Arrow Revenue Below ExpectationsBy Reuters | Print
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The distributor blames the performance of its second-quarter results on its Enterprise Computing Solutions division.
April 23 (Reuters) - Arrow Electronics Inc posted a quarterly profit that lagged market estimates, hurt by the sluggish performance of its enterprise computing solutions (ECS) business, and forecast weak second-quarter results, sending its shares down 8 percent to a new 52-week low.
The electronic parts and computer hardware distributor reported first-quarter earnings of $85.9 million, or 69 cents a share, compared with $96.3 million, or 77 cents a share, a year earlier.
Excluding special items, the company earned 79 cents a share. Sales rose 15 percent to $4.03 billion.
Analysts on average expected earnings of 82 cents a share, before special items, on revenue f $4.06 billion, according to Reuters Estimates.
Chief Executive William Mitchell said the ECS business was affected by challenging market conditions, which "created headwinds for our operating performance and resulted in lower-than-expected earnings per share."
For the second quarter, the company forecast earnings of 74 cents to 80 cents a share, excluding items, on total sales of $3.85 billion to $4.15 billion. Analysts were expecting earnings of 88 cents a share, before items, on revenue of $4.25 billion.
"We anticipate that our server business will continue to be under pressure worldwide and the components market in Europe, a high margin region for us, may continue to soften in the second quarter," Chief Financial Officer Paul Reilly said in a statement.
Shares of the Melville, New York-based company fell to a new 52-week low of $28.75, before recovering slightly to trade down $2.20 at $29.11 Wednesday morning on the New York Stock Exchange.
(Reporting by Bijoy Koyitty in Bangalore; Editing by Pratish Narayanan)
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