FLEX LTD.

Previous wording

This report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. The words “expects,” “anticipates,” “believes,” “intends,” “plans” and similar expressions identify forward-looking statements. In addition, any statements which refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. We undertake no obligation to publicly disclose any revisions to these forward-looking statements to reflect events or circumstances occurring subsequent to filing this Form 10-Q with the Securities and Exchange Commission. These forward-looking statements are subject to risks and uncertainties, including, without limitation, those risks and uncertainties discussed in this section, as well as any risks and uncertainties discussed in Part I, Item 1A, “Risk Factors” and in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025. In addition, new risks emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business. Accordingly, our future results may differ materially from historical results or from those discussed or implied by these forward-looking statements. Given these risks and uncertainties, the reader should not place undue reliance on these forward-looking statements.

Current wording

This report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. The words “expects,” “anticipates,” “believes,” “intends,” “plans” and similar expressions identify forward-looking statements. In addition, any statements which refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. We undertake no obligation to publicly disclose any revisions to these forward-looking statements to reflect events or circumstances occurring subsequent to filing this Form 10-Q with the Securities and Exchange Commission, except as required by law. These forward-looking statements are subject to risks and uncertainties, including, without limitation, those risks and uncertainties discussed in this section, as well as any risks and uncertainties discussed in Part I, Item 1A, “Risk Factors” and in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2026. In addition, new risks emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business. Accordingly, our future results may differ materially from historical results or from those discussed or implied by these forward-looking statements. Given these risks and uncertainties, the reader should not place undue reliance on these forward-looking statements.

Previous wording

We are the advanced, end-to-end manufacturing partner of choice that helps a diverse customer base design, build, deliver and manage innovative products that improve the world. Through the collective strength of a global workforce across approximately 30 countries with responsible, sustainable operations, we deliver technology innovation, supply chain, and manufacturing solutions to diverse industries and end markets. Our full suite of specialized capabilities includes design and engineering, supply chain, manufacturing, post-production and post-sale services, and proprietary products. We partner with customers across a diverse set of industries including data center, communications, enterprise, consumer, automotive, industrial, healthcare, and power. As of December 31, 2025, our two operating and reportable segments were as follows:

Current wording

We are the advanced, end-to-end manufacturing partner of choice that helps a diverse customer base design, build, deliver and manage innovative products that improve the world. Through the collective strength of a global workforce across approximately 30 countries with responsible, sustainable operations, we deliver technology innovation, supply chain, and manufacturing solutions to diverse industries and end markets. Our full suite of specialized capabilities includes design and engineering, supply chain, manufacturing, and integrated services, plus a portfolio of power and cooling products. Over time, we have built differentiated scale and expertise across both technology-driven and regulated markets, enabling us to support customers with increasingly complex product, infrastructure, and compliance requirements. We partner with customers across a diverse set of industries including data center, healthcare, industrial, automotive, communications, and lifestyle. As of June 26, 2026, our three operating and reportable segments were as follows:

Previous wording

We continue to monitor and respond to the conflict in Ukraine and the associated sanctions and other restrictions. We also are monitoring and responding to the Israel-Hamas conflict. The full impact of the conflicts on our business operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflicts and their impact on regional and global economic conditions. We will continue to monitor the conflicts and assess the related restrictions and other effects and pursue prudent decisions for our team members, customers, and business.

Current wording

We continue to monitor and respond to the conflict in Ukraine and the associated sanctions and other restrictions. We also are monitoring and responding to the Israel-Hamas conflict and recent U.S. and Israel military operations in Iran. The full impact of these conflicts on our business operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflicts and their impact on regional and global economic conditions. We will continue to monitor the conflicts and assess the related restrictions and other effects and pursue prudent decisions for our team members, customers, and business.

Previous wording

During the three and nine-month periods ended December 31, 2025, the Company recognized $5 million and $46 million, respectively, in asset impairments, inventory write-downs and other charges as a result of a missile strike on its Mukachevo, Ukraine facility in Western Ukraine on August 21, 2025. The missile strike represents an unusual and infrequent event as hostilities related to the Russian invasion of Ukraine have been primarily focused in Eastern Ukraine. The missile strike caused substantial physical damage and disrupted normal operations at the facility. In response, the Company activated contingency manufacturing plans and transitioned production to alternative facilities. As restoration activities progress in Mukachevo, the Company expects to incur additional near-term inefficiencies. The $46 million in asset impairments, inventory write-downs and other charges are included in restructuring and impairment charges in the condensed consolidated statements of operations. For further information, refer to Part I, Item 1A, Risk Factors - “Global economic conditions, including inflationary pressures, currency volatility, stagflation, slower economic growth or recession, high or rising interest rates, trade conflicts, tariffs, geopolitical uncertainty and instability in financial markets have in the past adversely affected, and may in the future adversely affect, our business, results of operations, financial condition, and access to capital markets.” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

Current wording

During the fiscal year ended March 31, 2026, we recognized $51 million in asset impairments, inventory write-downs and other charges as a result of a missile strike on our Mukachevo, Ukraine facility in Western Ukraine on August 21, 2025. The missile strike represents an unusual and infrequent event as hostilities related to the Russian invasion of Ukraine have been primarily focused in Eastern Ukraine. The missile strike caused substantial physical damage and disrupted normal operations at the facility. In response, we activated contingency manufacturing plans and transitioned production to alternative facilities. As restoration activities progress in Mukachevo, we expect to incur additional immaterial near-term inefficiencies. For further information, refer to Item 1A, “Risk Factors -Global economic conditions and geopolitical uncertainty have in the past adversely affected, and could in the future adversely affect, our business, results of operations, financial condition, and access to capital markets.” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2026.

Previous wording

In the fourth quarter of our fiscal year ended March 31, 2025, the U.S. implemented a series of global tariffs, including on a number of countries in which Flex operates. Although we have been and expect to continue to be able to pass tariff costs through to our customers, the global tariff landscape, which continues to evolve, has the potential to meaningfully impact end customer demand. During the three and nine-month periods ended December 31, 2025, tariff costs paid and recoveries from our customers impacted our revenues and costs of goods by approximately one percent and had a negligible impact on our profitability. If, in the future, we are no longer able to fully pass through these tariffs, our results from operations and cash flows would be negatively impacted. There are several court cases challenging the U.S. administration’s authority to impose tariffs, including a case pending before the U.S. Supreme Court, the outcomes of which could add complexity to our operations in terms of seeking refunds from the U.S. government and adjusting pricing with customers. For further information, refer to Part I, Item 1A, Risk Factors -"Global economic conditions, including inflationary pressures, currency volatility, stagflation, slower economic growth or recession, high or rising interest rates, trade conflicts, tariffs, geopolitical uncertainty and instability in financial markets have in the past adversely affected, and may in the future adversely affect, our business, results of operations, financial condition, and access to capital markets." in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025.

Current wording

The U.S. tariffs initially announced in April 2025, which continue to evolve, and other countries' potential retaliatory tariffs and import/export restrictions may materially increase our product input costs and negatively affect global economic conditions, contracting customer demand. As a contract manufacturer, we expect to recover the cost of tariffs by passing tariff costs to our customers which would increase net sales, decrease operating income margins, and negatively affect operating cash flow timing as we recover paid tariffs from our customers. During the quarter ended June 26, 2026, tariff costs paid and recoveries from our customers impacted our revenues and costs of goods by approximately one percent and had a negligible impact on our profitability. If, in the future, we are no longer able to fully pass through these tariffs, our results from operations and cash flows would be negatively impacted. On February 20, 2026, the U.S. Supreme Court struck down tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") and on April 20, 2026 the U.S. government opened a system to facilitate refunds for IEEPA tariffs paid. We have requested and received a portion of our requested IEEPA tariff refunds and do not expect refunds received will have a material effect on our financial performance. We will continue to monitor changes in global trade policy and employ measures to mitigate the impact of tariffs and leverage competitive opportunities. However, despite these efforts, the Company may not be able to fully mitigate the impact of changes in trade policies. For further information, refer to Item 1A, “Risk Factors -Tariffs, trade restrictions, export controls, and changes in trade policy, including heightened trade volatility and uncertainty regarding trade agreements, have in the past adversely affected, and could in the future adversely affect, our business, results of operations, and financial condition” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2026.

Previous wording

We are one of the world's largest providers of global supply chain solutions, with revenues of $20.4 billion for the nine-month period ended December 31, 2025 and $25.8 billion in the fiscal year ended March 31, 2025. We have established an extensive network of manufacturing facilities in the world's major consumer and enterprise markets (Asia, the Americas, and Europe) to serve the growing outsourcing needs of both multinational and regional customers. We design, build, ship, and service consumer and enterprise products for our customers through a network of approximately 100 facilities in approximately 30 countries across four continents. The following tables set forth the relative percentages and dollar amounts of net sales by region and by country, and net property and equipment by country, based on the location of our manufacturing sites.

Current wording

We are one of the world's largest providers of global supply chain solutions, with revenues of $7.9 billion for the three-month period ended June 26, 2026 and $27.9 billion in the fiscal year ended March 31, 2026. We have established an extensive network of manufacturing facilities in the world's major markets (Asia, the Americas, and Europe) to serve the outsourcing needs of both multinational and regional customers. We design, build, ship, and service consumer and enterprise products for our customers through a network of more than 100 facilities across approximately 30 countries on four continents. The following tables set forth the relative percentages and dollar amounts of net sales by region and by country, and net property and equipment by country, based on the location of our manufacturing sites:

Previous wording

•the impacts on our business due to supply chain issues, including component shortages, semiconductors and particularly involving suppliers who are our sole or primary sources, disruptions in transportation or other supply chain related constraints;

Current wording

• the impacts on our business due to supply chain issues, including component shortages, disruptions in transportation or other supply chain related constraints including disruptions in international commerce as a result of disruptions in the Strait of Hormuz and the Red Sea, including as a result of attacks on shipping vessels;

Previous wording

•changes in trade regulations and treaties

Current wording

• changes in trade regulations and treaties; and

Previous wording

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP" or "GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Due to global economic conditions, including the impact of ongoing trade conflicts and tariffs, and geopolitical conflicts (including the Russian invasion of Ukraine and the Israel-Hamas conflict), there has been and we expect there will continue to be uncertainty and disruption in the global economy and financial markets. We have made estimates and assumptions taking into consideration certain possible impacts due to the foregoing factors. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur.

Current wording

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP" or "GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Due to global economic conditions, including the impact of ongoing trade conflicts and tariffs, and geopolitical conflicts (including the Russian invasion of Ukraine and recent U.S. and Israel military operations in Iran), there has been and we expect there will continue to be uncertainty and disruption in the global economy and financial markets. We have made estimates and assumptions taking into consideration certain possible impacts due to the foregoing factors. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they occur.

Previous wording

Net sales during the three-month period ended December 31, 2025 totaled $7.1 billion, representing an increase of $0.5 billion, or 8% from $6.6 billion during the three-month period ended December 31, 2024. Net sales for our FAS segment increased $0.2 billion, or 6% from the three-month period ended December 31, 2024, primarily driven by a high single-digit percentage increase in our CEC business due to increased demand and a mid single-digit percentage increase in Lifestyle primarily due to net sales contributed by our Orangeburg Manufacturing Facility acquired on February 4, 2025. This was partially offset by a mid single-digit percentage decrease in Consumer Devices due to lower demand. Net sales for our FRS segment increased $0.3 billion, or 10% from the three-month period ended December 31, 2024, which was primarily driven by high-teen percentage growth in our Industrial business with strength in power and high single-digit percentage growth in Health Solutions, partially offset by a low single-digit percentage decrease in our Automotive business due to lower demand. Net sales increased $0.2 billion in the Americas, $0.2 billion in Asia, and $0.1 billion in Europe for a total gain of $0.5 billion.

Current wording

Net sales during the three-month period ended June 26, 2026 totaled $7.9 billion, representing an increase of $1.4 billion, or 21% from $6.6 billion during the three-month period ended June 27, 2025. Net sales for our ITS segment increased $0.5 billion, or 20% from the three-month period ended June 27, 2025, primarily driven by strong growth in the Communications business due to increased demand and increased memory pricing in both Communications and our Lifestyle businesses. Net sales for our RMS segment increased $0.3 billion, or 12% from the three-month period ended June 27, 2025, which was primarily driven by strong growth in Industrial. Net sales for our CPI segment increased $0.6 billion, or 35% from the three-month period ended June 27, 2025, which was driven by strong growth in Power, which includes contributions from the recent EPP acquisition combined with growth in Cloud and Cooling due to increased demand. Net sales increased $0.8 billion in the Americas, $0.5 billion in Asia, and $0.1 billion in Europe for a total increase of $1.4 billion.

Previous wording

Our ten largest customers during both the three and nine-month periods ended December 31, 2025 accounted for approximately 46% of net sales. No customer accounted for more than 10% of net sales during the nine-month periods ended December 31, 2025 or December 31, 2024.

Current wording

Our ten largest customers during both the three-month periods ended June 26, 2026 and June 27, 2025 accounted for approximately 49% and 48% of net sales. A significant customer accounted for 12% of net sales during the first quarter of fiscal year 2027 with the majority of this revenue being reported in our CPI segment. No other customer accounted for more than 10% of net sales during the three-month periods ended June 26, 2026 or June 27, 2025.

Previous wording

Cost of sales during the three-month period ended December 31, 2025 totaled $6.4 billion, representing an increase of $0.4 billion, or 7% from $6.0 billion during the three-month period ended December 31, 2024. The higher cost of sales for the three-month period ended December 31, 2025 was primarily driven by a $0.5 billion, or 8%, increase in consolidated sales, partially offset bycost efficiencies and favorable mix. Cost of sales in our FAS segment for the three-month period ended December 31, 2025 increased by 6% from the three-month period ended December 31, 2024, in line with revenue growth. Cost of sales in our FRS segment for the three-month period ended December 31, 2025 increased by 9% from the three-month period ended December 31, 2024, primarily driven by revenue growth of 10%, partially offset by favorable mix and cost efficiencies.

Current wording

Cost of sales during the three-month period ended June 26, 2026 totaled $7.2 billion, representing an increase of $1.2 billion, or 20% from $6.0 billion during the three-month period ended June 27, 2025. The higher cost of sales for the three-month period ended June 26, 2026 was primarily driven by a $1.4 billion, or 21%, increase in consolidated sales. Cost of sales in our ITS segment for the three-month period ended June 26, 2026 increased by 20% from the three-month period ended June 27, 2025, in line with revenue growth. Cost of sales in our RMS segment for the three-month period ended June 26, 2026 increased by 10% from the three-month period ended June 27, 2025, primarily driven by revenue growth of 12%, partially offset by favorable mix and cost efficiencies. Cost of sales in our CPI segment for the three-month period ended June 26, 2026 increased by 35% from the three-month period ended June 27, 2025, in line with revenue growth for the segment.

Previous wording

Gross profit during the three-month period ended December 31, 2025 increased $0.1 billion to $0.7 billion, or 9.6% of net sales, from $0.6 billion, or 9.1% of net sales, during the three-month period ended December 31, 2024. Gross margin improved 50 basis points year over year primarily due to revenue growth, favorable mix and continued operational execution.

Current wording

Gross profit during the three-month period ended June 26, 2026 increased $0.2 billion to $0.7 billion, or 9.4% of net sales, from $0.6 billion, or 8.7% of net sales, during the three-month period ended June 27, 2025. Gross margin improved 70 basis points year over year primarily due to revenue growth, favorable mix and continued operational execution.

Previous wording

The Company's Chief Executive Officer is our Chief Operating Decision Maker ("CODM") who uses segment income in evaluating how we allocate resources, assess performance and make strategic and operational decisions.

Current wording

The Company's Chief Executive Officer is our Chief Operating Decision Maker ("CODM") who compares actual segment income to budgeted financial performance in evaluating how we allocate resources, assess performance and make strategic and operational decisions.

Previous wording

We undertook targeted restructuring activities to improve operational efficiencies by reducing excess workforce capacity. During the three and nine-month periods ended December 31, 2025, we recognized $6 million and $39 million of restructuring charges, respectively, primarily related to employee severance. In addition, during the three and nine-month periods ended December 31, 2025, we incurred $5 million and $46 million in impairment and other charges related to a missile strike on our Mukachevo, Ukraine facility, as discussed in the Overview section above.

Current wording

We undertook targeted restructuring activities to improve operational efficiencies by reducing excess workforce capacity. During the three-month period ended June 26, 2026, we reversed $2 million of restructuring charges primarily related to updated estimates of employee severance.

Previous wording

Selling, general and administrative expenses (“SG&A”) was $0.3 billion, or 3.8% of net sales, during the three-month period ended December 31, 2025, increasing by $29 million compared to the three-month period ended December 31, 2024. The increase was largely driven by increases in employee compensation and other corporate costs. SG&A was $0.8 billion or 3.7%, of net sales, during the nine-month period ended December 31, 2025, increasing by $93 million from $0.7 billion or 3.5% of net sales during the nine-month period ended December 31, 2024, driven by the same factors as noted for the three-month period.

Current wording

Selling, general and administrative expenses (“SG&A”) was $0.3 billion, or 4.2% of net sales, during the three-month period ended June 26, 2026, increasing by $101 million compared to the three-month period ended June 27, 2025. The increase was largely driven by $53 million of costs associated with the intended spin-off of the CPI business, $18 million of increases in stock based compensation and other cost increases in line with the growth of the business.

Previous wording

Amortization of intangible assets decreased to $15 million for the three-month period ended December 31, 2025, compared to $17 million in the previous year as certain intangible assets fully amortized during fiscal year 2026. Amortization increased to $52 million during the nine-month period ended December 31, 2025, from $49 million for the nine-month period ended December 31, 2024 as a result of acquisitions in the second half of fiscal year 2025.

Current wording

Amortization of intangible assets increased to $23 million for the three-month period ended June 26, 2026, compared to $21 million in the previous year due to increased amortization as the result of the EPP acquisition entered into during the period, partially offset by certain intangible assets being fully amortized during fiscal year 2026 and the first quarter of fiscal 2027.

Previous wording

Interest income decreased to $15 million for the three-month period ended December 31, 2025 compared to $16 million for the same period in fiscal year 2025. Interest income decreased to $38 million for the nine-month period ended December 31,

Current wording

Interest income remained unchanged at $13 million for the three-month period ended June 26, 2026 compared to $13 million for the same period in fiscal year 2026.

Previous wording

Equity in losses of unconsolidated affiliates was $1 million during the three-month period ended December 31, 2025, compared to zero in the three-month period ended December 31, 2024, primarily due to losses in certain non-core equity method investments.

Current wording

Equity in losses of unconsolidated affiliates was $5 million during the three-month period ended June 26, 2026, compared to $20 million in the three-month period ended June 27, 2025, primarily due to losses in certain equity method investments.

Previous wording

The consolidated effective tax rate was 25% and 24% for the three and nine-month periods ended December 31, 2025, and 9% and 17% for the three and nine-month periods ended December 31, 2024, respectively. The effective tax rate varies from the Singapore statutory rate of 17% as a result of recognition of earnings in different jurisdictions (we generate most of our revenues and profits from operations outside of Singapore), operating loss carryforwards, income tax credits, release of previously established valuation allowances for deferred tax assets, liabilities for uncertain tax positions, as well as the effects of certain tax holidays and incentives granted to our subsidiaries primarily in China, Costa Rica, Malaysia, the Netherlands and Israel. The effective tax rate for the three-month period ended December 31, 2025 was higher than the effective tax rate for the three-month period ended December 31, 2024 for a variety of reasons, primarily due to the changing jurisdictions of income and recognition of a $19 million income tax expense related to an audit settlement with a foreign tax authority during the three-month period ended December 31, 2025 and recognition of a $26 million interest receivable on an income tax receivable for prior period taxes paid by one of its Brazilian subsidiaries during the three-month period ended December 31, 2024.

Current wording

The consolidated effective tax rate was 24% for the three-month period ended June 26, 2026 and 22% for the three-month period ended June 27, 2025. The effective tax rate varies from the Singapore statutory rate of 17% as a result of recognition of earnings in different jurisdictions (we generate most of our revenues and profits from operations outside of Singapore), operating loss carryforwards, income tax credits, release of previously established valuation allowances for deferred tax assets, liabilities for uncertain tax positions, as well as the effects of certain tax holidays and incentives granted to our subsidiaries primarily in China, Costa Rica, Malaysia, the Netherlands and Israel. The effective tax rate for the three-month period ended June 26, 2026 was higher than the effective tax rate for the three-month period ended June 27, 2025 for a variety of reasons, primarily due to the changing jurisdictional mix of income as well as the additional tax expense recorded on the gain from a business disposition occurring during current period.

Previous wording

The OECD Pillar Two Global Anti-Base Erosion (“GloBE”) model rules, issued under the OECD Inclusive Framework on Base Erosion and Profit Shifting, introduce a global minimum tax of 15% applicable to multinational enterprise groups with consolidated financial statement revenue in excess of €750 million. Numerous foreign jurisdictions have already enacted tax legislation based on the GloBE rules, with some effective as early as January 1, 2024. As of December 31, 2025 the Company has reflected all estimated impacts of the Pillar Two GloBE minimum tax accordingly within its estimated annual effective tax rate for the year.

Current wording

The OECD Pillar Two Global Anti-Base Erosion (“GloBE”) model rules, issued under the OECD Inclusive Framework on Base Erosion and Profit Shifting, introduce a global minimum tax of 15% applicable to multinational enterprise groups with consolidated financial statement revenue in excess of €750 million. As of June 26, 2026 the Company has reflected all estimated impacts of the Pillar Two GloBE minimum tax accordingly within its estimated annual effective tax rate for the year.

Previous wording

On July 4, 2025, The One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA makes permanent various provisions of the Tax Cuts and Jobs Act which otherwise would have expired as well as makes significant modifications to the U.S. international tax framework. The Company is in the process of evaluating the impact of the OBBBA on our consolidated financial statements.

Current wording

On July 4, 2025, The One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA makes permanent various provisions of the Tax Cuts and Jobs Act which otherwise would have expired as well as makes significant modifications to the U.S. international tax framework. The Company does not expect a material impact to the consolidated financial statements from the OBBBA, however, the Company will continue to monitor developments and evaluate any potential future impacts.

Previous wording

Net income was $239 million during the three-month period ended December 31, 2025, compared to $263 million during the three-month period ended December 31, 2024 and net income was $630 million during the nine-month period ended December 31, 2025 compared to $616 million during the nine-month period ended December 31, 2024, driven by the factors discussed above.

Current wording

Net income was $285 million during the three-month period ended June 26, 2026, compared to $192 million during the three-month period ended June 27, 2025, driven by the factors discussed above.

Previous wording

We continuously evaluate our ability to meet our obligations over the next 12 months and beyond and proactively reset our capital structure to improve maturities and liquidity. We expect that our current financial condition, including our liquidity sources are adequate to fund current and future commitments. As of December 31, 2025, we had cash and cash equivalents of approximately $3.1 billion, bank and other borrowings of approximately $4.4 billion and a $2.75 billion revolving credit facility under which we had no borrowings outstanding. We also issued $600 million of 5.375% Notes due November 2035 and $150 million of 5.250% Notes due January 2032 in the third quarter of fiscal year 2026. As of December 31, 2025, we were in compliance with the covenants under all of our credit facilities and indentures; we also expect to remain in compliance with the covenants in the upcoming 12 months for our credit facilities and indentures.

Current wording

We continuously evaluate our ability to meet our obligations over the next 12 months and beyond and proactively reset our capital structure to improve maturities and liquidity. We expect that our current financial condition, including our liquidity sources are adequate to fund current and future commitments. As of June 26, 2026, we had cash and cash equivalents of approximately $2.8 billion, bank and other borrowings of approximately $5.2 billion and a $2.75 billion revolving credit facility under which we had no borrowings outstanding. As of June 26, 2026, we were in compliance with the covenants under all of our credit facilities and indentures; we also expect to remain in compliance with the covenants in the upcoming 12 months for our credit facilities and indentures.

Previous wording

Cash provided by operating activities was $1.3 billion during the nine-month period ended December 31, 2025, primarily driven by $0.6 billion of net income for the period plus $0.4 billion of non-cash charges such as depreciation, amortization, and impairment charges and $0.2 billion of changes in working capital and other.

Current wording

Cash provided by operating activities was $0.3 billion during the three-month period ended June 26, 2026, primarily driven by $0.3 billion of net income for the period plus $0.1 billion of non-cash charges such as depreciation and amortization, slightly offset by $(0.1) billion of changes in working capital and other. Cash provided by operating activities for the three month period ended June 26, 2026 was negatively impacted by $24 million of separation costs incurred in connection with the announced intention to spin-off of Flex's CPI segment.

Previous wording

We believe net working capital is a key metric that measures our liquidity. Net working capital is calculated as current assets less current liabilities. Net working capital increased $1.3 billion to $4.3 billion as of December 31, 2025, from $3.0 billion as of March 31, 2025. The increase was primarily the result of a $0.5 billion decrease in the current portion of long-term debt driven by the repayment of the 4.750% Senior Notes during the first quarter, along with a $0.8 billion increase in cash and cash equivalents driven by the net increase from senior note issuances and repayments. Other movements in working capital largely offset themselves with increases of $0.2 billion in accounts receivable, $0.3 billion in contract assets, $0.5 billion in inventory, and $0.6 billion in other current assets (principally customer-controlled inventory), against increases of $1.3 billion in accounts payable and $0.2 billion in other current liabilities.

Current wording

We believe net working capital is a key metric that measures our liquidity. Net working capital is calculated as current assets less current liabilities. Net working capital increased $0.7 billion to $5.0 billion as of June 26, 2026, from $4.3 billion as of March 31, 2026. The increase was primarily the result of a $0.5 billion increase in cash and cash equivalents driven by the net increase from our senior term loan borrowings along with a $0.6 billion increase in our inventory balance. Other movements in working capital include increases of $0.4 billion in accounts receivable, $0.3 billion in contract assets, and $0.2 billion in other current assets (principally customer-controlled inventory), against increases of $1.1 billion in accounts payable and $0.3 billion in other current liabilities.

Previous wording

Net cash used in investing activities was $0.5 billion during the nine-month period ended December 31, 2025. This was primarily driven by $0.4 billion of net capital expenditures for property and equipment to continue expanding capabilities and capacity in support of our business growth as well as payment for a business acquisition during the period.

Current wording

Net cash used in investing activities was $1.3 billion during the three-month period ended June 26, 2026. This was primarily driven by $1.1 billion paid for the EPP business acquisition during the period as well as $0.2 billion of capital expenditures.

Previous wording

Cash used by financing activities was $46 million during the nine-month period ended December 31, 2025, which was primarily driven by $0.7 billion of cash paid for the repurchase of our ordinary shares and debt repayments of $0.5 billion, offset by $1.3 billion of proceeds from debt issuances. Refer to Note 6 and Note 14 to the condensed, consolidated financial statements in Item 1, "Financial Statements" for additional details.

Current wording

Cash provided by financing activities was $1.5 billion during the three-month period ended June 26, 2026, which was primarily driven by $1.5 billion of net proceeds from borrowing. Refer to Note 6 to the condensed, consolidated financial statements in Item 1, "Financial Statements" for additional details.

Previous wording

We believe free cash flow is an important liquidity metric because it measures, during a given period, the amount of cash generated that is available to repay debt obligations, make investments, fund acquisitions, repurchase company shares and for certain other activities. Our free cash flow is defined as cash from operations, less net purchases of property and equipment allowing us to present adjusted cash flows on a consistent basis for investors. Our free cash flow for the nine-month periods ended December 31, 2025 and December 31, 2024 was an inflow of $0.8 billion during both periods. Free cash flow is not a measure of liquidity under U.S. GAAP, and may not be defined and calculated by other companies in the same manner. Free cash flow should not be considered in isolation or as an alternative to net cash provided by operating activities. Free cash flows reconcile to the most directly comparable GAAP financial measure of cash flows from operations as follows:

Current wording

We believe free cash flow is an important liquidity metric because it measures, during a given period, the amount of cash generated that is available to repay debt obligations, make investments, fund acquisitions, repurchase company shares and for certain other activities. Our free cash flow is defined as cash from operations, less net purchases of property and equipment allowing us to present adjusted cash flows on a consistent basis for investors. Our free cash flow for the three-month periods ended June 26, 2026 and June 27, 2025 were an inflow of $41 million and $268 million during each period, respectively. Free cash flow is not a measure of liquidity under U.S. GAAP, and may not be defined and calculated by other companies in the same manner. Free cash flow should not be considered in isolation or as an alternative to net cash provided by operating activities. Free cash flows reconcile to the most directly comparable GAAP financial measure of cash flows from operations as follows:

Previous wording

Our cash balances are generated and held in numerous locations throughout the world. Liquidity is affected by many factors, some of which are based on normal ongoing operations of the business and some of which arise from fluctuations related to global economics and markets. Local government regulations may restrict our ability to move cash balances to meet cash needs under certain circumstances; however, any current restrictions are not material. We do not currently expect such regulations and restrictions to impact our ability to pay vendors and conduct operations throughout the global organization. We believe that our existing cash balances, together with anticipated cash flows from operations and borrowings available under our credit facilities, will be sufficient to fund our operations through at least the next twelve-month period and beyond. As of December 31, 2025 and March 31, 2025, approximately 52% and 81%, respectively, of our cash and cash equivalents were held by foreign subsidiaries outside of Singapore. Although substantially all of the amounts held outside of Singapore could be repatriated under current laws, a significant amount could be subject to income tax withholdings. We provide for tax liabilities on these amounts for financial statement purposes, except for certain of our foreign earnings that are considered indefinitely reinvested outside of Singapore (approximately $0.8 billion as of March 31, 2025). Repatriation could result in an additional income tax payment; however, for the majority of our foreign entities, our intent is to permanently reinvest these funds outside of Singapore and our current plans do not demonstrate a need to repatriate them to fund our operations in jurisdictions outside of where they are held. Where local restrictions prevent an efficient intercompany transfer of funds, our intent is that cash balances would remain outside of Singapore and we would meet our liquidity needs through ongoing cash flows, external borrowings, or both.

Current wording

Our cash balances are generated and held in numerous locations throughout the world. Liquidity is affected by many factors, some of which are based on normal ongoing operations of the business and some of which arise from fluctuations related to global economics and markets. Local government regulations may restrict our ability to move cash balances to meet cash needs under certain circumstances; however, any current restrictions are not material. We do not currently expect such regulations and restrictions to impact our ability to pay vendors and conduct operations throughout the global organization. We believe that our existing cash balances, together with anticipated cash flows from operations and borrowings available under our credit facilities, will be sufficient to fund our operations through at least the next twelve-month period. As of June 26, 2026 and March 31, 2026, approximately 29% and 62%, respectively, of our cash and cash equivalents were held by foreign subsidiaries outside of Singapore. Although substantially all of the amounts held outside of Singapore could be repatriated under current laws, a significant amount could be subject to income tax withholdings. We provide for tax liabilities on these amounts for financial statement purposes, except for certain of our foreign earnings that are considered indefinitely reinvested outside of Singapore (approximately $0.9 billion as of March 31, 2026). Repatriation could result in an additional income tax payment; however, for the majority of our foreign entities, our intent is to permanently reinvest these funds outside of Singapore and our current plans do not demonstrate a need to repatriate them to fund our operations in jurisdictions outside of where they are held. Where local restrictions prevent an efficient intercompany transfer of funds, our intent is that cash balances would remain outside of Singapore and we would meet our liquidity needs through ongoing cash flows, external borrowings, or both.

Previous wording

Under our current share repurchase program, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $1.7 billion in accordance with the share purchase mandate approved by our shareholders at the date of the most recent Annual General Meeting which was held on August 6, 2025. During the nine-month period ended December 31, 2025, we paid $0.7 billion to repurchase shares under the current and previous repurchase plans at an average price of $46.22 per share. As of December 31, 2025, shares in the aggregate amount of $1.3 billion were available to be repurchased under the current plan.

Current wording

Under our current share repurchase program, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $1.7 billion in accordance with the share purchase mandate approved by our shareholders at the date of the most recent Annual General Meeting which was held on August 6, 2025. During the three-month period ended June 26, 2026, we did not repurchase any shares. As of June 26, 2026, shares in the aggregate amount of $1.1 billion were available to be repurchased under the current plan.

Previous wording

On August 15, 2025, the Company issued a warrant (the “Warrant”) to Amazon.com NV Investment Holdings LLC (“Warrantholder”), a wholly-owned subsidiary of Amazon.com, Inc. (“Parent”) to purchase up to an aggregate of 3,859,851 ordinary shares of the Company (“Warrant Shares”) at an exercise price of $51.29 per share. The Warrant allows for cashless exercise and expires on August 15, 2030. The Warrant Shares are subject to vesting based on qualifying payments (as defined in the Warrant) for the purchase of all products and services by or on behalf of Parent and its affiliates over the term of the Warrant. The expense associated with the Warrant Shares will be recorded as a deduction to revenue as the customer purchases products and services over the vesting period. The Company recorded charges of $5 million related to the Warrant during the nine-month period ended December 31, 2025.

Current wording

On August 15, 2025, the Company issued a warrant (the “Warrant”) to Amazon.com NV Investment Holdings LLC (“Warrantholder”), a wholly-owned subsidiary of Amazon.com, Inc. (“Parent”) to purchase up to an aggregate of 3,859,851 ordinary shares of the Company (“Warrant Shares”) at an exercise price of $51.29 per share. The Warrant allows for cashless exercise and expires on August 15, 2030. The Warrant Shares are subject to vesting based on qualifying payments (as defined in the Warrant) for the purchase of all products and services by or on behalf of Parent and its affiliates over the term of the Warrant. The expense associated with the Warrant Shares will be recorded as a deduction to revenue as the customer purchases products and services over the vesting period. The Company recorded charges of $3 million related to the Warrant during the three-months ended June 26, 2026. Refer to Note 4, "Share-Based Compensation Expense" for more detail.