01—Abstract
Summary
Summary of the 10-Q filed October 31, 2025. Cited figures are marked; the original filing is the authoritative source.
Flex Ltd. reported solid revenue growth for the six-month period ended September 26, 2025, with net sales increasing by 4% year-over-year to $13.4 billiona.
This growth was primarily driven by strong performance in the Communications, Enterprise, and Cloud (CEC) sector within the Flex Agility Solutions (FAS) segment, fueled by increased demand in data center cloud. The Flex Reliability Solutions (FRS) segment also saw modest growth, with strength in the Industrial sector, though the Automotive business experienced a decline. The company demonstrated improved profitability, with gross margins expanding year-over-year due to a favorable mix and operational execution.
Net income for the six-month period was $391 millionb, an increase from $353 million in the prior year's comparable period, reflecting effective cost management and segment performance. The company also highlighted its ongoing commitment to returning capital to shareholders through share repurchases, with $1.5 billion available under its current repurchase program as of September 26, 2025.
Financially, Flex maintained a healthy liquidity position with $2.2 billionc in cash and cash equivalents and access to a $2.75 billion revolving credit facility. A significant event during the quarter was a missile strike on the company's Ukraine facility, resulting in $41 million in charges for impairments and inventory write-downs; however, the company has activated contingency plans to mitigate the impact.
02—Key points
Key Highlights
- Net sales increased 4% year-over-year to $13.4 billion for the six-month period ended September 26, 2025, driven by strong demand in data center cloud within the CEC sector.
- Gross margin improved to 8.9% for the six-month period, up from 7.8% in the prior year, attributed to favorable product mix and operational efficiency.
- Net income rose to $391 million for the six-month period, up from $353 million in the comparable prior-year period.
- The company generated $852 million in cash from operating activities and $573 million in free cash flow for the six-month period.
- Flex Ltd. ended the period with $2.2 billion in cash and cash equivalents, indicating a strong liquidity position.
- The company incurred $41 million in charges related to a missile strike on its Ukraine facility, impacting restructuring and impairment costs.
- Shareholder returns remain a focus, with $1.5 billion available for future share repurchases as of September 26, 2025.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2026, Flex Ltd. kept $0.03.
- Revenue$6.80B100.0%
- Cost of revenue−$6.19B91.0%
- Gross profit$614.0M9.0%
- Operating costs−$318.0M4.7%
- Operating income$296.0M4.4%
- Interest, other & tax−$97.0M1.4%
- Net income$199.0M2.9%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed October 31, 2025Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $6.80B$6.54B | +4.0% |
| Cost of Revenue | $6.18B$6.00B | +3.1% |
| Gross Profit | $614.00M$531.00M | +15.6% |
| SG&A Expenses | $260.00M$216.00M | +20.4% |
| Operating Income | $296.00M$297.00M | −0.3% |
| Interest Expense | $47.00M$46.00M | +2.2% |
| Net Income | $199.00M$214.00M | −7.0% |
| EPS (Basic) | $0.53$0.54 | −1.9% |
| EPS (Diluted) | $0.52$0.54 | −3.7% |
| Shares Outstanding (Basic) | 374.00M394.00M | −5.1% |
| Shares Outstanding (Diluted) | 380.00M400.00M | −5.0% |
05—Questions
Frequently Asked Questions
What was the main driver of Flex Ltd.'s revenue growth in the first half of fiscal year 2026?
The primary driver of Flex Ltd.'s revenue growth in the first half of fiscal year 2026 was the strong performance in the Communications, Enterprise, and Cloud (CEC) business within the Flex Agility Solutions (FAS) segment. This growth was largely fueled by increased demand in the data center cloud market.
How did the missile strike in Ukraine affect Flex Ltd.'s financial results?
The missile strike on Flex Ltd.'s facility in Mukachevo, Ukraine, resulted in $41 million of charges during the three months ended September 26, 2025. These charges included long-lived asset impairments and inventory write-downs, which were recorded as restructuring and impairment charges.
What is the company's outlook on liquidity and capital resources?
Flex Ltd. maintains a strong liquidity position, with $2.2 billion in cash and cash equivalents as of September 26, 2025, and an undrawn $2.75 billion revolving credit facility. The company expects its current financial condition and liquidity sources to be adequate to fund its operations and future commitments.
How is Flex Ltd. returning capital to shareholders?
Flex Ltd. continues to return capital to shareholders through its share repurchase program. As of September 26, 2025, there was approximately $1.5 billion available for future repurchases under the current plan, indicating a commitment to enhancing shareholder value.
06—Continue