Avnet CEO Hamada Out Following Disastrous Quarterly Financials

In the wake of a slew of disappointing financial results, Avnet (AVT) CEO Rick Hamada has stepped down, both from the chief executive role and his spot on the board of directors. William Amelio, who was CEO of Lenovo from 2005 to 2009, has been named interim chief executive.

Along with the announcement of the C-suite change, Avnet revised its sales estimates for its electronic marketing business in the Americas region, saying it expects a $100 million shortfall from previous predictions. The company said the primary reason for the adjustment was the implementation of an enterprise resource planning (ERP) system in the region, along with higher costs associated with deliveries.

Avnet also adjusted its per-share earnings expectation for the July quarter, lowering it to 80 to 86 cents from its prior guidance of 95 cents to $1.05, which was already below analyst predictions. The company said the aforementioned “higher costs” would continue and likely impact the quarter ending October 1.

Revenue for Avnet’s technology practice is down 12.9 percent for the third quarter ending in July, down to $2.13 billion, and total revenue for the company fell to $6.17 billion, failing to meet analysts’ expectations.

In April, Avnet announced a plan to slash $25 million in personnel and other operating expenses from its technology division, chalking the cuts up to declining sales of data center hardware and software. Channel partners are left to wonder if Amelio will institute further cuts in an attempt to turn the distributor’s finances around.

The VAR Guy has reached out to Avnet for comment and will give more information when it becomes available.