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Plexus Announces Fiscal Second Quarter Financial Results

Plexus Corp. (NASDAQ: PLXS) announced financial results for our fiscal second quarter ended April 1, 2023, and guidance for our fiscal third quarter ending July 1, 2023.

  • Reports fiscal second quarter 2023 revenue of $1.07 billion, GAAP operating margin of 5.3% and GAAP diluted EPS of $1.45, including $0.21 of stock-based compensation expense
  • Initiates fiscal third quarter 2023 revenue guidance of $1.00 billion to $1.05 billion with GAAP diluted EPS of $0.76 to $0.94, including $0.19 of stock-based compensation expense and approximately $0.29 of restructuring and other charges
Three Months Ended
Apr 1, 2023 Apr 1, 2023 Jul 1, 2023
Q2F23 Results Q2F23 Guidance Q3F23 Guidance
Summary GAAP Items
Revenue (in billions) $1.071 $1.020 to $1.070 $1.000 to $1.050
Operating margin (1) 5.3% 4.5% to 5.0% 3.6% to 4.1%
Diluted EPS (2) $1.45 $1.06 to $1.24 $0.76 to $0.94
Summary Non-GAAP Items (3)
Adjusted operating margin (4) 4.5% to 5.0%
Adjusted diluted EPS (5) $1.05 to $1.23
Return on invested capital (ROIC) 13.8%
Economic return 4.8%
(1Includes restructuring and other charges of approximately 90 bps in operating margin for Q3F23 guidance.
(2) Includes stock-based compensation expense of $0.21 for Q2F23 results, $0.21 for Q2F23 guidance and $0.19 for Q3F23 guidance. Includes restructuring and other charges of approximately $0.29 for Q3F23 guidance.
(3) Refer to Non-GAAP Supplemental Information in Tables 1 and 2 for additional information regarding non-GAAP financial measures.
(4) Excludes restructuring and other charges of approximately 90 bps.
(5) Excludes restructuring and other charges of approximately $0.29, but includes stock-based compensation expense of $0.19.

Fiscal Second Quarter 2023 Information

  • Won 31 manufacturing programs during the quarter representing $275 million in annualized revenue when fully ramped into production
  • Trailing four-quarter manufacturing wins of $847 million in annualized revenue when fully ramped into production
  • Purchased $12.4 million of our shares at an average price of $98.75 per share under our share repurchase program, leaving $22.6 million available under our current $50.0 million authorization

Todd Kelsey, Chief Executive Officer commented, “Our team continues to execute well amidst ongoing market volatility and supply chain challenges. Plexus delivered fiscal second quarter revenue of $1.07 billion, representing 21% year over year growth, GAAP operating margin of 5.3% and GAAP EPS of $1.45. Second quarter results exceeded our guidance reflecting increased end of quarter shipments as a result of mitigating supply constraints, better than anticipated performance by our engineering and sustaining services teams and our ongoing focus on improving manufacturing efficiency.”

Mr. Kelsey continued, “I’m extremely pleased with the strong performance of our go-to-market organization. Our team won 31 new manufacturing programs worth $275 million in the fiscal second quarter, capitalizing on robust demand for our solutions across all of our market sectors. Concurrently, the team expanded an already record funnel of qualified manufacturing opportunities to $4.2 billion, an increase of nearly $600 million from our fiscal first quarter. The funnel includes several large opportunities across all of our market sectors, which we believe positions us to sustain strong win performance and industry-leading revenue growth.”

Patrick Jermain, Executive Vice President and Chief Financial Officer, commented, “We generated $80 million in free cash flow during the fiscal second quarter, a result that was close to double our net income and exceeded our projections. Through the first six months of fiscal 2023, we generated positive free cash flow, and we anticipate delivering additional positive free cash flow for the second half of fiscal 2023. The fiscal second quarter cash cycle of 104 days was favorable to our expectations and sequentially lower by two days as we benefited from increased end of quarter revenue and continued progress on our working capital initiatives. Improvements in our cash cycle, coupled with strong operating performance, led to return on invested capital for the fiscal second quarter of 13.8% or 480 basis points above our weighted average cost of capital.”

Mr. Kelsey further commented, “We are guiding fiscal third quarter revenue of $1.00 billion to $1.05 billion, non-GAAP operating margin of 4.5% to 5.0% and non-GAAP EPS of $1.05 to $1.23. Our guidance is impacted by our strong late second quarter shipments, supply chain challenges and further semiconductor capital equipment market weakness. The non-GAAP guidance excludes $9 million, or $0.29 per share, of estimated restructuring and other charges associated with planned actions to realign our spending to create a more efficient and scalable platform to capitalize on our robust pipeline of future growth opportunities.”

Mr. Kelsey concluded, “As we near completion of our annual strategic planning process, I remain convinced in our ability to drive robust revenue growth and strong profitability, including achieving our target of $5 billion in revenue with 5.5% GAAP operating margin by our fiscal 2025. As we look beyond this goal, I have continued confidence in sustaining our industry-leading revenue growth and profitability as our team leverages our best-in-class capabilities and solutions to help our customers create the products that build a better world.”

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