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ARW Q1 earnings hit $5.22 per share, up 190% Y/Y, beating guidance and the consensus estimate.
Revenues rose 39% to $9.47B, driven by Global Components and ECS segment growth.
Data center demand, improved backlog and extra shipping days boosted quarterly performance.
Arrow Electronics (ARW - Free Report) reported first-quarter 2026 non-GAAP earnings of $5.22 per share, above the company's previously issued guidance of $2.70-$2.90. The bottom line increased 190% year over year and beat the Zacks Consensus Estimate by 85.77%.
In the first quarter, ARW reported revenues of $9.47 billion, which rose 39% year over year and beat the consensus mark by 14.7%. The figure also exceeded the company's earlier guided range of $7.95-$8.55 billion. At constant currency, revenues increased 34% year over year. Changes in foreign currencies had a positive impact of $274 million on sales and 7 cents on earnings per share compared with the first quarter of 2025.
On a GAAP basis, ARW reported earnings of $4.55 per share, up 201% year over year, while net income attributable to shareholders rose 195% year over year to $235 million.
Arrow Electronics, Inc. Price, Consensus and EPS Surprise
In the first quarter of 2026, Global Components sales increased 39% year over year on a reported basis and 35% on a constant currency basis to $6.64 billion.
Region-wise, revenues from the Americas increased 47%, and the same from the Asia-Pacific region rose 37% (36% at constant currency) year over year on a reported basis. EMEA revenues increased 32% year over year on a reported basis and 19% at constant currency.
Global Enterprise Computing Solutions (ECS) revenues were $2.83 billion, which increased 39% year over year on a reported basis and 32% at constant currency. Global ECS gross billings rose 39% year over year to $6.43 billion.
Region-wise, the segment's revenues from the Americas and EMEA grew 30% and 46%, respectively, year over year, on a reported basis. At constant currency, Americas ECS increased 30%, and EMEA ECS rose 33%.
ARW's Q1 Operating Details
Consolidated non-GAAP gross margin was 11.5%, up approximately 20 basis points on a year-over-year basis. The Global Components segment reported a non-GAAP gross margin of 12.1%, up 50 basis points year over year, whereas the Global ECS segment saw its margin contract 80 basis points to 10% year over year. The ECS gross margin contraction was primarily due to a $21.7 million loss related to the underperformance of a certain non-cancellable multi-year purchase obligation.
The non-GAAP operating income from Global Components and Global ECS was $365 million and $105 million, respectively. Global Components' operating income increased 111% year over year, while Global ECS rose 34% year over year.
Arrow Electronics' non-GAAP operating income rose to $401 million in the first quarter of 2026. The non-GAAP operating margin expanded 160 basis points year over year to 4.2%. Within segments, Global Components' non-GAAP operating margin expanded 190 basis points year over year to 5.5%, while Global ECS' non-GAAP operating margin contracted 10 basis points to 3.7%.
Balance Sheet & Cash Flow
As of April 4, 2026, cash and cash equivalents totaled $287 million, which decreased from $306 million as of Dec. 31, 2025.
The long-term debt was $2.35 billion, down from $3.08 billion at the end of the previous quarter. In the reported quarter, cash flow from operations was $700 million, partly due to the timing of cash flows within the company's supply chain services offering compared with $352 million in the first quarter of 2025.
In the first quarter of 2026, ARW repurchased $25 million of shares.
ARW Offers Q2 2026 Guidance
For the second quarter of 2026, sales are estimated between $9.15 billion and $9.75 billion.
Global Components sales are projected between $6.80 billion and $7.20 billion. Global ECS sales are anticipated to be between $2.35 billion and $2.55 billion.
Interest expenses are expected to be approximately $60 million. The average tax rate is expected to range from 23% to 25%.
ARW anticipates GAAP earnings of $3.91-$4.11 per share and non-GAAP earnings of $4.32-$4.52 per share.
Changes in foreign currencies are expected to increase sales by approximately $117 million and earnings per share by 11 cents compared to the second quarter of 2025. On a sequential basis, foreign-currency changes are expected to increase sales by approximately $21 million and earnings per share by 3 cents compared to the first quarter of 2026.
Shares of Analog Devices have gained 53.3% in the year-to-date period. Analog Devices is set to report the second quarter of fiscal 2026 results on May 20.
Applied Materials shares have gained 66.8% in the year-to-date period. Applied Materials is scheduled to report its second-quarter 2026 results on May 14.
Audioeye shares have lost 23.3% in the year-to-date period. Audioeye is set to report its first-quarter 2026 results on May 13.
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Arrow Electronics Q1 Earnings Beat Estimates, Revenues Rise Y/Y
Key Takeaways
Arrow Electronics (ARW - Free Report) reported first-quarter 2026 non-GAAP earnings of $5.22 per share, above the company's previously issued guidance of $2.70-$2.90. The bottom line increased 190% year over year and beat the Zacks Consensus Estimate by 85.77%.
In the first quarter, ARW reported revenues of $9.47 billion, which rose 39% year over year and beat the consensus mark by 14.7%. The figure also exceeded the company's earlier guided range of $7.95-$8.55 billion. At constant currency, revenues increased 34% year over year. Changes in foreign currencies had a positive impact of $274 million on sales and 7 cents on earnings per share compared with the first quarter of 2025.
On a GAAP basis, ARW reported earnings of $4.55 per share, up 201% year over year, while net income attributable to shareholders rose 195% year over year to $235 million.
Arrow Electronics, Inc. Price, Consensus and EPS Surprise
Arrow Electronics, Inc. price-consensus-eps-surprise-chart | Arrow Electronics, Inc. Quote
ARW's Q1 Revenue Details
In the first quarter of 2026, Global Components sales increased 39% year over year on a reported basis and 35% on a constant currency basis to $6.64 billion.
Region-wise, revenues from the Americas increased 47%, and the same from the Asia-Pacific region rose 37% (36% at constant currency) year over year on a reported basis. EMEA revenues increased 32% year over year on a reported basis and 19% at constant currency.
Global Enterprise Computing Solutions (ECS) revenues were $2.83 billion, which increased 39% year over year on a reported basis and 32% at constant currency. Global ECS gross billings rose 39% year over year to $6.43 billion.
Region-wise, the segment's revenues from the Americas and EMEA grew 30% and 46%, respectively, year over year, on a reported basis. At constant currency, Americas ECS increased 30%, and EMEA ECS rose 33%.
ARW's Q1 Operating Details
Consolidated non-GAAP gross margin was 11.5%, up approximately 20 basis points on a year-over-year basis. The Global Components segment reported a non-GAAP gross margin of 12.1%, up 50 basis points year over year, whereas the Global ECS segment saw its margin contract 80 basis points to 10% year over year. The ECS gross margin contraction was primarily due to a $21.7 million loss related to the underperformance of a certain non-cancellable multi-year purchase obligation.
The non-GAAP operating income from Global Components and Global ECS was $365 million and $105 million, respectively. Global Components' operating income increased 111% year over year, while Global ECS rose 34% year over year.
Arrow Electronics' non-GAAP operating income rose to $401 million in the first quarter of 2026. The non-GAAP operating margin expanded 160 basis points year over year to 4.2%. Within segments, Global Components' non-GAAP operating margin expanded 190 basis points year over year to 5.5%, while Global ECS' non-GAAP operating margin contracted 10 basis points to 3.7%.
Balance Sheet & Cash Flow
As of April 4, 2026, cash and cash equivalents totaled $287 million, which decreased from $306 million as of Dec. 31, 2025.
The long-term debt was $2.35 billion, down from $3.08 billion at the end of the previous quarter. In the reported quarter, cash flow from operations was $700 million, partly due to the timing of cash flows within the company's supply chain services offering compared with $352 million in the first quarter of 2025.
In the first quarter of 2026, ARW repurchased $25 million of shares.
ARW Offers Q2 2026 Guidance
For the second quarter of 2026, sales are estimated between $9.15 billion and $9.75 billion.
Global Components sales are projected between $6.80 billion and $7.20 billion. Global ECS sales are anticipated to be between $2.35 billion and $2.55 billion.
Interest expenses are expected to be approximately $60 million. The average tax rate is expected to range from 23% to 25%.
ARW anticipates GAAP earnings of $3.91-$4.11 per share and non-GAAP earnings of $4.32-$4.52 per share.
Changes in foreign currencies are expected to increase sales by approximately $117 million and earnings per share by 11 cents compared to the second quarter of 2025. On a sequential basis, foreign-currency changes are expected to increase sales by approximately $21 million and earnings per share by 3 cents compared to the first quarter of 2026.
ARW’s Zacks Rank & Other Stocks to Consider
ARW currently carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the broader Zacks Computer and Technology sector include Analog Devices (ADI - Free Report) , Applied Materials (AMAT - Free Report) and Audioeye (AEYE - Free Report) , each carrying a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have gained 53.3% in the year-to-date period. Analog Devices is set to report the second quarter of fiscal 2026 results on May 20.
Applied Materials shares have gained 66.8% in the year-to-date period. Applied Materials is scheduled to report its second-quarter 2026 results on May 14.
Audioeye shares have lost 23.3% in the year-to-date period. Audioeye is set to report its first-quarter 2026 results on May 13.