avnet analyst day 2010 presentation 4 technology solutions

Accelerating Your Success™1 Accelerating Your Success™

Avnet Analyst Day 2010

Performance & Potential

Avnet, Inc.

December 15, 2010

Accelerating Your Success™2 Accelerating Your Success™

Technology Solutions

Phil Gallagher

December 15, 2010

Accelerating Your Success™Accelerating Your Success™

Agenda

• Avnet Technology Solutions (TS) – A Global

Snapshot

• TS’ Strategic Imperatives

– Customer Focused Go-to-Market Strategy

– Global Scale and Scope

– Portfolio Management

3


Demonstrating Sustainable Growth

We will create a

sustainable competitive

advantage and

profitability for TS

globally by developing

technology solutions that

generate value for the IT

supply chain.

Our Mission

Accelerating Your Success™

4-Year CAGR 13.2%

4


Regional Revenue Mix Shift

4-Year CAGR:

Asia = 41.4%

EMEA = 17.9%

Americas = 7.3%

Q1FY11 includes Bell/Tallard5


World-Class Supplier Partnerships

In Q1FY11, Avnet’s Top 10 suppliers* accounted for 73% of total revenue.

* Includes Bell Micro

We celebrate our supplier

partnerships every day and are

particularly proud of those that

achieve significant milestones.

6


Outperforming the Market

Source: Avnet Data based on rolling 4 qtrs YoY growth- 1FQ11; IDC, Gartner, iSuppli – Oct 2010

0.8%

5.2%

14.6%

6.2%

12.0%

19.0%

0%

5%

10%

15%

20%

Services Software Hardware

Market Growth TS Revenue Growth

-16%

16%18%

11%

2%

23%21%

25%

-20%

-10%

0%

10%

20%

30%

40%

Proprietary Servers

ISS Networking Storage

Key Hardware Technologies vs. Market

Market Growth TS Revenue Growth

We are outgrowing the market in all categories -- software and services at an

accelerated rate, with hardware growth led by storage, ISS and networking.

7


Demonstrating Market Leadership

Avnet is the largest value-added IT

distributor in the world, with $8.2B in sales

Avnet has the only global footprint among

its peer group

The industry recognizes Avnet’s thought

leadership with our SolutionsPath®

methodology

Avnet’s Global Solutions Centers provide integration capabilities that

deliver a differentiated end-to-end supply chain for data center solutions

around the world

The world’s leading suppliers of data center technology partner with

Avnet to attract and grow the most successful enterprise resellers

around the globe

8

Accelerating Your Success™Accelerating Your Success™9

Executing Our Strategic Imperatives

1. Achieve targeted ROWC in all regions

2. Continue to build and leverage TS’ global scale and scope

3. Focus on high-growth technologies and verticals

4. Strengthen TS’ value-added solutions enablement model

5. Support customer, reseller and supplier migration to cloud-

based services

Market Focus


Becoming a “Trusted Advisor”

11

Empowered consumers are

driving businesses to become

more agile, without compromise

Available, scalable, flexible,

capacious and secure

Legacy infrastructure is complex

and burdensome

Simplification, virtualization

New infrastructure can be quickly

deployed with virtual data center

assets (public or private cloud)

Line executives are challenging

IT to support new, differentiated

applications and service levels

The channel partner of the future

is a trusted advisor to their

customer – understanding not only

technology, but also its application

and its business value.


Serving a Very Large and Growing Market

Source: Gartner, IDC & iSuppli – Nov 2010

$914$946

$984$1,034

$1,087

0

300

600

900

1,200

2009 2010 2011 2012 2013

US

$B

illio

ns

TS Served Available Market


Vertical Growth

Technology Growth

Segmenting for Optimal Growth

TAM CAGR,

4.7%

0%

5%

10%

15%

20%

25%

30%

$0 $50 $100 $150 $200 $250

3 Y

r C

AG

R 2

010-

2013

2010 IT Spend

Go

vt &

Ed

u (

5)

Ban

kin

g (

4)

Ret

ail (

3)

Hea

lth

care

(2)

Uti

litie

s(1

)

Security (d)

Networking (f)

Mobility (b)

Storage (g)

Collaboration (e)

Virtualization (c)

Cloud (a)a

b

c

e

d

f

g

12

3 4 5

Source: Gartner & IDC Oct 2010

13


Lin

e o

f B

usin

ess E

xe

cu

tive

s

an

d C

-Su

ite

De

cis

ion

Ma

ke

rs

Avnet interprets market needs, creates differentiated enablement programs and

aggregates products & services to help our partners become trusted advisors.

Extending the Value Chain with SolutionsPath®

• NetworkPath™

• VirtualPath®

• MobilityPath™

• SecurePath™

• StoragePath™

Fin

an

cia

lPath

™

Healt

hP

ath

®

Reta

ilP

ath

™

En

erg

yP

ath

™

Go

vP

ath

™

Market Focused

Customer Intimate

…with a repeatable, scalable enablement framework.

Industry, technology, application and customer expertise…

Avn

et

Serv

ices

Clo

ud

Read

y™

14

https://www.vmware.com/tryvmware/?p=vsphere&lp=1&src=PaidSearch_Google_AMER-US_AMER-US_VI_VI_Search_WWWLink_vSphere_Eval

http://www.mcafee.com/common/redirectgeneric.asp?rurl=/us/default.asp


Increasing Supplier, Reseller and End-User

Value

Envision – Enable – Execute with our proven SolutionsPath® methodology

“We continue to invest in helping our channel partners

deepen skills, deliver value to clients, and pursue new

opportunities for growth. We see that commitment to

growth reflected in Avnet's resources and programs that

they have developed to help IBM Business Partners sell

complete solutions that meet the business needs of

IBM's customers worldwide. Many of these programs

are among the industry best practices for our channel."

Rich Hume, general manager, global business partner and midmarket

organization, IBM

“Thanks to Avnet’s HealthPath® University and Internship and

the skills that we have been able to further develop with their

collaboration, we have the in-depth healthcare industry

knowledge that stands out to hospitals and medical facilities

and that quickly establishes us as trusted advisors.”

Jeff Teeter, vice president, vertical solutions, Logicalis

Analytics & market

opportunity identification

Strategic engagement & go-to-market strategy

Training and enablement

Demand creation

Service delivery

15


cloud

/klaʊd/

–noun

1. a set of services and

technologies that

enables the delivery of

computing services

over the internet in real

time.

2. the delivery of IT

resources via a shared

network in the form of

applications (SaaS),

infrastructure (IaaS)

and platform (PaaS).

Assessing “The Cloud” Opportunity

“The Cloud” is growing quickly and could become a much more significant portion

of overall IT spend by 2014, with private cloud services outpacing public.

Traditional IT Products -- 5% CAGR

Public IT Cloud Services -- 27% CAGR

Private IT Cloud Services (prelim) – 36%

CAGR

Source: IDC 2010 (note: Private IT Cloud

Services are IDC's preliminary estimates)16


Private Cloud – Avnet is Here, Now

Public, Private or Hybrid?

Legacy infrastructure predicates a slow,

deliberate migration to public cloud offerings

Private cloud solutions still dominate the

landscape in Avnet’s served market

Avnet is CloudReady™

Portfolio of cloud offerings from the world’s

leading technology suppliers

SolutionsPath® practices in all key cloud

technologies

Hosted/managed service infrastructure

Partner enablement services, including end-

user assessment services

PayNow™ financial program

Avnet occupies a unique and differentiated place in the value chain for

customers evaluation and migrating to cloud solutions.

17


Public Cloud – Avnet is CloudReady™

Avnet is poised, in all regions of the world, to support our suppliers’,

partners’, and customers’ respective pace of public cloud adoption.

Infrastructure still reigns

Even in most emerging markets, IT/voice

infrastructure is still core

Cloud adoption is likely in back-office

functions, not mission-critical ones

“Voice of the Customer” still rules

Councils, conferences, polls, surveys

Avnet has its finger on the pulse of the

speed with which customers will move

The future is still unclear

The channel will always find its role and a

way to add value

We consider team, time and tempo in all

endeavors

Predicting the impact of the

internet 10 years ago is

analogous to predicting the

impact of the cloud today. Avnet

is positioned to succeed, along

with our trading partners.

18

Global Expansion


Going Where the Growth Is

20

We continue to invest in markets that will provide the greatest growth

opportunity, organically and through value-creating acquisitions.

$946B

$984B

$1,034B

$1,087B

2010 2011 2012 2013

IT Spend Forecast North

America44%

Asia/Pac19%

Western Europe

17%

Latin America

8%

Japan4%

Eastern Europe

4%

Middle East/Africa

4%

New Growth Spend by Region

$141B

*Note: Data represents breakdown of net new IT Spend

Growth between 2010 to 2013

Source: Gartner, IDC & iSuppli – Oct 2010


Extending our Global Footprint

Americas

$5.1B Revenue

17% YoY Growth

EMEA

$2.5B Revenue

16% YoY Growth

Asia

$1.1B Revenue

79% YoY Growth

Recent Acquisitions

Avnet Revenue & Growth based on Rolling 4 Qtrs Q1FY11

Bell Micro (NA, LAC, EMEA) ~~~ Tallard (LAC) ~~~

Datamation (Indonesia) ~~~ itX (Australia) ~~~ Sunshine (Vietnam)

Recent Acquisitions

Avnet TS-Served Countries

21


NetApp Services

SyncSort

CommVault

Quantum

Apple (Latin America)

IBM (Latin America)

Riverbed

Oracle (Brazil, Mexico)

Oracle (Australia)

Dell (Vietnam)

HP (Vietnam and Indonesia)

NetApp (India)

VMware (Indonesia)

IBM (Indonesia, Vietnam)

Oracle (UK, Belgium, Luxembourg,

Switzerland, Ireland, Hungary, Slovakia,

Czech Republic, 16 countries in MENA)

HP (Hungary, UK)

Juniper (Poland, Czech Republic)

NetApp (Ireland, Netherlands, Germany,

UK)

EMC/Data Domain (Mostly Eastern

Europe)

VMware (Eastern Europe)

Avaya (Belgium, Ireland, Netherlands,

Poland)

ShoreTel (pan European)

Symantec (Ireland, UK, Netherlands,

Czech Republic, Slovakia)

Brocade IP (Eastern Europe)

HDS (France, Germany, Austria, Hungary)

Microsoft (UK)

IBM (Belgium, Netherlands, Turkey)

Asia

Americas

EMEA

We expand our line card to support our solutions distribution vision

and provide our suppliers global market reach and operational scale.

TS Global Line Card

Expanding Partnerships* for Global Reach

*Significant 2010 line card additions by region22

Portfolio

Management


TS remains committed to value-based, portfolio management to

drive our committed financial returns in each region.

▪ Continue to drive

profitable growth

▪ Expand in LAC, with a

focus on improving

profitability

▪ Maintain strong regional

ROWC performance

Americas

▪ Continue driving toward

targeted financial returns

▪ Leverage and scale

regional expertise for pan-

European support

▪ Expand appropriately in

high-growth geographies

▪ Strengthen the line card to

support our solutions and

global growth strategies

EMEA

▪ Accelerate drop-through

with operational focus

▪ Continue to balance

expansion opportunity with

profitability

▪ Strengthen the line card to

support our solutions and

global growth strategies

Asia

Managing Regional Priorities

24


Accelerating Your Success™

Avnet TS had a strong recovery in FY10 and is delivering financial

returns within our targeted range.

Avnet is the leading IT solutions distributor in the world in scale and

scope with revenues over $8B and presence in more than 70 countries.

Avnet intends to continue to outgrow the markets we serve by investing

in high-growth technologies, vertical markets and geographies.

Avnet leads the industry with our SolutionsPath® methodology,

redefining the role of distribution.

Avnet maintains world-class supplier and reseller partnerships that

provide data center hardware, software and services solutions.

Avnet will continue to exercise value-based management across the TS

portfolio to achieve our stated financial targets in all regions.

25

avnet analyst day 2010 presentation 4 technology solutions

Technology

success source

technology growth

market leadership avnet

available market

avnet data

market needs

hardware growth

market strategy global