Q2 2025 Flex Ltd Earnings Call Transcript
Key Points
- Flex Ltd (FLEX) reported a solid Q2 with revenue of $6.5 billion, in line with expectations.
- The company achieved a record adjusted operating margin of 5.5% due to strong mix and effective cost management.
- Adjusted EPS reached a quarterly record of $0.64, reflecting a 12% year-over-year increase.
- Flex Ltd (FLEX) experienced 40% year-over-year growth in its data center portfolio, surpassing the expected 20% long-term CAGR.
- The acquisition of Crown Technical Systems is expected to enhance Flex Ltd (FLEX)'s data center power portfolio and support growth in the U.S. market.
- Revenue guidance for the full year has been adjusted downwards due to macroeconomic pressures, with expectations now between $24.9 billion and $25.5 billion.
- The automotive segment is experiencing macro-related slowing, which is affecting growth in the second half of the fiscal year.
- Core industrial demand is softer than previously expected, impacting the Reliability Solutions segment.
- Agility Solutions revenue is expected to decline in the low to high single digits, despite strong growth in the cloud sector.
- Concerns about potential under-absorption of costs in the automotive segment due to lower volumes were raised during the call.
Thank you for standing by. Welcome to Flex's second quarter fiscal 2025 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded. I will now turn the call over to Mr. David Rubin. Mr. Rubin, please begin.
Thank you. Good morning, and welcome to Flex's second quarter fiscal 2025 Earnings Conference Call. With me today is our Chief Executive Officer, Revathi Advaithi; and Interim Chief Financial Officer, Jaime Martinez. We will give brief remarks followed by Q&A.
Slides for today's call as well as a copy of the earnings press release and summary of financials are available on the Investor Relations section at flex.com. This call is being recorded and will be available for replay on our corporate website. As a reminder, today's call contains forward-looking statements, which are based on our current expectations and assumptions.
These statements involve risks and uncertainties that could cause actual results to differ materially. For a full
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