Avnet, Inc. recently released its 10-K report. The company distributes electronic components across the Americas, Europe, the Middle East, Africa and Asia/Pacific through two segments, Electronic Components and Farnell. It sells semiconductors and related components, provides design and supply-chain support, and offers embedded and test-and-measurement products to customers in automotive, defense, aerospace, medical, telecommunications, industrial and other markets.
In Item 7, Avnet said fiscal 2026 was a 52-week year, as were fiscal 2025 and 2024, and noted that its discussion of year-to-year comparisons is framed in both reported and constant-currency terms because foreign exchange can move results materially. The company also presented adjusted operating income as a non-GAAP measure, defined as operating income before restructuring, integration and other expenses and amortization of acquired intangible assets; fiscal 2026 adjusted operating income was $860.9 million versus $624.0 million in fiscal 2025 and $900.0 million in fiscal 2024.
Avnet’s fiscal 2026 sales rose 24.5% to $27.63 billion from $22.20 billion in fiscal 2025, with constant-currency sales up 22.4%. Electronic Components generated $25.85 billion of sales, up 24.6%, while Farnell posted $1.78 billion, up 23.2%; by geography, Asia produced $13.43 billion, the Americas $6.48 billion and EMEA $7.73 billion.
Gross profit increased 20.8% to $2.88 billion, but gross margin slipped to 10.4% from 10.7%. EC gross margin fell 44 basis points to 9.24%, while Farnell’s gross margin rose 168 basis points to 27.73%.
SG&A expenses climbed 14.8% to $2.02 billion, but fell to 7.3% of sales from 7.9% a year earlier. Restructuring, integration and other expenses totaled $134.7 million, including $87.7 million of severance and restructuring costs and $47.0 million of integration and other costs, partly tied to a new distribution center in EMEA; the largest severance charge related to the planned closure of a German distribution center affecting about 350 employees.
Operating income increased 40.9% to $724.8 million, and adjusted operating income rose 38.0% to $860.9 million. EC operating income advanced 26.9% to $898.5 million, while Farnell operating income jumped 221.7% to $105.7 million.
Interest and other financing expenses were $250.7 million, up 1.8% from $246.4 million, mainly because of higher average borrowings. Other expense narrowed to $6.6 million from $17.3 million, reflecting lower foreign-currency translation losses.
Income tax expense increased to $133.0 million from $10.4 million, lifting the effective tax rate to 28.5% from 4.1%. Net income rose to $334.4 million from $240.2 million, and diluted earnings per share increased to $4.01 from $2.75.
On cash flow, Avnet used $280.9 million in operating activities in fiscal 2026, compared with $724.5 million provided in fiscal 2025. The swing was driven by $802.4 million of cash used for working capital and other items, as the company bought more inventory, paid inventory obligations and carried higher receivables to support sales growth. Today the company's shares have moved 0.59% to a price of $96.555. If you want to know more, read the company's complete 10-K report here.
