Plexus ((PLXS)) has held its Q4 earnings call. Read on for the main highlights of the call.
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Plexus Earnings Call Highlights Strong Performance Amid Sector Challenges
The recent earnings call for Plexus was marked by an overall positive sentiment, underscored by strong financial performance, market share gains, and notable achievements in sustainability. Despite facing challenges such as delays in the Aerospace and Defense sector and subdued demand in the industrial sector, the company’s revenue growth and operational efficiency were significant positives that outweighed the negatives.
Strong Financial Performance
Plexus reported impressive financial results, including a 40 basis point expansion of its non-GAAP operating margin and a remarkable 30% growth in non-GAAP EPS. The company also generated $154 million in free cash flow for fiscal 2025, highlighting its robust financial health and strategic execution.
Impressive Revenue and Market Share Gains
The company’s revenue reached $1.058 billion, nearing the high end of its guidance and marking the third consecutive quarter of sequential growth. Plexus secured $274 million in annual revenue from 28 new manufacturing programs, demonstrating its ability to capture market share and drive growth.
Sustainability and Community Engagement
Plexus made significant strides in sustainability, reducing waste to landfill by over 30% and achieving over 32,000 volunteer hours, a 47% increase. The company also granted $1.4 million to global nonprofits, reflecting its commitment to community engagement and environmental responsibility.
Operational Efficiency and ROI
The company achieved a 14.6% return on invested capital, significantly surpassing the 570 basis points over the weighted average cost of capital. Plexus also improved its cash cycle to the best result in five years, underscoring its focus on operational efficiency and return on investment.
Aerospace and Defense Sector Revenue Decline
Revenue in the Aerospace and Defense sector saw a 6% sequential decline due to minor delays in new program ramps. This sector’s performance was a notable challenge amid otherwise strong company results.
Muted Demand in Industrial Sector
The outlook for the industrial sector in the fiscal first quarter indicates a high single-digit decrease, driven by seasonality within the energy subsector and generally muted demand. This presents a challenge that Plexus will need to navigate in the coming quarters.
Forward-Looking Guidance
Looking ahead, Plexus provided optimistic guidance for the fiscal first quarter of 2026, with expected revenue between $1.05 billion to $1.09 billion and a non-GAAP operating margin of 5.6% to 6.0%. The company anticipates continued revenue growth through new program ramps and market share gains, aiming for a 6% non-GAAP operating margin and robust free cash flow. The commitment to sustainability remains strong, with further reductions in waste and emissions planned.
In summary, Plexus’s earnings call reflected a strong overall performance, with significant achievements in financial metrics and sustainability efforts. While challenges in specific sectors were noted, the company’s strategic initiatives and forward-looking guidance suggest continued growth and market leadership.