Flex Ltd.

Good afternoon and thank you for standing by. Welcome to Flex's Fiscal Third Quarter 2023 Earnings Conference Call. Presently, all participants are in listen-only mode. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question, please press star 1 on your phone. If you would like to withdraw your questions, please press the pound key. As a reminder, this call is being recorded. I will now begin and turn the call over to Mr. David Rubin. You may begin.

Thank you, JP. Good afternoon and welcome to FLEX's third quarter fiscal 2023 earnings conference call. With me today is our chief executive officer, Revati Advaiti, and our chief financial officer, Paul Lundstrom. Both will give brief remarks followed by Q&A. Slides for today's call, as well as a copy of the earnings press release and summary financials are available in the investor relations section at flex.com. This call has been recorded and will be available for replay on our corporate website. As a reminder, Today's call contains forward-looking statements which are based on our current expectations and assumptions. These statements involve risks and uncertainties that could cause actual results to differ materially. For full discussion of these risks and uncertainties, please see the cautionary statements in our presentation, press release, or in our most recent filings with the SEC. Note this information is subject to change and we undertake no obligation to update these forward-looking statements. Unless otherwise specified, we will refer to non-GAAP metrics on the call. The full non-GAAP to GAAP reconciliations can be found in the appendix slides of today's presentation, as well as in the summary financials posted in the Investor Relations website. On January 13th of this year, we publicly filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission relating to Nextractor's proposed initial public offering. In connection with the proposed offering, Next Tracker intends to list under the ticker symbol NXT. The timing, number of shares to be offered, and the price range for the proposed offering have not yet been determined. This offering is determined, excuse me, this offering is subject to market and other conditions. For more information, please refer to the S-1 filing. Following SEC regulation, remain in quiet period and will not make any further statements or answer additional questions on the Next Tracker filing at this time. With that out of the way, I'd like to turn the call over to our CEO, Revathy.

Thank you, David. Good afternoon and thank you for joining us today. So by now you've all probably seen the S-1 public filing for the Nextracker IPO. As I said from the very beginning of this process, the first step in creating value for our shareholders and to unlock the full long-term potential of Nextracker is for it to operate as a standalone company. This process was, of course, delayed by the supply chain crisis brought on by the pandemic. Despite all of the challenges during this time, we have maintained discipline and achieved multiple quarters of improving growth and margins. Along the way, we partnered with TPG Rise Climate, a team who's making a real difference in the renewable energy transition. So now we're moving forward. That said, renewable energy is one of the most important global technology transitions ever. It also represents a robust, long-term growth opportunity for a number of technologies, including solar trackers, and FLEX will continue to be involved to help drive this critical sector. Moving to our results, please turn to slide four. Overall, fiscal Q3 was another fantastic quarter for FLEX. and another validation in the resiliency of our diverse portfolio. Revenue grew 17% year over year with adjusted operating margin at 4.8%. And the strong performance overall drove solid results of adjusted EPS at 62 cents up 24% year over year. Turning to slide five. Many of the positive dynamics in fiscal Q2 continued through the quarter, but with a few ongoing challenges that I'll touch on in a minute. We see strong growth driven by secular trends with technology transitions in EV and ADAS, in renewables, in factory automation, along with cloud expansion and strong automotive backlog. We're also seeing demand in communications, network security, and many of the industrial applications we touch. Consumer and markets remained weak, which shouldn't be a surprise, and we expect that weakness to continue in the current environment. Similar to last quarter, the overall supply chain and logistics situation continues to improve on a global level. However, shortages in the large-node semiconductors remain a challenge, particularly within high-reliability applications such as automotive, industrial, and some healthcare products. We have talked before about how this causes inefficiencies and under absorption of costs and this golden screw effect is also the primary driver of higher working capital requirements. We remain very bullish on the long term growth opportunities and reliability so have made additional near term operational investments to support this growth, including increases in higher skill Labor. The net result this quarter was additional pressure on reliability operating margins. However, these investments will benefit our longer-term market positioning and is worth the focus as reliability has and will be the bigger driver of our long-term growth story. The agility team had great execution, meeting strong demand in CEC and delivered another quarter of growth in lifestyle, but also demonstrated very effective cost management given the broader consumer turndown. We continue to recognize the benefits of both the operational improvements and portfolio changes we have made over the last several years. It is important to highlight the power of a well-diversified and balanced portfolio. We remain in a challenging macro environment and yet delivered growth and five of six core business units and accelerated growth and next tracker. Now looking to slide six. Paul will discuss our guidance in a minute, but assuming Q4 revenue comes in, as expected, we remain on track to deliver 16% year-over-year growth in fiscal 2023. As you can see in the chart on the left, this also means we will have beat our previous revenue high watermark before we pruned a substantial amount of lower quality business. Adding in our operational initiatives, you can see a steady and consistent path of margin expansion, and all of this reflects the improvements we have made as a company. With the evolving macroeconomic uncertainty, it's still a highly dynamic environment out there. However, I want to share an early view into what we're seeing as we look to our fiscal 2024. At this point, demand indicators are holding up for many of the multi-year trends we've been talking about, including renewables, next-gen mobility, cloud, and healthcare. We believe these are strong enough to offset headwinds like consumer-related weaknesses and slowing enterprise IT spending. So at this point, We thought it was important to state we expect to grow next year in fiscal 2024. We will discuss our full fiscal 2024 guidance on next quarter's call. Turning to slide 7. Lastly, taking a step back as I look at the fiscal 2025 financial framework we gave you in our investor day last year. We said high single digit revenue CAGR. Which will lead to five plus percent adjusting operating margin in core flex, which is without next tracker with mid teens adjusted EPS growth getting us to $2 65 for core flex and 80% adjusted free cash flow conversion. Is a combination of strong multi year drivers, coupled with our focus on the right growth areas and our execution that will get us to these targets. With that, I'll turn it over to Paul to take you through our financials. Paul?