Avnet (AVT) shares plummeted 7.54% in pre-market trading on Wednesday following the release of the company's first-quarter fiscal 2026 financial results and disappointing second-quarter guidance. The electronic components distributor's performance and outlook fell short of investor expectations, triggering a significant sell-off.
Avnet reported first-quarter earnings per share (EPS) of $0.61, marking a substantial decline from the previous year. While the company's adjusted EPS of $0.84 slightly beat the analyst estimate of $0.81, it still represented a decrease from $0.92 in the same period last year. This 27% year-over-year drop in earnings likely contributed to the negative sentiment among investors. Avnet's Q1 sales reached $5.90 billion, slightly exceeding analyst estimates of $5.75 billion, but the focus remained on the bottom-line performance and future outlook.
Adding to investor concerns, Avnet provided guidance for the second quarter that suggests continued challenges. The company forecasts adjusted EPS in the range of $0.90 to $1.00 and sales between $5.85 billion and $6.15 billion for Q2. This outlook may be perceived as cautious, potentially indicating that Avnet expects headwinds in the coming months. The projected earnings range falls below the previous quarter's adjusted EPS, which could be interpreted as a sign of declining profitability. As the market digests this information, investors appear to be reevaluating their positions in Avnet, leading to the sharp pre-market decline.
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