Avnet Sales Jump 81.7% to $10.72 Billion on AI and Industrial Demand

Avnet grew sales 81.7% year over year to $10.72 billion in its fiscal first quarter, as demand from industrial customers and builders of artificial intelligence infrastructure lifted every business line and every region. Net income rose 445.3% to $282.2 million, up from $51.7 million a year earlier.

The quarter, which ended October 3, contained 14 weeks against 13 weeks in the prior-year period. Excluding the extra week, Avnet measured sales growth at 71%. The company reported higher profits and forecast further sales growth in the current quarter.

What drove the numbers?

The Electronic Components business produced the bulk of the result. It generated $10.13 billion in sales, up 84.3% from $5.50 billion a year earlier, and operating income of $484.5 million, compared with $159 million. Farnell, the smaller catalog unit, set a record with sales of $583.3 million, up 46.2% from $398.9 million.

CEO Phil Gallagher framed the quarter as a continuation of momentum rather than a one-off. He said: "We began fiscal 2027 by delivering another record quarter, reflecting stronger demand and solid execution across all of our businesses."

Gallagher pointed to several customer markets, including manufacturers and companies building AI infrastructure. "The fundamental backdrop for our industry remains positive, with continued growth across our core verticals such as industrial, aerospace and defense, transportation and AI and data center applications," he said.

The takeaway: component distribution is riding a broad demand wave, not a single AI spike, though AI and data center applications rank among the fastest-moving verticals.

How did each region perform?

Growth extended across all three geographic regions, with the Americas leading in percentage terms:

• Americas: sales up 108.9% to $2.86 billion
• Europe, Middle East and Africa: sales up 64.3% to $2.74 billion
• Asia: sales up 78.8% to $5.12 billion, remaining Avnet's largest region

Companywide operating income increased 234.3% to $474.7 million from $142 million.

The pattern matters for distributors watching allocation risk: no region lagged, which suggests the demand signal is global rather than concentrated in one supply chain.

What does the growth cost in cash?

The expansion consumed cash at an accelerated rate. Operating activities used $842.4 million during the quarter, compared with $144.6 million a year earlier. Avnet financed inventory and amounts owed by customers — in effect, the distributor funded its own growth by carrying more stock and extending more receivables.

This is the operational lesson of the quarter for peers. Rapid top-line expansion in component distribution requires working capital in proportion to it, and a quarter that adds nearly $5 billion in sales can add hundreds of millions in cash requirements at the same time. Distributors planning for similar demand should model the balance sheet, not only the income statement.

The takeaway: growth of this size is a financing decision as much as a sales result.

What does Avnet expect next quarter?

The company forecast second-quarter sales of $11.1 billion to $11.4 billion. The midpoint of that range, roughly $11.25 billion, would represent approximately 5% sequential growth from the first quarter — a marked deceleration from the year-over-year surge, but continued expansion on a much larger base.

The forecast carries one stated assumption: suppliers will provide a similar supply of electronic components as in the first quarter. That condition makes the guidance conditional on upstream allocation holding steady, a factor outside Avnet's control and the single variable most worth watching.

If supplier output holds and vertical demand persists, Avnet enters the second quarter with record momentum, $10.72 billion in trailing-quarter sales, and a clearly priced working-capital bill for financing the next stage of growth.