Earnings call transcript Q4 2023

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Operator

Good afternoon. Thank you for standing by. Welcome to Flex's Fourth Quarter and Fiscal 2023 Earnings Conference Call. [Operator Instructions].

I will now turn the call over to Mr. begin. may you Rubin, David

David Rubin

being Chief Thank you, Quarter today to Fourth followed and and our will Lundstrom. give brief Good XXXX Earnings afternoon, remarks summary be well our at on available the Advaithi; for Fiscal Revathi Relations me Q&A. section call Slides Executive copy our welcome the are for Officer, Conference as corporate today's will earnings Paul Chief financials of This Both Flex's by Officer, recorded call replay on is flex.com. a available as Chris. press and Financial Call. is release and website. With Investor

could forward-looking current materially. differ actual a today's These results risks assumptions. As are that based involve statements, expectations call cause and on our contains to statements reminder, uncertainties which and

discussion of or press presentation risks our most with these in please recent Factors in and release statements cautionary see section a filings For SEC. full the our in Risk the uncertainties, the

to we subject is information change, obligation this undertake to these statements. and Note forward-looking update no

stated, be slides unless as summary full metrics non-GAAP growth as be unless please a measures, the note, in posted reconciliations financials will provided presentation the in all all be GAAP can basis website. to on results -- otherwise non-GAAP on year-over-year of the this Relations found appendix will the Lastly, well otherwise Investor

to over Now call to our CEO. Revathi? I'd the turn like

Revathi Advaithi

our Starting was David. you QX Good another today. joining with on fiscal quarter. you, Slide Thank afternoon, thank Overall, solid and results us X. it for

delivered new fiscal which in at NEXTracker for in $X.XX reliability, we and came Adjusted year-over-year QX. segments. operating growth with revenue and EPS, record margin was of adjusted X% our grew Our a X.X%, agility

with third in in results, $X.XX, delivered very X.X%. has operating That's EPS full the the XX%. up adjusted And at up -- revenue a the at year-over-year we margins year the XX% at strong EPS despite fiscal continuing the was grown year least for We XX%. landscape. grew full macroeconomic challenges year adjusted Looking row 'XX of

executing Clearly, we strategy. can see the by progress have on our made we

X. completed very getting to great pricing for a IPO what got a still done market. lot IPO, right and NEXTracker a year. timing We Turning is the tough Slide showing We this despite the

had to Looking the but in an revenue next-gen has year with we XX% of organization, last years, composition Not another over automotive mobility record continues across our automotive wins. the shift to the increasing being grown X design-led. wins percentage only

to targeting, we're design long-term areas providing we capabilities engineering wins and business the customer build In secure industry-leading trust. are and

our for the space. true also in wins is healthcare this Now

become increase OEMs to and complexity. devices complex, looking this smarter medical are to more As manufacturing help their outsourced navigate

Our position extensive us automation and in help this health changing complex customers scale, and global capabilities and care succeed to highly well landscape. experience

leading record serving As health automotive and and brands design competitive business, us with our advantage. track market engineering of a capabilities care give our

We this ramp as we new had hyperscale exceptionally growth in strong programs. year our cloud cloud business

from partners. year vertical and we inverters technology this growth Our energy. to hardware renewable in X and opportunities, drive global these notable shift with help chargers, advanced trends the our scale cloud to multiple hyperscale include integration, by energy-related EV accelerated clean capabilities Other have

also to opportunity take growing the additional customers passage, advantage increasing from our of market. IRA We see U.S. help creating this demand

to Now turning supply chain.

in challenges during ongoing year. the navigate fiscal to continue We supply constraints the

the we many year progressed. areas as However, see improvements did in

most node is reliability a larger with issue part While is segment. business, the there our supply the that primarily still is significant the of remaining occasional everyday affect which challenge, semiconductors our constraints

for as often topic important efficiency oversimplified. and lot complexity resiliency. Regionalization companies There's of remains a gets topic here, and strive an that

complex by such supply integration economy we as and waste. to design connect, and advance Our vertical supported and capabilities recycling core refurbishment bring minimize value proposition is Then that chains. we manufacturing, circular

regionalization. strong Because adding heart resilience chain to major every is about of production in to regionalization this is it, do value we at and of the moving consumption, And the to critical helping which the and theater closer operation, products of Flex their where of concerns. be and supply. sustainability and a addressing customers should track labor has dimensions services, record produced technology, them guiding balancing optimize outsourced on what manufacturing

We and our geographies. gains. managing well in through decrease end wins weak become fiscal we've A to reduce came which done from Overall, our 'XX positioned very and targeted cycle, our deliver share time fiscal customers' example performance. Many these more to are market very companies significantly resilient. this to year and is multiple outperformed reflected of ability help good manufacturing business, in in and is regionalize wins our from well consumer in that risk, lifestyle markets

We customers for growth our and across and even operations our suppliers, stronger have more opportunities forward. strong resilient that capabilities built new going make increased relationships and implemented us with our our

Now turning Slide to X.

as industry and and customers being Our in our our customers deliver accomplishments to technology contributions that and manner. manufacturing in advanced sustainable by are a groups well as our a recognized efforts responsible as Flex for leader acknowledge

I'm will few to very to a I comments fiscal of we proud have Paul make guidance moment, we just as in accomplished. but want XXXX. a what ahead provide look

aware, highly dynamic environment, on it's a and concerns general well there interest and recession, uncertainty rates with you're geopolitical is As increasing dynamics.

our most customer we the provide current to want always into can demand. on transparency visibility we However, based

last as of several the will the we manage this have environment through challenges We through years. all

past fundamentals we the uncertainty, outsourced believe very the of manufacturing remain near-term macro strong. Looking

and well ability future. positions proposition us to through for cycles value manage the the our Our

the it Paul over to With financials. I'll that, through to Paul? you take turn

Paul Lundstrom

you, and $X.X quarter good performance X%. begin up Okay. quarter everyone. X. fourth was Fourth afternoon, Thank Slide billion, Revathi, with I'll our revenue on

profit to the earnings million, $X.XX XX improving points basis $XXX margins operating points XX X.X%. gross with Gross per basis year-over-year. of improved at XX%. was and profit in came increase And X.X%, quarter, margin at $XXX an Operating share totaled million for

Turning quarter the to our on results fourth slide. next segment

was strong. to increased growth $X.X Revenue $XXX margin was segment up revenue Operating was and income operating Reliability XX% billion. X.X%. million, this for X%

continued we investments program the labor and to quarter segment. the margins However, mentioned in last inflation, pressure

improve several Agility, was next margins billion, reliability revenue In quarters. the X%. expect $X.X up over to We progressively

Operating margin. operating up and an execution impressive $XXX XX% million, X.X% income and cost was drove strong management

million, came up revenue NEXTracker margins XX% million, it NEXTracker Xx XX.X%. $XXX $XX the in Operating income now level operating with was at Finally, year at was last year-over-year. at

Looking year a year up with Revenue was Gross $XX.X profit Operating results XX. and X.X% Slide income at on totaled billion, our full up improved operating fiscal billion billion, XX%. X.X%. to margin $X.X for margin. gross the XX% XXXX record totaled $X.X

Flex earnings year, was EPS non typical the due full up $X.XX, GAAP primarily worth pointing GAAP charges. IPO-related XX%. than of the and For between NEXTracker to our greater It's out achieved differential the

for driven revenue was have we year. performance operating X.X%. Reliability billion, margin was with automotive business at unit the XX, ramps reliability, full up EV center renewable by a our primarily Within Slide growth XX%, revenue was charging $XX.X Health On by industrial data energy, for solutions new aided X%, next-gen portfolio. and and in up was hardware up mobility power. project very strong by XX%, finishing

strength business, management comprehensive focus segment operating margin. Overall, came as the The to strategy solid strong markets. well double-digit $XX.X revenue in on growth is delivering Agility of billion, a at in of of our this more strong our in profitable This cost efforts representative consumer reflective our operating segment slowing on margin portfolio. as the is X.X%

of Consumer cloud from as lifestyle market and as along XX%, drove gains performance devices up expected, with was reflective consumer increased to finally, was weakness. infrastructure the better down like exposure portfolio wins than than offsetting share revenue critical And consumer new resulting softer revenue CEC end Agility, networking. Within security market X% more spending.

the ended XX% with $X.X growth over a and a our and year challenging the year year. of prior were year-over-year improvement performance billion, the higher and we in to year. completed XX.X% deliver sales than operating pleased our margin, points ability Overall, of revenue strong with a NEXTracker with profit X

advances to gross on improvements inventory dropped quarter also down advances net net Slide saw of about -- inventory million. on with working flow Moving cash X% down Total sequentially. $XXX this QX with in inventory working by We capital XX. capital

We continue improving signs here. to see

we to However, some materials, times near be extended inventory the term. shortages in will lead for we're still managing expect through so and unwind slow

the year for in CapEx QX million, at revenue. at came of net $XXX full X% on million $XXX totaled target and

cash the $XXX quarter similar expect fiscal flow levels $XXX our for We for XXXX. and Free year. the was investment full million in million

in stronger improves. the as in component be We should Free $XXX XXXX cash FY 'XX shortages cash million severity of the flow generation expect more. or

some In made terms we retiring and in million Indian minor capital repayments loan. EUR debt $XX of and loan XXX million a structure, the QX, financing CapEx term

than more as That's capital debt Maybe would hand $XXX of we put won't that but $X.X in part allocation. of typically NEXTracker on of solid cash is their turn at IPO. balance on consolidation as before carry. in million to our billion $XXX on we comments a debt you north couple and of see to Cash retirement, million we

shortages, elevated given is the the IPO one, plan The is add, of not we situation we cycle of indefinitely. created carry proceeds X product global have were two, and things: cash level level do cash million. mentioned, to of a about improve; component significant, from which, a I'll NEXTracker volatility as $XXX beginning elevated level buffer by cash to this

fiscal our for bought and We XX. full of Slide We allocation and Slide year. million the first in back capital the capital. fiscal priorities, $XX segment worth including quarter. to turn in future investing Please quarter for million Turning stock focused of $XXX to return growth XX remain outlook the on for our

double-digit revenue all the Reliability longer-term growth trends. For across mid-single growth business we low segment, secular for based X Solutions, to by units on continuing expect driven

expenses billion the and of million Interest consumer and $XXX CEC. XX%. digits with and our tax market the in million weakness range $X.X and we lifestyle expect in we be to estimated quarter, mid-single to revenue expect growth guidance, $XX will devices, million. be $XXX to affecting income to $X Slide in the end consumer down operating be rate and adjusted both modest XX offsetting between Revenue for to with other around expected billion Agility quarterly On double low around

that OP outstanding. between based quarter, and shares from adjusted share the All So from XXX at interest for pressure weighted the average expecting with and $X.XX taxes. EPS growth to million approximately midpoint a we're $X.XX on translates some

This approximately of $X.XX impact of resulting guidance noncontrolling from to interest IPO. $X.XX NEXTracker includes the the

full the Looking now. on following at dynamic a year macro guidance It's our slide. right very

year. demand trends QX positive we described based indicators to on our expect the for reliability, current the we However, continue through in

with QX year. environment the For beyond some challenging continue potential Agility, to we expect in late improvements also the

We expect billion adjusted year billion, positioning revenue $X.XX $X.XX to $XX.X currently utility and on between and margin between adjusted to share. a full their X.X% NEXTracker X.X%, and in solar grow and space. the operating expect We EPS between continue strong $XX.X based and

QX our reiterate our confidence just to resulting to in NEXTracker To separation. goals. noncontrolling like strategy does, longer-term as of deliver I'd includes, the $X.XX approximately the interest against from again $X.XX This to close,

manage can growth. portfolio many we the how deliver double-digit challenges, improve still through annual our Over years, EPS X last we've demonstrated and

we'll to through call current to manage turn focused value backdrop remain I'll back for So this Chris long-term begin over Q&A. the our and stakeholders. now creating on

Operator

[Operator Instructions].

Steven from comes question Fox, Fox first Advisors. Our

Steven Fox

on I the was planning mean a And ago. out buy how impetus if not stock stock might are putting the to up just significant curious, back of guidance while, and comfortable meeting some analyst And slowdown cash segments? 'XX What's of one, that carrying sort the your forward? with said guidance year fiscal a the then at that $XX, in Agility within you your would but get under secondly, you I very that a was for strong I laid you're going it you change still excess here. core recently you know just

Revathi Advaithi

we a of it that have those with that Paul an we start goals Steve. had But was first towards 'XX giving We high start said with progressed I'd single-digit that over for the guidance give second comfortable [indiscernible] X FY expectation years. a for how for here. X. not to we're we're have very CAGR and long-term ourselves. with I'll the set our saying number

still 'XX fiscal We slower the be that in to even expect was XX%. growth with a up 'XX, case strong really

you'll we've remains goals have managed craziness then that current kind 'XX, not about guidance we around still into track, performed you. with Paul, all dynamics given, with so which here. situation that it guide going on overall, the and still us even we everything really good FY comfortable FY macro our though long-term 'XX with on of well, cash? that's And given I think we're see details have we we our and what with that really the And makes this feel happening,

Paul Lundstrom

Yes.

Just, the Steven, I appreciate the cash, on question.

prepared in end remarks, As I on mentioned cash the at was high of definitely the the QX. side

priority is full Our repurchase, stock stop.

was I we NEXTracker would we seen QX, going it. IPO. trading quiet a to we sort to of lighter than saw have due with into If you it be the there's period That like we what to of the a the then was market, stop to did were associated knew Once have and bit much in blackout thereafter.

I had choices, going would that's what more I'll did we stock to -- my far have more QX. in So in if you do our done QX. the repurchase in all is if we by say allocation look druthers, at highest again, now capital And than QX priority. right of we're

Steven Fox

if And sort just part question the to of down you year. Agility on that maybe, the Anything do a you of in was -- segment. X the to have manage

Revathi Advaithi

on we manage a little if has knowing really terms of more than the ago, focused see we about Yes. done you of the this maybe And I the for Agility through terms can we've couple years operational margin reliability downs forgetting long ups to we demand say it's I'm volatile the through business. ago, Agility have how segment how time. managed help X really having operating really ago, model performance would in years of right helped and in well bit talked our Agility a cycles the how that us, of

I -- lifestyle been in because see see Lifestyle talked we little a commonly probably have consumer cloud a the strong grew about of FY XX%. impact that grow can is sooner cloud. positively. we've the will they is a for they which expect what comps a bit market. still there on I'd CEC, few had as consumer pressured, think strong are had devices we'll to the seeing before, quarters. a -- lot lap you We of 'XX, noise and say

through in demand good will about feel for and 'XX, like have the say managing margins we've I'd this terms cadence very some we operational about of cycle. talked agility the FY business but overall fluctuate So in we

Operator

Mark question next Our from comes Sachs. Goldman Delaney,

Mark Delaney

to guidance First, I compared just reported. quick a to housekeeping make how sure just previously you one. how prepared want have understand I would

So sequentially any would I so you're baking NEXTracker. -- big assuming from in, count a proceeds share flat not you're use of think

impact there's noncontrolling $X.XX a say You to interest. from $X.XX

to done? it $X.XX conclude guidance at the So have midpoint, fair $X.XX, EPS been transaction there would is to if that wasn't

Paul Lundstrom

You're absolutely right, Mark.

absolutely right. You're

else all would So we quite up a bit more equal, be year-on-year.

-- you at you just If an basis. look it on purely EPS

count also correct. share is on comment Your

And think I worth allocation billion We north capital we're to is typically towards guide as Steven, knows, $X mentioned the I sitting repo But weighted priority our on flat. everybody of moment. of cash. at

Mark Delaney

it. Got

on accounting Okay. That's helpful just And my to level set on guidance said and in last relative earnings then to methods. question grow the 'XX. to expected your quarter fiscal business you you was prior the on just call,

for new You're with a little not formally year-on-year guiding the guidance. growth bit revenue revenue

difficult macro though last headwinds a that it like the days. XX over You're increased sounds more bit calling got out

offsetting maybe come basis, about that's So become talk views not company-specific something share like or have incremental you just on your can so they more down whether Or is there challenging overall? a incrementally gain?

Revathi Advaithi

is last we've looks X while. for X consistent right? the really We've how maybe been like say focused right of kind are I'd we our for what slowdown, talked recession or customers on planning And our forecasting this been Mark, super for demand of about demand on the behalf a like. on So quarters, we've what playbook that

how play in terms So super consistent of our 'XX out. of will fiscal we've view been

very guiding few with positive that We're comfortable call line for ago surprise. a our months last growth we're in earnings of much not that. it's 'XX, see why in that's And saying fiscal a we'll

our of 'XX all fiscal we out. despite the we XX how view haven't noise days, terms play last in in changed So the see

quarters consistent we've and we macro system but been the to in have X, terms rate. it. not it, -- now recession we've noise, in And I about we're about how all we're much planning too quite we And of XX all is see ago out, how talking to I say what terms would noise headwinds said that. right? despite overall and the consistent, of for our talk been I play what would been talk in There's we've X growth days about seeing for what mean we say very of this And in right? the

we're not anything from our views. change seeing So

this, cycle, I and of our we through hasn't X about noise think at changed publicly they're So perform have you're lot how but really about for us. going to a segments hearing thought how the all

anything thought been have much We us Paul, give to it guidance be. what to you kind super consistent, helps want which what with is going of we add pretty this to that? line in and was

Paul Lundstrom

haven't banking markets. couple puts on I'd even pretty is and X No, that I'd I a say months. But externally of significantly, we're last it end consistent. the we're turmoil balance, our than just X to seeing takes. regional over say, changed the with is more little say would

Operator

from Bank next comes America. Ruplu Bhattacharya, Our of question

Ruplu Bhattacharya

inflation you pass-through is Paul, think the it's flow with in And my to to line top year-on-year from on benefit -- the also cash impact full I inflation related year For of unwind impact. first the but in the which question, guide, inventory pass-through guide. slow factored be double to year-on-year million, what will almost same your $XXX free year-on-year you fiscal and respect margin again related term. 'XX also from nearer negative you said said to have

cash flow give us how So linearity we should about your can you on in thoughts think free 'XX?

Paul Lundstrom

Ruplu. Sure. a There's fair to Okay. amount unpack that

make I about -- in quick QX. So we missed sure it. talk and factored I something pass-through real of for first in terms have the that what But guidance I'll answer if redirect just on maybe

slightly seen ago. than less we year a recoveries had were QX what So actually

rate. a we ago, so levels terms year inflation in peak of Now at were

a through lot. passing were we so And

think low pass-through. understands as calorie are you very And else and those everyone I

going assuming little it's play going on be this exactly not a that to would basis, just percentage right affect out quarter, to hard down past OP? full I'm a call now. forward, this year out. we're We assumed little What guidepost for to we've so a going essentially look, be And awfully sure how a put it's Well, flat. saw bit. what recoveries but there the XXXX. would again, if that helpful. down come is we How

the I saw inventory. free right. and XXX, working saw 'XX, generation flow guiding was we -- we QX. Yes, double cash the cash that you're I that the gradual second to think and said slow question FY to in happy situation. what was or a our I think We're in the be to really I it tailwind see improvement more XXX will was on capital

Working was capital advances were down sequentially, sequentially. inventory up

that down So million to for slow rollout. half at be flow, guy good at cash. cash was a expect going be quarter after cash back I quarter. typically continue But that you look after quarter don't tends And how we've flow performed, will $XXX It if a loaded. more a we're to

see we'll So again think probably what I here year. this that's

Ruplu Bhattacharya

Okay. have Maybe a for my follow-up, question Revathi. I for

care the more life the You've been steering industrial. business like areas longer cycle towards and automotive, health

you can the years? you of intensity the X thoughts capital see give over So business how next X, the evolving us on your

you're same than guiding 'XX, to level XXX is the be at CapEx X, know years. X I higher as which in past the fiscal

which to expect areas CapEx this drive growth? forward? and which we you more the investments more, where should do going end So And see investing you are future level markets of

Revathi Advaithi

last would you how in -- Ruplu. with played going different reliability moving mix CapEx of couple Thanks, out this forward to been not say and of be I I'd between for years last agility. few is So say this we've what right? our strategy terms Yes. years, the the the the see than very redirecting business has

for our has customers our the this of we've CapEx on common how using well is calls, I've of the in overall before businesses, and based and redirecting prior pluses volume, across really reliability in that what and that minuses and terms various is helped and at applies equipment, gotten that which agility. across we said good manage both

and we in CapEx efficient in our it and volumes manage but talked line use with very use So how of we what down and I'd to have be about, businesses, capital capital up more going will terms efficiently. say Flex remain does overall, us require of for across

terms investment health is high involve of you complicated, are most very very complex and because for in the automation ramps areas reliability, say, see care would like the I'd they and effect more in automotive. of programs

to from the result will investments be are is more heavy the So look thing is towards at I'd will a efficiently what that our and planning that what and to are now. regionalization, a we'll a to been effect what of towards last the is CapEx little say right And us of lean if the we've that's business. doing of which growth capital ramps, which that macro do, years. happening which in -- OpEx of is the redistribute that towards more even couple off world, bit then our tending of is part in happening of other and you we driving lot the see you as reliability,

I distribution net-net, overall may see lot of shift. the don't terms change CapEx, to of So of continue in a it.

Operator

Our from Matt next Stifel. Sheerin, question comes

Matthew Sheerin

regarding your for a just so. or framework calls X% My for 'XX, or growth, modest FY which first question guidance

Given rebound And to from that some to CEC? in more a continued QX be down of slightly loaded on do markets? basically to is expect growth in Or going come that implies the that it is you your year-on-year, based growth? a back-end reliability flat

Paul Lundstrom

question. It's QX Sure, huge good versus full Not glad a asked. a I'm change year. Matt. you

I at full down X think X. midpoint midpoint at QX the is about the year up

I of business, back half think lot as pieces. So about of the a bit little load. a But moving there's a whole

me And kind so down them that break happening. of of what's few illustrate just let a

saw We in a If Agility. started maybe business ago. at within see consumer rewind of it we last What probably device to consumer end in year was look June year softening the you markets.

in saw business. lifestyle We also the it

much we share soft. it because As you see gain, had underlying necessarily didn't markets the but investors, in were lifestyle so

June markets yet soften time in consumer end because frame. haven't comps We those tough we until things really lapped see didn't

both months our on June we devices, last the pressure just what we seen as the and soft in to continuation So is X which have lifestyle here over quarter, being we'll markets. have ahead end fairly of consumer QX, look

tough So a businesses. comp of those in bit a

soft. sort think a to We're expecting everybody first that the bit be expecting in of I little quarter. enterprise spending IT

What be we're in that will okay, within solutions fairly have in then driven business. what that, them will on That's doing -- markets if half business, they in share give the the within us look ramps you significant second CEC strong with second is be, expected the half the the CEC all as pieces tailwind we gain have some businesses cloud we second expecting that growth. in will the but at X growing reliability, And of health business ramp half. well. The

think to move of that back year I into we this we'll continue for group. half ramp the as

doing within like piece and energy to we mobility continue to next-gen to continues and EV and ADAS do we'll ramp, on and rates ramp renewable continue within to portfolio our see The take continuing strong there. things reliability automotive, is well well,

those things back QX -- driven consumer think I the the of the a of the reliability. in of the by comps, and half first So for the nice softer business, we it's side, we year, hopper in particular, consumer on And get lap some in have half mix ramps as kind easier little

Matthew Sheerin

that? then key are regarding fiscal the you margin Okay. progress the expectations just 'XX. of drivers That reliability was for What improvement as helpful. And within through

Paul Lundstrom

whichhas in out, quarters. pressure So last of situation, the it as that business will right We're couple improvement Revathi a inventory of the it similar investments put really gradual a margins. had making will pointed number be now, on in be little of bit to a reliability.

in in idle resources. to I other at cases, think which larger suffer you means reliability the the moment have, is from node continue we challenge some semiconductor the shortages,

last a year. been over challenge for And us the that's really

resources have that to sure well year. move again, you funded that we're gradual have You will through ready ramps we as to improvement And we for we a of but the when be -- high-quality make don't want it arrives. ready be to offline, business that stuff need and take number a in

It rate better up improving will to it will be on coming chips. and be ramps think I absorption.

Operator

Instructions]. [Operator

comes Credit Our Shannon next from question Cross, Suisse.

Shannon Cross

and now follow-up. how that starting to Can on curious to you the we're on funds your color us you're And hopefully give about I'm I flow have clarity IRA thinking getting closer going who's some renewables then segment? where. a benefit any it within to

Paul Lundstrom

to and there tell than going I'll you, minutes from XX half they be joking. can. Shannon, in very IRA cover team I'm about can I conference a probably the is well-executed call NEXTracker better

won't it's taking say lot shape. whole probably a either They because still

we've talking -- on been quite think clarity I for about that time. some

been a in been is have do to be What guy say how will itself then It P&L., able it thought with going a bill. clarified ambiguous. we to probably it Flex, margin. of We and to will be Core agency really is exactly it good out was we're it's the going government thought the You bit was going be be guy details and to manifest then tasked good December, just a to a than for adjudicating has that tailwind NEXTracker. in We for in that here complicated big to it's guy. of it be other volume, clarified January good a still and figure know I February, helps for say and the little a industry. are, with we haven't it and will with it helps we all going

Revathi Advaithi

And where some equipment it residential for ramps volume we're the seeing solar also We're Shannon, customers. result charging NEXTracker, a business where clearly both stations. America already we've seen North in, in in of push of EV going as outside and seeing

customers with for on growth putting by in driven our the clearly revenue are program we ramps So IRA. investment

So I where benefit, outside think of it. who I'd benefit part exactly I'd volume margin say is that benefit, to the noise which in still that's NEXTracker. of say that we those in to see the terms are in areas terms exists starting already going of to see of the

Shannon Cross

cash on but Okay. just beat And of things. the a here, horse return then not dead side to

got you've of $X.X billion at look cash. i As

million You've got about this flow secondary that's where $XXX X-month year. cash a NexTracker get of $XXX is you're generation do the you once assume trading. given to through period million I probably going

billion not precluding repurchase. $X.X $X we're worth of So from that why you're saying you to stock, understand that want share close to saying cash. billion more buy back but you that to do a what's gets me to I going

market. So be at the to we're We're XXX, in looking quarter. going XXX a

Just thinking. investors that idea some those magnitude trying of to forecast to give us the you're and of

Paul Lundstrom

great to I really dodge don't Yes. It's a Shannon. And want question, it.

just you. I'll So tell

Our NEXTracker that share which thing our intentions and definitely right is a similar repo the quarter capital X now. But on allocation announced to we years priority transaction, ago.

definitely -- There fully little the of system. takes see. work that business do the are in another how time We'll in necessarily our fully priority And through more following doesn't a to it is operationalize QX we bit Meeting share you you'll in But QX. see Street other did things August. the than to a what here Sometimes, impediments right Shareholder are Annual repo now. going for reauthorization

point, be a So will that marker we but hear you.

Revathi Advaithi

And Shannon.

thing just done add allocation clearly only I think with we investors our how -- well think the have is, have seen I'd I capital strategy.

Our of we executed timing good this. on have terms has been how in

is going very exact the that -- we're our numbers, sense that and continue be what to at we But commitment this and the way time we're providing we'll within point -- are investors year. do that's which I to -- past, of to think talk well and how I think the the we without when that use it giving giving and we'll have it about. the next to cash, without I know in doesn't so commentary make will do, numbers clarity done commitment, think, the in the And of and to specific going

Paul Lundstrom

thread that Just NEXTracker needle which like mentioned IPO, that. did the is why we I on we with the think I

Shannon Cross

Great.

business nothing's a clarify, at thoughts your though. to about be should point stand-alone some on NEXTracker here, Just changed

Paul Lundstrom

I a believe be it stand-alone should absolutely business.

Operator

JPMorgan. comes question from Paul last Chung, The

Paul Chung

X.X%. a just at finished the record year, So on you here at

You that mentioned for with guide the X% want first from the kind to And point you're seeing exceeding point implementing? of time. you're targets see some margin today? you of portfolio nice mix do the anything longer-term else uptick product automation you maybe possibly of structural kind driving shift, Any methods here? some where upside out

Revathi Advaithi

last that we the we the there these in. we been continuing to change we'll what to move improve and said businesses, we One about part I'll within Paul, X businesses, within and And we've available are really years large do. Lundstrom for Paul that X a important kinds which our I'd say have businesses few our when talked So jump Because mix. of talked is have segments, the the start of about markets in right? pursue look leaders will very business margin mix maybe things. have is over how then up the to it's consistent can these to

bookings of for terms So that consistently. we look margins. We movement in measure

mix of So terms yes. part side, a is On operations of it. big absolutely,

very been we good have the in at We kinds investment make of automation.

very very it's we a in of the right? have and just look very, good of factories terms for automation, where automation sake We are So prudent of invest automation, not our plan will we futuristic in like. how

You've seen that have from for excellence. awards won manufacturing the we kinds of

our last every manufacturing I operational year. expect to definitely driving seen because operated improving they've will automation would is in operating is that at, best say the year year. every the efficiency improve So that, plants ever continue that we are the of improvement and you've some margin

So it for we willing new targets already haven't we're that any are you 'XX? Paul, consistent both to is and not shared from that margin with sides FY give seeing improvement, that I'm

Paul Chung

products kind Great. opportunities you are lower expect as appetite auto, my And these then of some more to that care, of hurdle out? volume some there here call on you in rates? is, products, And take to to want from displacements higher result of the specialized come U.S. you share any being industrial, kind across at higher-margin these seeing there? that you more Are complex -- players EMS higher Do the more health you of for competitive more a type follow-up products, margins. kind move of as smaller

Revathi Advaithi

Yes.

Paul, from are what So EMS. share But each we think is I a see different. what say we X is smaller is I don't little would at definitely

volume tend So products the for see space. in more margin, out you higher that to be we and industrial play lower complex we example, that lot products industrial, in do of So right? -- a that

margins make products, higher it's about of seeing as the ramps all health getting customers -- the the the it you the and that make is make stabilize good ones the but automotive, cycle we automotive are similar is In getting correct we can up, more volume, products we and own automation are which right, you and through program that sure footprint so that EV those for to complex and of our combination way. platform kind

high cloud the improvement in the by it scale businesses, that maintaining quickly a level very Our and about of efficiency way. so general, and automation. drive then have can been to all we getting

lean kind say the on terms that industrial volume mix business and it in I'd depends I'd more products. volume, say margin, to tends lower towards So of drives of complex the

The Automotive but getting more more all higher cloud volume is also. complex. they're getting complex, is

X each not different. a There's is I'd a So say little one-size-fits-all.

Operator

further Please questions are proceed. no time. the at There

Revathi Advaithi

you. Thank

on for the Flex then thank our a to want Flex work behalf the and across your leadership you I support. team, continuing to thank and business. And customers our to to I contributions So give to shareholders just of team all the globe wanted for dedication the and their

joining us thank you for all. today. Thanks So

Operator

Thank today's you. This joining. call. concludes you for conference Thank

disconnect. now may You

Flex (FLEX) 10 May 232023 Q4 Earnings call transcript