Plexus Corp.

Hello everyone. Thank you for joining us and welcome to the Plexus 4th Quarter 2026 and Fiscal 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. On the call today to answer your questions after the presentation are Todd Kelsey, President and CEO, David Abuhl, CFO and Senior Vice President, and Oliver Mihm, Executive Vice President and COO. I will now hand the conference over to Shawn Harrison, VP of Investor Relations. Shawn, please go ahead.

Good morning and thank you for joining us today. Some of the statements made and information provided during our call today will be forward-looking statements. including without limitation those regarding revenue, gross margin, selling and administrative expense, operating margin, other income and expense, taxes, cash cycle, capital allocation, and future business outlook. Forward-looking statements are not guarantees since there are inherent difficulties in predicting future results, and actual results could differ materially from those expressed or implied in the forward-looking statements. For a list of factors that could cause actual results to differ materially from those discussed, Please refer to the company's periodic SEC filings, particularly the risk factors in our Form 10-K filing for the fiscal year ended September 27, 2025, and the Safe Harbor and Fair Disclosure Statement in our press release. We encourage participants on the call this morning to access the live webcast and supporting materials at Plexus's website at www.plexus.com, clicking on Investors at the top of that page. Joining me today are Todd Kelsey, President and Chief Executive Officer, Oliver Mihm, Executive Vice President and Chief Operating Officer, and David Abuhl, Senior Vice President and Chief Financial Officer. With today's earnings call, Todd will provide summary comments before turning the call over to Oliver and David for further details. Before turning the call over to Todd, please note that Plexus will attend Bayard's Global Industrial Conference in Chicago on November 11th and Raymond James' TMT and Consumer Conference in New York City on December 7th. With that, let me now turn the call over to Todd.

Thank you, Shawn. Good morning, everyone. Please advance to slide three. Plexus delivered an outstanding fiscal 2026 that exceeded expectations. Our differentiated value proposition, anchored by unmatched quality and delivery, creates significant opportunities for new and expanded customer relationships, positioning Plexus to generate robust financial returns and shareholder value. Flex has generated record fiscal fourth quarter revenue of $1.43 billion. This resulted in fiscal 2026 revenue increasing 23% year over year to approximately $5 billion. We're now forecasting fiscal 2027 revenue growth in the mid to upper teens. Our wins performance remains strong while our funnel of qualified manufacturing opportunities reached another record level. expanding $1.2 billion year-over-year to nearly $5 billion, supporting our diversified and accelerating revenue growth momentum. We delivered fantastic operating performance that exceeded our guidance. Fiscal fourth quarter non-GAAP operating margin of 6.7% increased 40 basis points sequentially and nearly 100 basis points year-over-year. Plexus exceeded its 6% non-GAAP operating margin goal for fiscal 2026, expanding non-GAAP operating margin 30 basis points to 6.2%. We're introducing a new non-GAAP operating margin goal of 6.5% to 7% given our expectation of continued revenue growth and ongoing dividends from efficiency investments and our continuous improvement culture. Finally, Fiscal 2026 ROIC exceeded our 15% enduring goal supported by continued robust working capital efficiency and disciplined capital investment. We anticipate another strong ROIC result for fiscal 2027 and at the anticipated revenue growth rate continue to forecast free cash flow for fiscal 2027 exceeding $100 million. Please advance to slide four. Record revenue in the fiscal fourth quarter of $1.43 billion substantially exceeded our guidance range and increased 9% sequentially and 35% year over year. Excellent performance by our supply chain and operations teams helped our customers gain market share and Plexus capture stronger than anticipated end market demand. In addition, non-GAAP operating margin of 6.7%, and Nongap EPS of $2.84 substantially exceeded our guidance ranges on strong operating leverage from the revenue upside and continued efficiency gains.