Jabil AI Revenue Jumps 51 Percent

Core Insights - Jabil Inc. reported a significant increase in AI-driven Intelligent Infrastructure revenue, which surged approximately 51% year over year to $3.4 billion [1] - The company anticipates AI-related revenue to reach approximately $8.5 billion for the fiscal year, reflecting a year-on-year increase of over 50% [3] AI Infrastructure Acceleration and U.S. Capacity Investment - Jabil's U.S. manufacturing base now exceeds 30 locations, with a new site announced in the Southeastern U.S. involving a planned investment of $500 million over several years to meet rising AI data center infrastructure demand [2][3] Operating Margin Roadmap and Capacity Utilization Dynamics - Current company-wide capacity utilization is at 75%, below the historical range of 85%-86%, primarily due to geographic mismatches [4][5] - The underutilized capacity is concentrated outside the U.S., while AI growth is predominantly occurring within the U.S., indicating a need for optimization [5] Shareholder Returns and Capital Allocation Flexibility - Jabil executed $339 million in share repurchases during the quarter and is on track to complete a $1 billion share repurchase authorization in Q4 [6][7] - The company plans to return 80% of its free cash flow to buybacks, with projected free cash flow for the year exceeding $1.2 billion [7] Looking Ahead - Full-year core operating margins are expected to be at 5.4%, with the new U.S. site not expected to materially impact financials before FY2027 [9] - Detailed FY2026 guidance, including core operating margin and adjusted free cash flow targets, will be shared at the September investor briefing [9]