Flex (NASDAQ:FLEX) Posts Earnings Results, Beats Estimates By $0.10 EPS

Key Points

• Flex exceeded quarterly expectations: EPS reached $1.00 versus the $0.90 consensus, while revenue rose 20.6% year over year to $7.93 billion, above the $7.53 billion estimate.
• AI infrastructure demand is driving growth: Cloud and Power Infrastructure revenue increased 35%, and Flex raised its fiscal 2027 outlook to $4.42–$4.74 in EPS and $33.7–$35.2 billion in revenue.
• The planned spin-off remains on track: Flex expects to separate its Cloud and Power Infrastructure segment in the first quarter of calendar 2027, though related costs have reduced projected fiscal 2027 free-cash-flow conversion to about 40%.

Flex (NASDAQ:FLEX - Get Free Report) announced its quarterly earnings results on Wednesday. The technology company reported $1.00 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.90 by $0.10, FiscalAI reports. The business had revenue of $7.93 billion during the quarter, compared to the consensus estimate of $7.53 billion. Flex had a net margin of 3.15% and a return on equity of 22.12%. The business's revenue was up 20.6% compared to the same quarter last year. During the same quarter last year, the firm posted $0.72 EPS. Flex updated its Q2 2027 guidance to 1.000-1.070 EPS and its FY 2027 guidance to 4.420-4.740 EPS.

Here are the key takeaways from Flex's conference call:

• Strong first-quarter results: Revenue rose 21% year over year to $7.9 billion, while adjusted operating margin expanded 70 basis points and adjusted EPS increased 39% to a record $1.00.
• AI infrastructure demand remains robust: Cloud and Power Infrastructure revenue grew 35%, with management forecasting 65%–75% growth for fiscal 2027 and citing strong visibility, capacity investments, and program ramps in cloud, power, and cooling.
• Favorable outlook across growth markets: Communications, advanced networking, industrial energy infrastructure, robotics, and warehouse automation are expected to benefit from sustained data-center investment and longer-term secular trends, with the company also reporting share gains in some networking products.
• Free cash flow expectations were reduced: Incorporating costs associated with the planned spin-off, Flex lowered expected fiscal 2027 free-cash-flow conversion to approximately 40% from the previously stated 60%, while consumer-related end markets remain weak.
• Spin-off remains on track: Flex continues preparing to separate its Cloud and Power Infrastructure segment into a standalone company, targeting a tax-free spin-off in the first quarter of calendar 2027 and planning to provide further details at its November 10 Investor Day.

Flex Price Performance

NASDAQ:FLEX traded down $9.37 during trading hours on Wednesday, reaching $103.91. 4,472,451 shares of the company traded hands, compared to its average volume of 5,180,047. Flex has a 1-year low of $47.83 and a 1-year high of $166.86. The stock has a market cap of $38.07 billion, a P/E ratio of 44.64, a P/E/G ratio of 0.61 and a beta of 1.64. The firm's 50-day moving average is $140.84 and its 200-day moving average is $98.96. The company has a debt-to-equity ratio of 0.73, a current ratio of 1.36 and a quick ratio of 0.87.

Key Stories Impacting Flex

Here are the key news stories impacting Flex this week:

• Positive Sentiment: Strong quarterly beat: Flex reported adjusted EPS of $1.00, versus the $0.90 consensus estimate cited by analysts, while revenue reached $7.93 billion, above expectations of approximately $7.53 billion. EPS increased from $0.72 a year earlier, and sales rose 20.6% year over year. Flex Reports First Quarter Fiscal 2027 Results
• Positive Sentiment: Raised guidance exceeds estimates: Flex forecast second-quarter fiscal 2027 EPS of $1.00-$1.07 and revenue of $8.0-$8.3 billion, ahead of consensus estimates of $0.98 EPS and $7.8 billion revenue. Full-year EPS guidance of $4.42-$4.74 brackets the $4.46 consensus, while projected revenue of $33.7-$35.2 billion exceeds the $33.3 billion estimate.
• Positive Sentiment: Technical and analyst support: Zacks said the stock’s recent trading pattern formed a potential “hammer” signal, which can indicate support after a decline. The firm also cited upward earnings-estimate revisions as a possible catalyst for a near-term rebound. Flex Could Find Support Soon
• Neutral Sentiment: Planned spin-off advances: Flex named leadership teams for the company and SpinCo, its planned independent cloud and power infrastructure business. The separation is expected in the first calendar quarter of 2027 and could sharpen each company’s strategic focus, though it also introduces execution and transaction risks. Flex Announces Leadership Teams
• Negative Sentiment: Possible sell-the-news pressure: The strong results and outlook have not prevented a recent decline in FLEX shares. With the stock trading well above its 200-day average and at a relatively elevated earnings multiple, investors may be locking in gains or demanding further upside beyond the guidance increase.

Analyst Ratings Changes

FLEX has been the subject of a number of research reports. JPMorgan Chase & Co. lifted their price target on shares of Flex from $75.00 to $84.00 and gave the company an "overweight" rating in a research report on Thursday, April 16th. Barclays lifted their price objective on Flex from $174.00 to $203.00 and gave the stock an "overweight" rating in a report on Thursday, June 4th. Freedom Capital upgraded Flex from a "hold" rating to a "strong-buy" rating in a research report on Thursday, July 16th. Weiss Ratings restated a "buy (b-)" rating on shares of Flex in a research report on Friday, July 17th. Finally, Stifel Nicolaus lifted their price target on Flex from $75.00 to $95.00 and gave the stock a "buy" rating in a research note on Monday, April 20th. One research analyst has rated the stock with a Strong Buy rating, nine have issued a Buy rating and two have given a Hold rating to the stock. Based on data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus target price of $115.70.

Insider Buying and Selling at Flex

In other Flex news, EVP David Scott Offer sold 6,657 shares of the company's stock in a transaction dated Thursday, June 18th. The shares were sold at an average price of $145.23, for a total value of $966,796.11. Following the transaction, the executive vice president directly owned 91,122 shares in the company, valued at approximately $13,233,648.06. This represents a 6.81% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, COO Kwang Hooi Tan sold 8,981 shares of Flex stock in a transaction dated Thursday, June 18th. The stock was sold at an average price of $145.19, for a total transaction of $1,303,951.39. Following the sale, the chief operating officer owned 248,546 shares of the company's stock, valued at approximately $36,086,393.74. This trade represents a 3.49% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last quarter, insiders have sold 769,195 shares of company stock valued at $110,116,823. 0.62% of the stock is owned by company insiders.

Institutional Investors Weigh In On Flex

Hedge funds have recently made changes to their positions in the business. Brighton Jones LLC purchased a new position in shares of Flex during the 4th quarter worth about $260,000. Parallel Advisors LLC increased its position in Flex by 19.6% during the fourth quarter. Parallel Advisors LLC now owns 4,293 shares of the technology company's stock worth $259,000 after purchasing an additional 705 shares during the last quarter. Aptus Capital Advisors LLC purchased a new position in Flex during the fourth quarter worth approximately $255,000. Wealthspire Advisors LLC grew its stake in shares of Flex by 151.1% during the 4th quarter. Wealthspire Advisors LLC now owns 3,952 shares of the technology company's stock valued at $239,000 after buying an additional 2,378 shares during the period. Finally, Brown Brothers Harriman & Co. raised its position in shares of Flex by 71.3% in the 3rd quarter. Brown Brothers Harriman & Co. now owns 4,106 shares of the technology company's stock worth $238,000 after buying an additional 1,709 shares during the period. Institutional investors and hedge funds own 94.30% of the company's stock.

Flex Company Profile

Flex NASDAQ: FLEX, formerly known as Flextronics, is a global provider of electronics manufacturing services (EMS) and original design manufacturing (ODM). The company offers end-to-end product lifecycle solutions including product design and engineering, prototyping, volume manufacturing, testing, and aftermarket services. Its offerings extend into supply chain management, component sourcing, logistics and distribution, and advanced manufacturing capabilities such as automation and digital manufacturing to support customers from concept through end-of-life.

Flex serves a broad range of industries, including automotive, healthcare, industrial, communications, and consumer electronics, working with original equipment manufacturers (OEMs) and technology companies to accelerate time to market and manage complex supply chains.

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