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Plexus Announces Fiscal Second Quarter Financial Results

1. Plexus reports Q2 2025 revenue of $980 million, meeting guidance. 2. Non-GAAP EPS for Q2 2025 exceeds guidance at $1.66. 3. Third quarter revenue guidance estimated between $1.00 billion and $1.04 billion. 4. Company achieved 42 manufacturing wins worth $205 million in annualized revenue. 5. Plexus generated free cash flow of $16.5 million, supporting share repurchase.

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Why Bullish?

Plexus's strong revenue results and positive EPS guidance indicate healthy performance, boosting investor confidence. Historical trends show that positive quarterly results often lead to stock price increases, as seen in Q1 2025.

How important is it?

Strong financial results and positive forward guidance are key indicators for investor sentiment and future stock performance. The significant wins and free cash flow reinforce financial sustainability, likely impacting PLXS price positively.

Why Short Term?

The immediate effects from the earnings announcement and guidance can influence investor behavior in the short term, typically resulting in a stock price adjustment.

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NEENAH, WI, April 23, 2025 (GLOBE NEWSWIRE) -- Plexus Corp. (NASDAQ: PLXS) today announced financial results for our fiscal second quarter ended March 29, 2025, and guidance for our fiscal third quarter ending June 28, 2025. Reports fiscal second quarter 2025 revenue of $980 million, GAAP operating margin of 5.0% and GAAP diluted EPS of $1.41.Reports fiscal second quarter 2025 non-GAAP operating margin of 5.7% and non-GAAP diluted EPS of $1.66, excluding $0.25 of stock-based compensation expense.Initiates fiscal third quarter 2025 revenue guidance of $1.00 billion to $1.04 billion with GAAP diluted EPS of $1.40 to $1.55, including $0.25 of stock-based compensation expense. Fiscal third quarter non-GAAP EPS guidance of $1.65 to $1.80 excludes stock-based compensation expense.   Three Months Ended  Mar 29, 2025  Mar 29, 2025   Jun 28, 2025   Q2F25 Results  Q2F25 Guidance   Q3F25 Guidance Summary GAAP Items         Revenue (in millions)$980   $960 to $1,000   $1,000 to $1,040 Operating margin 5.0%  4.6% to 5.0%   5.0% to 5.4% Diluted EPS$1.41   $1.22 to $1.37   $1.40 to $1.55            Summary Non-GAAP Items (1)         Adjusted operating margin (2) 5.7%  5.3% to 5.7%   5.7% to 6.1% Adjusted EPS (3)$1.66   $1.46 to $1.61   $1.65 to $1.80 Return on invested capital (ROIC) 13.7%        Economic return 4.8%         (1)Refer to Non-GAAP Supplemental Information tables for additional information regarding non-GAAP financial measures.(2)Excludes stock-based compensation expense of approximately 70 bps for Q2F25 results,Q2F25 guidance and Q3F25 guidance.(3)Excludes stock-based compensation expense, net of tax, of $0.25 for Q2F25 results,$0.24 for Q2F25 guidance and $0.25 for Q3F25 guidance.    Fiscal Second Quarter 2025 Information Won 42 manufacturing programs during the quarter representing $205 million in annualized revenue when fully ramped into production.Generated fiscal second quarter free cash flow of $16.5 million, contributing to fiscal year-to-date free cash flow of $43.6 million.Purchased $12.2 million of our shares at an average price of $141.18 per share under our 2025 Share Repurchase Program, leaving $25.0 million available under our existing $50.0 million authorization. Todd Kelsey, President and Chief Executive Officer, commented, “Plexus generated strong fiscal second quarter financial performance, demonstrating the continued momentum of our operational and working capital efficiency initiatives. We achieved revenue of $980 million, in-line with guidance, with non-GAAP operating margin of 5.7% at the high-end of guidance and non-GAAP EPS of $1.66 exceeding guidance. In addition, free cash flow exceeded our expectations.” Patrick Jermain, Executive Vice President and Chief Financial Officer, commented, "Fiscal second quarter cash cycle of 68 days was favorable to expectations and consistent with the fiscal first quarter. We continue to drive reductions in our gross inventory balance, with this quarter representing the fifth consecutive quarter of improvement. Our favorable cash cycle performance benefited our fiscal second quarter return on invested capital of 13.7%, which exceeded our weighted average cost of capital by 480 basis points. Finally, we delivered better than expected free cash flow of $16.5 million, which we utilized to repurchase $12.2 million of our shares during the fiscal second quarter in support of our commitment to return cash to shareholders." Mr. Kelsey added, “We delivered 42 fiscal second quarter manufacturing wins, representing $205 million in annualized revenue. Notably, this result included our largest ever sustaining services win in support of creating success for an industry-leading healthcare customer. Additionally, our engineering solutions team delivered its best quarterly wins performance in more than 5 years, highlighting the breadth of our global capabilities and the effectiveness of our diversification efforts.” Mr. Kelsey continued, “We are guiding fiscal third quarter revenue of $1.00 to $1.04 billion, non-GAAP operating margin of 5.7% to 6.1% and non-GAAP EPS of $1.65 to $1.80. Furthermore, while conservatively assessing the remainder of the fiscal year and acknowledging the uncertainty associated with tariffs, we continue to anticipate achieving meaningful EPS growth in fiscal 2025, capitalizing upon revenue growth in each of our market sectors, robust operating margin performance and ongoing free cash flow deployment.” Mr. Kelsey concluded, “Plexus uniquely supports customer success, leveraging our comprehensive product lifecycle solutions and passion for operational excellence delivered through our globally united team. Our ongoing strategic investments in talent, technology, facilities and advanced capabilities position Plexus to proactively navigate evolving landscapes and dynamic environments to enable our customers’ success.” Quarterly ComparisonThree Months Ended(in thousands, except EPS)Mar 29, 2025 Dec 28, 2024 Mar 30, 2024Revenue$980,170  $976,122  $966,900 Gross profit 97,751   100,692   88,063 Operating income 48,791   46,860   29,470 Net income 39,073   37,267   16,239 Diluted EPS$1.41  $1.34  $0.58       Gross margin 10.0%  10.3%  9.1%Operating margin 5.0%  4.8%  3.0%      ROIC (1) 13.7%  13.8%  9.9%Economic return (1) 4.8%  4.9%  1.7% (1)Refer to Non-GAAP Supplemental Information tables for non-GAAP financial measures discussed and/or disclosed in this release, such as adjusted operating margin, adjusted net income, adjusted diluted EPS, ROIC and economic return.    Business Segment and Market Sector Revenue Plexus measures operational performance and allocates resources on a geographic segment basis. Plexus also reports revenue based on the market sector breakout set forth in the table below, which reflects Plexus’ market sector focused strategy. Top 10 customers comprised 51% of revenue during both the first and second quarter of fiscal 2025. This is up 3 percentage points from the second quarter of fiscal 2024. Business Segments ($ in millions)Three Months Ended  Mar 29, 2025 Dec 28, 2024 Mar 30, 2024Americas$295  $274  $296 Asia-Pacific 587   607   522 Europe, Middle East and Africa 103   101   152 Elimination of inter-segment sales (5)  (6)  (3)Total Revenue$980  $976  $967  Market Sectors ($ in millions)Three Months Ended Mar 29, 2025 Dec 28, 2024 Mar 30, 2024Aerospace/Defense$17218% $16016% $17018%Healthcare/Life Sciences 41142%  37438%  37939%Industrial 39740%  44246%  41843%Total Revenue$980  $976  $967   Non-GAAP Supplemental Information Plexus provides non-GAAP supplemental information, such as ROIC, economic return and free cash flow, because such measures are used for internal management goals and decision-making, and because they provide management and investors with additional insight into financial performance. In addition, management uses these and other non-GAAP measures, such as adjusted operating income, adjusted operating margin, adjusted net income and adjusted diluted EPS, to provide a better understanding of core performance for purposes of period-to-period comparisons. Plexus believes that these measures are also useful to investors because they provide further insight by eliminating the effect of non-recurring items that are not reflective of continuing operations. For additional information on non-GAAP measures, please refer to the attached Non-GAAP Supplemental Information tables. ROIC and Economic Return ROIC for the second quarter of fiscal 2025 was 13.7%. Plexus defines ROIC as tax-effected annualized adjusted operating income divided by average invested capital over a three-quarter period for the second fiscal quarter. Invested capital is defined as equity plus debt and operating lease obligations, less cash and cash equivalents. Plexus' weighted average cost of capital for fiscal 2025 is 8.9%. ROIC for the second quarter of fiscal 2025 less Plexus’ weighted average cost of capital resulted in an economic return of 4.8%. Free Cash Flow Plexus defines free cash flow as cash flows provided by operations less capital expenditures. For the three months ended March 29, 2025, cash flows provided by operations was $36.7 million, less capital expenditures of $20.2 million, resulting in free cash flow of $16.5 million. Cash Cycle DaysThree Months Ended  Mar 29, 2025 Dec 28, 2024 Mar 30, 2024Days in Accounts Receivable 57   56   61 Days in Contract Assets 12   12   12 Days in Inventory 132   134   158 Days in Accounts Payable (70)   (69)   (65) Days in Advanced Payments (63)   (65)   (75) Annualized Cash Cycle (1) 68   68   91  (1)Plexus calculates cash cycle as the sum of days in accounts receivable, days in contract assets and days in inventory, less days in accounts payable and days in advanced payments.    Conference Call and Webcast Information What:Plexus Fiscal 2025 Q2 Earnings Conference Call and WebcastWhen:Thursday, April 24, 2025 at 8:30 a.m. Eastern TimeWhere:Participants are encouraged to join the live webcast at the investor relations section of the Plexus website, plexus.com. Participants can also join utilizing the links below:Webcast link:https://events.q4inc.com/attendee/242810884Replay:The webcast will be archived on the Plexus website and will be available as on-demand for 12 months   Investor and Media ContactShawn Harrison+1.920.969.6325shawn.harrison@plexus.com About PlexusSince 1979, Plexus has helped create the products that build a better world. Driven by a passion for excellence, we partner with our customers to design, manufacture and service highly complex products in demanding regulatory environments. From life-saving medical devices and mission-critical aerospace and defense products to industrial automation systems and semiconductor capital equipment, our innovative solutions across the lifecycle of a product converge where advanced technology and human impact intersect. We provide these solutions to market-leading as well as disruptive global companies in the Aerospace/Defense, Healthcare/Life Sciences, and Industrial sectors, supported by a global team of over 20,000 members across our 26 facilities in the Americas ("AMER"), Asia-Pacific ("APAC") and Europe, Middle East and Africa ("EMEA") regions. For more information about Plexus, visit our website at www.plexus.com. Safe Harbor and Fair Disclosure Statement The statements contained in this press release that are guidance or which are not historical facts (such as statements in the future tense and statements including believe, expect, intend, plan, anticipate, goal, target and similar terms and concepts), including all discussions of periods which are not yet completed, are forward-looking statements that involve risks and uncertainties. These risks and uncertainties include the effects of tariffs, trade disputes, trade agreements and other trade protection measures; the effect of inflationary pressures on our costs of production, profitability, and on the economic outlook of our markets; the effects of shortages and delays in obtaining components as a result of economic cycles, natural disasters or otherwise; the risk of customer delays, changes, cancellations or forecast inaccuracies in both ongoing and new programs; the ability to realize anticipated savings from restructuring or similar actions, as well as the adequacy of related charges as compared to actual expenses; the lack of visibility of future orders, particularly in view of changing economic conditions; the economic performance of the industries, sectors and customers we serve; the outcome of litigation and regulatory investigations and proceedings, including the results of any challenges with regard to such outcomes; the effects of the volume of revenue from certain sectors or programs on our margins in particular periods; our ability to secure new customers, maintain our current customer base and deliver product on a timely basis; the risks of concentration of work for certain customers; the particular risks relative to new or recent customers, programs or services, which risks include customer and other delays, start-up costs, potential inability to execute, the establishment of appropriate terms of agreements, and the lack of a track record of order volume and timing; the effects of start-up costs of new programs and facilities or the costs associated with the closure or consolidation of facilities; possible unexpected costs and operating disruption in transitioning programs, including transitions between Company facilities; the risk that new program wins and/or customer demand may not result in the expected revenue or profitability; the fact that customer orders may not lead to long-term relationships; our ability to manage successfully and execute a complex business model characterized by high product mix and demanding quality, regulatory, and other requirements; the risks associated with excess and obsolete inventory, including the risk that inventory purchased on behalf of our customers may not be consumed or otherwise paid for by the customer, resulting in an inventory write-off; risks related to information technology systems and data security; increasing regulatory and compliance requirements; any tax law changes and related foreign jurisdiction tax developments; current or potential future barriers to the repatriation of funds that are currently held outside of the United States as a result of actions taken by other countries or otherwise; the potential effects of jurisdictional results on our taxes, tax rates, and our ability to use deferred tax assets and net operating losses; the weakness of areas of the global economy; the effect of changes in the pricing and margins of products; raw materials and component cost fluctuations; the potential effect of fluctuations in the value of the currencies in which we transact business; the effects of changes in economic conditions, political conditions and regulatory matters in the United States and in the other countries in which we do business; the potential effect of other world or local events or other events outside our control (such as the conflict between Russia and Ukraine, conflict in the Middle East, escalating tensions between China and Taiwan or China and the United States, changes in energy prices, terrorism, global health epidemics and weather events); the impact of increased competition; an inability to successfully manage human capital; changes in financial accounting standards; and other risks detailed herein and in our other Securities and Exchange Commission filings, particularly in Risk Factors contained in our fiscal 2024 Form 10-K. PLEXUS CORP. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except per share data)(unaudited)       Three Months Ended Six Months Ended Mar 29, Mar 30, Mar 29, Mar 30,  2025   2024   2025   2024 Net sales$980,170  $966,900  $1,956,292  $1,949,507 Cost of sales 882,419   878,837   1,757,849   1,773,304 Gross profit 97,751   88,063   198,443   176,203 Operating expenses:       Selling and administrative expenses 48,960   47,555   98,109   90,537 Restructuring and other charges, net —   11,038   4,683   11,038 Operating income 48,791   29,470   95,651   74,628 Other income (expense):       Interest expense (3,137)  (8,293)  (6,691)  (15,910)Interest income 871   817   2,105   1,625 Miscellaneous, net (1,502)  (3,027)  (2,548)  (6,529)Income before income taxes 45,023   18,967   88,517   53,814 Income tax expense 5,950   2,728   12,177   8,360 Net income$39,073  $16,239  $76,340  $45,454 Earnings per share:       Basic$1.44  $0.59  $2.82  $1.65 Diluted$1.41  $0.58  $2.75  $1.62 Weighted average shares outstanding:       Basic 27,109   27,542   27,098   27,513 Diluted 27,662   27,929   27,726   27,982  PLEXUS CORP. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except per share data)(unaudited) Mar 29, Sep 28,  2025   2024 ASSETS   Current assets:   Cash and cash equivalents$310,531  $345,109 Restricted cash 31   2,353 Accounts receivable 609,493   622,366 Contract assets 136,131   120,560 Inventories 1,280,385   1,311,434 Prepaid expenses and other 59,740   75,328 Total current assets 2,396,311   2,477,150 Property, plant and equipment, net 511,865   501,112 Operating lease right-of-use assets 76,217   74,360 Deferred income taxes 73,841   73,919 Other assets 27,506   27,280 Total non-current assets 689,429   676,671 Total assets$3,085,740  $3,153,821     LIABILITIES AND SHAREHOLDERS’ EQUITY   Current liabilities:   Current portion of long-term debt and finance lease obligations$121,014  $157,325 Accounts payable 680,078   606,378 Advanced payments from customers 611,590   709,152 Accrued salaries and wages 83,650   94,448 Other accrued liabilities 69,499   75,991 Total current liabilities 1,565,831   1,643,294 Long-term debt and finance lease obligations, net of current portion 88,761   89,993 Accrued income taxes payable —   17,198 Long-term operating lease liabilities 32,720   32,275 Deferred income taxes 7,224   8,234 Other liabilities 39,529   38,002 Total non-current liabilities 168,234   185,702 Total liabilities 1,734,065   1,828,996 Shareholders’ equity:   Common stock 547   545 Additional paid-in-capital 680,880   680,638 Common stock held in treasury (1,215,481)  (1,190,115)Retained earnings 1,899,483   1,823,143 Accumulated other comprehensive (loss) income (13,754)  10,614 Total shareholders’ equity 1,351,675   1,324,825 Total liabilities and shareholders’ equity$3,085,740  $3,153,821  PLEXUS CORP. AND SUBSIDIARIESNON-GAAP SUPPLEMENTAL INFORMATION Table 1(in thousands, except per share data)(unaudited)           Three Months Ended Six Months Ended Mar 29, Dec 28, Mar 30, Mar 29, Mar 30,  2025   2024   2024   2025   2024 Operating income, as reported$48,791  $46,860  $29,470  $95,651  $74,628 Operating margin, as reported 5.0%  4.8%  3.0%  4.9%  3.8%          Non-GAAP adjustments:         Restructuring costs (1) —   4,683   13,288   4,683   13,288 Other non-recurring income (2) —   —   (2,250)  —   (2,250)Stock-based compensation 7,132   6,990   7,096   14,122   12,431 Non-GAAP operating income$55,923  $58,533  $47,604  $114,456  $98,097 Non-GAAP operating margin 5.7%  6.0%  4.9%  5.9%  5.0%          Net income, as reported$39,073  $37,267  $16,239  $76,340  $45,454           Non-GAAP adjustments:         Restructuring costs, net of tax (1) —   4,191   11,893   4,191   11,893 Other non-recurring income, net of tax (2) —   —   (2,014)  —   (2,014)Stock-based compensation, net of tax 6,775   6,640   7,096   13,415   12,431 Adjusted net income$45,848  $48,098  $33,214  $93,946  $67,764           Diluted earnings per share, as reported$1.41  $1.34  $0.58  $2.75  $1.62           Non-GAAP per share adjustments:         Restructuring costs, net of tax (1) —   0.15   0.43   0.15   0.43 Other non-recurring income, net of tax (2) —   —   (0.07)  —   (0.07)Stock-based compensation, net of tax 0.25   0.24   0.25   0.49   0.44 Adjusted diluted earnings per share$1.66  $1.73  $1.19  $3.39  $2.42  (1)During the three months ended December 28, 2024, restructuring costs of $4.7 million, or $4.2 million net of taxes, were incurred primarily for employee severance costs associated with a reduction in the Company's workforce in the EMEA and AMER regions.   During the three and six months ended March 30, 2024, restructuring and impairment charges of $13.3 million, or $11.9 million net of taxes, were incurred for employee severance costs associated with a reduction in the Company's workforce as well as closure costs associated with a site in the Company's EMEA region. (2)During the three and six months ended March 30, 2024, insurance proceeds of $2.3 million, or $2.0 million net of taxes, were received related to an arbitration decision associated with a contractual matter that occurred in the Company's EMEA region in fiscal 2023. PLEXUS CORP. AND SUBSIDIARIESNON-GAAP SUPPLEMENTAL INFORMATION Table 2(in thousands)(unaudited)      ROIC and Economic Return CalculationsSix Months Ended Three Months Ended Six Months Ended Mar 29, Dec 28, Mar 30, 2025  2024  2024 Operating income, as reported$95,651   $46,860   $74,628 Restructuring and other charges, net 4,683  + 4,683  + 11,038 Adjusted operating income$100,334   $51,543   $85,666   2  x 4  x 2                 Adjusted annualized operating income$200,668   $206,172   $171,332 Adjusted effective tax rate 13% x 15% x 15%Tax impact 26,087    30,926    25,700 Adjusted operating income (tax-effected)$174,581   $175,246   $145,632         Average invested capital$1,276,742  ÷$1,268,309  ÷$1,478,062 ROIC 13.7%   13.8%   9.9%Weighted average cost of capital 8.9% - 8.9% - 8.2%Economic return 4.8%   4.9%   1.7%               Average Invested Capital CalculationsMar 29, Dec 28, Sep 28, Jun 29, Mar 30, Dec 30, Sep 30,  2025   2024   2024   2024   2024   2023   2023 Equity$1,351,675  $1,319,069  $1,324,825  $1,266,360  $1,259,762  $1,266,755  $1,214,382 Plus:             Debt and finance lease obligations - current 121,014   121,977   157,325   258,175   245,964   251,119   240,205 Operating lease obligations - current (1) 9,968   14,875   14,697   7,990   8,281   9,172   8,363 Debt and finance lease obligations - long-term 88,761   88,728   89,993   90,715   192,025   192,118   190,853 Operating lease obligations - long-term 32,720   35,124   32,275   31,923   33,915   35,989   38,552 Less:             Cash and cash equivalents (310,531)  (317,161)  (345,109)  (269,868)  (265,053)  (231,982)  (256,233) $1,293,607  $1,262,612  $1,274,006  $1,385,295  $1,474,894  $1,523,171  $1,436,122  (1)Included in other accrued liabilities on the Condensed Consolidated Balance Sheets.

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