top line beat the Zacks Consensus Estimate by 5.91%. Second-Quarter Details In t ...

Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was $6.9 billion, exceeding the high end of guidance and down 19% year-over-year [7][17] - Non-GAAP earnings per share (EPS) for Q2 2024 was $2.78, significantly higher than the guided range [17][19] - Consolidated gross margin was 12.3%, down approximately 20 basis points sequentially and year-over-year [17] - Non-GAAP operating income was $262 million, representing 3.8% of sales [18] Business Line Data and Key Metrics Changes - Global Components segment sales were $5 billion, down 3% sequentially but better than expected [17] - Enterprise Computing Solutions (ECS) sales were $1.9 billion, up 2% year-over-year due to a favorable product mix [17] - Operating margin for Global Components was 4.3%, while ECS margin was 5.6% on a non-GAAP basis [18] Market Data and Key Metrics Changes - In Asia, revenue grew sequentially in semiconductor and IP&E product lines, with notable growth in China [9][10] - The Americas saw a slight decline, but aerospace and defense remained healthy [9] - EMEA markets continued to decline, particularly in industrial and transportation sectors [10] Company Strategy and Development Direction - The company is focused on value-added offerings, including supply chain management and engineering services, to deepen engagement with suppliers and customers [8] - There is an emphasis on investing in strategic priorities while managing costs and working capital [11][15] - The company is positioning itself for future growth cycles, particularly in AI and cloud-related solutions [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about approaching a turning point in core markets, with expectations for stronger performance in the second half of the year [14][15] - The outlook for Q3 indicates typical seasonal patterns, with expectations for stable operating margins [11][22] - Management noted that while conditions are improving, the broader industrial markets remain soft [10][42] Other Important Information - The company reduced net working capital by approximately $150 million in Q2, marking the fourth consecutive quarter of lower net working capital [19][20] - Inventory levels decreased by $140 million from Q1, with a total reduction of $1.2 billion over the last nine months [21] - The company repurchased $50 million of shares in Q2, with a remaining repurchase authorization of approximately $425 million [21] Q&A Session Summary Question: Expectations for stronger second half revenue growth - Management expects better performance in the second half compared to the first half, driven by improvements in the components business and ECS seasonality [25] Question: Specific areas targeted for inventory investments - Management indicated a focus on IP&E as a strategic growth priority while managing working capital carefully [26][27] Question: Revenue guidance for Q4 - Management refrained from providing specific guidance for Q4 but expressed optimism based on improving indicators [32][34] Question: Geo-mix and recovery in China - Management noted sequential growth in Asia, particularly in China, but cautioned that recovery is not V-shaped and remains moderate [38][39] Question: Inventory levels and future demand - Management is confident in the inventory mix and is prepared to invest in areas where demand is expected to improve [44][47] Question: Revenue contribution from AI - Management indicated that while it is too early to quantify AI revenue contributions, they are actively engaged in enabling AI infrastructure [54][55] Question: Drivers for ECS margin growth - ECS margin growth was attributed to business mix, with expectations for normal seasonality impacting margins in Q3 [56] Question: Free cash flow and inventory trends - Management expressed confidence in cash generation capabilities and indicated ongoing investments in inventory as needed [59][63]