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Flex posted Q4 FY26 adjusted EPS of $0.93 on 17% revenue growth to $7.5B.
Cloud and Power Infrastructure revenue surged 31% to $1.8B, the standout segment.
FLEX plans to spin off Cloud and Power Infrastructure and realign into three segments.
Flex Ltd. (FLEX - Free Report) reported fourth-quarter fiscal 2026 adjusted earnings per share (EPS) of 93 cents, which surpassed the Zacks Consensus Estimate by 8.1%. The bottom line compared favorably with 73 cents posted in the prior-year quarter.
Revenues increased 17% year over year to $7.5 billion. It beat the consensus mark by 8.1%. The growth was primarily driven by strong momentum across all three segments, with Cloud and Power Infrastructure emerging as the standout performer.
Management highlighted that the company’s strong finish to fiscal 2026 reflected disciplined execution and a well-defined strategy, supported by targeted acquisitions and capital investments aligned with Flex’s long-term growth opportunities.
Flex has announced its intention to spin off its Cloud and Power Infrastructure segment into a newly formed, independent, publicly traded company, marking a significant step in the company's broader strategic realignment.
As part of this reorganization, Flex is separating its Data Center business and realigning into three distinct segments. The first, Regulated Manufacturing Solutions, will serve Industrial, Automotive, and Healthcare markets, covering automation and energy infrastructure, compute and power electronics, and regulated medical devices, respectively. The second, Integrated Technology Solutions, will focus on Communications through high-speed networking and enterprise systems and on Lifestyle through premium products across commercial, home and personal categories. The third and newly defined segment, Cloud and Power Infrastructure, will deliver compute, liquid cooling and data center architecture solutions alongside critical rack-level and embedded power capabilities.
Shares of the company soared 25% in the pre-market trading session today. In the past year, the stock has surged 154.2% compared with the Zacks Electronics - Miscellaneous Products industry’s growth of 81%.
Image Source: Zacks Investment Research
Segment Details
Regulated Manufacturing Solutions Segment: This segment encompasses Health Solutions, Automotive and Industrial businesses. Revenues grew 13% to $2.7 billion, accounting for 36% of net sales.
Integrated Technology Solutions Segment: This segment comprises Communications and Lifestyle businesses. Revenues grew 13% to $2.9 billion, accounting for 39% of net sales.
Cloud and Power Infrastructure Segment: This segment comprises Cloud $ Cooling and Power businesses. Revenues increased 31% to $1.8 billion, accounting for 25% of net sales.
FLEX’s Operating Details
Non-GAAP gross profit came in at $737 million, up from $602 million reported in the year-ago quarter. Non-GAAP gross margin expanded 50 basis points (bps) to 9.9% in the reported quarter.
Non-GAAP operating income came in at $500 million, up from $396 million reported a year ago. Non-GAAP operating margin expanded 50 bps to 6.7%.
Selling, general & administrative expenses totaled $289 million, up 23.5% year over year.
Balance Sheet & Cash Flow
As of March 31, 2026, cash & cash equivalents and long-term debt (net of current portion) were $2.4 billion and $3.8 billion, respectively, compared with $3.1 billion and $3.8 billion as of Dec. 31, 2025.
The company generated a fourth-quarter fiscal 2026 cash flow from operating activities of $413 million and an adjusted free cash flow of $212 million.
In the quarter, the company repurchased $200 million worth of stock.
Flex Guidance
For the first quarter of fiscal 2027, the company expects net sales in the range of $7.35 billion to $7.65 billion, representing growth of approximately 14% at the midpoint of the guidance. Adjusted operating income is projected to be between $469 million and $499 million, while adjusted EPS are anticipated to be 86-92 cents, suggesting growth of 24% at the midpoint. Interest and other expenses are expected to be approximately $65 million. The adjusted income tax rate is projected at 21%, with weighted average shares outstanding estimated at approximately 374 million.
For fiscal 2027, the company expects net sales to range between $32.3 billion and $33.8 billion, representing growth of approximately 18% at the midpoint of the guidance. Adjusted operating margin is projected to be between 7% and 7.1%, while adjusted EPS is expected to range from $4.21 to $4.51, implying growth of 32% at the midpoint. The adjusted income tax rate for the fiscal year is expected to remain at 21%.
Badger Meter, Inc. (BMI - Free Report) reported EPS of 93 cents for first-quarter 2026, which missed the Zacks Consensus Estimate by 22.5%. The bottom line compared unfavorably with the year-ago quarter’s EPS of $1.30.
Quarterly net sales were $202.3 million, down 9% from $222.2 million in the year-ago quarter due to delayed project deployments and weaker-than-expected short-cycle order activity. The Zacks Consensus Estimate was pegged at $230.1 million.
Fortive Corporation (FTV - Free Report) reported first-quarter 2026 adjusted EPS of 70 cents from continuing operations, which surpassed the Zacks Consensus Estimate of 64 cents. The bottom line increased 25.4% year over year.
Revenues increased 7.7% year over year to $1069.4 million. The top line beat the Zacks Consensus Estimate by 3.8%. Core revenues jumped 5.3%.
Sensata Technologies Holding plc (ST - Free Report) reported first-quarter 2026 adjusted EPS of 86 cents, up from 78 cents a year ago. The bottom line beat the Zacks Consensus Estimate by 2.4%.
Revenues for the quarter reached $934.8 million, up 2.6% from a year ago. The figure came near to the upper end of management’s expectations ($917-$937 million) and beat the consensus estimate by 0.7%. Strength Aerospace, Defense and Commercial Equipment segments drove the top-line performance.
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Flex Q4 Earnings & Revenues Beat Estimates, Rise Y/Y, Stock Up
Key Takeaways
Flex Ltd. (FLEX - Free Report) reported fourth-quarter fiscal 2026 adjusted earnings per share (EPS) of 93 cents, which surpassed the Zacks Consensus Estimate by 8.1%. The bottom line compared favorably with 73 cents posted in the prior-year quarter.
Revenues increased 17% year over year to $7.5 billion. It beat the consensus mark by 8.1%. The growth was primarily driven by strong momentum across all three segments, with Cloud and Power Infrastructure emerging as the standout performer.
Management highlighted that the company’s strong finish to fiscal 2026 reflected disciplined execution and a well-defined strategy, supported by targeted acquisitions and capital investments aligned with Flex’s long-term growth opportunities.
Flex Ltd. Price, Consensus and EPS Surprise
Flex Ltd. price-consensus-eps-surprise-chart | Flex Ltd. Quote
Flex has announced its intention to spin off its Cloud and Power Infrastructure segment into a newly formed, independent, publicly traded company, marking a significant step in the company's broader strategic realignment.
As part of this reorganization, Flex is separating its Data Center business and realigning into three distinct segments. The first, Regulated Manufacturing Solutions, will serve Industrial, Automotive, and Healthcare markets, covering automation and energy infrastructure, compute and power electronics, and regulated medical devices, respectively. The second, Integrated Technology Solutions, will focus on Communications through high-speed networking and enterprise systems and on Lifestyle through premium products across commercial, home and personal categories. The third and newly defined segment, Cloud and Power Infrastructure, will deliver compute, liquid cooling and data center architecture solutions alongside critical rack-level and embedded power capabilities.
Shares of the company soared 25% in the pre-market trading session today. In the past year, the stock has surged 154.2% compared with the Zacks Electronics - Miscellaneous Products industry’s growth of 81%.
Image Source: Zacks Investment Research
Segment Details
Regulated Manufacturing Solutions Segment: This segment encompasses Health Solutions, Automotive and Industrial businesses. Revenues grew 13% to $2.7 billion, accounting for 36% of net sales.
Integrated Technology Solutions Segment: This segment comprises Communications and Lifestyle businesses. Revenues grew 13% to $2.9 billion, accounting for 39% of net sales.
Cloud and Power Infrastructure Segment: This segment comprises Cloud $ Cooling and Power businesses. Revenues increased 31% to $1.8 billion, accounting for 25% of net sales.
FLEX’s Operating Details
Non-GAAP gross profit came in at $737 million, up from $602 million reported in the year-ago quarter. Non-GAAP gross margin expanded 50 basis points (bps) to 9.9% in the reported quarter.
Non-GAAP operating income came in at $500 million, up from $396 million reported a year ago. Non-GAAP operating margin expanded 50 bps to 6.7%.
Selling, general & administrative expenses totaled $289 million, up 23.5% year over year.
Balance Sheet & Cash Flow
As of March 31, 2026, cash & cash equivalents and long-term debt (net of current portion) were $2.4 billion and $3.8 billion, respectively, compared with $3.1 billion and $3.8 billion as of Dec. 31, 2025.
The company generated a fourth-quarter fiscal 2026 cash flow from operating activities of $413 million and an adjusted free cash flow of $212 million.
In the quarter, the company repurchased $200 million worth of stock.
Flex Guidance
For the first quarter of fiscal 2027, the company expects net sales in the range of $7.35 billion to $7.65 billion, representing growth of approximately 14% at the midpoint of the guidance. Adjusted operating income is projected to be between $469 million and $499 million, while adjusted EPS are anticipated to be 86-92 cents, suggesting growth of 24% at the midpoint. Interest and other expenses are expected to be approximately $65 million. The adjusted income tax rate is projected at 21%, with weighted average shares outstanding estimated at approximately 374 million.
For fiscal 2027, the company expects net sales to range between $32.3 billion and $33.8 billion, representing growth of approximately 18% at the midpoint of the guidance. Adjusted operating margin is projected to be between 7% and 7.1%, while adjusted EPS is expected to range from $4.21 to $4.51, implying growth of 32% at the midpoint. The adjusted income tax rate for the fiscal year is expected to remain at 21%.
FLEX’s Zacks Rank
Flex currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Performance of Other Firms
Badger Meter, Inc. (BMI - Free Report) reported EPS of 93 cents for first-quarter 2026, which missed the Zacks Consensus Estimate by 22.5%. The bottom line compared unfavorably with the year-ago quarter’s EPS of $1.30.
Quarterly net sales were $202.3 million, down 9% from $222.2 million in the year-ago quarter due to delayed project deployments and weaker-than-expected short-cycle order activity. The Zacks Consensus Estimate was pegged at $230.1 million.
Fortive Corporation (FTV - Free Report) reported first-quarter 2026 adjusted EPS of 70 cents from continuing operations, which surpassed the Zacks Consensus Estimate of 64 cents. The bottom line increased 25.4% year over year.
Revenues increased 7.7% year over year to $1069.4 million. The top line beat the Zacks Consensus Estimate by 3.8%. Core revenues jumped 5.3%.
Sensata Technologies Holding plc (ST - Free Report) reported first-quarter 2026 adjusted EPS of 86 cents, up from 78 cents a year ago. The bottom line beat the Zacks Consensus Estimate by 2.4%.
Revenues for the quarter reached $934.8 million, up 2.6% from a year ago. The figure came near to the upper end of management’s expectations ($917-$937 million) and beat the consensus estimate by 0.7%. Strength Aerospace, Defense and Commercial Equipment segments drove the top-line performance.