Arrow Electronics Reports Second-Quarter 2021 Results

Arrow Electronics, Inc. (NYSE:ARW) today reported second-quarter 2021 sales of $8.56 billion, an increase of 30 percent from sales of $6.61 billion in the second quarter of 2020. Second-quarter net income was $241 million, or $3.23 per share on a diluted basis, compared with a net income of $133 million, or $1.68 per share on a diluted basis, in the second quarter of 2020. Non-GAAP net income1 was $249 million, or $3.34 per share on a diluted basis, in the second quarter of 2021, compared with non-GAAP net income of $126 million, or $1.59 per share on a diluted basis, in the second quarter of 2020.

“Arrow reported record results this quarter, reflecting our constant efforts to capture new growth opportunities and harvest the benefits as leaders of information and operational technology innovation,” said Michael J. Long, chairman, president, and chief executive officer. “We believe that financial performance is directly linked to the value we deliver to customers and suppliers, making our achievement of the highest sales, gross profit and earnings per share for any quarter in Arrow’s history a true testament to the hard work and commitment of our team. We look forward to driving further success for our customers, as well as all our company’s stakeholders as we continue to advance our strategic priorities.”

Global components second-quarter sales of $6.61 billion reflected an increase of 40 percent year over year and non-GAAP sales increased 36 percent year over year. Asia-Pacific components second-quarter sales increased 49 percent year over year and non-GAAP sales in the region increased 47 percent year over year. Americas components second-quarter sales increased 32 percent year over year. Europe components second-quarter sales increased 33 percent year over year and non-GAAP sales in the region increased 22 percent year over year. Global components second-quarter operating income was $327 million, and second-quarter non-GAAP operating income was $339 million.

“Our commitment to helping customers bring innovative next-generation electronic products to market quickly is a key driver of our success,” continued Mr. Long. “Global components sales were above the high-end of our expectations for the fifth consecutive quarter resulting from our ability to secure additional inventory to meet strong demand.”

Global enterprise computing solutions second-quarter sales of $1.95 billion reflected an increase of 4 percent year over year and non-GAAP sales decreased 1 percent year over year. Europe enterprise computing solutions second-quarter sales increased 19 percent year over year and non-GAAP sales in the region increased 8 percent year over year. Americas enterprise computing solutions second-quarter sales decreased 5 percent year over year. Global enterprise computing solutions second-quarter operating income was $81 million, and second-quarter non-GAAP operating income was $83 million.

Mr. Long said, “We are seeing strong demand for complex software and cloud-based solutions, and our pipeline is healthy. Despite strong demand, second-quarter global enterprise computing solutions performance was in-line with our expectations as shifting spending priorities and some supply constraints stood in the way of capturing upside.”

“Enhancing shareholder value remains a top priority. With a strong balance sheet and liquidity position, our return on invested capital increased year over year for the fifth straight quarter,” said Chris Stansbury, senior vice president and chief financial officer. “We are pleased our strong financial returns, positive cash flow from operations, and the effective management of our balance sheet enabled us to deliver on our commitment to returning cash to shareholders through an additional $600 million repurchase authorization on July 21. During the second quarter, we repurchased a single-quarter record of approximately $250 million of shares through our stock repurchase program. Our current repurchase authorization stands at approximately $663 million.”

1 A reconciliation of non-GAAP financial measures, including sales, gross profit, operating income, net income attributable to shareholders, and net income per share, to GAAP financial measures is presented in the reconciliation tables included herein.

THIRD-QUARTER 2021 OUTLOOK

  • Consolidated sales of $8.175 billion to $8.775 billion, with global components sales of $6.375 billion to $6.675 billion, and global enterprise computing solutions sales of $1.8 billion to $2.1 billion
  • Net income per share on a diluted basis of $3.24 to $3.40, and non-GAAP net income per share on a diluted basis1 of $3.42 to $3.58
  • Average tax rate of approximately 23.5 percent compared to the long-term range of 23 to 25 percent
  • Average diluted shares outstanding of 73 million
  • Interest expense of approximately $32 million
  • Expecting average USD-to-Euro exchange rate of $1.19 to €1; changes in foreign currencies to increase sales by approximately $40 million, and earnings per share on a diluted basis by $.02 compared to the third quarter of 2020

Third-Quarter 2021 Outlook

Reported GAAP measure

Intangible amortization expense

Restructuring & integration charges

Non-GAAP measure

Net income per diluted share

$3.24 - $3.40

$.09

$.09

$3.42 - $3.58

Please refer to the CFO commentary, which can be found at investor.arrow.com, as a supplement to the company’s earnings release.

Arrow Electronics guides innovation forward for over 180,000 leading technology manufacturers and service providers. With 2020 sales of $29 billion, Arrow develops technology solutions that improve business and daily life. Learn more at fiveyearsout.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 third quarter of fiscal 2021, such as sales, net income per diluted share, non-GAAP net income per diluted share, average tax rate, average diluted shares outstanding, interest expense, average USD-to-Euro exchange rate, impact to sales due to changes in foreign currencies, intangible amortization expense per diluted share, restructuring and integration charges per diluted share, and expectation regarding market demand. These 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: potential adverse effects of the ongoing global COVID-19 pandemic, including actions taken to contain or treat COVID-19, industry conditions, changes in product supply, pricing and customer demand, competition, other vagaries in the global components and global enterprise computing solutions markets, changes in relationships with key suppliers, increased profit margin pressure, foreign currency fluctuation, changes in legal and regulatory matters, non-compliance with certain regulations, such as export, anti-trust, and anti-corruption laws, foreign tax and other loss contingencies, and the company's ability to generate 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 periodic reports on Form 10-K and Form 10-Q and subsequent filings made 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 relating to sales, operating income, net income attributable to shareholders, and net income per basic and diluted share.

The company provides non-GAAP sales, gross profit, operating income, income before income taxes, provision for income taxes, net income, and net income per share on a diluted basis which are adjusted GAAP measures for the impact of changes in foreign currencies (referred to as "changes in foreign currencies") by re-translating prior period results at current period foreign exchange rates and the impact of notes receivable reserves and recoveries related to the AFS business (referred to as “AFS notes receivable reserves and recoveries”). Non-GAAP operating income excludes identifiable intangible asset amortization, restructuring, integration, and other charges, AFS notes receivable reserves and recoveries, impairment of long-lived assets, and the impact of wind down. Non-GAAP effective tax rate and non-GAAP net income attributable to shareholders excludes identifiable intangible asset amortization, restructuring, integration, and other charges, gain (loss) on investments, net, the impact of tax legislation changes, AFS notes receivable recoveries, the impact of impairments of long-lived assets, pension settlement loss, and the impact of wind down.

The company believes that such non-GAAP financial information is useful to investors to assist in assessing and understanding the company’s operating performance and underlying trends in the company’s business because management considers these items referred to above to be outside the company’s core operating results. This non-GAAP financial information is among the primary indicators management uses as a basis for evaluating the company’s financial and operating performance. In addition, the company’s Board of Directors may use this non-GAAP financial information in evaluating management performance and setting management compensation.

The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for, or alternative to, sales, operating income, net income and net income per basic and diluted share determined in accordance with GAAP. Analysis of results and outlook on a non-GAAP basis should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

A reconciliation of the company’s non-GAAP financial information to GAAP is set forth in the tables below.

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands except per share data)

(Unaudited)

Quarter Ended

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Sales

$

8,562,631

$

6,606,494

$

16,948,550

$

12,987,911

Cost of sales

7,562,526

5,856,031

15,018,335

11,509,057

Gross profit

1,000,105

750,463

1,930,215

1,478,854

Operating expenses:

Selling, general, and administrative expenses

602,084

501,470

1,176,651

1,035,309

Depreciation and amortization

48,539

46,812

98,870

93,922

Impairments

4,482

4,918

4,482

4,918

Restructuring, integration, and other charges

4,478

650

10,187

9,788

659,583

553,850

1,290,190

1,143,937

Operating income

340,522

196,613

640,025

334,917

Equity in earnings (losses) of affiliated companies

190

(283)

1,034

247

Gain (loss) on investments, net

6,726

10,901

9,519

(5,909)

Employee benefit plan expense, net

(1,438)

(1,173)

(2,668)

(2,282)

Interest and other financing expense, net

(30,685)

(31,867)

(64,341)

(75,135)

Income before income taxes

315,315

174,191

583,569

251,838

Provision for income taxes

74,113

40,854

135,139

68,746

Consolidated net income

241,202

133,337

448,430

183,092

Noncontrolling interests

561

533

1,468

785

Net income attributable to shareholders

$

240,641

$

132,804

$

446,962

$

182,307

Net income per share:

Basic

$

3.27

$

1.69

$

6.02

$

2.29

Diluted

$

3.23

$

1.68

$

5.94

$

2.28

Weighted-average shares outstanding:

Basic

73,693

78,677

74,294

79,527

Diluted

74,611

79,226

75,197

80,113

ARROW ELECTRONICS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands except par value)

(Unaudited)

July 3, 2021

December 31, 2020

ASSETS

Current assets:

Cash and cash equivalents

$

244,070

$

373,615

Accounts receivable, net

8,846,715

9,205,343

Inventories

3,636,082

3,287,308

Other current assets

355,757

286,633

Total current assets

13,082,624

13,152,899

Property, plant, and equipment, at cost:

Land

5,691

7,940

Buildings and improvements

184,676

207,614

Machinery and equipment

1,530,544

1,553,371

1,720,911

1,768,925

Less: Accumulated depreciation and amortization

(993,500)

(969,320)

Property, plant, and equipment, net

727,411

799,605

Investments in affiliated companies

68,937

76,358

Intangible assets, net

214,261

233,819

Goodwill

2,106,182

2,115,469

Other assets

643,358

675,761

Total assets

$

16,842,773

$

17,053,911

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable

$

7,625,844

$

7,937,889

Accrued expenses

1,089,866

1,034,361

Short-term borrowings, including current portion of long-term debt

356,986

158,633

Total current liabilities

9,072,696

9,130,883

Long-term debt

1,884,393

2,097,940

Other liabilities

661,223

676,136

Commitments and contingencies

Equity:

Shareholders’ equity:

Common stock, par value $1:

Authorized - 160,000 shares in both 2021 and 2020

Issued - 125,424 shares in both 2021 and 2020

125,424

125,424

Capital in excess of par value

1,175,470

1,165,850

Treasury stock (53,286 and 50,581 shares in 2021 and 2020, respectively), at cost

(3,134,484)

(2,776,821)

Retained earnings

7,126,713

6,679,751

Accumulated other comprehensive loss

(128,201)

(104,885)

Total shareholders’ equity

5,164,922

5,089,319

Noncontrolling interests

59,539

59,633

Total equity

5,224,461

5,148,952

Total liabilities and equity

$

16,842,773

$

17,053,911

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Quarter Ended

July 3, 2021

June 27, 2020

Cash flows from operating activities:

Consolidated net income

$

241,202

$

133,337

Adjustments to reconcile consolidated net income to net cash provided by operations:

Depreciation and amortization

48,539

46,812

Amortization of stock-based compensation

8,744

8,397

Equity in (earnings) losses of affiliated companies

(190)

283

Deferred income taxes

(1,594)

13,732

Impairments

4,482

4,918

Gain on investments, net

(6,726)

(10,885)

Other

277

253

Change in assets and liabilities, net of effects of acquired and disposed businesses:

Accounts receivable, net

(313,735)

(112,437)

Inventories

(357,065)

(80,465)

Accounts payable

562,461

292,024

Accrued expenses

79,459

102,369

Other assets and liabilities

15,526

19,907

Net cash provided by operating activities

281,380

418,245

Cash flows from investing activities:

Acquisition of property, plant, and equipment

(20,929)

(31,571)

Net cash used for investing activities

(20,929)

(31,571)

Cash flows from financing activities:

Change in short-term and other borrowings

(2,379)

77,165

Proceeds from (repayments of) long-term bank borrowings, net

(20,433)

(123,113)

Redemption of notes

(209,366)

Proceeds from exercise of stock options

15,226

1,750

Repurchases of common stock

(250,708)

(72,750)

Settlement of forward-starting interest rate swap

(48,378)

Other

(159)

(141)

Net cash used for financing activities

(258,453)

(374,833)

Effect of exchange rate changes on cash

14,371

(7,011)

Net increase in cash and cash equivalents

16,369

4,830

Cash and cash equivalents at beginning of period

227,701

200,998

Cash and cash equivalents at end of period

$

244,070

$

205,828

ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Six Months Ended

July 3, 2021

June 27, 2020

Cash flows from operating activities:

Consolidated net income

$

448,430

$

183,092

Adjustments to reconcile consolidated net income to net cash provided by operations:

Depreciation and amortization

98,870

93,922

Amortization of stock-based compensation

21,967

22,317

Equity in earnings of affiliated companies

(1,034)

(247)

Deferred income taxes

12,069

46,345

Impairments

4,482

4,918

Loss (gain) on investments, net

(9,519)

5,925

Other

1,651

48

Change in assets and liabilities, net of effects of acquired and disposed businesses:

Accounts receivable, net

283,042

446,168

Inventories

(370,212)

52,927

Accounts payable

(277,663)

(51,027)

Accrued expenses

83,102

71,043

Other assets and liabilities

(18,341)

9,679

Net cash provided by operating activities

276,844

885,110

Cash flows from investing activities:

Acquisition of property, plant, and equipment

(41,109)

(59,542)

Proceeds from sale of property, plant, and equipment

22,171

Other

(5,466)

Net cash used for investing activities

(18,938)

(65,008)

Cash flows from financing activities:

Change in short-term and other borrowings

(14,831)

(7,189)

Proceeds from (repayments of) long-term bank borrowings, net

134,241

(411,690)

Redemption of notes

(130,860)

(209,366)

Proceeds from exercise of stock options

41,317

3,730

Repurchases of common stock

(411,327)

(231,739)

Settlement of forward-starting interest rate swap

(48,378)

Other

(159)

(141)

Net cash used for financing activities

(381,619)

(904,773)

Effect of exchange rate changes on cash

(5,832)

(9,604)

Net decrease in cash and cash equivalents

(129,545)

(94,275)

Cash and cash equivalents at beginning of period

373,615

300,103

Cash and cash equivalents at end of period

$

244,070

205,828

ARROW ELECTRONICS, INC.

NON-GAAP SALES RECONCILIATION

(In thousands)

(Unaudited)

 

Quarter Ended

July 3, 2021

June 27, 2020

% Change

Consolidated sales, as reported

$

8,562,631

$

6,606,494

29.6

%

Impact of changes in foreign currencies

218,616

Non-GAAP consolidated sales

$

8,562,631

$

6,825,110

25.5

%

Global components sales, as reported

$

6,610,761

$

4,721,255

40.0

%

Impact of changes in foreign currencies

133,141

Non-GAAP global components sales

$

6,610,761

$

4,854,396

36.2

%

Americas components sales, as reported

$

1,970,756

$

1,488,901

32.4

%

Impact of changes in foreign currencies

637

Non-GAAP Americas components sales

$

1,970,756

$

1,489,538

32.3

%

Europe components sales, as reported

$

1,490,662

$

1,118,417

33.3

%

Impact of changes in foreign currencies

106,199

Non-GAAP Europe components sales

$

1,490,662

$

1,224,616

21.7

%

Asia components sales, as reported

$

3,149,343

$

2,113,937

49.0

%

Impact of changes in foreign currencies

26,305

Non-GAAP Asia components sales

$

3,149,343

$

2,140,242

47.1

%

Global ECS sales, as reported

$

1,951,870

$

1,885,239

3.5

%

Impact of changes in foreign currencies

85,475

Non-GAAP global ECS sales

$

1,951,870

$

1,970,714

(1.0)

%

Europe ECS sales, as reported

$

784,515

$

661,983

18.5

%

Impact of changes in foreign currencies

66,164

Non-GAAP Europe ECS sales

$

784,515

$

728,147

7.7

%

Americas ECS sales, as reported

$

1,167,355

$

1,223,256

(4.6)

%

Impact of changes in foreign currencies

19,311

Non-GAAP Americas ECS sales

$

1,167,355

$

1,242,567

(6.1)

%

ARROW ELECTRONICS, INC.

NON-GAAP SALES RECONCILIATION

(In thousands)

(Unaudited)

 

Six Months Ended

July 3, 2021

June 27, 2020

% Change

Consolidated sales, as reported

$

16,948,550

$

12,987,911

30.5

%

Impact of changes in foreign currencies

421,289

Consolidated sales, as adjusted

$

16,948,550

$

13,409,200

26.4

%

Global components sales, as reported

$

13,054,014

$

9,271,856

40.8

%

Impact of changes in foreign currencies

263,439

Global components sales, as adjusted

$

13,054,014

$

9,535,295

36.9

%

Americas components sales, as reported

$

3,671,929

$

3,041,699

20.7

%

Impact of changes in foreign currencies

346

Americas components sales, as adjusted

$

3,671,929

$

3,042,045

20.7

%

Europe components sales, as reported

$

3,059,264

$

2,428,407

26.0

%

Impact of changes in foreign currencies

221,483

Europe components sales, as adjusted

$

3,059,264

$

2,649,890

15.4

%

Asia components sales, as reported

$

6,322,821

$

3,801,750

66.3

%

Impact of changes in foreign currencies

41,610

Asia components sales, as adjusted

$

6,322,821

$

3,843,360

64.5

%

Global ECS sales, as reported

$

3,894,536

$

3,716,055

4.8

%

Impact of changes in foreign currencies

157,850

Global ECS sales, as adjusted

$

3,894,536

$

3,873,905

0.5

%

Europe ECS sales, as reported

$

1,575,843

$

1,364,111

15.5

%

Impact of changes in foreign currencies

125,964

Europe ECS sales, as adjusted

$

1,575,843

$

1,490,075

5.8

%

Americas ECS sales, as reported

$

2,318,693

$

2,351,944

(1.4)

%

Impact of changes in foreign currencies

31,886

Americas ECS sales, as adjusted

$

2,318,693

$

2,383,830

(2.7)

%

ARROW ELECTRONICS, INC.

NON-GAAP EARNINGS RECONCILIATION

(In thousands except per share data)

(Unaudited)

Three months ended July 3, 2021

Reported

GAAP

measure

Intangible

amortization

expense

Restructuring

& Integration

charges

AFS Reserves & Recoveries

Impairments

Impact of Wind Down

Other(1)

Non-GAAP

measure

Sales

$

8,562,631

$

$

$

$

$

$

$

8,562,631

Gross Profit

1,000,105

1,000,105

Operating income

340,522

9,316

4,478

4,482

358,798

Income before income taxes

315,315

9,316

4,478

4,482

(6,545)

327,046

Provision for income taxes

74,113

2,382

1,010

1,078

(1,575)

77,008

Consolidated net income

241,202

6,934

3,468

3,404

(4,970)

250,038

Noncontrolling interests

561

150

711

Net income attributable to shareholders

$

240,641

$

6,784

$

3,468

$

$

3,404

$

$

(4,970)

$

249,327

Net income per diluted share (3)

$

3.23

$

0.09

$

0.05

$

$

0.05

$

$

(0.07)

$

3.34

Effective tax rate (4)

23.5

%

23.5

%

Three months ended June 27, 2020

Reported

GAAP

measure

Intangible

amortization

expense

Restructuring

& Integration

charges

AFS Reserves & Recoveries

Impairments

Impact of Wind Down

Other(2)

Non-GAAP

measure

Sales

$

6,606,494

$

$

$

$

$

$

$

6,606,494

Gross Profit

750,463

(10,696)

739,767

Operating income

196,613

9,734

650

197

4,918

(11,824)

200,288

Income before income taxes

174,191

9,734

650

197

4,918

(11,814)

(10,901)

166,975

Provision for income taxes

40,854

2,501

313

47

1,800

(2,662)

(2,631)

40,222

Consolidated net income

133,337

7,233

337

150

3,118

(9,152)

(8,270)

126,753

Noncontrolling interests

533

137

670

Net income attributable to shareholders

$

132,804

$

7,096

$

337

$

150

$

3,118

$

(9,152)

$

(8,270)

$

126,083

Net income per diluted share (3)

$

1.68

$

0.09

$

$

$

0.04

$

(0.12)

$

(0.10)

$

1.59

Effective tax rate (4)

23.5

%

24.1

%

ARROW ELECTRONICS, INC.

NON-GAAP EARNINGS RECONCILIATION

(In thousands except per share data)

(Unaudited)

Six months ended July 3, 2021

Reported

GAAP

measure

Intangible

amortization

expense

Restructuring

& Integration

charges

AFS Reserves & Recoveries

Impairments

Impact of Wind Down

Non-recurring tax items

Other(1)

Non-GAAP

measure

Sales

$

16,948,550

$

$

$

$

$

$

$

$

16,948,550

Gross Profit

1,930,215

1,930,215

Operating income

640,025

18,642

10,187

4,482

673,336

Income before income taxes

583,569

18,642

10,187

4,482

(9,338)

607,542

Provision for income taxes

135,139

4,767

2,176

1,078

(2,247)

140,913

Consolidated net income

448,430

13,875

8,011

3,404

(7,091)

466,629

Noncontrolling interests

1,468

300

1,768

Net income attributable to shareholders

$

446,962

$

13,575

$

8,011

$

$

3,404

$

$

$

(7,091)

$

464,861

Net income per diluted share (3)

$

5.94

$

0.18

$

0.11

$

$

0.05

$

$

$

(0.09)

$

6.18

Effective tax rate (4)

23.2

%

23.2

%

Six months ended June 27, 2020

Reported

GAAP

measure

Intangible

amortization

expense

Restructuring

& Integration

charges

AFS Reserves & Recoveries

Impairments

Impact of Wind Down

Non-recurring tax items

Other(2)

Non-GAAP

measure

Sales

$

12,987,911

$

$

$

$

$

$

$

$

12,987,911

Gross Profit

1,478,854

(10,696)

1,468,158

Operating income

334,917

19,689

9,788

(723)

4,918

(11,824)

356,765

Income before income taxes

251,838

19,689

9,788

(723)

4,918

(11,814)

5,909

279,605

Provision for income taxes

68,746

5,065

2,884

(175)

1,800

(2,662)

(3,615)

1,426

73,469

Consolidated net income

183,092

14,624

6,904

(548)

3,118

(9,152)

3,615

4,483

206,136

Noncontrolling interests

785

274

1,059

Net income attributable to shareholders

$

182,307

$

14,350

$

6,904

$

(548)

$

3,118

$

(9,152)

$

3,615

$

4,483

$

205,077

Net income per diluted share (3)

$

2.28

$

0.18

$

0.09

$

(0.01)

$

0.04

$

(0.11)

$

0.05

$

0.06

$

2.56

Effective tax rate (4)

27.3

%

26.3

%

(1) Other includes (gain) loss on investments, net and pension settlement loss.

(2) Other includes (gain) loss on investments, net

(3) In all periods presented the sum of the components for diluted EPS, as adjusted may not agree to totals, as presented, due to rounding.

(4) 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

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Sales:

Global components

$

6,610,761

$

4,721,255

$

13,054,014

$

9,271,856

Global ECS

1,951,870

1,885,239

3,894,536

3,716,055

Consolidated

$

8,562,631

$

6,606,494

$

16,948,550

$

12,987,911

Operating income (loss):

Global components (a)

$

327,036

$

181,836

$

616,419

$

346,603

Global ECS (b)

81,099

72,921

158,458

115,354

Corporate (c)

(67,613)

(58,144)

(134,852)

(127,040)

Consolidated

$

340,522

$

196,613

$

640,025

$

334,917

(a)

Global components operating income includes $8.2 million and $12.5 million related to proceeds from legal settlements for the second quarter and first six months of 2021.

(b)

Includes reserves and other adjustments of approximately $29.9 million primarily related to foreign tax and other loss contingencies for the first six months of 2020. These reserves are principally associated with transactional taxes on activity from several prior years, not significant to any one year.

(c)

Includes restructuring, integration, and other charges of $4.5 million and $10.2 million for the second quarter and first six months of 2021, respectively, and $0.7 million and $9.8 million for the second quarter and first six months of 2020, respectively.

NON-GAAP SEGMENT RECONCILIATION

Quarter Ended

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Global components operating income, as reported

$

327,036

$

181,836

$

616,419

$

346,603

Intangible assets amortization expense

6,995

7,259

13,999

14,639

Impairments

4,482

4,482

Impact of wind down

(11,824)

(11,824)

AFS notes receivable reserve (recoveries)

197

(723)

Global components non-GAAP operating income

$

338,513

$

177,468

$

634,900

$

348,695

Global ECS operating income, as reported

$

81,099

$

72,921

$

158,458

$

115,354

Intangible assets amortization expense

2,321

2,475

4,643

5,050

Impairments

4,918

4,918

Global ECS non-GAAP operating income

$

83,420

$

80,314

$

163,101

$

125,322

Contacts:

Steven O’Brien,
Vice President, Investor Relations
303-824-4544

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