---
title: "Avnet sells finished machines now, and still trades at 8 times earnings while Arrow gets 14"
description: "Two October 26 agreements, an EMEA-wide pact with Teltonika Networks and an AI edge device with Octonion, push the century-old component distributor past selling parts, days before a November 4 report that must show whether its debt-financed inventory turns into cash."
publisher: "The Inference"
section: "Chips"
published: 2026-10-30T16:19:28.734Z
modified: 2026-10-30T16:19:28.734Z
canonical: https://theinference.org/article/avnet-sells-finished-machines-now-and-still-trades-at-8-times-earnings-while-arrow-gets-14
language: en
keywords: "Chips, Distributors, Avnet, Arrow Electronics, Earnings"
---

# Avnet sells finished machines now, and still trades at 8 times earnings while Arrow gets 14

> Two October 26 agreements, an EMEA-wide pact with Teltonika Networks and an AI edge device with Octonion, push the century-old component distributor past selling parts, days before a November 4 report that must show whether its debt-financed inventory turns into cash.

Two agreements landed on October 26, and both sell something [Avnet](https://theinference.org/markets/companies/avnet), the parts distributor born on Manhattan's Radio Row in 1921 [1], has mostly left to its customers: finished machines. Avnet Silica, its European semiconductor division, [signed an EMEA-wide master distribution agreement](https://www.firmenpresse.de/pressrelease743149/avnet-silica-expands-industrial-connectivity-portfolio-with-teltonika-networks-distribution-agreement.html) with Teltonika Networks, a Lithuanian maker of industrial routers, gateways and switches, after five years of cooperation limited to selected European markets [2].

The same day, Avnet and Octonion, a Swiss internet-of-things software firm, [announced SmartEdge Agile](https://civl.com/news/story/avnet-and-octonion-announce-partnership-to-shorten-iot-project-timelines-7fe84722), an edge device built on an [STMicroelectronics](https://theinference.org/markets/companies/stmicroelectronics) STM32 microcontroller, running Octonion's Brainium AI software, with low-power LTE-M cellular connectivity developed with Orange on [Sequans](https://theinference.org/markets/companies/sequans-communications)' Monarch chip [3].

## The margin is in the attach

For a component distributor, the money is in what attaches: hardware, software and connectivity sold as one working unit earn more per design win than chips alone. Lou Lutostanski, Avnet's global vice president for IoT, says most industrial IoT projects spend 18 to 24 months in prototype; Avnet claims its [Meta](https://theinference.org/markets/companies/meta)-Sensing approach cuts that to 6 to 8 months [3].

Teltonika's gear arrives certified, with a remote management platform, Avnet Silica's 200-plus application engineers behind it and a joint pledge by the two companies to fund inventory across EMEA [2]. The clock is short: [first-quarter fiscal 2027 results land on November 4](https://ir.avnet.com/news-releases/news-release-details/avnet-report-first-quarter-fiscal-year-2027-earnings-november-4), before the market opens [4][5].

*Chart: **Avnet's June-quarter revenue hit a record $8.3 billion, up 48 percent in a year** Avnet quarterly revenue fell to about $5.3 billion in early 2025, then climbed for five straight quarters to a record $8.3 billion*

*Quarterly revenue in USD billions from Avnet's SEC filings; calendar-quarter labels, Avnet's fiscal year ends in June. [6]*

## Record revenue, negative cash

The June quarter, Avnet's fiscal fourth, brought record sales of $8.3 billion, up 48 percent year on year [6][7], and adjusted earnings of $2.28 a share, up 182 percent [7]. The filings also carry the reason the stock stays cheap: operating cash flow of minus $291 million for the quarter and debt of $3.48 billion [6], the numbers behind the October 13 expansion of the revolving credit line to $2.75 billion [8], which [The Inference reported](https://theinference.org/article/avnet-adds-1-billion-of-bank-credit-as-inventory-climbs-600-million-and-debt-reaches-3-48-billion) at the time.

*Chart: **Arrow gets 14 times earnings on 26 percent growth; Avnet gets 8 on 48 percent** Avnet trades at 8.15 times trailing earnings while Arrow trades at 13.91 times, above its own five-year median of 9.96*

*Price-to-earnings multiples: Pluang quote for Avnet on October 30, 2026, GuruFocus for Arrow on October 27, 2026. [7][9]*

## The gap the deals must close

[Arrow Electronics](https://theinference.org/markets/companies/arrow-electronics), Avnet's closest US rival ([called the cheapest of the four big US distributors here on October 20](https://theinference.org/article/arrow-electronics-is-the-cheapest-of-the-four-big-us-distributors-after-its-operating-income-roughly-doubled)), grew revenue 26 percent and trades at 13.91 times trailing earnings, [31.9 percent above one valuation model's fair-value estimate](https://www.gurufocus.com/news/9145056/arrow-electronics-arw-shows-strong-growth-but-trades-32-above-gf-value-on-october-27-2026); its insiders sold $14.6 million of stock over twelve months and bought $0.6 million [9]. Avnet grew 48 percent and trades at 8.15 times trailing earnings, or 6.71 times EV/EBITDA [7]. The market pays Arrow for growth and prices Avnet as a cash-conversion risk.

## What the releases do not say

Neither agreement carries a revenue, volume or margin figure, and Octonion chief Cédric Mangaud's claim that Brainium is "already proven effective in the sports industry" is a thin résumé for factory floors [3]. The next readings arrive in order: operating cash flow and short-term borrowings in the November 4 release [4], then the public preview of SmartEdge Agile at the electronica trade show in Munich in mid-November [3]. Arrow gets paid for growth; Avnet gets a week to prove growth pays.

## Takeaway

Avnet's October 26 deals sell finished machines rather than parts, but at 8 times earnings versus Arrow's 14, the stock waits on November 4 cash-flow proof that debt-financed inventory converts.

## Sources

1. [Wikipedia, "Avnet", retrieved 30 October 2026](https://en.wikipedia.org/wiki/Avnet)
2. [PresseBox via firmenpresse, "Avnet Silica Expands Industrial Connectivity Portfolio with Teltonika Networks Distribution Agreement", 26 October 2026](https://www.firmenpresse.de/pressrelease743149/avnet-silica-expands-industrial-connectivity-portfolio-with-teltonika-networks-distribution-agreement.html)
3. [CiVL News, "Avnet and Octonion announce partnership to shorten IoT project timelines", 26 October 2026](https://civl.com/news/story/avnet-and-octonion-announce-partnership-to-shorten-iot-project-timelines-7fe84722)
4. [Avnet Investor Relations, "Avnet to Report First Quarter Fiscal Year 2027 Earnings on November 4", 21 October 2026](https://ir.avnet.com/news-releases/news-release-details/avnet-report-first-quarter-fiscal-year-2027-earnings-november-4)
5. [Avnet Investor Relations, events listing, retrieved 30 October 2026](https://ir.avnet.com/)
6. [Avnet quarterly figures from its SEC filings, retrieved 30 October 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000008858)
7. [Pluang, "Avnet posts record Q4 sales and profit gains", 30 October 2026](https://pluang.com/en/news-feed/avnet-beli-menarik-jelang-laporan-keuangan-q1-nasdaq-avt)
8. [OptimistFI, "Avnet, Inc. (NASDAQ: AVT) Expands Revolver by $1 Billion", 22 October 2026](https://optimistfi.com/research/avnet-revolver-expansion-liquidity-test)
9. [GuruFocus, "Arrow Electronics (ARW) Shows Strong Growth but Trades 32% Above GF Value", 27 October 2026](https://www.gurufocus.com/news/9145056/arrow-electronics-arw-shows-strong-growth-but-trades-32-above-gf-value-on-october-27-2026)


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Avnet sells finished machines now, and still trades at 8 times earnings while Arrow gets 14 — The Inference. Canonical: https://theinference.org/article/avnet-sells-finished-machines-now-and-still-trades-at-8-times-earnings-while-arrow-gets-14