-- Fourth-Quarter Sales In Line with Guidance --
-- Fourth-Quarter Earnings Per Share of $3.54 and Non-GAAP Earnings Per Share of $3.98, Both Above High End of Guidance --
CENTENNIAL, Colo.--(BUSINESS WIRE)--
Arrow Electronics, Inc. (NYSE:ARW) today announced financial results for its fourth quarter and fiscal year ended Dec. 31, 2023.
“The company delivered fourth-quarter sales in line with our expectations, with earnings per share above the high end of our guidance range in challenging electronic components and IT spending markets,” said Sean Kerins, Arrow’s president and chief executive officer.
“Despite excess inventory throughout the supply chain leading to softer demand in our components business, and a mixed IT spending environment for our enterprise computing solutions business, full-year 2023 results were solid. Arrow generated healthy cashflow from operations that enabled the company to repurchase approximately $750 million of shares throughout the year,” said Mr. Kerins. “Looking ahead, and given the current market dynamics, we’ll manage our cost structure and working capital prudently while continuing to remain committed to growth initiatives where our differentiation provides value to our suppliers and customers.”
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Arrow Consolidated
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Quarter Ended
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Year Ended
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December 31,
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December 31,
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December 31,
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December 31,
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(in millions except per share data)
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2023
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2022
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2023
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2022
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Consolidated sales
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$
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7,849
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$
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9,323
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$
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33,107
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$
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37,124
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Net income attributable to shareholders
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195
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349
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904
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1,427
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Net income per diluted share
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3.54
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5.66
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15.84
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21.80
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Non-GAAP net income attributable to shareholders(1)
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219
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351
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977
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1,465
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Non-GAAP net income per diluted share
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3.98
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5.69
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17.12
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22.38
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In the fourth quarter of 2023, sales decreased 16 percent year over year. Changes in foreign currencies had positive impacts on growth of approximately $126 million on sales and $0.08 on earnings per share on a diluted basis compared to the fourth quarter of 2022.
Full-year 2023 sales decreased 11 percent year over year. Changes in foreign currencies had immaterial impacts on sales and earnings per share on a diluted basis compared to 2022.
Global Components
“During the quarter, we experienced continued weakness in our industrial end markets for components. We saw relative strength in aerospace and defense, and medical device verticals in the west along with sequential growth in data center and transportation markets in Asia,” said Mr. Kerins.
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Global Components
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Quarter Ended
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Year Ended
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December 31,
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December 31,
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December 31,
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December 31,
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(in millions)
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2023
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2022
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2023
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2022
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Global components sales
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$
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5,636
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$
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6,827
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$
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25,420
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$
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28,788
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Global components operating income, as reported
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281
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443
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1,459
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1,961
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Global components non-GAAP operating income
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288
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449
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1,486
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1,988
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In the fourth quarter of 2023, global component sales decreased 17 percent year over year. Americas components fourth-quarter sales decreased 23 percent year over year. Europe components fourth-quarter sales decreased 14 percent year over year and decreased 17 percent year over year on a constant currency basis. Asia-Pacific components fourth-quarter sales decreased 15 percent year over year.
Global Enterprise Computing Solutions
“In our enterprise computing solutions business, momentum continued to build in infrastructure software, as-a-service solutions and related services,” said Mr. Kerins. “In EMEA, we achieved year-on-year billings growth in the fourth quarter while our North America results reflected a more muted IT spending environment.”
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Global Enterprise Computing Solutions
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Quarter Ended
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Year Ended
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December 31,
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December 31,
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December 31,
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December 31,
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(in millions)
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2023
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2022
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2023
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2022
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Global ECS sales
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$
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2,213
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$
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2,496
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$
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7,687
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$
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8,336
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Global ECS operating income, as reported
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145
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155
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367
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409
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Global ECS non-GAAP operating income
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146
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156
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372
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416
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In the fourth quarter of 2023, global enterprise computing solutions (“ECS”) sales decreased 11 percent year over year and decreased 13 percent year over year on a constant currency basis. Europe ECS fourth-quarter sales decreased 2 percent year over year and decreased 7 percent year over year on a constant currency basis. Americas ECS fourth-quarter sales decreased 18 percent year over year.
Other Financial Metrics
“For the full-year 2023, we generated $705 million in cash flow from operations,” said Raj Agrawal, Arrow’s senior vice president and chief financial officer. “Focusing on execution in the fourth quarter enabled us to reduce inventory by more than $600 million sequentially. We generated $287 million in cash flow from operations and repurchased approximately $50 million of shares in the fourth quarter. We now have remaining purchase authorization of approximately $580 million.”
1 A reconciliation of non-GAAP financial measures to GAAP financial measures is presented in the reconciliation tables included herein.
First-Quarter 2024 Outlook
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Consolidated sales of $6.70 billion to $7.30 billion, with global components sales of $5.00 billion to $5.40 billion, and global enterprise computing solutions sales of $1.70 billion to $1.90 billion
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Net income per share on a diluted basis of $1.95 to $2.15, and non-GAAP net income per share on a diluted basis of $2.20 to $2.40
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Average tax rate in the range of 23 to 25 percent
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Interest expense of approximately $80 million
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Changes in foreign currencies to increase sales by approximately $13 million, and earnings per share on a diluted basis by $0.01 compared to the first quarter of 2023
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Changes in foreign currencies to increase quarter-over-quarter growth in sales by $31 million and earnings per share on a diluted basis by $0.02 compared to the fourth quarter of 2023
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First-Quarter 2024 GAAP to non-GAAP Outlook Reconciliation
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NON-GAAP SALES RECONCILIATION
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Quarter Ended
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Quarter Ended
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(in billions)
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March 30, 2024
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April 1, 2023
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% Change
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March 30, 2024
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December 31, 2023
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% Change
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Global components sales, GAAP
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$
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5.00 - 5.40
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$
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6.86
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(27%) - (21%)
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$
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5.00 - 5.40
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$
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5.64
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(11%) - (4%)
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Impact of changes in foreign currencies
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—
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(0.01
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)
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—
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0.02
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Global components sales, constant currency
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$
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5.00 - 5.40
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$
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6.85
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(27%) - (21%)
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$
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5.00 - 5.40
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$
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5.66
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(12%) - (5%)
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Global ECS sales, GAAP
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$
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1.70 - 1.90
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$
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1.88
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(10%) - 1%
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$
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1.70 - 1.90
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$
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2.21
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(23%) - (14%)
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Impact of changes in foreign currencies
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—
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0.02
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—
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0.01
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Global ECS sales, constant currency
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$
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1.70 - 1.90
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$
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1.90
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(11%) - 0%
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$
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1.70 - 1.90
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$
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2.22
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(23%) - (14%)
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NON-GAAP EARNINGS RECONCILIATION
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Reported GAAP measure
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Intangible amortization
expense
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Restructuring &
integration charges
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Non-GAAP measure
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Net income per diluted share
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$1.95 to $2.15
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$0.10
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$0.15
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$2.20 to $2.40
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Earnings Presentation
Please refer to the earnings presentation, that can be found at investor.arrow.com, as a supplement to the company’s earnings release. The company uses its website as a tool to disclose important information about the company and to comply with its disclosure obligations under Regulation Fair Disclosure.
Webcast and Conference Call Information
Arrow Electronics will host a conference call to discuss fourth-quarter and full-year 2023 financial results on Feb 8, 2024, at 1:00 PM ET.
A live webcast of the conference call will be available via the events section of investor.arrow.com or by accessing the webcast link directly at https://events.q4inc.com/attendee/921341362. Shortly after the conclusion of the conference call, a webcast replay will be available on the Arrow website for one year.
Interested parties may pre-register online at https://registrations.events/direct/Q4I97132 to obtain a user-specific access code and dial-in information to access the live conference call.
About Arrow Electronics
Arrow Electronics guides innovation forward for thousands of leading technology manufacturers and service providers. With 2023 sales of $33 billion, Arrow develops technology solutions that help improve business and daily life. Learn more at arrow.com.
Information Relating to Forward-Looking Statements
This press release includes “forward-looking” statements, as the term is defined under the federal securities laws, including but not limited to statements regarding: Arrow’s future financial performance, including its outlook on financial results for the first quarter of fiscal 2024 such as sales, net income per diluted share, non-GAAP net income per diluted share, average tax rate, average diluted shares outstanding, interest and other expense, impact to sales due to changes in foreign currencies, intangible amortization expense per diluted share, restructuring & integration charges per diluted share, and expectations regarding market demand and shareholder returns. These and other forward-looking statements are subject to numerous assumptions, risks, and uncertainties, which could cause actual results or facts to differ materially from such statements for a variety of reasons, including, but not limited to: unfavorable economic conditions; disruptions or inefficiencies in the supply chain; political instability; impacts of military conflict and sanctions; industry conditions; changes in product supply, pricing and customer demand; competition; other vagaries in the global components and the global ECS markets; deteriorating economic conditions, including economic recession, inflation, tax rates, foreign currency exchange rates, or the availability of capital; the effects of natural or man-made catastrophic events; changes in relationships with key suppliers; increased profit margin pressure; changes in legal and regulatory matters; non-compliance with certain regulations, such as export, antitrust, and anti-corruption laws; foreign tax and other loss contingencies; breaches of security or privacy of business information; outbreaks, epidemics, pandemics, or public health crises; and the company's ability to generate positive cash flow. For a further discussion of these and other factors that could cause the company's future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company's most recent Annual Report on Form 10-K, as well as in other filings the company makes with the Securities and Exchange Commission. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. The company undertakes no obligation to update publicly or revise any of the forward-looking statements.
Certain Non-GAAP Financial Information
In addition to disclosing financial results that are determined in accordance with accounting principles generally accepted in the United States (“GAAP”), the company also provides certain non-GAAP financial information. The company provides the following non-GAAP metrics: non-GAAP sales, operating income (included by business segment), income before income taxes, provision for income taxes, consolidated net income, noncontrolling interests, net income attributable to shareholders, effective tax rate and net income per share on a diluted basis. The foregoing non-GAAP measures are adjusted by certain of the following, as applicable: impact of changes in foreign currencies (referred to as “changes in foreign currencies” or “on a constant currency basis”) by re-translating prior-period results at current period foreign exchange rates; identifiable intangible asset amortization, restructuring, integration, and other charges; net gains and losses on investments; and impact of tax legislation changes. Management believes that providing this additional information is useful to the reader to better assess and understand the company’s operating performance and future prospects in the same manner as management, especially when comparing results with previous periods. Management typically monitors the business as adjusted for these items, in addition to GAAP results, to understand and compare operating results across accounting periods, for internal budgeting purposes, for short- and long-term operating plans, and to evaluate the company's financial performance. However, analysis of results on a non-GAAP basis should be used as a complement to, in conjunction with, and not as a substitute for, data presented in accordance with GAAP.
ARROW ELECTRONICS, INC.
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CONSOLIDATED STATEMENTS OF OPERATIONS
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(In thousands except per share data)
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Quarter Ended
|
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Year Ended
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December 31, 2023
(Unaudited)
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|
|
December 31, 2022
(Unaudited)
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|
|
December 31, 2023
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December 31, 2022
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Sales
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$
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7,849,157
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$
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9,323,023
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$
|
33,107,120
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$
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37,124,422
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Cost of sales
|
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6,859,607
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8,117,028
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28,958,102
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32,287,797
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Gross profit
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989,550
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1,205,995
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4,149,018
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4,836,625
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Operating expenses:
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Selling, general, and administrative expenses
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590,039
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635,090
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2,412,822
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2,567,008
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Depreciation and amortization
|
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43,168
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|
|
|
45,595
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|
|
|
181,116
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|
|
|
187,382
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Restructuring, integration, and other charges
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39,664
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|
|
|
2,714
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|
|
|
83,916
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|
|
|
13,741
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|
|
|
|
672,871
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|
|
|
683,399
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|
|
|
2,677,854
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|
|
|
2,768,131
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Operating income
|
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|
316,679
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|
522,596
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|
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1,471,164
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2,068,494
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Equity in earnings of affiliated companies
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|
2,034
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|
2,938
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|
|
6,407
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|
|
7,664
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Gain (loss) on investments, net
|
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|
14,635
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|
8,356
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|
|
19,284
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(2,857
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)
|
Employee benefit plan expense, net
|
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|
(1,267
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)
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|
(889
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)
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|
|
(3,777
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)
|
|
|
(3,503
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)
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Interest and other financing expense, net
|
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|
(82,052
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)
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|
(62,221
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)
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(328,724
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)
|
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|
(185,648
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)
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Income before income taxes
|
|
|
250,029
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|
|
|
470,780
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|
|
|
1,164,354
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|
|
|
1,884,150
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Provision for income taxes
|
|
|
53,823
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|
|
|
116,719
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|
|
|
254,991
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|
|
|
448,992
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Consolidated net income
|
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|
196,206
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|
|
354,061
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|
|
909,363
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|
|
|
1,435,158
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Noncontrolling interests
|
|
|
1,669
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|
|
|
4,659
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|
|
|
5,858
|
|
|
|
8,274
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|
Net income attributable to shareholders
|
|
$
|
194,537
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|
|
$
|
349,402
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|
|
$
|
903,505
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|
|
$
|
1,426,884
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|
Net income per share:
|
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|
|
|
|
|
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|
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Basic
|
|
$
|
3.58
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|
|
$
|
5.71
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|
|
$
|
16.03
|
|
|
$
|
22.01
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Diluted
|
|
$
|
3.54
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|
|
$
|
5.66
|
|
|
$
|
15.84
|
|
|
$
|
21.80
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
54,396
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|
|
|
61,175
|
|
|
|
56,359
|
|
|
|
64,838
|
|
Diluted
|
|
|
55,015
|
|
|
|
61,739
|
|
|
|
57,035
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|
|
|
65,453
|
|
ARROW ELECTRONICS, INC.
|
CONSOLIDATED BALANCE SHEETS
|
(In thousands except par value)
|
|
|
|
|
|
|
|
|
|
December 31, 2023
|
|
December 31, 2022
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
218,053
|
|
|
$
|
176,915
|
|
Accounts receivable, net
|
|
|
12,238,073
|
|
|
|
12,322,717
|
|
Inventories
|
|
|
5,187,225
|
|
|
|
5,319,369
|
|
Other current assets
|
|
|
684,126
|
|
|
|
521,339
|
|
Total current assets
|
|
|
18,327,477
|
|
|
|
18,340,340
|
|
Property, plant, and equipment, at cost:
|
|
|
|
|
|
|
Land
|
|
|
5,691
|
|
|
|
5,691
|
|
Buildings and improvements
|
|
|
195,579
|
|
|
|
184,211
|
|
Machinery and equipment
|
|
|
1,632,606
|
|
|
|
1,583,661
|
|
|
|
|
1,833,876
|
|
|
|
1,773,563
|
|
Less: Accumulated depreciation and amortization
|
|
|
(1,303,136
|
)
|
|
|
(1,177,107
|
)
|
Property, plant, and equipment, net
|
|
|
530,740
|
|
|
|
596,456
|
|
Investments in affiliated companies
|
|
|
62,741
|
|
|
|
65,112
|
|
Intangible assets, net
|
|
|
127,440
|
|
|
|
159,137
|
|
Goodwill
|
|
|
2,050,426
|
|
|
|
2,027,626
|
|
Other assets
|
|
|
627,344
|
|
|
|
574,511
|
|
Total assets
|
|
$
|
21,726,168
|
|
|
$
|
21,763,182
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
10,070,015
|
|
|
$
|
10,460,419
|
|
Accrued expenses
|
|
|
1,463,915
|
|
|
|
1,339,302
|
|
Short-term borrowings, including current portion of long-term debt
|
|
|
1,653,954
|
|
|
|
589,883
|
|
Total current liabilities
|
|
|
13,187,884
|
|
|
|
12,389,604
|
|
Long-term debt
|
|
|
2,153,553
|
|
|
|
3,182,964
|
|
Other liabilities
|
|
|
507,424
|
|
|
|
579,261
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
Shareholders’ equity:
|
|
|
|
|
|
|
Common stock, par value $1:
|
|
|
|
|
|
|
Authorized - 160,000 shares in both 2023 and 2022
|
|
|
|
|
|
|
Issued - 57,691 and 125,424 shares in 2023 and 2022, respectively
|
|
|
57,691
|
|
|
|
125,424
|
|
Capital in excess of par value
|
|
|
553,340
|
|
|
|
1,208,708
|
|
Treasury stock (3,880 and 66,175 shares in 2023 and 2022, respectively), at cost
|
|
|
(297,745
|
)
|
|
|
(4,637,345
|
)
|
Retained earnings
|
|
|
5,790,217
|
|
|
|
9,214,832
|
|
Accumulated other comprehensive loss
|
|
|
(298,039
|
)
|
|
|
(365,262
|
)
|
Total shareholders’ equity
|
|
|
5,805,464
|
|
|
|
5,546,357
|
|
Noncontrolling interests
|
|
|
71,843
|
|
|
|
64,996
|
|
Total equity
|
|
|
5,877,307
|
|
|
|
5,611,353
|
|
Total liabilities and equity
|
|
$
|
21,726,168
|
|
|
$
|
21,763,182
|
|
ARROW ELECTRONICS, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Quarter Ended
|
|
|
December 31, 2023
|
|
December 31, 2022
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Consolidated net income
|
|
$
|
196,206
|
|
|
$
|
354,061
|
|
Adjustments to reconcile consolidated net income to net cash provided by operations:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
43,168
|
|
|
|
45,595
|
|
Amortization of stock-based compensation
|
|
|
6,701
|
|
|
|
7,921
|
|
Equity in earnings of affiliated companies
|
|
|
(2,034
|
)
|
|
|
(2,938
|
)
|
Deferred income taxes
|
|
|
(40,942
|
)
|
|
|
(14,518
|
)
|
Gain on investments, net
|
|
|
(7,817
|
)
|
|
|
(8,356
|
)
|
Other
|
|
|
18,512
|
|
|
|
939
|
|
Change in assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
(1,396,096
|
)
|
|
|
(801,426
|
)
|
Inventories
|
|
|
664,333
|
|
|
|
(154,022
|
)
|
Accounts payable
|
|
|
898,395
|
|
|
|
779,217
|
|
Accrued expenses
|
|
|
126,949
|
|
|
|
(90,566
|
)
|
Other assets and liabilities
|
|
|
(220,633
|
)
|
|
|
(7,220
|
)
|
Net cash provided by operating activities
|
|
|
286,742
|
|
|
|
108,687
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
Acquisition of property, plant, and equipment
|
|
|
(25,510
|
)
|
|
|
(24,056
|
)
|
Proceeds from collections of notes receivable
|
|
|
—
|
|
|
|
320
|
|
Net cash used for investing activities
|
|
|
(25,510
|
)
|
|
|
(23,736
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Change in short-term and other borrowings
|
|
|
63,980
|
|
|
|
(17,700
|
)
|
Repayments of long-term bank borrowings, net
|
|
|
(465,147
|
)
|
|
|
(5,018
|
)
|
Proceeds from exercise of stock options
|
|
|
186
|
|
|
|
906
|
|
Repurchases of common stock
|
|
|
(50,492
|
)
|
|
|
(324,233
|
)
|
Net cash used for financing activities
|
|
|
(451,473
|
)
|
|
|
(346,045
|
)
|
Effect of exchange rate changes on cash
|
|
|
75,000
|
|
|
|
104,024
|
|
Net decrease in cash and cash equivalents
|
|
|
(115,241
|
)
|
|
|
(157,070
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
333,294
|
|
|
|
333,985
|
|
Cash and cash equivalents at end of period
|
|
$
|
218,053
|
|
|
$
|
176,915
|
|
ARROW ELECTRONICS, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
December 31, 2023
|
|
December 31, 2022
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Consolidated net income
|
|
$
|
909,363
|
|
|
$
|
1,435,158
|
|
Adjustments to reconcile consolidated net income to net cash provided by (used for) operations:
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
181,116
|
|
|
|
187,382
|
|
Amortization of stock-based compensation
|
|
|
41,569
|
|
|
|
42,930
|
|
Equity in earnings of affiliated companies
|
|
|
(6,407
|
)
|
|
|
(7,664
|
)
|
Deferred income taxes
|
|
|
(93,980
|
)
|
|
|
(13,050
|
)
|
(Gain) loss on investments, net
|
|
|
(12,466
|
)
|
|
|
2,857
|
|
Other
|
|
|
22,590
|
|
|
|
3,612
|
|
Change in assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
189,425
|
|
|
|
(1,430,400
|
)
|
Inventories
|
|
|
139,313
|
|
|
|
(1,165,785
|
)
|
Accounts payable
|
|
|
(457,382
|
)
|
|
|
945,819
|
|
Accrued expenses
|
|
|
38,601
|
|
|
|
102,193
|
|
Other assets and liabilities
|
|
|
(246,293
|
)
|
|
|
(136,129
|
)
|
Net cash provided by (used for) operating activities
|
|
|
705,449
|
|
|
|
(33,077
|
)
|
Cash flows from investing activities:
|
|
|
|
|
|
|
Acquisition of property, plant, and equipment
|
|
|
(83,285
|
)
|
|
|
(78,836
|
)
|
Proceeds from collections of notes receivable
|
|
|
237
|
|
|
|
21,125
|
|
Proceeds from settlement of net investment hedge
|
|
|
10,725
|
|
|
|
—
|
|
Net cash used for investing activities
|
|
|
(72,323
|
)
|
|
|
(57,711
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Change in short-term and other borrowings
|
|
|
866,012
|
|
|
|
258,816
|
|
(Repayments of) proceeds from long-term bank borrowings, net
|
|
|
(1,031,881
|
)
|
|
|
1,233,250
|
|
Redemption of notes
|
|
|
(300,000
|
)
|
|
|
(350,000
|
)
|
Net proceeds from note offering
|
|
|
496,268
|
|
|
|
—
|
|
Proceeds from exercise of stock options
|
|
|
17,010
|
|
|
|
17,340
|
|
Repurchases of common stock
|
|
|
(770,200
|
)
|
|
|
(1,049,487
|
)
|
Settlement of forward-starting interest rate swap
|
|
|
56,711
|
|
|
|
—
|
|
Other
|
|
|
(142
|
)
|
|
|
(137
|
)
|
Net cash (used for) provided by financing activities
|
|
|
(666,222
|
)
|
|
|
109,782
|
|
Effect of exchange rate changes on cash
|
|
|
74,234
|
|
|
|
(64,273
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
41,138
|
|
|
|
(45,279
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
176,915
|
|
|
|
222,194
|
|
Cash and cash equivalents at end of period
|
|
$
|
218,053
|
|
|
$
|
176,915
|
|
ARROW ELECTRONICS, INC.
|
NON-GAAP SALES RECONCILIATION
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
|
|
|
|
|
December 31, 2023
|
|
December 31, 2022
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Consolidated sales, as reported
|
|
$
|
7,849,157
|
|
$
|
9,323,023
|
|
|
(15.8
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
126,441
|
|
|
|
Consolidated sales, constant currency
|
|
$
|
7,849,157
|
|
$
|
9,449,464
|
|
|
(16.9
|
)%
|
|
|
|
|
|
|
|
|
|
Global components sales, as reported
|
|
$
|
5,636,032
|
|
$
|
6,827,029
|
|
|
(17.4
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
75,974
|
|
|
|
Global components sales, constant currency
|
|
$
|
5,636,032
|
|
$
|
6,903,003
|
|
|
(18.4
|
)%
|
|
|
|
|
|
|
|
|
|
Americas components sales, as reported
|
|
$
|
1,784,764
|
|
$
|
2,326,995
|
|
|
(23.3
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
99
|
|
|
|
Americas components sales, constant currency
|
|
$
|
1,784,764
|
|
$
|
2,327,094
|
|
|
(23.3
|
)%
|
|
|
|
|
|
|
|
|
|
Asia components sales, as reported
|
|
$
|
2,163,421
|
|
$
|
2,543,294
|
|
|
(14.9
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
(7,158
|
)
|
|
|
Asia components sales, constant currency
|
|
$
|
2,163,421
|
|
$
|
2,536,136
|
|
|
(14.7
|
)%
|
|
|
|
|
|
|
|
|
|
Europe components sales, as reported
|
|
$
|
1,687,847
|
|
$
|
1,956,740
|
|
|
(13.7
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
83,033
|
|
|
|
Europe components sales, constant currency
|
|
$
|
1,687,847
|
|
$
|
2,039,773
|
|
|
(17.3
|
)%
|
|
|
|
|
|
|
|
|
|
Global ECS sales, as reported
|
|
$
|
2,213,125
|
|
$
|
2,495,994
|
|
|
(11.3
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
50,467
|
|
|
|
Global ECS sales, constant currency
|
|
$
|
2,213,125
|
|
$
|
2,546,461
|
|
|
(13.1
|
)%
|
|
|
|
|
|
|
|
|
|
Americas ECS sales, as reported
|
|
$
|
1,145,754
|
|
$
|
1,404,224
|
|
|
(18.4
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
200
|
|
|
|
Americas ECS sales, constant currency
|
|
$
|
1,145,754
|
|
$
|
1,404,424
|
|
|
(18.4
|
)%
|
|
|
|
|
|
|
|
|
|
Europe ECS sales, as reported
|
|
$
|
1,067,371
|
|
$
|
1,091,770
|
|
|
(2.2
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
50,267
|
|
|
|
Europe ECS sales, constant currency
|
|
$
|
1,067,371
|
|
$
|
1,142,037
|
|
|
(6.5
|
)%
|
ARROW ELECTRONICS, INC.
|
NON-GAAP SALES RECONCILIATION
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
December 31, 2023
|
|
December 31, 2022
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Consolidated sales, as reported
|
|
$
|
33,107,120
|
|
$
|
37,124,422
|
|
|
(10.8
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
51,829
|
|
|
|
Consolidated sales, constant currency
|
|
$
|
33,107,120
|
|
$
|
37,176,251
|
|
|
(10.9
|
)%
|
|
|
|
|
|
|
|
|
|
Global components sales, as reported
|
|
$
|
25,419,899
|
|
$
|
28,788,003
|
|
|
(11.7
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
7,690
|
|
|
|
Global components sales, constant currency
|
|
$
|
25,419,899
|
|
$
|
28,795,693
|
|
|
(11.7
|
)%
|
|
|
|
|
|
|
|
|
|
Americas components sales, as reported
|
|
$
|
7,954,713
|
|
$
|
9,592,547
|
|
|
(17.1
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
(2,166
|
)
|
|
|
Americas components sales, constant currency
|
|
$
|
7,954,713
|
|
$
|
9,590,381
|
|
|
(17.1
|
)%
|
|
|
|
|
|
|
|
|
|
Asia components sales, as reported
|
|
$
|
9,390,292
|
|
$
|
11,567,482
|
|
|
(18.8
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
(122,448
|
)
|
|
|
Asia components sales, constant currency
|
|
$
|
9,390,292
|
|
$
|
11,445,034
|
|
|
(18.0
|
)%
|
|
|
|
|
|
|
|
|
|
Europe components sales, as reported
|
|
$
|
8,074,894
|
|
$
|
7,627,974
|
|
|
5.9
|
%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
132,304
|
|
|
|
Europe components sales, constant currency
|
|
$
|
8,074,894
|
|
$
|
7,760,278
|
|
|
4.1
|
%
|
|
|
|
|
|
|
|
|
|
Global ECS sales, as reported
|
|
$
|
7,687,221
|
|
$
|
8,336,419
|
|
|
(7.8
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
44,139
|
|
|
|
Global ECS sales, constant currency
|
|
$
|
7,687,221
|
|
$
|
8,380,558
|
|
|
(8.3
|
)%
|
|
|
|
|
|
|
|
|
|
Americas ECS sales, as reported
|
|
$
|
4,160,298
|
|
$
|
4,847,027
|
|
|
(14.2
|
)%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
(18,850
|
)
|
|
|
Americas ECS sales, constant currency
|
|
$
|
4,160,298
|
|
$
|
4,828,177
|
|
|
(13.8
|
)%
|
|
|
|
|
|
|
|
|
|
Europe ECS sales, as reported
|
|
$
|
3,526,923
|
|
$
|
3,489,392
|
|
|
1.1
|
%
|
Impact of changes in foreign currencies
|
|
|
—
|
|
|
62,989
|
|
|
|
Europe ECS sales, constant currency
|
|
$
|
3,526,923
|
|
$
|
3,552,381
|
|
|
(0.7
|
)%
|
ARROW ELECTRONICS, INC.
|
NON-GAAP EARNINGS RECONCILIATION
|
(In thousands except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31, 2023
|
|
|
|
Reported
|
|
Intangible
|
|
Restructuring
|
|
|
|
|
|
|
|
|
|
GAAP
|
|
amortization
|
|
& Integration
|
|
|
|
|
Non-GAAP
|
|
|
|
measure
|
|
expense
|
|
charges
|
|
Other(1)
|
|
measure
|
|
Operating income
|
|
$
|
316,679
|
|
$
|
7,491
|
|
$
|
39,664
|
|
$
|
—
|
|
|
$
|
363,834
|
|
Income before income taxes
|
|
|
250,029
|
|
|
7,491
|
|
|
39,664
|
|
|
(14,635
|
)
|
|
|
282,549
|
|
Provision for income taxes
|
|
|
53,823
|
|
|
1,863
|
|
|
9,331
|
|
|
(3,500
|
)
|
|
|
61,517
|
|
Consolidated net income
|
|
|
196,206
|
|
|
5,628
|
|
|
30,333
|
|
|
(11,135
|
)
|
|
|
221,032
|
|
Noncontrolling interests
|
|
|
1,669
|
|
|
131
|
|
|
—
|
|
|
—
|
|
|
|
1,800
|
|
Net income attributable to shareholders
|
|
$
|
194,537
|
|
$
|
5,497
|
|
$
|
30,333
|
|
$
|
(11,135
|
)
|
|
$
|
219,232
|
|
Net income per diluted share (2)
|
|
$
|
3.54
|
|
$
|
0.10
|
|
$
|
0.55
|
|
$
|
(0.20
|
)
|
|
$
|
3.98
|
|
Effective tax rate (3)
|
|
|
21.5
|
%
|
|
|
|
|
|
|
|
|
|
|
21.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended December 31, 2022
|
|
|
|
Reported
|
|
Intangible
|
|
Restructuring
|
|
|
|
|
|
|
|
|
|
GAAP
|
|
amortization
|
|
& Integration
|
|
|
|
|
Non-GAAP
|
|
|
|
measure
|
|
expense
|
|
charges
|
|
Other(1)
|
|
measure
|
|
Operating income
|
|
$
|
522,596
|
|
$
|
8,170
|
|
$
|
2,714
|
|
$
|
—
|
|
|
$
|
533,480
|
|
Income before income taxes
|
|
|
470,780
|
|
|
8,170
|
|
|
2,714
|
|
|
(8,356
|
)
|
|
|
473,308
|
|
Provision for income taxes
|
|
|
116,719
|
|
|
2,056
|
|
|
472
|
|
|
(2,003
|
)
|
|
|
117,244
|
|
Consolidated net income
|
|
|
354,061
|
|
|
6,114
|
|
|
2,242
|
|
|
(6,353
|
)
|
|
|
356,064
|
|
Noncontrolling interests
|
|
|
4,659
|
|
|
127
|
|
|
—
|
|
|
—
|
|
|
|
4,786
|
|
Net income attributable to shareholders
|
|
$
|
349,402
|
|
$
|
5,987
|
|
$
|
2,242
|
|
$
|
(6,353
|
)
|
|
$
|
351,278
|
|
Net income per diluted share (2)
|
|
$
|
5.66
|
|
$
|
0.10
|
|
$
|
0.04
|
|
$
|
(0.10
|
)
|
|
$
|
5.69
|
|
Effective tax rate (3)
|
|
|
24.8
|
%
|
|
|
|
|
|
|
|
|
|
|
24.8
|
%
|
ARROW ELECTRONICS, INC.
|
NON-GAAP EARNINGS RECONCILIATION
|
(In thousands except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2023
|
|
|
|
Reported
GAAP
measure
|
|
Intangible
amortization
expense
|
|
Restructuring
& Integration
charges
|
|
Non- recurring
tax items
|
|
Other(1)
|
|
Non-GAAP
measure
|
|
Operating income
|
|
$
|
1,471,164
|
|
$
|
31,242
|
|
$
|
83,916
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,586,322
|
|
Income before income taxes
|
|
|
1,164,354
|
|
|
31,242
|
|
|
83,916
|
|
|
—
|
|
|
|
(19,284
|
)
|
|
|
1,260,228
|
|
Provision for income taxes
|
|
|
254,991
|
|
|
7,824
|
|
|
19,969
|
|
|
(942
|
)
|
|
|
(4,614
|
)
|
|
|
277,228
|
|
Consolidated net income
|
|
|
909,363
|
|
|
23,418
|
|
|
63,947
|
|
|
942
|
|
|
|
(14,670
|
)
|
|
|
983,000
|
|
Noncontrolling interests
|
|
|
5,858
|
|
|
539
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
|
6,397
|
|
Net income attributable to shareholders
|
|
$
|
903,505
|
|
$
|
22,879
|
|
$
|
63,947
|
|
$
|
942
|
|
|
$
|
(14,670
|
)
|
|
$
|
976,603
|
|
Net income per diluted share (2)
|
|
$
|
15.84
|
|
$
|
0.40
|
|
$
|
1.12
|
|
$
|
0.02
|
|
|
$
|
(0.26
|
)
|
|
$
|
17.12
|
|
Effective tax rate (3)
|
|
|
21.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, 2022
|
|
|
|
Reported
GAAP
measure
|
|
Intangible
amortization
expense
|
|
Restructuring
& Integration
charges
|
|
Non- recurring
tax items
|
|
Other(1)
|
|
Non-GAAP
measure
|
|
Operating income
|
|
$
|
2,068,494
|
|
$
|
34,692
|
|
$
|
13,741
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,116,927
|
|
Income before income taxes
|
|
|
1,884,150
|
|
|
34,692
|
|
|
13,741
|
|
|
—
|
|
|
2,857
|
|
|
1,935,440
|
|
Provision for income taxes
|
|
|
448,992
|
|
|
8,848
|
|
|
2,931
|
|
|
—
|
|
|
708
|
|
|
461,479
|
|
Consolidated net income
|
|
|
1,435,158
|
|
|
25,844
|
|
|
10,810
|
|
|
—
|
|
|
2,149
|
|
|
1,473,961
|
|
Noncontrolling interests
|
|
|
8,274
|
|
|
525
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,799
|
|
Net income attributable to shareholders
|
|
$
|
1,426,884
|
|
$
|
25,319
|
|
$
|
10,810
|
|
$
|
—
|
|
$
|
2,149
|
|
$
|
1,465,162
|
|
Net income per diluted share (2)
|
|
$
|
21.80
|
|
$
|
0.39
|
|
$
|
0.17
|
|
$
|
—
|
|
$
|
0.03
|
|
$
|
22.38
|
|
Effective tax rate (3)
|
|
|
23.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23.8
|
%
|
___________________ |
(1)
|
Other includes (gain) loss on investments, net.
|
(2)
|
The sum of the components for diluted EPS, as adjusted may not agree to totals, as presented, due to rounding.
|
(3)
|
The items as shown in this table, represent the reconciling items for the tax rate as reported by GAAP measure and as a non-GAAP measure.
|
ARROW ELECTRONICS, INC.
|
SEGMENT INFORMATION
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
|
|
Year Ended
|
|
|
December 31, 2023
|
|
December 31, 2022
|
|
December 31, 2023
|
|
December 31, 2022
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
Global components
|
|
$
|
5,636,032
|
|
|
$
|
6,827,029
|
|
|
$
|
25,419,899
|
|
|
$
|
28,788,003
|
|
Global ECS
|
|
|
2,213,125
|
|
|
|
2,495,994
|
|
|
|
7,687,221
|
|
|
|
8,336,419
|
|
Consolidated
|
|
$
|
7,849,157
|
|
|
$
|
9,323,023
|
|
|
$
|
33,107,120
|
|
|
$
|
37,124,422
|
|
Operating income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
Global components (a)
|
|
$
|
281,260
|
|
|
$
|
442,702
|
|
|
$
|
1,459,166
|
|
|
$
|
1,961,125
|
|
Global ECS (b)
|
|
|
145,053
|
|
|
|
154,775
|
|
|
|
367,004
|
|
|
|
408,519
|
|
Corporate (c)
|
|
|
(109,634
|
)
|
|
|
(74,881
|
)
|
|
|
(355,006
|
)
|
|
|
(301,150
|
)
|
Consolidated
|
|
$
|
316,679
|
|
|
$
|
522,596
|
|
|
$
|
1,471,164
|
|
|
$
|
2,068,494
|
|
(a)
|
Global components operating income includes $62.2 million in settlement charges recorded as a reduction to operating expense for the year ended December 31, 2023.
|
(b)
|
Global ECS operating income includes charges to the allowance for credit losses, which decreased by $2.8 million and increased by $24.0 million for the fourth quarter and the year ended December 31, 2023, respectively, relative to the year-earlier periods.
|
(c)
|
Corporate operating loss includes restructuring, integration, and other charges of $39.6 million and $83.9 million for the fourth quarter and the year ended December 31, 2023, respectively, and $2.7 million and $13.7 million for the fourth quarter and year ended December 31, 2022, respectively.
|
NON-GAAP SEGMENT RECONCILIATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
|
|
Year Ended
|
|
|
December 31, 2023
|
|
December 31, 2022
|
|
December 31, 2023
|
|
December 31, 2022
|
Global components operating income, as reported
|
|
$
|
281,260
|
|
$
|
442,702
|
|
$
|
1,459,166
|
|
$
|
1,961,125
|
Intangible assets amortization expense
|
|
|
6,436
|
|
|
6,702
|
|
|
26,500
|
|
|
27,005
|
Global components non-GAAP operating income
|
|
$
|
287,696
|
|
$
|
449,404
|
|
$
|
1,485,666
|
|
$
|
1,988,130
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global ECS operating income, as reported
|
|
$
|
145,053
|
|
$
|
154,775
|
|
$
|
367,004
|
|
$
|
408,519
|
Intangible assets amortization expense
|
|
|
1,055
|
|
|
1,468
|
|
|
4,742
|
|
|
7,687
|
Global ECS non-GAAP operating income
|
|
$
|
146,108
|
|
$
|
156,243
|
|
$
|
371,746
|
|
$
|
416,206
|
Source: Arrow Electronics