Plexus (PLXS) Q1 2025 earnings summary

Executive summary

• Fiscal Q1 2025 revenue was $976 million, with non-GAAP EPS of $1.73 and GAAP EPS of $1.34, both exceeding guidance; non-GAAP operating margin reached 6.0% and GAAP operating margin was 4.8%.

• Free cash flow was $27 million, the best Q1 in five years, and net income rose 27.7% to $37.3 million.

• 30 new manufacturing program wins in Q1 represent $212 million in annualized revenue, with strong contributions from Healthcare/Life Sciences and growth in Aerospace/Defense and Industrial sectors.

• Return on invested capital (ROIC) increased to 13.8%, 490 bps above WACC.

• Robust sector wins and continued focus on working capital efficiency position the company for growth in FY2025.

Financial highlights

• Q1 2025 revenue: $976 million, down from $1.05 billion in Q4 2024 and $983 million in Q1 2024.

• Gross margin: 10.3%, up from 9.0% in Q1 2024.

• Non-GAAP EPS: $1.73, above guidance; GAAP EPS: $1.34.

• Free cash flow: $27 million in Q1, a significant improvement from negative $32 million in Q1 2024.

• Net cash cycle days improved to 68 from 95 in Q1 2024.

Outlook and guidance

• Q2 2025 revenue guidance: $960 million to $1.0 billion; non-GAAP EPS: $1.46 to $1.61; GAAP EPS: $1.22 to $1.37.

• Expects sequential revenue growth in the back half of FY2025 and up to $100 million in free cash flow for the year.

• Capital expenditures for FY2025 expected at $120–$150 million, including $60 million for Penang expansion.

• Annual effective tax rate for FY2025 expected to be 14.0% to 16.0%.

• Management expects sufficient liquidity for the next twelve months from operations, cash, and credit facilities.