Jabil(US:JBL)2025-09-25 13:32Financial Data and Key Metrics Changes - For Q4, the company reported approximately $8.3 billion in revenue, exceeding guidance by roughly $800 million, with core operating income at $519 million and core operating margin at 6.3%, a 50 basis point improvement year-over-year [9][10] - Core diluted earnings per share was $3.29, while GAAP diluted earnings per share came in at $1.99 [9][10] - Full-year adjusted free cash flow was over $1.3 billion, with a healthy balance sheet showing a debt-to-core EBITDA ratio of 1.3x and cash balances of approximately $1.9 billion [12][13] Segment Performance Changes - Regulated Industries revenue was $3.1 billion, with a year-over-year increase of approximately 3% and core operating margin expanding by 40 basis points to 6.5% [10] - Intelligent Infrastructure revenue reached $3.7 billion, $400 million above expectations, with a core operating margin of 5.9% [10][11] - Connected Living and Digital Commerce revenue totaled $1.4 billion, reflecting a year-over-year decline of approximately 14%, but core operating margin improved by 210 basis points to 6.6% [11][34] Market Data and Key Metrics Changes - The automotive and transportation market is experiencing a decline of 5% due to slowing demand for battery electric vehicles in the U.S. and Europe, while healthcare outsourcing is expected to enter a growth phase [49][50] - The company anticipates Intelligent Infrastructure revenue to grow by 18% in FY 2026, driven by AI-related demand across capital equipment and cloud infrastructure [54][55] Company Strategy and Industry Competition - The company is focusing on system-level integration across its segments, particularly in Intelligent Infrastructure, to enhance customer deployment speed and reduce costs [51][52] - A deliberate shift in the Connected Living and Digital Commerce segment is underway, moving away from lower-margin legacy consumer programs towards higher-margin automation and advanced technologies [7][56] Management's Comments on Operating Environment and Future Outlook - Management highlighted the resilience of the diversified model despite mixed dynamics across end markets, with strong performance in AI-related sectors offsetting weaknesses in automotive and renewables [36][60] - The company expects approximately 5% revenue growth for FY 2026, with core operating margin expanding to around 5.6% [57][58] Other Important Information - The company completed a $1 billion share repurchase authorization and plans to return 80% of annual adjusted free cash flow to shareholders [12][14] - The company is investing in AI and automation across its operations to enhance efficiency and competitiveness [44][46] Q&A Session Summary Question: Can you provide details on growth areas in AI? - The company expects 25% year-over-year growth in AI revenue, with significant growth in capital equipment and cloud infrastructure, while maintaining strong positions in existing markets [64][65]