Goliath distributor Arrow Electronics missed Wall Street expectations in the first quarter as the strengthening dollar wiped £322m off its sales.
For its Q1 ending 28 March, the NYSE-listed giant saw as-reported sales fall two per cent year on year to $5bn, missing analyst expectations of $5.11bn.
Sales at its global components arm fell two per cent in dollar terms to $3.35bn, while revenues at its enterprise computing solutions (ECS) business were flat at $1.66bn. Although European sales at ECS dropped 13 per cent in dollar terms, revenues were actually up eight per cent in local currencies.
"Our focus on the higher-value portion of the datacentre resulted in record first-quarter operating income and operating margins for our enterprise computing solutions business," said Arrow chief executive Michael Long.
Total net profit fell one per cent to $106.1m, although the figure rose fractionally to $127.8m excluding certain items.
The weakening of foreign currencies, including the euro, against the dollar had a negative impact of $322m on Arrow's sales in Q1.
But the strong dollar will leave an even bigger black hole in its Q2 results, chief financial officer Paul Reilly predicted.
"We are expecting the average USD to euro exchange rate for the second quarter to be approximately $1.08 to €1," he said. "Based on this assumption, the weaker euro will have a negative impact of $350m... when compared with the second quarter of 2014..."
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