Flex Ltd. (FLEX) Financial Results Summary
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Flex (FLEX) Q3 2026 Financial Results Summary
Austin, Texas, February 4, 2026 – Flex (NASDAQ: FLEX) today announced results for its third quarter ended December 31, 2025.
Key Financial Highlights
- Net Sales: Reported at $7.1 billion, representing an 8% increase compared to the same period last year.
- GAAP Operating Income: $389 million; operating margin at 5.5% (up from 5.1%).
- GAAP Net Income: $239 million, with GAAP Earnings Per Share (EPS) at $0.64 (decrease from $0.67).
- Free Cash Flow: $275 million, compared to $306 million in Q3 2025.
Non-GAAP Financial Metrics
- Adjusted Operating Income: $460 million with an adjusted operating margin of 6.5% (up from 6.1%).
- Adjusted Net Income: $326 million with adjusted EPS at $0.87 (up from $0.77).
- Cash provided by Operating Activities: $420 million.
Full Year Guidance Updates
- Net Sales Guidance: Updated to $27.2 billion to $27.5 billion, indicating a projected 6% growth at the midpoint compared to previous forecasts.
- Adjusted Operating Margin: Now expected to be 6.3%.
- Adjusted EPS Guidance: Updated to $3.21 to $3.27, reflecting an 18% growth at the midpoint.
Fourth Quarter Fiscal Year 2026 Guidance
- Net Sales: Estimated between $6.75 billion and $7.05 billion, once again suggesting an 8% growth at the midpoint.
- Adjusted Operating Income: Expected between $445 million and $475 million.
- Adjusted EPS: Forecasted at $0.83 to $0.89, indicating an 18% increase at the midpoint.
- Interest & Other: Approximately $54 million, with an adjusted income tax rate at 21%.
Share Repurchase Program
- During the quarter, the company actively repurchased shares, spending $744 million on share repurchases compared to $958 million last year.
Summary of Financial Performance
- Revenue and Growth:
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Strong sales performance driven by demand across various industries, particularly in the Data Center sector.
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Profitability Metrics:
- Achieved record GAAP operating margins (5.5%) and adjusted margins (6.5%).
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Reflects five consecutive quarters with adjusted operating margins exceeding 6%.
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Earnings Performance:
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While GAAP EPS showed a slight decrease by 4.5%, adjusted EPS demonstrated robust growth of 12.9% year-over-year.
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Cash Flow Management:
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Despite a 10.1% decline in free cash flow compared to the previous year, cash flows from operational activities remained strong at $420 million.
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Fiscal Year Strategy:
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Flex’s management believes the diversified model across various sectors supports ongoing growth, with expectations of further advancements in operating margins and strategic positioning.
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Market Outlook:
- Management remains optimistic about Flex’s ability to navigate challenges posed by the macroeconomic environment while continuing to leverage its diversified business model.
Conclusion
Flex’s third quarter results for fiscal 2026 reflect a strong performance, with growth across multiple key metrics. The company has shown resilience in profitability, maintained solid cash flow, and updated guidance indicates confidence in future performance. The implemented share repurchase program underlines Flex’s commitment to returning value to shareholders.
FLEX UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts)
Three-Month Periods Ended
| Description | December 31, 2025 | December 31, 2024 |
|---|---|---|
| Net sales | $7,058 | $6,556 |
| Cost of sales | $6,373 | $5,952 |
| Restructuring charges | $6 | $10 |
| Gross profit | $679 | $594 |
| Selling, general and administrative expenses | $270 | $241 |
| Restructuring and impairment charges | $5 | $2 |
| Intangible amortization | $15 | $17 |
| Operating income | $389 | $334 |
| Interest expense | $58 | $57 |
| Interest income | $15 | $16 |
| Other charges (income), net | $25 | $5 |
| Equity in earnings (losses) of unconsolidated affiliates | -$1 | — |
| Income before income taxes | $320 | $288 |
| Provision for (benefit from) income taxes | $81 | $25 |
| Net income | $239 | $263 |
| GAAP EPS | ||
| Diluted earnings per share | $0.64 | $0.67 |
| Diluted shares used in computing per share amounts | 376 | 394 |
FLEX UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
| Description | As of December 31, 2025 | As of March 31, 2025 |
|---|---|---|
| ASSETS | ||
| Current assets: | ||
| Cash and cash equivalents | $3,057 | $2,289 |
| Accounts receivable, net of allowance | $3,837 | $3,671 |
| Contract assets | $881 | $616 |
| Inventories | $5,549 | $5,071 |
| Other current assets | $1,828 | $1,194 |
| Total current assets | $15,152 | $12,841 |
| Property and equipment, net | $2,393 | $2,330 |
| Operating lease right-of-use assets, net | $667 | $562 |
| Goodwill | $1,375 | $1,341 |
| Other intangible assets, net | $300 | $343 |
| Other non-current assets | $933 | $964 |
| Total assets | $20,820 | $18,381 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||
| Current liabilities: | ||
| Bank borrowings and current portion of long-term debt | $675 | $1,209 |
| Accounts payable | $6,482 | $5,147 |
| Accrued payroll and benefits | $590 | $560 |
| Deferred revenue and customer working capital advances | $1,959 | $1,957 |
| Other current liabilities | $1,150 | $977 |
| Total current liabilities | $10,856 | $9,850 |
| Long-term debt, net of current portion | $3,760 | $2,483 |
| Operating lease liabilities, non-current | $583 | $456 |
| Other non-current liabilities | $500 | $590 |
| Total liabilities | $15,699 | $13,379 |
| Total shareholders’ equity | $5,121 | $5,002 |
| Total liabilities and shareholders’ equity | $20,820 | $18,381 |