Avnet Technology Solutions Revenue Up 8.9%

The division's sales were up 8.9 percent to $1.21 billon during its first quarter, lead by storage, software and services sales, an improvement over the 5 percent growth during fiscal 2006.

"Returning to nice growth is part of the big story for Technology Solutions," Hamada told CRN after the distributor reported earnings.

Companywide, Avnet sales were up 11.6 percent to $3.65 billion while earnings rose 145 percent to $64.1 million, fueled by Electronic Marketing sales to Europe, the Middle East and Asia, the company reported.

In the computer products business, storage solutions, software and services experienced the strongest growth, while hardware grew slowest, according to Hamada.

He said future growth will come from incorporating more solutions-based value-adds, the growing popularity of industry standards and managing global relationships, including trying to increase Avnet Technology Solutions' business in Asia. "Those mega-trends are the ones that I think we need to be paying attention to as we look to create value in the IT supply chains of the future," he said.

Hamada also called the recent acquisition of specialty distributor Alternative Technology by Avnet's rival, Arrow Electronics, an interesting move and a positive one for value-added distribution.

"We've been preaching for quite a while more and more about solutions," Hamada said. "I think more and more value is created out of what we can do to help bring solutions to market and not just products and technologies to market. I think that's in both [Avnet and Arrow's] futures."

Avnet expects Technology Solutions sales to be between $1.5 billion and $1.6 billion for the second quarter, with companywide sales in the $3.83 billion to $4.03 billion range.

Excluding charges, Avnet companywide posted net income of $82.2 million, or 56 cents per share, for the quarter. The mean earnings per share estimate by analysts for the quarter was 52 cents per share, according to Thomson Financial.