Avnet forecasts third-quarter results above estimates; shares rise
(Reuters) - Electronic products distributor Avnet Inc (AVT.N) forecast current-quarter results above analysts' estimates after reporting a better-than-expected second quarter, sending its shares up 9 percent in premarket trading.
The company, considered a bellwether for corporate technology spending, forecast third-quarter adjusted earnings of 81 cents to 91 cents per share, on revenue of between $5.95 billion and $6.55 billion.
Analysts on average were expecting earnings of 78 cents on revenue of $5.95 billion, according to Thomson Reuters I/B/E/S.
"In the December quarter, technology solutions revenue increased 36 percent sequentially ... as customers were more willing to spend their IT budget dollars," Chief Executive Rick Hamada said in a statement.
The technology solutions business, which accounted for 42 percent of total revenue in 2012, provides enterprise servers and software.
Net income fell to $137.5 million in the second quarter from $147 million a year earlier.
Excluding items, the company earned $1.01 per share, beating analysts' expectation of 83 cents.
Revenue rose marginally to $6.7 billion, above estimates of $6.23 billion -- the company's first beat in three quarters.
Avnet and other technology distributors such as Arrow Electronics Inc (ARW.N) and Ingram Micro Inc (IM.N) have been hit by weak demand for the past few quarters, underscoring a slowdown in technology spending.
Avnet shares, which gained about 15 percent in the last three months, were up at $34.90 in premarket trading. They closed at $32.17 on the Nasdaq on Wednesday.
(Reporting by Chandni Doulatramani in Bangalore; Editing by Maju Samuel)