Flex (FLEX) Q1 2027 earnings summary

Executive summary

• Q1 revenue reached $7.9 billion, up 21% year-over-year, with record adjusted EPS of $1.00 and margin expansion across all segments, notably in Cloud and Power Infrastructure (CPI) and Integrated Technology Solutions (ITS).

• Net income rose to $285 million from $192 million year-over-year, and the company was added to the S&P 500 index.

• Announced progress on the planned spin-off of the CPI segment, expected in Q1 calendar 2027, with leadership appointments and timeline updates.

• Strategic partnerships and new product launches in AI supercomputing and liquid cooling solutions, including the acquisition of Electrical Power Products, Inc. (EPP) for $1.2 billion.

• Strategic focus on building two distinct, growth-oriented companies post-spin-off.

Financial highlights

• Q1 revenue: $7.9 billion, up 21% year-over-year; adjusted gross profit: $761 million, margin 9.6%, up 50 bps; adjusted operating profit: $534 million, margin 6.7%, up 70 bps.

• Net income: $285 million, up from $192 million year-over-year; GAAP EPS: $0.76, up from $0.50; adjusted EPS: $1.00, up 39% year-over-year.

• Free cash flow: $41 million, impacted by $24 million in one-time spin-off/separation costs.

• Net CapEx: $235 million (3% of revenue); cash and cash equivalents: $2.84 billion as of June 26, 2026.

• Operating income: $392 million GAAP, up from $311 million year-over-year.

Outlook and guidance

• FY27 revenue guidance raised to $33.7–$35.2 billion, up 23% at midpoint; adjusted operating margin: 7.0–7.2%; adjusted EPS: $4.42–$4.74, up 39% at midpoint.

• Q2 FY27 revenue expected at $7.95–$8.25 billion, up 19% at midpoint; adjusted EPS: $1.00–$1.07.

• FY27 segment outlook: RMS up mid-to-high single digits, ITS up high single to low double digits, CPI up 65–75%.

• Free cash flow conversion guidance revised to -40% due to spin-off costs.

• Management expects current liquidity and capital structure to be sufficient for future commitments.