Avnet Feels the Industry Slowdown -- Now is the time for the Mid-Tier to Outsource their Internet activities to fetch Solutions!

Avnet shares sink after profit warning
By Jeffry Bartash, MarketWatch
Last update: 11:33 a.m. EDT April 15, 2008

WASHINGTON (MarketWatch) -- Computer-technology distributor Avnet Inc. warned Tuesday that third-quarter results would be weaker than expected, raising concerns about a summer slowdown in the U.S. high-tech industry.
Phoenix-based Avnet (AVT:
Avnet, Inc
News, chart, profile, more
Last: 27.96-0.42-1.48%
10:51am 04/16/2008
Delayed quote data
Add to portfolio
Analyst
Create alert
Insider
Discuss
Financials
Sponsored by:
AVT 27.96, -0.42, -1.5%) blamed sales shortfalls in some segments of its business, a significant change in a rebate program with a major supplier and higher costs related to a recent acquisition.
Just four weeks ago, Avnet executives were telling investors that its business appeared to be holding up well despite a weakened U.S economy, according to Cowen & Co. analyst Louis Miscioscia.
He told clients in a report Tuesday that Avnet's sudden setback could be another piece of evidence supporting the idea of a pullback in the computer industry over the next few months.
"Those that have commented, or suggested slower trends, now include Avnet, Ingram Micro and Synnex," Miscioscia wrote.
Chart of AVT
In the quarter ended March 29, Avnet now says per-share earnings will range from 74 cents to 76 cents, excluding onetime costs.
Earlier this year, the company had predicted profit from operations would reach as high as 85 cents to 89 cents a share.
Similarly, Avnet trimmed its estimate for third-quarter revenue to $4.42 billion. That's near the lower end of its previously announced goal of $4.37 billion to $4.57 billion. See news release.
"We are extremely disappointed with our earnings as a confluence of issues contributed to a very difficult quarter," Chief Executive Roy Vallee said in a statement.
Vallee said the company has already taken "corrective action" to remedy the problems.
In recent action, shares of Avnet fell to $29.90 from Monday's closing price of $32.33. End of Story