10. Pension and retirement plans

Pension Plan

The Company has a noncontributory defined benefit pension plan that covers substantially all current or former U.S. Employees (the “Plan”).

The Plan meets the definition of a defined benefit plan and, as a result, the Company applies ASC 715 pension accounting to the Plan. 

The following table outlines changes in benefit obligations, plan assets, and the funded status of the Plan as of the end of fiscal 2026 and 2025:

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Included in “Accumulated other comprehensive loss” at June 27, 2026, is $193.1 million of net actuarial losses that have not yet been recognized in net periodic pension cost, of which $17.5 million is expected to be recognized as a component of net periodic pension cost during fiscal 2027.

Assumptions used to calculate actuarial present values of benefit obligations are as follows:

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The discount rate selected by the Company for the Plan reflects the current rate at which the underlying liability could be settled at the measurement date as of June 27, 2026. The estimated discount rate in fiscal 2026 and fiscal 2025 was based on the spot yield curve approach, which applies the individual spot rates from a highly rated bond yield curve to each future year’s estimated cash flows.

The weighted-average assumptions used to determine net benefit costs are as follows:

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Components of net periodic pension cost for the Plan during the last three fiscal years are as follows:

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The Company made $8.0 million of contributions in fiscal 2026 and fiscal 2025 and expects to make approximately $8.0 million of contributions in fiscal 2027.

Benefit payments are expected to be paid to Plan participants as follows for the next five fiscal years and the aggregate for the five years thereafter (in thousands):

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The Plan’s assets are held in trust and were invested as follows as of the measurement date at the end of fiscal 2026 and 2025:

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The general investment objectives of the Plan are to maximize returns through a diversified investment portfolio to earn annualized returns that exceed the long-term cost of funding the Plan’s pension obligations while maintaining reasonable and prudent levels of risk. The expected return on the Plan’s assets in fiscal 2027 is currently 8.0%, which is the average rate of earnings expected on the funds invested or to be invested to provide for the benefits included in the benefit obligation based upon the targeted investment allocations. In making this assumption, the Company evaluated expectations regarding future rates of return for the investment portfolio, along with the historical and expected distribution of investments by asset class and the historical rates of return for each of those asset classes. The mix of return seeking and fixed income investments is typically diversified. The Plan’s assets do not include any investments in Avnet common stock. As of June 27, 2026, the Company’s target allocation for the Plan’s investment portfolio is for return seeking investments to represent approximately 65% of the investment portfolio. The majority of the remaining investment portfolio is invested in fixed income investments, which typically have lower risks, but also lower returns.

The following table sets forth the fair value of the Plan’s investments as of June 27, 2026:

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Certain investments included in the table above are measured at fair value using the net asset value per share (or its equivalent) practical expedient and are not included in the three levels of the fair value hierarchy.

The following table sets forth the fair value of the Plan’s investments as of June 28, 2025:

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Each of these investments may be redeemed without restrictions in the normal course of business and there were no material unfunded commitments as of June 27, 2026.