Core Insights - Plexus Corp (PLXS) reported fourth-quarter fiscal 2025 adjusted earnings per share (EPS) of $2.14, an increase from $1.85 in the same quarter last year, surpassing the Zacks Consensus Estimate of $1.84 per share [1][7] - Revenues for the quarter reached $1.058 billion, reflecting a year-over-year increase of nearly 0.7%, exceeding the Zacks Consensus Estimate of $1.046 billion [1][7] - For fiscal 2025, PLXS reported total revenues of $4.03 billion, up 1.8% from fiscal 2024, and adjusted EPS of $7.43, marking a 29.9% increase [3] Revenue Breakdown - Revenues from the Americas increased by 9.4% to $336 million, while revenues from EMEA and Asia-Pacific declined by 7% and 2.1%, respectively [2] - The Industrial sector's revenues rose by 2% year over year to $461 million, contributing 44% to total revenues, with expectations for low single-digit growth in the current quarter [4] - Healthcare/Life Sciences revenues increased by 2.2% to $424 million, accounting for 40% of total revenues, with anticipated low single-digit growth [5] - Aerospace/Defense revenues fell by 6% year over year to $173 million, contributing 16% to total revenues, with management guiding for flat revenue growth in this sector [8] Operational Performance - Gross profit on a GAAP basis decreased by 2.9% year over year to $104.8 million, with a gross margin of 9.9%, down from 10.3% in the previous year [10] - Selling and administrative expenses declined by 4.4% to $51.7 million, while adjusted operating margin contracted by 40 basis points to 5.8% [10] Cash Flow and Balance Sheet - As of September 27, 2025, Plexus had cash and cash equivalents of $307 million, up from $237.6 million as of June 28 [11] - Long-term debt and finance lease obligations were $91.9 million, slightly down from $92.2 million [11] - Cash flows from operations for the quarter were $132 million, with free cash flow reported at $97.2 million [11] Share Repurchase - The company repurchased $21.5 million worth of shares at an average price of $134.07 per share, with a total of $65 million repurchased in fiscal 2025 [12] Q1 Outlook - For the first quarter of fiscal 2025, revenues are expected to be between $1.05 billion and $1.09 billion, with non-GAAP EPS anticipated in the range of $1.66 to $1.81 [13]

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Financial Data and Key Metrics Changes - Revenue for fiscal 2025 was $1.058 billion, marking the third consecutive quarter of sequential growth and approaching the high end of guidance [7] - Non-GAAP EPS grew over 30% to $2.14, substantially exceeding guidance due to favorable discrete tax items [7][25] - Non-GAAP operating margin expanded by 40 basis points to 5.8% [8][24] - Free cash flow for fiscal 2025 was $154 million, significantly exceeding projections, with a total of $495 million generated over the past two fiscal years [8][25] Business Line Data and Key Metrics Changes - Aerospace and Defense sector revenue decreased 6% sequentially in Q4, with flat revenue for fiscal 2025 due to delays in new product launches [16][18] - Healthcare Life Sciences sector revenue increased 1% sequentially in Q4 and 5% for fiscal 2025, driven by strength in imaging and monitoring subsectors [18][19] - Industrial sector revenue was up 11% sequentially in Q4, but flat for fiscal 2025, with strong wins of $165 million in Q4 [20][22] Market Data and Key Metrics Changes - The funnel of qualified manufacturing opportunities increased by 2% sequentially to $3.7 billion, with a record high in aerospace and defense sector opportunities [22] - The company expects mid-single-digit growth in the Aerospace and Defense sector for Q1, driven by new program ramps [17] - The Healthcare Life Sciences sector is anticipated to grow high single to low double digits in Q1 due to ongoing program ramps [18] Company Strategy and Development Direction - The company aims for revenue growth in excess of 9%-12% in fiscal 2026, supported by new program ramps and market share gains [7][13] - Investments will focus on talent, technology, and facilities to enhance operational efficiency and support sustained revenue growth [7][12] - The company is committed to driving positive change and promoting sustainability through its operations and community engagement [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth potential, citing substantial new program ramps and modest improvements in end markets [40] - The company is monitoring the impact of government shutdowns but has not seen any indications of slowdown in major market verticals [48] - There is optimism regarding the defense sector's growth, with expectations of increased military spending in the U.S. and Europe [114] Other Important Information - The company achieved a gross margin of 9.9% in Q4, consistent with guidance, and experienced improved fixed cost leverage [24] - The cash cycle improved to 63 days, the best result in five years, due to reduced inventory days and improved working capital management [27] Q&A Session Summary Question: Growth trajectory and investments - Management indicated increased confidence in growth trajectory due to substantial new program ramps and modest market improvements [36][40] Question: AI opportunities - The company is seeing opportunities in AI, particularly in power generation and healthcare, with several programs leveraging AI technology [41][44] Question: Impact of government shutdown - No indications of slowdown due to the government shutdown have been observed, and customer conversations remain stable [48][49] Question: Semicap and energy growth - The outlook for semicap remains similar to previous forecasts, with expectations of share gains, while energy growth is driven by infrastructure and power generation [51][52] Question: Healthcare life sciences strength - Strength in the healthcare sector is attributed to both new program ramps and the resolution of inventory overhang [55][56] Question: Customer visibility and tariffs - Customer visibility is stable, with ongoing focus on mitigating tariff-related challenges [66] Question: Margin expansion outlook - Management expects to overcome near-term headwinds and achieve better fixed cost leverage with revenue growth [102] Question: Program ramp timing - Minor delays in defense programs contributed to Q4 results, but growth is expected in Q1 and beyond [109][110]

Financial Data and Key Metrics Changes - Revenue for fiscal 2025 was $1.058 billion, marking the third consecutive quarter of sequential growth and approaching the high end of guidance [8][9] - Non-GAAP EPS grew over 30% to $2.14, substantially exceeding guidance due to favorable discrete tax items [8][9] - Non-GAAP operating margin expanded by 40 basis points to 5.8% [9][25] - Free cash flow for fiscal 2025 was $154 million, significantly exceeding projections, with a total of $495 million generated over the past two fiscal years [9][26] Business Line Data and Key Metrics Changes - Aerospace and Defense sector revenue decreased 6% sequentially in Q4, with flat revenue for fiscal 2025 due to delays in new product launches [17][18] - Healthcare Life Sciences sector revenue increased 1% sequentially in Q4, with a 5% increase for fiscal 2025 driven by imaging and monitoring subsectors [19][20] - Industrial sector revenue was up 11% sequentially in Q4, but flat for fiscal 2025, with strong wins of $165 million in Q4 [21][22] Market Data and Key Metrics Changes - The funnel of qualified manufacturing opportunities increased by 2% sequentially to $3.7 billion, with a record high in aerospace and defense sector opportunities [23] - The company expects revenue growth in excess of end markets for fiscal 2026, driven by ongoing program ramps and market share gains [24][14] Company Strategy and Development Direction - The company aims for revenue growth of 9% to 12% in fiscal 2026, focusing on investments in talent, technology, and operational efficiency [8][14] - Continued emphasis on sustainability and responsible innovation, with significant achievements in waste reduction and community engagement [12][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth potential, citing new program ramps and modest improvements in end markets [41][39] - The company is monitoring the impact of government shutdowns but has not seen any indications of slowdown in major market verticals [49][50] Other Important Information - The company reduced debt by over $100 million in fiscal 2025 while returning cash to shareholders through an expanded share repurchase program [26][27] - The cash cycle improved to 63 days, the best result in five years, with significant reductions in gross inventory [28] Q&A Session Summary Question: Growth trajectory and confidence in future investments - Management indicated increased confidence in growth trajectory due to substantial new program ramps and modest market improvements [39][41] Question: AI opportunities and new product developments - The company is seeing opportunities in AI, particularly in power generation and healthcare, with ongoing programs leveraging AI technology [45][46] Question: Impact of government shutdown on defense and other markets - No indications of slowdown due to the government shutdown have been observed, and management is closely monitoring the situation [49][50] Question: Strength in semicap and energy sectors - Management expects similar performance in semicap for fiscal 2026, with significant share gains anticipated [52][53] Question: Healthcare Life Sciences growth drivers - Growth in this sector is attributed to both new program ramps and the resolution of inventory overhang [56][57] Question: Customer visibility and market stability - Visibility from customers appears stable, with ongoing programs progressing well despite previous volatility [66][67] Question: Capacity and expansion plans for Penang facility - The Penang facility has significant expansion capacity, and efficiency improvements are expected to drive profitability [80][81] Question: Commercial aerospace demand signals - Management is optimistic about potential tailwinds in commercial aerospace but has not yet seen demand signal changes [83][85]

Financial Data and Key Metrics Changes - Revenue for fiscal 2025 was $1.058 billion, marking the third consecutive quarter of sequential growth and approaching the high end of guidance [6][7] - Non-GAAP EPS for fiscal 2025 was $2.14, exceeding guidance due to favorable discrete tax items, with a non-GAAP operating margin of 5.8% [6][25] - Free cash flow for fiscal 2025 was $154 million, significantly exceeding projections, with a total of $495 million generated over the past two fiscal years [7][25] Business Line Data and Key Metrics Changes - Aerospace and Defense sector revenue decreased 6% sequentially in Q4, with flat revenue for fiscal 2025 due to delays in new product launches [16][17] - Healthcare Life Sciences sector revenue increased 1% sequentially in Q4, with a 5% increase for fiscal 2025 driven by imaging and monitoring subsectors [18][19] - Industrial sector revenue was up 11% sequentially in Q4, but flat for fiscal 2025, with strong wins of $165 million in Q4 [20][21] Market Data and Key Metrics Changes - The funnel of qualified manufacturing opportunities increased 2% sequentially to $3.7 billion, with a record high in aerospace and defense sector opportunities [22][23] - The company expects mid-single-digit revenue growth in the Aerospace and Defense sector for Q1, driven by new program ramps [17] - The Healthcare Life Sciences sector is expected to see high single to low double-digit growth in Q1, supported by ongoing program ramps [18] Company Strategy and Development Direction - The company aims for revenue growth in excess of end markets, targeting a 9% to 12% growth goal for fiscal 2026 [6][13] - Investments will continue in talent, technology, and facilities to support long-term operational efficiency and revenue growth [13][28] - The company is focused on diversifying engineering solutions and expanding market share in key sectors [9][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in future growth potential, citing substantial new program ramps and modest improvements in end markets [38][40] - The company is monitoring the impact of government shutdowns but has not seen any indications of slowdown in major market verticals [50][51] - There is optimism regarding the defense sector, with expectations of increased military spending in the U.S. and Europe [141] Other Important Information - The company achieved a 40 basis point expansion in non-GAAP operating margin and 30% non-GAAP EPS growth compared to fiscal 2024 [5][7] - The cash cycle improved to 63 days, the best result in five years, with significant reductions in gross inventory [27][28] - The company plans to maintain capital spending in the range of $90 million to $110 million for fiscal 2026 [32][116] Q&A Session Summary Question: Growth trajectory and confidence in future investments - Management indicated increased confidence in growth trajectory due to substantial new program ramps and modest market improvements [36][38] Question: AI opportunities and new product developments - The company is seeing opportunities in AI, particularly in power generation and thermal management, with new AI-powered products being developed [42][45] Question: Impact of government shutdown on major market verticals - No indications of slowdown due to the government shutdown have been observed, and customer conversations remain stable [50][51] Question: Strength in semicap and energy sectors - The company expects similar growth in semicap for fiscal 2026, with significant share gains anticipated [56][57] Question: Healthcare Life Sciences sector performance - Strength in the Healthcare Life Sciences sector is attributed to both new program ramps and the resolution of inventory overhang [60][62] Question: Customer visibility and market stability - Visibility from customers is stable, with programs ramping well and markets trending upwards [76][78] Question: Margin expansion and investment impacts - Management expects to overcome near-term margin drags from investments and continue driving productivity improvements [125][126]

Plexus (NasdaqGS:PLXS) Q4 2025 Earnings Call October 23, 2025 08:30 AM ET Speaker0Ladies and gentlemen, thank you for joining us, and welcome to the Plexus Fiscal Fourth Quarter and Fiscal Year End twenty twenty five Conference Call. After today's prepared remarks, we will host a question and answer session. I will now hand the conference over to Shawn Harrison, Vice President of Investor Relations. Please go ahead.Speaker1Good morning, and thank youSpeaker2for joining us today. Some of the statements made ...

FISCAL FOURTH QUARTER AND FISCAL 2025 HIGHLIGHTS October 22, 2025 PLEXUS CONFIDENTIAL SAFE HARBOR AND FAIR DISCLOSURE STATEMENT Some of the statements made and information provided during our call as well as information included in the supporting materials will be forward looking statements, including, without limitation, those regarding revenue, gross margin, selling and administrative expense, operating margin, other income and expense, taxes, cash cycle, capital allocation and future business outlook. Fo ...

Core Insights - Plexus (PLXS) reported revenue of $1.06 billion for the quarter ended September 2025, marking a year-over-year increase of 0.7% and an EPS of $2.14, up from $1.85 a year ago, indicating strong earnings performance [1] - The revenue exceeded the Zacks Consensus Estimate of $1.05 billion by 1.16%, while the EPS surpassed the consensus estimate of $1.84 by 16.3% [1] Financial Performance Metrics - Plexus shares have returned +3.4% over the past month, outperforming the Zacks S&P 500 composite's +1.1% change, with a current Zacks Rank of 3 (Hold), suggesting potential performance in line with the broader market [3] - Revenue breakdown by market sector includes: - Healthcare/Life Sciences: $424 million, below the average estimate of $433.16 million, with a year-over-year change of +2.2% [4] - Aerospace/Defense: $173 million, below the average estimate of $183.12 million, with a year-over-year change of -6% [4] - Industrial: $461 million, exceeding the average estimate of $430.41 million, with a year-over-year change of +2% [4]

Core Viewpoint - Plexus (PLXS) reported quarterly earnings of $2.14 per share, exceeding the Zacks Consensus Estimate of $1.84 per share, and showing an increase from $1.85 per share a year ago, resulting in an earnings surprise of +16.30% [1][2] Financial Performance - The company achieved revenues of $1.06 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.16%, compared to $1.05 billion in the same quarter last year [2] - Over the last four quarters, Plexus has exceeded consensus EPS estimates four times, but has only topped consensus revenue estimates once [2] Stock Performance and Outlook - Plexus shares have declined approximately 3.9% year-to-date, while the S&P 500 has gained 14.5% [3] - The future performance of Plexus stock will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $1.83 on revenues of $1.06 billion, and for the current fiscal year, it is $7.49 on revenues of $4.31 billion [7] - The estimate revisions trend for Plexus was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Electronics - Manufacturing Services industry, to which Plexus belongs, is currently ranked in the top 18% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Plexus reported fiscal fourth quarter revenue of $1.058 billion, with a GAAP operating margin of 5.0% and diluted EPS of $1.87[5]. - For fiscal year 2025, Plexus achieved revenue of $4.033 billion, maintaining a GAAP operating margin of 5.0% and diluted EPS of $6.26[5]. - The company generated free cash flow of $97 million in Q4 and $154 million for the fiscal year 2025, exceeding projections[6][8]. - Plexus won 28 manufacturing programs in Q4, representing $274 million in annualized revenue, and a total of 141 wins for fiscal 2025, amounting to $941 million[7]. - The fiscal fourth quarter cash cycle was 63 days, a reduction of 6 days sequentially, marking the best result in the past five years[7][16]. - Return on invested capital (ROIC) for fiscal year 2025 was 14.6%, exceeding the weighted average cost of capital by 570 basis points[8][14]. - The company initiated fiscal first quarter 2026 revenue guidance of $1.050 billion to $1.090 billion, with non-GAAP EPS guidance of $1.66 to $1.81[5][7]. - Plexus' non-GAAP diluted EPS for Q4 was $2.14, exceeding guidance, while fiscal 2025 non-GAAP diluted EPS was $7.43[5][7]. Customer and Revenue Concentration - The top 10 customers accounted for 49% of revenue in Q4, consistent with the previous quarter and fiscal year 2025[11]. Investment and Growth Strategy - Plexus plans to invest in talent, technology, and facilities to support future revenue growth and operational efficiency initiatives[7]. Quarterly Financial Metrics - Net sales for Q4 2025 reached $1,058,366, an increase from $1,050,569 in Q4 2024, representing a growth of 0.08%[21]. - Gross profit for Q4 2025 was $104,783, compared to $107,912 in Q4 2024, indicating a decrease of 2.1%[21]. - Operating income for Q4 2025 was $53,112, slightly down from $53,858 in Q4 2024, a decline of 1.4%[21]. - Net income for Q4 2025 increased to $51,429, up from $41,221 in Q4 2024, reflecting a growth of 24.5%[21]. - Diluted earnings per share for Q4 2025 were $1.87, compared to $1.48 in Q4 2024, marking an increase of 26.3%[21]. Balance Sheet Highlights - Total current assets decreased to $2,398,793 in Q4 2025 from $2,477,150 in Q4 2024, a decline of 3.2%[24]. - Total liabilities decreased to $1,682,522 in Q4 2025 from $1,828,996 in Q4 2024, a reduction of 8.0%[24]. - Total shareholders' equity increased to $1,454,588 in Q4 2025 from $1,324,825 in Q4 2024, an increase of 9.8%[24]. Non-GAAP Metrics - Non-GAAP operating income for Q4 2025 was $60,915, compared to $64,707 in Q4 2024, a decrease of 5.4%[26]. - Adjusted diluted earnings per share for Q4 2025 were $2.14, up from $1.85 in Q4 2024, reflecting a growth of 15.7%[26]. Tax and Economic Metrics - The adjusted effective tax rate decreased to 8% for the twelve months ended September 28, 2024, down from 13% in the previous year[31]. - Economic return improved to 5.7% for the twelve months ended September 28, 2024, compared to 3.6% in the previous year[31]. Executive Compensation and Charges - Accelerated stock-based compensation expense recorded was $5.1 million due to an executive retirement agreement[31]. - The company incurred restructuring and other charges of $20.257 million for the twelve months ended September 28, 2024[31].