Arrow Electronics (ARW) Q3 2026 Earnings Report

The call was strongly positive, with record revenue and EPS, substantial year-over-year operating and earnings growth, broad-based demand, strong backlog visibility, improving returns, and robust fourth-quarter guidance. The main challenges were extended lead times, product availability constraints, a significant working-capital and inventory build, lower reported ECS margins from hardware mix, and leadership transition. These lowlights were outweighed by the breadth and magnitude of the reported performance and outlook.

For the fourth quarter, Arrow expects sales to be between $11.55 billion and $12.15 billion, representing an increase of 36% year-over-year at the midpoint of the range; global component sales to be between $8.15 billion and $8.55 billion, representing sequential growth of 5% at the midpoint; and Enterprise Computing Solutions sales to be between $3.4 billion and $3.6 billion, which is up 22% year-over-year at the midpoint. Enterprise Computing Solutions should benefit from typical fourth quarter seasonality, which historically has been the strongest quarter of the year. The company estimates a tax rate in the range of 23% to 25%, interest expense of approximately $50 million, and non-GAAP diluted earnings per share between $7 and $7.20. Global Components’ sequential growth is expected to be driven primarily by unit volume, as the majority of supplier price increases took effect in the third quarter, while in ECS hardware is expected to represent a larger portion of revenue, margins on a billings basis are expected to be relatively unchanged from the prior year, and the company implied net sales margins lower than the historically above 6% fourth-quarter level.