The Eurozone debt crisis weighed heavily on Avnet's third quarter results, dragging down overall sales by just under 6% to $6.28bn (£3.88bn) as both Electronics Marketing (EM) and Technology Solutions (TS) divisions booked double digit declines respectively.
Avnet posted GAAP net income of $147.6m, down 2.3% year-on-year for the three months to 31 March, but although the headline figures made for grim reading CEO Rick Hamada pointed to improving margins across the board, and growth in operating income, saying that the results were in fact in line with general expectations.
"In EMEA our continuing focus on profitable growth and restructuring initiatives combined to drive operating income up 69% from the year-ago quarter ... as gross profit and operating margins increased 119 basis points and 87 basis points respectively," said Hamada.
TS sales fell 8.1% (7.3% excluding foreign currency) to $2.53bn, but operating income was up $10.6m to $67.9m.
"As demand for datacentre solutions and cloud computing create more opportunities for the channel we are continuing to increase the value we deliver to our partners and strengthening our supplier partnerships with new services focused on high-growth technologies and vertical markets," said Hamada.
Elsewhere, the supply chain inventory correction that hurt EM in particular earlier in the fiscal year seemed to have worked its way out of the system, added Hamada.
"Sequential growth has returned to a more normalised seasonal level and [EM's] book to bill ratio finished at parity for the quarter," he said.