Plexus Announces Fiscal Third Quarter Financial Results

NEENAH, WI, July 23, 2025 (GLOBE NEWSWIRE) -- Plexus Corp. (NASDAQ: PLXS) today announced financial results for our fiscal third quarter ended June 28, 2025, and guidance for our fiscal fourth quarter ending September 27, 2025. Reports fiscal third quarter 2025 revenue of $1.018 billion, GAAP operating margin of 5.3% and GAAP diluted EPS of $1.64.Reports fiscal third quarter 2025 non-GAAP operating margin of 6.0% and non-GAAP diluted EPS of $1.90, excluding $0.26 of stock-based compensation expense.Initiates fiscal fourth quarter 2025 revenue guidance of $1.025 billion to $1.065 billion with GAAP diluted EPS of $1.57 to $1.72, including $0.25 of stock-based compensation expense. Fiscal fourth quarter non-GAAP EPS guidance of $1.82 to $1.97 excludes stock-based compensation expense. Three Months Ended Jun 28, 2025 Jun 28, 2025 Sep 27, 2025 Q3F25 Results Q3F25 Guidance Q4F25 GuidanceSummary GAAP Items Revenue (in billions)$1.018 $1.000 to $1.040 $1.025 to $1.065Operating margin5.3% 5.0% to 5.4% 5.0% to 5.4%Diluted EPS$1.64 $1.40 to $1.55 $1.57 to $1.72 Summary Non-GAAP Items (1) Adjusted operating margin (2)6.0% 5.7% to 6.1% 5.7% to 6.1%Adjusted EPS (3)$1.90 $1.65 to $1.80 $1.82 to $1.97Return on invested capital (ROIC)14.1% Economic return5.2% (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 Q3F25 results, Q3F25 guidance and Q4F25 guidance.(3) Excludes stock-based compensation expense, net of tax, of $0.26 for Q3F25 results and $0.25 for Q3F25 guidance and Q4F25 guidance. Fiscal Third Quarter 2025 Information Won 41 manufacturing programs during the quarter representing $250 million in annualized revenue when fully ramped into production.Generated fiscal third quarter free cash flow of $13.2 million, contributing to fiscal year-to-date free cash flow of $56.8 million.Purchased $18.4 million of our shares at an average price of $128.70 per share during the quarter.As previously announced on May 14, 2025, Plexus’ Board of Directors approved a new $100.0 million share repurchase program. Plexus has recently begun repurchasing shares under this $100.0 million program as the previous $50.0 million program has been fulfilled. Todd Kelsey, President and Chief Executive Officer, commented, “Our Plexus team continues to execute at a high level in driving numerous efficiency initiatives, which resulted in another strong quarter of financial performance. Fiscal third quarter revenue of $1.018 billion grew sequentially and was in-line with guidance, non-GAAP operating margin of 6.0% was near the high end of guidance and non-GAAP EPS of $1.90 exceeded guidance. Furthermore, free cash flow again surpassed our expectations.” Patrick Jermain, Executive Vice President and Chief Financial Officer, commented, "Fiscal third quarter cash cycle of 69 days was consistent with expectations and one day higher than the fiscal second quarter. For the sixth consecutive quarter, we drove a reduction in our gross inventory balance. This result, combined with other improvements to our cash cycle and our strong operating performance, produced fiscal third quarter return on invested capital of 14.1%, which exceeded our weighted average cost of capital by 520 basis points. We also delivered better than anticipated free cash flow of $13.2 million in support of our expectation to achieve approximately $100 million in free cash flow for fiscal 2025. Finally, furthering our commitment to return cash to our shareholders, we repurchased $18.4 million of our shares during the fiscal third quarter, while adding a $100 million share repurchase program to our previous, now fully-utilized, $50 million program." Mr. Kelsey added, “Our go-to-market team secured 41 fiscal third quarter manufacturing wins with well-balanced market sector diversification, representing $250 million in annualized revenue. Included in these wins are share gains resulting from our sustained focus on zero defects and perfect delivery as well as new customers in each of our market sectors with products aligned to exciting growth technologies.” Mr. Kelsey continued, “We expect to deliver strong fiscal fourth quarter financial results, including further sequential revenue growth. We anticipate generating this revenue expansion through share gains, new program ramps and growth with new customers, while overcoming muted end market demand, evolving new program ramp timelines and uncertainties created by tariffs. We are guiding revenue of $1.025 to $1.065 billion, non-GAAP operating margin of 5.7% to 6.1% and non-GAAP EPS of $1.82 to $1.97. At the midpoint, our fiscal fourth quarter guidance would result in robust non-GAAP fiscal 2025 EPS growth of 26%.” Mr. Kelsey concluded, “We are committed to creating long-term shareholder value through enabling customer success and focused initiatives that drive organizational and operational efficiency. We are bullish on the growth opportunities our solutions and market sectors provide. Our strategy is creating opportunities to gain share and capture new outsourcing opportunities in support of delivering sustained strong financial performance and growth exceeding that of our end markets.” Quarterly ComparisonThree Months Ended(in thousands, except EPS)Jun 28, 2025 Mar 29, 2025 Jun 29, 2024Revenue$1,018,308 $980,170 $960,751 Gross profit 103,288 97,751 94,415 Operating income 53,608 48,791 39,246 Net income 45,116 39,073 25,140 Diluted EPS$1.64 $1.41 $0.91 Gross margin 10.1% 10.0% 9.8%Operating margin 5.3% 5.0% 4.1% ROIC (1) 14.1% 13.7% 10.4%Economic return (1) 5.2% 4.8% 2.2% (1) Refer to Non-GAAP Supplemental Information tables for non-GAAP financial measures discussed and/or disclosed in this release, such as adjusted operating margin, adjusted net income, adjusted diluted EPS, ROIC and economic return. Business Segment and Market Sector Revenue Plexus measures operational performance and allocates resources on a geographic segment basis. Plexus also reports revenue based on the market sector breakout set forth in the table below, which reflects Plexus’ market sector focused strategy. Top 10 customers comprised 48% of revenue during the third quarter of both fiscal 2025 and 2024, which is down three percentage points from the second quarter of fiscal 2025. Business Segments ($ in millions)Three Months Ended Jun 28, 2025 Mar 29, 2025 Jun 29, 2024Americas$312 $295 $306 Asia-Pacific 594 587 521 Europe, Middle East and Africa 117 103 137 Elimination of inter-segment sales (5) (5) (3)Total Revenue$1,018 $980 $961 Market Sectors ($ in millions)Three Months Ended Jun 28, 2025 Mar 29, 2025 Jun 29, 2024Aerospace/Defense$18318% $17218% $17818%Healthcare/Life Sciences 42041% 41142% 38040%Industrial 41541% 39740% 40342%Total Revenue$1,018 $980 $961 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 third quarter of fiscal 2025 was 14.1%. Plexus defines ROIC as tax-effected annualized adjusted operating income divided by average invested capital over a four-quarter period for the third 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 third quarter of fiscal 2025 less Plexus’ weighted average cost of capital resulted in an economic return of 5.2%. Free Cash Flow Plexus defines free cash flow as cash flows provided by operations less capital expenditures. For the three months ended June 28, 2025, cash flows provided by operations was $26.9 million, less capital expenditures of $13.7 million, resulting in free cash flow of $13.2 million. Cash Cycle DaysThree Months Ended Jun 28, 2025 Mar 29, 2025 Jun 29, 2024Days in Accounts Receivable59 57 61Days in Contract Assets13 12 11Days in Inventory128 132 151Days in Accounts Payable(72) (70) (62)Days in Advanced Payments(59) (63) (78)Annualized Cash Cycle (1)69 68 83 (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 Q3 Earnings Conference Call and WebcastWhen:Thursday, July 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/103729490Replay: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 Nine Months Ended Jun 28, Jun 29, Jun 28, Jun 29, 2025 2024 2025 2024 Net sales$1,018,308 $960,751 $2,974,600 $2,910,258 Cost of sales 915,020 866,336 2,672,869 2,639,640 Gross profit 103,288 94,415 301,731 270,618 Operating expenses: Selling and administrative expenses 49,680 45,950 147,789 136,487 Restructuring and other charges, net — 9,219 4,683 20,257 Operating income 53,608 39,246 149,259 113,874 Other income (expense): Interest expense (2,501) (7,389) (9,192) (23,299)Interest income 934 1,015 3,039 2,640 Miscellaneous, net (2,205) (2,568) (4,753) (9,097)Income before income taxes 49,836 30,304 138,353 84,118 Income tax expense 4,720 5,164 16,897 13,524 Net income$45,116 $25,140 $121,456 $70,594 Earnings per share: Basic$1.67 $0.92 $4.48 $2.57 Diluted$1.64 $0.91 $4.39 $2.53 Weighted average shares outstanding: Basic 27,059 27,364 27,084 27,463 Diluted 27,532 27,765 27,670 27,918 PLEXUS CORP. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except per share data)(unaudited) Jun 28, Sep 28, 2025 2024 ASSETS Current assets: Cash and cash equivalents$237,567 $345,109 Restricted cash 50 2,353 Accounts receivable 663,549 622,366 Contract assets 145,145 120,560 Inventories 1,278,219 1,311,434 Prepaid expenses and other 70,538 75,328 Total current assets 2,395,068 2,477,150 Property, plant and equipment, net 534,560 501,112 Operating lease right-of-use assets 74,741 74,360 Deferred income taxes 73,550 73,919 Other assets 27,714 27,280 Total non-current assets 710,565 676,671 Total assets$3,105,633 $3,153,821 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Current portion of long-term debt and finance lease obligations$50,678 $157,325 Accounts payable 722,270 606,378 Advanced payments from customers 592,512 709,152 Accrued salaries and wages 89,797 94,448 Other accrued liabilities 61,196 75,991 Total current liabilities 1,516,453 1,643,294 Long-term debt and finance lease obligations, net of current portion 92,215 89,993 Accrued income taxes payable — 17,198 Long-term operating lease liabilities 31,192 32,275 Deferred income taxes 5,986 8,234 Other liabilities 40,702 38,002 Total non-current liabilities 170,095 185,702 Total liabilities 1,686,548 1,828,996 Shareholders’ equity: Common stock 547 545 Additional paid-in-capital 688,002 680,638 Common stock held in treasury (1,233,922) (1,190,115)Retained earnings 1,944,599 1,823,143 Accumulated other comprehensive income 19,859 10,614 Total shareholders’ equity 1,419,085 1,324,825 Total liabilities and shareholders’ equity$3,105,633 $3,153,821 PLEXUS CORP. AND SUBSIDIARIESNON-GAAP SUPPLEMENTAL INFORMATION Table 1(in thousands, except per share data)(unaudited) Three Months Ended Nine Months Ended Jun 28, Mar 29, Jun 29, Jun 28, Jun 29, 2025 2025 2024 2025 2024 Operating income, as reported$53,608 $48,791 $39,246 $149,259 $113,874 Operating margin, as reported 5.3% 5.0% 4.1% 5.0% 3.9% Non-GAAP adjustments: Restructuring costs (1) — — 9,219 4,683 22,507 Other non-recurring income (2) — — — — (2,250)Stock-based compensation 7,691 7,132 7,205 21,813 19,636 Non-GAAP operating income$61,299 $55,923 $55,670 $175,755 $153,767 Non-GAAP operating margin 6.0% 5.7% 5.8% 5.9% 5.3% Net income, as reported$45,116 $39,073 $25,140 $121,456 $70,594 Non-GAAP adjustments: Restructuring costs, net of tax (1) — — 8,251 4,191 20,144 Other non-recurring income, net of tax (2) — — — — (2,014)Stock-based compensation, net of tax 7,307 6,775 6,845 20,722 19,276 Adjusted net income$52,423 $45,848 $40,236 $146,369 $108,000 Diluted earnings per share, as reported$1.64 $1.41 $0.91 $4.39 $2.53 Non-GAAP per share adjustments: Restructuring costs, net of tax (1) — — 0.30 0.15 0.72 Other non-recurring income, net of tax (2) — — — — (0.07)Stock-based compensation, net of tax 0.26 0.25 0.24 0.75 0.69 Adjusted diluted earnings per share$1.90 $1.66 $1.45 $5.29 $3.87 (1) During the three months ended June 29, 2024, restructuring and impairment charges of $9.2 million, or $8.3 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 AMER region. During the nine months ended June 28, 2025, 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 nine months ended June 29, 2024, restructuring costs of $22.5 million, or $20.1 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 and with a site in the Company's AMER region. (2) During the nine months ended June 29, 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 CalculationsNine Months Ended Six Months Ended Nine Months Ended Jun 28, Mar 29, Jun 29, 2025 2025 2024 Operating income, as reported $149,259 $95,651 $113,874 Restructuring and other charges, net 4,683 4,683 20,257 Accelerated stock-based compensation (1)+ — + — + 892 Adjusted operating income $153,942 $100,334 $135,023 ÷ 3 x 2 ÷ 3 $51,314 $45,008 x 4 x 4 Adjusted annualized operating income $205,256 $200,668 $180,032 Adjusted effective tax ratex 11% x 13% x 16%Tax impact 22,578 26,087 28,805 Adjusted operating income (tax-effected) $182,678 $174,581 $151,227 Average invested capital÷$1,298,575 ÷$1,276,742 ÷$1,454,871 ROIC 14.1% 13.7% 10.4%Weighted average cost of capital- 8.9% - 8.9% - 8.2%Economic return 5.2% 4.8% 2.2% Average Invested Capital CalculationsJun 28, Mar 29, Dec 28, Sep 28, 2025 2025 2024 2024 Equity$1,419,085 $1,351,675 $1,319,069 $1,324,825 Plus: Debt and finance lease obligations - current 50,678 121,014 121,977 157,325 Operating lease obligations - current (2) 8,470 9,968 14,875 14,697 Debt and finance lease obligations - long-term 92,215 88,761 88,728 89,993 Operating lease obligations - long-term 31,192 32,720 35,124 32,275 Less: Cash and cash equivalents (237,567) (310,531) (317,161) (345,109) $1,364,073 $1,293,607 $1,262,612 $1,274,006 Average Invested Capital CalculationsJun 29, Mar 30, Dec 30, Sep 30, 2024 2024 2023 2023 Equity$1,266,360 $1,259,762 $1,266,755 $1,214,382 Plus: Debt and finance lease obligations - current 258,175 245,964 251,119 240,205 Operating lease obligations - current (2) 7,990 8,281 9,172 8,363 Debt and finance lease obligations - long-term 90,715 192,025 192,118 190,853 Operating lease obligations - long-term 31,923 33,915 35,989 38,552 Less: Cash and cash equivalents (269,868) (265,053) (231,982) (256,233) $1,385,295 $1,474,894 $1,523,171 $1,436,122 (1)During the nine months ended June 29, 2024, $0.9 million of accelerated stock-based compensation expense was recorded in selling and administrative expense in the accompanying Condensed Consolidated Statements of Operations as a result of a previously announced executive retirement agreement.(2)Included in other accrued liabilities on the Condensed Consolidated Balance Sheets.

Plexus Announces Fiscal Third Quarter Financial Results

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