Flex’s third quarter results were shaped by strong demand in its data center segment and continued execution on higher-margin, technology-driven business lines. Management credited robust growth in both cloud and power infrastructure solutions as key factors supporting revenue gains, while also noting steady contributions from Health Solutions and stabilization in automotive. CEO Revathi Advaithi highlighted Flex’s ability to outperform industry growth rates, stating, “We are outperforming industry growth rates and continuing to strategically shift our portfolio towards higher-margin critical technology-driven businesses, shaping today’s market evolution.”
Is now the time to buy FLEX? Find out in our full research report (it’s free for active Edge members).
Flex (FLEX) Q3 CY2025 Highlights:
- Revenue: $6.80 billion vs analyst estimates of $6.70 billion (4% year-on-year growth, 1.6% beat)
- Adjusted EPS: $0.79 vs analyst estimates of $0.76 (4.3% beat)
- Adjusted EBITDA: $565 million vs analyst estimates of $528 million (8.3% margin, 7% beat)
- The company lifted its revenue guidance for the full year to $27 billion at the midpoint from $26.5 billion, a 1.9% increase
- Management raised its full-year Adjusted EPS guidance to $3.13 at the midpoint, a 5.7% increase
- Operating Margin: 4.4%, in line with the same quarter last year
- Market Capitalization: $22.86 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Flex’s Q3 Earnings Call
- Ruplu Bhattacharya (Bank of America) asked about the lack of an updated data center guidance despite strong performance. CEO Revathi Advaithi explained Flex does not update data center figures between annual Investor Days but confirmed growth is tracking above 35%.
- Timothy Long (Barclays) questioned margin improvements and evolving economics in cloud and power. CFO Kevin Krumm highlighted the increasing role of higher-margin products and services, while Advaithi noted the integration of compute, power, and cooling is driving positive margin trends.
- Samik Chatterjee (JPMorgan) inquired about the drivers behind the full-year guidance increase and the impact of the Ukraine facility shutdown. Advaithi cited strength in data center and health solutions, while Krumm clarified the Ukraine disruption was a roughly $100 million headwind.
- Steven Fox (Fox Advisors) probed whether growth acceleration in Q4 would provide a base for next year. Krumm responded that strong momentum in data center, power, and medical device markets is expected to continue into the first half of the next year.
- Mark Delaney (Goldman Sachs) asked about capacity for data center growth and the need for increased capital expenditures. Advaithi detailed new investments in manufacturing facilities and emphasized a shift in capital allocation toward supporting long-term growth in data center infrastructure.
Catalysts in Upcoming Quarters
In the quarters ahead, the StockStory team will closely watch (1) the pace of new customer wins and project ramps in Flex’s data center infrastructure segment; (2) evidence of sustained margin improvement as the product and services mix continues to evolve; and (3) the recovery trajectory in automotive and the medical device markets. Additionally, progress on regionalization strategies and execution on AI infrastructure partnerships will be important markers of success.
Flex currently trades at $62, down from $64.24 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free for active Edge members).
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