Key Highlights

  • Record first-quarter fiscal 2027 sales of USD 10.7 billion rose 81.7% year over year and 29.2% from the prior quarter, a span that included 14 weeks instead of 13.
  • On a GAAP basis, Diluted Earnings per Share reached USD 3.28, up from USD 0.61, and the adjusted measure rose to USD 3.63 from USD 0.84.
  • Operating margin landed at 4.4% under GAAP and 4.7% after adjustments, improvements of 202 and 210 basis points on the year-ago quarter.
  • Second-quarter guidance covers sales of USD 11.1 billion to USD 11.4 billion and adjusted diluted EPS between USD 3.90 and USD 4.10.

Record Sales Across a 14-Week Quarter

Avnet (NASDAQ:AVT) reported fiscal 2027 first-quarter results on November 4, 2026, covering the quarter that ended October 3, 2026. Sales of USD 10.72 billion were up 81.7%, roughly 82%, from USD 5.90 billion, and management said growth excluding the extra week was 71% year over year and 21% sequentially. Electronic Components generated USD 10.13 billion of sales at a 4.8% operating margin, while Farnell delivered USD 583.3 million at a 10.1% margin. Regionally, Americas climbed 108.9% to USD 2.86 billion, EMEA rose 64.3% to USD 2.74 billion and Asia advanced 78.8% to USD 5.12 billion. Demand was cited across industrial, aerospace and defense, transportation, and AI and Data Center applications.

Operating Leverage on GAAP and Adjusted Measures

Gross profit increased to USD 1.07 billion from USD 614.8 million, and selling, general and administrative costs rose more slowly, to USD 576.3 million from USD 464.4 million. GAAP Operating Income climbed to USD 474.7 million from USD 142.0 million, lifting Net Income to USD 282.2 million from USD 51.7 million. Adjusted operating income was USD 498.1 million, and adjusted diluted EPS rose 332.1%. Return on Working Capital improved to 25% from 10% a year earlier, while net working capital days dropped 5 days sequentially to 64. Dividends of USD 30 million equaled USD 0.37 per share, and the GAAP diluted share count was 86.0 million versus 84.5 million a year earlier.

Inventory Build, Debt Load and the Second-Quarter Test

Growth is absorbing cash. Operating Activities consumed USD 842.4 million this quarter against USD 144.6 million a year earlier, as inventories rose to USD 8.18 billion from USD 6.07 billion at June 27, 2026 and receivables climbed to USD 7.76 billion from USD 6.88 billion. Cash and equivalents were only USD 236.8 million. Long-term debt grew to USD 3.31 billion from USD 2.48 billion, Short-Term Debt was USD 861.5 million, and interest and financing expense reached USD 91.9 million compared with USD 59.8 million. The second-quarter outlook assumes similar component supply, a tax rate of 21% to 25% and 87 million diluted shares, and implies about 5% sequential sales growth at the midpoint.

Where Things Stand

Because growth is tying up working capital faster than earnings turn into cash. Avnet (NASDAQ:AVT) grew sales 81.7% and lifted GAAP diluted EPS to USD 3.28, yet Operating Cash Flow was negative by USD 842.4 million and long-term debt increased. Inventory days held at 72, flat sequentially, and the company reports faster working capital efficiency. The next tests are whether component Supply holds, whether second-quarter sales reach USD 11.1 billion to USD 11.4 billion and whether cash flow turns as inventory converts.