FLEX REPORTS FIRST QUARTER FISCAL 2027 RESULTS

Rhea-AI Summary

Flex (NASDAQ: FLEX) reported first quarter fiscal 2027 net sales of $7.9 billion, up 21% year over year, with GAAP operating income of $392 million (4.9% margin) and adjusted operating income of $534 million (6.7% margin). GAAP net income was $285 million, or $0.76 per diluted share, while adjusted EPS reached a record $1.00. Operating cash flow was $276 million and free cash flow $41 million.

Flex issued second quarter fiscal 2027 guidance for net sales of $7.95–$8.25 billion and adjusted EPS of $1.00–$1.07. It raised full‑year fiscal 2027 guidance to net sales of $33.7–$35.2 billion, adjusted operating margin of 7.0–7.2%, and adjusted EPS of $4.42–$4.74. Long‑term debt increased to $5.2 billion and cash to $2.8 billion. Flex also announced an Investor Day on November 10, 2026.

Positive

• Net sales +21% YoY to $7.9 billion in Q1 FY27
• Adjusted EPS increased to $1.00 from $0.72 a year ago
• Adjusted operating margin improved to 6.7% from 6.0% YoY
• FY27 revenue guidance raised to $33.7–$35.2 billion from $32.3–$33.8 billion
• FY27 adjusted EPS guidance raised to $4.42–$4.74 from $4.21–$4.51
• Cash balance grew to $2.84 billion from $2.39 billion sequentially

Negative

• Free cash flow declined to $41 million from $268 million YoY
• Long-term debt increased to $5.22 billion from $3.75 billion sequentially
• Net cash used in investing rose to $1.28 billion, driven by $1.13 billion of acquisitions
• Operating cash flow fell to $276 million from $399 million YoY
• Interest expense increased to $60 million from $51 million YoY

News Explained

Borrowing supported the quarter’s cash increase, while full-year guidance remains explicitly before the planned separation.

Flex reported first-quarter fiscal 2027 results for the quarter ended June 26, 2026; its updated full-year guidance explicitly excludes the planned separation of its Cloud and Power Infrastructure segment, making that guidance a pre-separation baseline.

The release says adjusted measures exclude items including stock-based compensation, restructuring, amortization, legal and other costs, and related tax effects, so they are intended to supplement rather than replace GAAP results.

Market reaction after Q1 FY27 earnings report: FLEX -6.16%

-6.16% $106.30

15m delay

-6.16% Vs previous close

$106.30 Last Price

$98.89 $116.03 Day Range

$39.91B Market Cap

0.1x Rel. Volume

Following this news, FLEX has declined 6.16%, reflecting a notable negative market reaction. Our momentum scanner has triggered 13 alerts so far, indicating notable trading interest and price volatility. The stock is currently trading at $106.30.

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Market Context

Historical news_id 1083779 recorded a 0.55% 24-hour move after an acquisition completion. That bench...

Analysis

Historical news_id 1083779 recorded a 0.55% 24-hour move after an acquisition completion. That benchmark adds context to this earnings report, while current data records Net Selling insider activity and makes cash flow a watch item.

Key Figures

Q1 net sales: $7.9 billion GAAP operating margin: 4.9% Adjusted operating margin: 6.7% +5 more

8 metrics

Q1 net sales $7.9 billion First quarter fiscal 2027; up 21% versus prior year

GAAP operating margin 4.9% First quarter fiscal 2027

Adjusted operating margin 6.7% First quarter fiscal 2027

GAAP EPS $0.76 First quarter fiscal 2027

Adjusted EPS $1.00 First quarter fiscal 2027; record adjusted EPS

Q2 net sales guidance $7.95 billion to $8.25 billion Second quarter fiscal 2027 guidance

Q2 adjusted EPS guidance $1.00 to $1.07 Second quarter fiscal 2027 guidance

FY27 adjusted EPS guidance $4.42 to $4.74 Updated fiscal year 2027 guidance

Historical Context

5 past events · Latest: Jul 20 (Positive)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Jul 20	Acquisition completion	Positive	+0.6%	Nextpower completed its acquisition of Prevalon Energy and launched an energy storage business.
Jul 13	Leadership appointment	Neutral	-4.6%	DG Matrix appointed a commercial officer with prior Flex experience.
Jul 9	Earnings date notice	Neutral	-3.0%	Nextpower scheduled its first-quarter fiscal 2027 financial-results announcement.
Jul 9	Partnership expansion	Positive	+4.9%	Cerebras and Flex expanded manufacturing capacity for CS-3 AI supercomputers.
Jul 8	Earnings date notice	Neutral	+4.9%	Flex announced the date for its first-quarter fiscal 2027 earnings call.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent available news reactions were mixed, with three positive and two negative 24-hour moves across the selected records.

Key Terms

gaap, non-gaap financial measures, free cash flow, spin-off, +1 more

5 terms

gaap financial

"Reported Q1 GAAP operating margin of 4.9%"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

View in glossary

non-gaap financial measures financial

"An explanation and reconciliation of GAAP financial measures to non-GAAP financial measures"

Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.

free cash flow financial

"Free Cash Flow: $41 million"

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

View in glossary

spin-off financial

"the planned spin-off of its Cloud and Power Infrastructure segment"

A spin-off happens when a company creates a new, independent business by separating part of itself, like splitting off a division into its own company. This often happens so the new company can focus better on its own goals or attract different investors. It matters because it can lead to more growth opportunities and clearer focus for both companies.

View in glossary

weighted average shares outstanding financial

"Weighted average shares outstanding: approximately 375 million"

The weighted average shares outstanding is the average number of a company’s common shares that were available during a reporting period, adjusted so each change (like new shares issued or shares bought back) counts only for the portion of the period it was in effect. Investors use it to calculate per-share measures such as earnings per share, so it shows how ownership dilution or buybacks affect what each share is entitled to—like averaging how many people were at a potluck over time to determine each person’s share of the food.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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• Reported Q1 net sales of $7.9 billion, up 21% versus the prior year.
• Delivered Q1 GAAP operating margin of 4.9%, and adjusted operating margin of 6.7%.
• Reported Q1 GAAP EPS of $0.76, and record adjusted EPS of $1.00.
• Announced Investor Day date of November 10th, 2026.

AUSTIN, Texas, July 29, 2026 /PRNewswire/ -- Flex (NASDAQ: FLEX) today announced results for its first quarter ended June 26, 2026.

"This quarter reflects the continued execution of the strategy we've advanced over the last several years. From joining the S&P 500 to expanding our role in AI infrastructure, we've strengthened our position in attractive growth markets. Looking ahead, we're confident both Flex and SpinCo have the leadership, capabilities, and focus to capitalize on the significant opportunities in front of them," said Revathi Advaithi, CEO of Flex.

First Quarter Fiscal Year 2027 GAAP Summary:

• Net Sales: $7.9 billion
• GAAP Operating Income: $392 million
• GAAP Net Income: $285 million
• GAAP Earnings Per Share: $0.76
• Cash provided by Operating Activities: $276 million

First Quarter Fiscal Year 2027 Non-GAAP Summary:

• Adjusted Operating Income: $534 million
• Adjusted Net Income: $374 million
• Adjusted Earnings Per Share: $1.00
• Free Cash Flow: $41 million

An explanation and reconciliation of GAAP financial measures to non-GAAP financial measures is presented in Schedules II and V attached to this press release.

Second Quarter Fiscal Year 2027 Guidance:

• Net Sales: $7.95 billion to $8.25 billion, growth of 19% at the midpoint
• Adjusted Operating Income: $535 million to $565 million*
• Adjusted EPS: $1.00 to $1.07*, growth of 32% at the midpoint
• Interest & Other: approximately $58 million
• Adjusted income tax rate: 21%*
• Weighted average shares outstanding: approximately 375 million

Updated Fiscal Year 2027 Guidance†:

• Net Sales: $33.7 billion to $35.2 billion, growth of 23% at the midpoint
• Adjusted Operating Margin: 7.0% to 7.2%*
• Adjusted EPS: $4.42 to $4.74*, growth of 39% at the midpoint
• Adjusted income tax rate: 21%*

	Fiscal Year 2027 Guidance
	Prior		Updated
Net Sales	$32.3 - $33.8 billion		$33.7 - $35.2 billion
Adjusted Operating Margin*	7.0% - 7.1%		7.0% - 7.2%
Adjusted EPS*	$4.21 - $4.51		$4.42 - $4.74

*This is a forward-looking non-GAAP financial measure that cannot be reconciled to its equivalent GAAP financial measure without unreasonable effort for the reasons set forth in Schedule V attached to this press release.

†Reflects expected results for the full fiscal year and does not give effect to the planned spin-off of the Cloud and Power Infrastructure segment

Webcast and Conference Call

The Flex management team will host a conference call today, July 29, 2026, at 7:30 AM (CT) / 8:30 AM (ET), to review first quarter fiscal 2027 results. A live webcast of the event and slides will be available on the Flex Investor Relations website at http://investors.flex.com. An audio replay and transcript will also be available after the event on the Flex Investor Relations website.

About Flex

Flex (Reg. No. 199002645H) is the manufacturing partner of choice that helps leading brands design, build, and manage products that improve the world. With a global footprint spanning 30 countries, Flex delivers advanced manufacturing and supply chain solutions, innovative products and technology, and lifecycle services that support customers from concept to scale. In the AI era, Flex is helping customers accelerate data center deployment by solving power, heat, and scale challenges through cutting-edge power and cooling technology and scalable IT infrastructure solutions.

Contacts

Investors & Analysts
Michelle Simmons
Senior Vice President, Global Investor Relations and Public Relations
(669) 242-6332
Michelle.Simmons@flex.com 

Media & Press
press@flex.com 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of U.S. securities laws, including statements related to our future financial results and our guidance for future financial performance (including expected revenues, operating income, margins and earnings per share). These forward-looking statements are based on current expectations, forecasts and assumptions involving risks and uncertainties that could cause the actual outcomes and results to differ materially from those anticipated by these forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. These risks include: that we may not achieve our expected future operating results; risks related to our ability to successfully execute our strategic priorities, including the planned spin-off of our Cloud and Power Infrastructure segment into an independent, publicly traded company, and to achieve the anticipated benefits of such transaction, including risks that the spin-off may not be completed on the anticipated timeline or at all, that the spin-off may not achieve its intended benefits, that the transaction may have an adverse impact on existing business relationships, and that the costs of the spin-off may be greater than anticipated; the effects that the current and future macroeconomic environment, including inflationary pressures, currency volatility, stagflation, slower economic growth or recession, and high or rising interest rates, could have on our business and demand for our products; geopolitical uncertainties and risks, including impacts from trade conflicts, the termination and renegotiation of international trade agreements and trade policies, a further escalation of sanctions, tariffs or other trade tensions between the U.S. and China or other countries, or the ongoing conflicts between Russia and Ukraine and in the Middle East, including recent developments in Iran, any of which could lead to disruption, instability, and volatility in global markets and negatively impact our operations and financial performance; supply chain disruptions, including those involving suppliers who are sole or primary sources, logistical constraints, manufacturing interruptions or delays, or the failure to accurately forecast customer demand; the impact of fluctuations in the pricing or availability of raw materials and components, including semiconductors, labor and energy; our dependence on industries that continually produce technologically advanced products with short product life cycles; the short-term nature of our customers' commitments and rapid changes in demand may cause supply chain issues, excess and obsolete inventory and other issues which adversely affect our operating results; our dependence on a small number of customers; risks associated with acquisitions and divestitures, including the possibility that we may not fully realize their projected benefits, including the acquisition of Electrical Power Products, Inc., and other events that could adversely impact the anticipated benefits of the acquisition, including industry or economic conditions outside of our control; our industry is extremely competitive; that the expected revenue and margins from recently launched programs may not be realized; the challenges of effectively managing our operations, including our ability to control costs and manage changes in our operations; the possibility that benefits of our restructuring actions may not materialize as expected; a breach of our IT or physical security systems, or violation of data privacy laws, may cause us to incur significant legal and financial exposure and adversely affect our operations; hiring and retaining key personnel; that recent changes or future changes in tax laws in certain jurisdictions where we operate could materially impact our tax expense; litigation and regulatory investigations and proceedings; the impact and effects on our business, results of operations and financial condition of union disputes or other labor disruptions as well as unforeseen or catastrophic events; the effects that current and future credit and market conditions could have on the liquidity and financial condition of our customers and suppliers, including any impact on their ability to meet their contractual obligations to us and our ability to pass through costs to our customers; the success of certain of our activities depends on our ability to protect our intellectual property rights and we may be exposed to claims of infringement, misuse or breach of license agreements; physical and operational risks from natural disasters, severe weather events, or climate change; we may be exposed to product liability and product warranty liability; we may be exposed to financially troubled customers or suppliers; our compliance with legal and regulatory requirements; changes in laws, regulations, or policies that may impact our  business, including those related to trade policy and tariffs and climate change; our ability to  meet sustainability, including environmental, social and governance, expectations or standards or achieve sustainability goals.

SCHEDULE I
FLEX
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts)
	Three-Month Periods Ended
	June 26, 2026		June 27, 2025
GAAP:
Net sales	$                 7,928		$                 6,575
Cost of sales	7,177		5,987
Restructuring charges	4		16
Gross profit	747		572
Selling, general and administrative expenses	334		233
Restructuring and impairment charges (reversal)	(2)		7
Intangible amortization	23		21
Operating income	392		311
Interest expense	60		51
Interest income	13		13
Other charges (income), net	(37)		7
Equity in earnings (losses) of unconsolidated affiliates	(5)		(20)
Income before income taxes	377		246
Provision for income taxes	92		54
Net income	$                   285		$                   192
GAAP EPS
Diluted earnings per share	$                   0.76		$                  0.50
Diluted shares used in computing per share amounts	374		381

See Schedule II for the reconciliation of GAAP to non-GAAP financial measures. See the accompanying notes on Schedule V attached to this press release.

 

SCHEDULE II
FLEX
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except per share amounts and percentages)
	Three-Month Periods Ended
	June 26, 2026			June 27, 2025
GAAP operating income and margin %	$                 392	4.9 %		$                 311	4.7 %
Intangible amortization	23			21
Stock-based compensation	51			34
Restructuring and impairment charges	1			23
Legal and other	67			6
Non-GAAP operating income and margin %	$                 534	6.7 %		$                 395	6.0 %
GAAP provision for income taxes	$                  92			$                  54
Intangible amortization benefit	5			5
Other tax related adjustments	2			14
Non-GAAP provision for income taxes	$                  99			$                  73
GAAP net income	$                 285			$                 192
Intangible amortization	23			21
Stock-based compensation	51			34
Restructuring and impairment charges	1			23
Legal and other	67			6
Equity in losses of unconsolidated affiliates	—			17
Interest and other, net	(46)			—
Adjustments for taxes	(7)			(19)
Non-GAAP net income	$                 374			$                 274
Diluted earnings per share:
GAAP	$                0.76			$                0.50
Non-GAAP	$                1.00			$                0.72
Free Cash Flow:
Net cash provided by operating activities	$                 276			$                 399
Purchases of property and equipment	(236)			(133)
Proceeds from the disposition of property and equipment	1			2
Free Cash Flow	$                  41			$                 268
See the accompanying notes on Schedule V attached to this press release.

 

SCHEDULE III
FLEX
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
	As of June 26, 2026		As of March 31, 2026
ASSETS
Current assets:
Cash and cash equivalents	$                2,840		$                2,389
Accounts receivable, net of allowance for doubtful accounts	5,036		4,679
Contract assets	1,386		1,063
Inventories	6,453		5,845
Other current assets	2,522		2,356
Total current assets	18,237		16,332
Property and equipment, net	2,655		2,505
Operating lease right-of-use assets, net	794		659
Goodwill	1,831		1,369
Other intangible assets, net	736		283
Other non-current assets	945		912
Total assets	$               25,198		$               22,060
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$                9,195		$                8,055
Accrued payroll and benefits	579		671
Deferred revenue and customer working capital advances	2,053		2,156
Other current liabilities	1,393		1,134
Total current liabilities	13,220		12,016
Long-term debt, net of current portion	5,219		3,751
Operating lease liabilities, non-current	711		565
Other non-current liabilities	548		584
Total liabilities	19,698		16,916
Total shareholders' equity	5,500		5,144
Total liabilities and shareholders' equity	$               25,198		$               22,060

 

SCHEDULE IV
FLEX
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
	Three-Month Periods Ended
	June 26, 2026		June 27, 2025
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$         285		$          192
Depreciation, amortization and other impairment charges	140		142
Changes in working capital and other, net	(149)		65
Net cash provided by operating activities	276		399
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(236)		(133)
Proceeds from the disposition of property and equipment	1		2
Acquisition of businesses, net of cash acquired	(1,134)		(41)
Proceeds from divestiture of businesses, net of cash held in divested businesses	90		—
Other investing activities, net	—		(7)
Net cash used in investing activities	(1,279)		(179)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from bank borrowings and long-term debt	2,830		500
Payments of bank borrowings, long-term debt and other financing liabilities	(1,385)		(532)
Payments for repurchases of ordinary shares	—		(247)
Other financing activities, net	10		(4)
Net cash (used in) provided by financing activities	1,455		(283)
Effect of exchange rates on cash and cash equivalents	(1)		13
Net change in cash and cash equivalents	451		(50)
Cash and cash equivalents, beginning of period	2,389		2,289
Cash and cash equivalents, end of period	$       2,840		$       2,239

SCHEDULE V

FLEX AND SUBSIDIARIES
NOTES TO SCHEDULES I and II

To supplement Flex's unaudited selected financial data presented consistent with U.S. Generally Accepted Accounting Principles ("GAAP"), the Company discloses certain non-GAAP financial measures that exclude certain charges and gains, including non-GAAP operating income, non-GAAP net income and non-GAAP net income per diluted share. These supplemental measures exclude certain legal and other charges, restructuring charges, customer-related asset impairments (recoveries), stock-based compensation expense, intangible amortization, other discrete events as applicable and the related tax effects. These non-GAAP measures are not in accordance with or an alternative for GAAP and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Flex's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Flex's results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of the Company's performance.

In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of the Company's operating performance on a period-to-period basis because such items are not, in our view, related to the Company's ongoing operational performance. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with forecasts and strategic plans, for calculating return on investment, and for benchmarking performance externally against competitors. In addition, management's incentive compensation is determined using certain non-GAAP measures. Also, when evaluating potential acquisitions, we exclude certain items described below from consideration of the target's performance and valuation. Since we find these measures to be useful, we believe that investors benefit from seeing results "through the eyes" of management in addition to seeing GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company's GAAP financials, provide useful information to investors by offering:

• the ability to make more meaningful period-to-period comparisons of the Company's ongoing operating results;
• the ability to better identify trends in the Company's underlying business and perform related trend analysis;
• a better understanding of how management plans and measures the Company's underlying business; and
• an easier way to compare the Company's operating results against analyst financial models and operating results of competitors that supplement their GAAP results with non-GAAP financial measures.

We present forward‑looking non‑GAAP financial measures in our first quarter and full year fiscal 2027 guidance, including adjusted operating income, adjusted operating margin, adjusted income tax rate, and adjusted EPS. We do not provide a reconciliation of these measures to the most directly comparable GAAP measures because the information necessary to do so is not available without unreasonable effort due to the inherent variability, complexity, and uncertainty in forecasting certain items required for such a reconciliation. These items may include restructuring charges and impairment charges, among others. The information that is unavailable could be material and could significantly affect our GAAP results.

The following are explanations of each of the adjustments that we incorporate into non-GAAP measures, as well as the reasons for excluding each of these individual items in the reconciliations of these non-GAAP financial measures:

Stock-based compensation expense consists of non-cash charges for the estimated fair value of unvested restricted share units granted to employees and assumed in business acquisitions. The Company believes that the exclusion of these charges provides for more accurate comparisons of its operating results to peer companies due to the varying available valuation methodologies, subjective assumptions and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact stock-based compensation expense has on its operating results.

Intangible amortization consists primarily of non-cash charges that can be impacted by, among other things, the timing and magnitude of acquisitions. The Company considers its operating results without these charges when evaluating its ongoing performance and forecasting its earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. The Company believes that the assessment of its operations excluding these costs is relevant to its assessment of internal operations and comparisons to the performance of its competitors.

Restructuring and impairment charges include severance charges at existing sites and corporate SG&A functions as well as asset impairment, and other charges related to the closures and consolidations of certain operating sites and targeted activities to restructure the business. These costs also include asset impairment charges related to assets significantly impacted by the geopolitical events on the basis of management's best estimate of the recoverable value of assets.  These costs may vary in size based on the Company's initiatives, are not directly related to ongoing or core business results, and do not reflect expected future operating expenses. These costs are excluded by the Company's management in assessing current operating performance and forecasting its earnings trends and are therefore excluded by the Company from its non-GAAP measures.

During the three month periods ended June 26, 2026 and  June 27, 2025, the Company recognized $1 million and approximately $23 million of restructuring charges, respectively, most of which related to employee severance.

Legal and other consist primarily of costs not directly related to core business results and may include matters relating to commercial disputes, government regulatory and compliance, intellectual property, antitrust, tax, employment or shareholder issues, product liability claims and other costs such as acquisition, portfolio optimization related costs and asset impairment. These costs are excluded by the Company's management in assessing current operating performance and forecasting its earnings trends and are therefore excluded by the Company from its non-GAAP measures. During the three month period ended June 26, 2026, the Company incurred approximately $53 million primarily related to the planned spin-off of its Cloud and Power Infrastructure segment into a separate publicly traded company as well as $14 million of acquisition costs. During the three month period ended June 27, 2025, the Company incurred $6 million related to acquisitions costs.

Equity in losses of unconsolidated affiliates consists of various other types of items that are not directly related to ongoing or core business results, such as significant gains or losses associated with certain non-core investments. The Company excludes these items because they are not related to the Company's ongoing operating performance or do not affect core operations. Excluding these amounts provides investors with a basis to compare Company performance against the performance of other companies without this variability. During the three month period ended June 27, 2025, the Company recognized approximately $17 million equity in losses from a reduced valuation of a certain non-core investment fund. No such costs were incurred in the first quarter of fiscal year 2027.

Interest and other, net consist of various other types of items that are not directly related to ongoing or core business results, such as the gain or losses related to certain divestitures, currency translation reserve write-offs upon liquidation of certain legal entities, debt extinguishment costs and impairment charges or gains associated with certain non-core investments. The Company excludes these items because they are not related to the Company's ongoing operating performance or do not affect core operations. During the three month period ended June 26, 2026, the Company recognized a $46 million gain on the divestiture of a subsidiary. No such costs were incurred in the first quarter of fiscal year 2026.

Adjustments for taxes relates to the tax effects of the various adjustments that we incorporate into non-GAAP measures in order to provide a more meaningful measure on non-GAAP net income and certain adjustments related to non-recurring settlements of tax contingencies or other non-recurring tax charges, when applicable. Effective in fiscal year 2026, the Company adopted an annual normalized tax rate for the purpose of determining the tax effect of non-GAAP adjustments. In estimating the normalized tax rate, the Company utilizes a full-year projection of earnings that considers the mix of earnings across tax jurisdictions, existing tax positions and other significant tax matters.

During the three month periods ended June 26, 2026 and June 27, 2025, the Company recognized a $7 million and $19 million net tax benefit, respectively, related to the tax effects of various adjustments that are incorporated into non-GAAP measures on restructuring and other.

Free cash flow is an important liquidity metric because it measures, during a given period, the amount of cash generated that is available to repay debt obligations, make investments, fund acquisitions, repurchase company shares and for certain other activities. The Company's free cash flow is defined as cash flows from operating activities, less net purchases of property and equipment and proceeds from the disposition of property and equipment ("net capital expenditures"), allowing us to present free cash flow on a consistent basis for investors.

During the three month periods ended June 26, 2026 and June 27, 2025, the Company recognized $41 million and $268 million of free cash inflow, respectively. Free Cash Flow for the three month period ended June 26, 2026,  was negatively impacted by $24 million of separation costs incurred in connection with the spin-off of Flex's Cloud & Power Infrastructure segment. Free cash flow is not a measure of liquidity under U.S. GAAP, and may not be defined and calculated by other companies in the same manner.

 

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SOURCE Flex

FAQ

How did Flex (NASDAQ: FLEX) perform in Q1 fiscal 2027?

Flex reported strong Q1 fiscal 2027 results, with net sales of $7.9 billion and GAAP EPS of $0.76. According to Flex, adjusted EPS reached a record $1.00, supported by a 6.7% adjusted operating margin and 21% year-over-year revenue growth.

What revenue and earnings guidance did Flex (FLEX) give for Q2 fiscal 2027?

For Q2 fiscal 2027, Flex guided net sales to $7.95–$8.25 billion and adjusted EPS of $1.00–$1.07. According to Flex, this outlook implies about 19% revenue growth at the midpoint and 32% adjusted EPS growth at the midpoint versus the prior-year quarter.

How has Flex updated its full-year fiscal 2027 guidance (FLEX)?

Flex raised its fiscal 2027 outlook to net sales of $33.7–$35.2 billion and adjusted EPS of $4.42–$4.74. According to Flex, the new guidance reflects 23% revenue growth and 39% adjusted EPS growth at the midpoint, excluding effects of the planned spin-off.

What were Flex’s key profitability metrics in Q1 fiscal 2027?

Flex delivered Q1 fiscal 2027 GAAP operating margin of 4.9% and adjusted operating margin of 6.7%. According to Flex, GAAP operating income was $392 million and adjusted operating income was $534 million, both higher than the prior-year quarter’s levels.

How did Flex’s cash flow and free cash flow trend in Q1 fiscal 2027?

Flex generated operating cash flow of $276 million and free cash flow of $41 million in Q1 fiscal 2027. According to Flex, operating cash flow and free cash flow were lower year over year, reflecting higher capital expenditures and other working capital changes compared with the prior-year period.

What changes occurred in Flex’s debt and cash position in Q1 fiscal 2027?

Flex ended Q1 fiscal 2027 with $2.84 billion in cash and $5.22 billion in long-term debt. According to Flex, cash increased from $2.39 billion and long-term debt rose from $3.75 billion at March 31, 2026, following significant borrowing and acquisition activity.

When is Flex’s next Investor Day and what is its purpose for FLEX shareholders?

Flex scheduled its next Investor Day for November 10, 2026. According to Flex, management plans to discuss strategy, financial performance, and outlook, giving FLEX shareholders and analysts deeper insight into its markets, guidance framework, and the planned spin-off of the Cloud and Power Infrastructure segment.