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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 8, 2024

ARROW ELECTRONICS, INC.

(Exact Name of Registrant as Specified in Charter)

New York

1-4482

11-1806155

(State or Other Jurisdiction

(Commission

(IRS Employer

of Incorporation)

File Number)

Identification No.)

9201 East Dry Creek Road,

Centennial,

CO

80112

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (303) 824-4000

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of the exchange on which registered

Common Stock, $1 par value

ARW

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company     

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.               

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On February 8, 2024, the Registrant issued a press release announcing its fourth quarter 2023 earnings. A copy of the press release is attached hereto as an Exhibit (99.1).

The information in this Current Report on Form 8-K and Exhibit 99.1 attached hereto is being furnished and shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d)           EXHIBITS

Exhibit Number

    

Description

 

99.1

Earnings press release issued by Arrow Electronics, Inc., dated February 8, 2024.

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

ARROW ELECTRONICS, INC.

Date:

February 8, 2024

By:

/s/ Carine Jean-Claude

Name:

Carine Jean-Claude

Title:

Senior Vice President, Chief Legal Officer and Secretary

ARROW ELECTRONICS, INC.

9201 E. DRY CREEK ROAD

CENTENNIAL, CO 80112

303-824-4000

NEWS

Exhibit 99.1

Arrow Electronics Reports Fourth-Quarter and Full-Year 2023 Results

-- 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)- Feb. 8, 2024--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.”

Arrow Consolidated

    

Quarter Ended

    

Year Ended

December 31,

December 31,

December 31,

December 31,

(in millions except per share data)

    

2023

    

2022

    

2023

    

2022

Consolidated sales

$

7,849

$

9,323

$

33,107

$

37,124

Net income attributable to shareholders

 

195

 

349

 

904

 

1,427

Net income per diluted share

3.54

5.66

15.84

21.80

Non-GAAP net income attributable to shareholders (1)

219

351

977

1,465

Non-GAAP net income per diluted share

3.98

5.69

17.12

22.38

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.

Graphic

1


ARROW ELECTRONICS, INC.

9201 E. DRY CREEK ROAD

CENTENNIAL, CO 80112

303-824-4000

NEWS

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.

Global Components

    

Quarter Ended

    

Year Ended

December 31,

December 31,

December 31,

December 31,

(in millions)

2023

2022

2023

2022

Global components sales

$

5,636

$

6,827

$

25,420

$

28,788

Global components operating income, as reported

 

281

 

443

 

1,459

 

1,961

Global components non-GAAP operating income

288

449

1,486

1,988

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.”

Global Enterprise Computing Solutions

    

Quarter Ended

    

Year Ended

December 31,

December 31,

December 31,

December 31,

(in millions)

2023

2022

2023

2022

Global ECS sales

$

2,213

$

2,496

$

7,687

$

8,336

Global ECS operating income, as reported

 

145

 

155

 

367

 

409

Global ECS non-GAAP operating income

146

156

372

416

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.

Graphic

2


First-Quarter 2024 Outlook

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
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
Average tax rate in the range of 23 to 25 percent
Interest expense of approximately $80 million
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
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

First-Quarter 2024 GAAP to non-GAAP Outlook Reconciliation

 NON-GAAP SALES RECONCILIATION

 

Quarter Ended

 

Quarter Ended

(in billions)

    

March 30, 2024

    

April 1, 2023

    

% Change

    

March 30, 2024

    

December 31, 2023

    

% Change

Global components sales, GAAP

$

5.00 - 5.40

$

6.86

 

(27%) - (21%)

$

5.00 - 5.40

$

5.64

 

(11%) - (4%)

Impact of changes in foreign currencies

 

 

(0.01)

 

 

 

0.02

 

Global components sales, constant currency

$

5.00 - 5.40

$

6.85

 

(27%) - (21%)

$

5.00 - 5.40

$

5.66

 

(12%) - (5%)

Global ECS sales, GAAP

$

1.70 - 1.90

$

1.88

 

(10%) - 1%

$

1.70 - 1.90

$

2.21

 

(23%) - (14%)

Impact of changes in foreign currencies

 

 

0.02

 

 

 

0.01

 

Global ECS sales, constant currency

$

1.70 - 1.90

$

1.90

 

(11%) - 0%

$

1.70 - 1.90

$

2.22

 

(23%) - (14%)

NON-GAAP EARNINGS RECONCILIATION

    

    

Intangible amortization

    

Restructuring &

    

Reported GAAP measure

 

expense

 

integration charges

Non-GAAP measure

Net income per diluted share

$1.95 to $2.15

$0.10

$0.15

$2.20 to $2.40

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.

Graphic

3


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.

Contacts

 Investors:

Media:

Anthony Bencivenga, 303-566-7456

John Hourigan, 303-824-4586

Vice President, Investor Relations

Vice President, Public Affairs and Corporate Marketing

anthony.bencivenga@arrow.com

jhourigan@arrow.com

Graphic

4


ARROW ELECTRONICS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands except per share data)

Quarter Ended

Year Ended

    

December 31, 2023

    

December 31, 2022

    

December 31, 2023

    

December 31, 2022

(Unaudited)

(Unaudited)

Sales

$

7,849,157

$

9,323,023

$

33,107,120

$

37,124,422

Cost of sales

 

6,859,607

 

8,117,028

 

28,958,102

 

32,287,797

Gross profit

 

989,550

 

1,205,995

 

4,149,018

 

4,836,625

Operating expenses:

 

  

 

  

 

  

 

  

Selling, general, and administrative expenses

 

590,039

 

635,090

 

2,412,822

 

2,567,008

Depreciation and amortization

 

43,168

 

45,595

 

181,116

 

187,382

Restructuring, integration, and other charges

 

39,664

 

2,714

 

83,916

 

13,741

 

672,871

 

683,399

 

2,677,854

 

2,768,131

Operating income

 

316,679

 

522,596

 

1,471,164

 

2,068,494

Equity in earnings of affiliated companies

 

2,034

 

2,938

 

6,407

 

7,664

Gain (loss) on investments, net

 

14,635

 

8,356

 

19,284

 

(2,857)

Employee benefit plan expense, net

 

(1,267)

 

(889)

 

(3,777)

 

(3,503)

Interest and other financing expense, net

 

(82,052)

 

(62,221)

 

(328,724)

 

(185,648)

Income before income taxes

 

250,029

 

470,780

 

1,164,354

 

1,884,150

Provision for income taxes

 

53,823

 

116,719

 

254,991

 

448,992

Consolidated net income

 

196,206

 

354,061

 

909,363

 

1,435,158

Noncontrolling interests

 

1,669

 

4,659

 

5,858

 

8,274

Net income attributable to shareholders

$

194,537

$

349,402

$

903,505

$

1,426,884

Net income per share:

 

  

 

  

 

  

 

  

Basic

$

3.58

$

5.71

$

16.03

$

22.01

Diluted

$

3.54

$

5.66

$

15.84

$

21.80

Weighted-average shares outstanding:

 

  

 

  

 

  

 

  

Basic

 

54,396

 

61,175

 

56,359

 

64,838

Diluted

 

55,015

 

61,739

 

57,035

 

65,453

Graphic

5


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

Graphic

6


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

Graphic

7


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

Graphic

8


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)

%

Graphic

9


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)

%

Graphic

10


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

%  

Graphic

11


ARROW ELECTRONICS, INC.

NON-GAAP EARNINGS RECONCILIATION

(In thousands except per share data)

(Unaudited)

Year ended December 31, 2023

 

    

Reported

    

Intangible

    

Restructuring

    

    

    

 

GAAP

amortization

& Integration

Non- recurring

Non-GAAP

 

 

measure

 

expense

 

charges

tax items

Other(1)

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

    

Intangible

    

Restructuring

    

    

    

 

GAAP

amortization

& Integration

Non- recurring

Non-GAAP

 

measure

expense

charges

tax items

Other(1)

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.

Graphic

12


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

Graphic

13


v3.24.0.1
Document and Entity Information
Feb. 08, 2024
Document and Entity Information [Abstract]  
Document Type 8-K
Document Period End Date Feb. 08, 2024
Entity Registrant Name ARROW ELECTRONICS, INC.
Entity Incorporation, State or Country Code NY
Entity File Number 1-4482
Entity Tax Identification Number 11-1806155
Entity Address, Address Line One 9201 East Dry Creek Road,
Entity Address, City or Town Centennial,
Entity Address State Or Province CO
Entity Address, Postal Zip Code 80112
City Area Code (303)
Local Phone Number 824-4000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $1 par value
Trading Symbol ARW
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000007536
Amendment Flag false

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