Arrow Electronics (ARW) Q2 2026 earnings summary

Executive summary

• Second quarter 2026 revenue reached $10 billion, up 32% year-over-year, surpassing guidance, with operating margin expanding 120 basis points to 4%.

• Non-GAAP EPS rose 124% year-over-year to $5.45, driven by broad-based demand, disciplined execution, and improved leading indicators.

• Growth was supported by sustained unit volume, price inflation, value-added services, and strong performance in both Global Components and ECS segments.

• Net income attributable to shareholders increased 45% year-over-year to $273 million.

• Leading indicators such as book-to-bill ratios and backlog provide visibility into continued growth into 2027.

Financial highlights

• Sales increased $2.4 billion year-over-year to $10 billion, exceeding guidance and up 30% on a constant currency basis.

• Non-GAAP operating income rose 87% year-over-year to $403 million; non-GAAP gross margin was 11.2%, flat year-over-year.

• Operating income for the quarter was $377 million, up from $191 million a year ago.

• Cash flow from operations was $318 million for the quarter, over $1 billion year-to-date.

• Gross debt declined to $2.2 billion, down $300 million sequentially and $650 million year-over-year.

Outlook and guidance

• Q3 2026 consolidated sales expected between $9.60 billion and $10.20 billion.

• Non-GAAP diluted EPS for Q3 expected between $4.83 and $5.03; tax rate 23–25%, interest expense ~$50 million.

• Foreign currency expected to decrease Q3 sales by $27 million and EPS by $0.01 year-over-year.

• Global Components expected to perform at or above seasonal trends; ECS to see normalization in supply chain services profitability.

• Management expects continued AI-driven demand but notes uncertainty due to geopolitical and economic factors.