JBL - Earnings call transcript Q2 2024

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Operator

Greetings. Welcome to the Jabil Second Quarter of Fiscal Year 2024 Earnings Call. [Operator Instructions] Please note that this conference is being recorded. I will now turn the conference over to Adam Berry, Vice President, Investor Relations. Thank you.

begin. may You

Adam Berry

thank XXXX and joining Second Jabil's Good Call. you Fiscal Earnings Quarter morning, for

Joining call on Chief me today's Executive Dastoor; Officer, Officer, and Mike Kenny Wilson. are Chief Financial

will few Mike current next trends new 'XX. provide for and QX the Over demand and I results, review minutes, update fiscal guidance our

building call outlook us give confidence our strong We the Kenny, will that over will then provide blocks who fiscal 'XX. for to turn several of the in

webcast note To now of Before the beginning within with At during along today's the call, presentation entirety the that live, presentation, we be today's website with being of will slides. and view Relations the our statement. prepared forward-looking of the is referencing slides, please follow we the remarks, portion begin, the slides that and ask the Investor you playback. jabil.com our follow on posted conclusion call with I'd website. please be visit the will for audio along

or information, XXXX, conference These During involving any could intention business. result of risks and among these any a other annual XX, or in the future our for forward-looking call, statements, and and on assumptions outcomes the expectations, fiscal August Jabil statements, identified events that actual otherwise. anticipated to report results risks An our disclaims our on uncertainties update and materially. the extensive as filings are to outlook ended forecasts Form XX-K new or those whether list including, uncertainties year for SEC. making obligation with other revise current and things, forward-looking are cause regarding this differ based statements will be we of

roughly came where in our our as extremely line revenue. Core the now like provided in billion the revenue X% with I'd or in quarter income results, at of quarter of businesses performed in that, shift December. $XXX focus guidance updated well operating provided the we for delivered approximately we the $X.X range back team million With the to majority against a to guidance second

This mix by percentage end by within of $XX a higher as for ongoing was care, supported and our the higher also mix revenue came expense in a led strong to networking at automotive shift markets. Net reflecting up XX year-over-year and while basis an due of levels than quarter. expected health points business the million, inventory of interest quarter during storage

that of approximately noting we worth also for business the Electronics mobility to $X.X It's billion. on our BYD quarter closed sale during the successfully

operating earnings share income and our was of with was $X.X approximately GAAP provided the reflecting diluted for was Core As midpoint GAAP $X.XX quarter at the earnings above substantial per our December. the a $X.XX, end diluted range in associated $X.XX, billion, the result, the December. sale guidance of per gain share

performed our very turning to driven divestiture. approximately for came performance segment segment DMS growth in the well, year, at entirely comparisons our prior down basis, for transportation automotive On in segment DMS billion, by our the like-for-like from XX% Now the by businesses. the year-over-year and XX% a mobility quarter. $X.X approximately by in led almost Revenue

quarter. came reflective margin Revenue for XXX and than roughly billion, below business. from EMS down DMS X.X%, in roughly ongoing our at the XX% higher the operating our $X.X segment to of Core million within for same year points came year-over-year at shift the expectations basis million a for quarter mix $XXX ago, our $XXX in segment the

and like lower as renewable revenue year-on-year in XG, revenue EMS The was business energy of digital to move our driven our within decline our cloud within by a expected. model markets print majority consignment and

with by yet those the businesses end were demand However, associated both markets. of and XG decline our unexpectedly, end impacted quarter, and towards negatively renewables in the another

the EMS core margins the year-over-year. quarter, points XX were For down X.X%, segment basis for

like with flow customers, the sequentially end sheet as update balance inventory, to inventory and quarter-on-quarter for of Net of begin QX, of days days in metrics of deposits XX which Next, our to which days. days. inventory were cash our on X higher came XX%, an X increase I'd beginning with was

$XX from Our cash resulting expenditures adjusted in second quarter. $XXX during operations while quarter totaled cash free at flows $XXX million, flow million, came net the capital in in million

$X.X our we February XX. million repurchase repurchased shares authorization X.X current as us billion the $XXX approximately quarter, on leaving for million, During with of remaining

debt QX ended approximately With the EBITDA of largely to cash In this, we solid with levels quarter total a closing, billion was X.Xx. core and $X.X of balances quarter.

our divestiture of intent share business the the to strategic where team appropriate also buybacks of while of returns management this reflect funds For starters, the the healthy to reshape and maintaining those allocation the shareholders. both mobility towards business

ability 'XX considerable At despite admirably the business And to these headwinds. margins same higher evidenced time, in leave fiscal with of we and as we serve you performing the ahead finally, declines beyond. optimism our look a the pretty end is deliver I'll by of to bit despite markets X as

of business on about harnessed. that serve, intelligence, being end vehicles there's the specific this becoming that of theme autonomous of common by As into impact surge, our future. adjacencies artificial to have the it's across created we with data a well clear and the markets, forming number EV and proliferation there's it among needs the a will And think the end customers' we to be the a markets surge

we're design. our results. into we're And for demand hardware, most perhaps specific And innings our and manufacturing in enthusiasm cloud In operating related the beginning to arms is getting this business, industry, care around exciting, of services to AI increased AI turn of our the the significantly benefits room. health the seeing to early in in tangible

first XXXX. of our that of For of level half instance, the GPU is AI in XXXX the volume XXXx

be bit So road. there's we to the little about excited a lot down a as look further

end despite outlook fiscal believes thoughts why hand a to details With market. the provide fiscal fiscal on who original I'll I'll over and 'XX thank hand call outlook transitional share Mike. Mike, first, In you. 'XX. his update But call attainable a on growth that, few our including to will an minutes, the by on Kenny remains more XX.XX over 'XX, will now our he of

Michael Meheryar Dastoor

good Adam, Thanks, morning, and everyone.

information 'XX. few outlook next plan provide following: you and the to I updated financial on First, QX minutes, Over our FY for the more I'll outlook walk for through

an opportunities FY share are our Next, our I'll are progressing provide buyback on I'll schedule. for ahead accelerated we execution update in plans, an update And of confident on why 'XX. provide then growth which

the third With our slide that, next guidance. for quarter turn to let's

the our our markets, which and end second sudden expect renewable within FY X end Towards lower-than-expected energy revenue and 'XX the will of XG a and second we in quarter, through quarters. we the continue experienced of last for result slowdown half

this February. an done we energy of year of forecast the inventory our our in will that as The our within towards and renewable job customers chain has began end of QX. our current the in persist towards market as back overall renewable our we business, move lower Within base excellent energy team customers' have customer supply the share correction balance higher expected demand fiscal QX business the is the consolidating now of through end to a half

faster-growing quicker investments. quarter, expected XG the towards India In infrastructure of than slowed rollout all the as infrastructure end like back substantially markets XG, on pull

QX, range be X million As we expect these Core estimated a $XXX market the million. billion. in revenue to $X.X $X.X for billion to for total dynamics result operating range company QX to be $XXX in of income the is of to of

is in in estimated expense be the range Core expected to the to $XX of to to share GAAP is Net GAAP of diluted million. the be operating be to earnings per $X.XX income range in $X.XX. million. $XXX $XXX per million to the be to earnings is range expected third estimated share $X.XX quarter interest in of is $X.XX. diluted

on guidance Now end December. our line by the level, our largely moving on this a near-term of renewable XG of with At majority remains and high our slide. exception for markets, with to the in the market in expectations pots within next revenue full year dynamics the energy year

expect care we AI our data end notably centers. across continue growth, the some growth Importantly, for which markets, year-on-year and experiencing year, year-on-year cloud in health to vehicles, are still core of electric

to next in we the customers margin as confident anticipating and markets. end be headwinds of the erosion more will not slide. of the geographies near revenue slowdowns. that Jabil resilient term, Despite Because we in we're traditionally past are to Moving this, we've products, the diversified seen level same across

confidence Our with committed give in weathering and strong customers on adapting, value. challenges. us these flow and margins and near-term staying global cash to focused We're diversified delivering approach, footprint relationships

despite higher reasons come revenue. Notably, drive December by in core for at our to margins ability 'XX, than margins operating we higher in expected we Three to FY account largely X.X%. expect lower

to First, in that fiscal agile and deleveraging of as support in new year. planned is the the this, renewables ramps of allows, model our plan limited. our investments costs back Because pushed we half will

expect align our to structure business. energy we recoveries our lower footprint revenue cost we our and efforts And with offset go-forward Second, renewable from customers. cost XG progress fixed made to with and with third,

All us expansion our ability future of of this and deliver well an to X.X% gives me optimized for higher structure. confidence on core in cost as FY growth drive margin positions revenue we 'XX in operating margins

Putting it FY next on the slide. for 'XX all together

to us to operating leverage, improved core raise optimization confidence drive business margin of incremental FY billion. guidance expect our our revenue on and X.X% 'XX of for and We operating mix will giving efforts thereby the $XX.X

by in accelerated this which of $X.XX, core reflected margin to operating improved expect We is dynamic share EPS and repurchases. income result core

free committed year, in the also to $X than for remain flow. we cash generating Importantly, billion more

that automotive, than unit continued to rates, a EV at Overall, the and areas continue anticipated headlined positioned slide. originally growth anticipated platforms with well had portfolio this end about of centers are next feel at are year. the outpace in by of fiscal beginning FY albeit year. to recoveries along market data care and business ICE drive we and lower growth in 'XX Moving and rate Globally, our we of in AI the the our good hybrid to contracted both health trajectory growth

of customers platforms multiple with such business is supporting LIDAR battery Our next-gen areas other compute and as and management, number solutions. as conversion control EV in a charging modules, as well vehicle power sensors new

software different updates. awarded through are capabilities, OEMs modules optics where Additionally, enabling of business new autonomous camera we optical recently in of predeploying were the driving rollout levels hardware

growth customers. to of year-on-year less by of It platforms and in with gives the existing the be year growth new EDs be our will is FY important in confidence 'XX. of growth on expect in FY in reliant new 'XX another volume EVs expectations will note for These driven programs we majority us

opportunity outsourcing significant EV to our Jabil technologies and of larger we overall as offer a customers take well to solutions to auto credibility trend. the health in the hybrid EMS provider term, continue growing globally. well us largest take positioned of and of Longer care in critical health manufacturing support capabilities positions to business, care they is tasks. complex see Within share growth both outsourcing advantage to as space Jabil's unit the

of to there next-generation explore winning investments positioned common continue In of to FY customers we collaboration share to 'XX, base Jabil business opportunities growing to in the transactions in And strategic of as this data a have of and ML. out forming AI anticipate the we is and our our fair of few BXB markets space, our ourselves we to ago. number assist investments year related accelerate, similar build continues growth well years center theme another from The among is centers. capabilities a our end AI as surge a in pie pace in data AI and our new

and winning markets infrastructure AI multiple quickly space, applications, silicon we're networking are cooling across end GPU and seeing share accelerated center in the teams storage. photonics, data and right switches capabilities power for Our configurations growth liquid AI in where optical AI back-end diversifying energy

in date approximately FY net across now this end 'XX of AI-related year-on-year. markets expect to we billion multiple success $X be or to space, our increase in XX% Given revenue an

as muted the customer with normalizes. very continue to commentary market, end inventory across on expectation the a to business along we overall horizon FY calendar and as remain with suggests And year, the that we of to look memory end semi-cap demand recover for industry to new market 'XX. may towards be consolidation expect are However, improve dynamics base. while we within recovery expected to growing we things the improve in as market and this FY anticipate this renewables, the current fab utilization ticks are slowly, aforementioned market higher winning share 'XX, our Within And

power space capabilities. infrastructure renewable Longer growth combination positioned we engineering support supply Jabil's term, chain of well unique energy remain expertise, in-region secular due and in to to the manufacturing

diversified to we're forward, the and momentum growth Looking underlying well FY our are 'XX. excited in drive positioned portfolio across about

series update on buybacks repurchase to I'd accelerated our like in of share outlined for intentions balance I provide repurchases. $X.X In Next, billion of an FY our 'XX. a the of authorization executing December, the

repurchased to am price repurchase happy $XXX We that our repurchases. opportunistically purchase just ahead remaining million FY say for This and million amount repurchase current our to an for in to on XX.X fully the year-to-date I per in $XXX billion QX. billion optimize share. schedule $X.X with brings we're our 'XX under we'll continue average anticipate shares completing of authorization $X.X

in be for range 'XX. $XXX With [indiscernible] the FY expect plan and to million $XXX and progress $XXX million in in the to 'XX approximately to place date, million $XXX I FY of million to

This diversified FY I'm multiple share we're positioned excited multiple following: and 'XX the the to market. we storage mix out growth in cap continuing of recovery the customers, the continue end market help consolidation in underlying the borne am new renewable programs be with AI-driven macro in excited of end existing share strategy, our will space, paths to of in a solution customers, trend our market next higher-margin AI/ML lower-margin will as to On about across to legacy 'XX, about result summary, expected equipment. confident semi the of equipment that I'm fuel gains silicon particularly and the market, booked slide, FY our that the with with replace of confirmed shift I energy and required momentum infrastructure networking networking drive is the where portfolio, for which new in well accelerate

we consider positioned our On than you to top cost are optimized X.X%. when structure, of all core this, expand more margins well to

gives intentional also this of accelerated areas In EPS just you with several diversified, to the FY to me due time for expenses in more morning. expected end addition, share In $XX.XX our net and repurchases resources resilient and today in more in my were our invest multiyear to higher opportunities. growth view, joining deliver efforts secular than align we turn but offer interest 'XX. not ability over I'll Thank call which for us our confidence lower has and key our core returns Jabil your to ago years and Kenny. markets, now significantly

Kenneth Wilson

was for and for the company's Mike, company. Jabil, us and for Thank you, joining history everyone and with to we've successfully going our subsequent teams go-forward thanks to be to which sale one cost mobility structure year footprint a 'XX largest today. of efforts by transitional Fiscal the always its our the optimize completed transaction the in

was our slowdown and anticipated, this were of footprint transaction not. the end For optimization market the

control operations, revenue. agility Managing to As well. absorb by ability a I about working not tirelessly quickly of is such we what effectively the is obsess previously, ensure our does slowdown to factories control, within have happen attribute stated react our key to model and chance. changes absorb our March in Jabil, and that we At our

to pleasing see up. our it's hold So margins

this Additionally, allocate us opportunity make and provide reassuring is more to Jabil. dislocations their who progress to spend with consolidation some like trust of customers to for

process future tandem where with shaped commercial In telling in part we not with the event, current was exhibiting The but of have execution, margins secular a on of our flows. focus and cash we the been growth desirable how appropriate deal operational closing capabilities and mobility our a portfolio. one-off we've of intentional long-term characteristics look and our markets

to us of result appropriate while current lives making our of The customers allows returns. simplify help future the this and

autonomous to as care switches markets. silicon network of EV this electronics simple accelerated in and our telco us implantables, liquid the From and has cameras. from starting build-to-print optical in applications from highly seen transition machining and tech including packaging from systems, at a to precision recent racks, low we manufacturing switching center AI and servers PCBA history, for table, to to build-to-print automotive health photonics supporting multiple seat look driving data example, For from customized advanced configurable value to across the chain cooled our space, end optimize AI

short, are support our of ready company In continuously retailing needs we to ensure we the future to the are customers.

proof mobility another of In were couple deal, evident addition quarter. to in points the the

been competent security new with a We have highly to optics including manufacturing Motorola sites are video proud North business awarded X America. and Solutions in

And center advantage infrastructure awarded This program, ramp supports 'XX. our centers. on see switchgear U.S. focus of in in accelerated ability data the where switching cooled year from liquid AI which in proliferation a supply significant we the coupled with AI building support were chain space, domiciled we medium regionalization the the low fiscal network data leverage voltage We of benefits are footprint global to a to will and being

While the we team the pluggable Intel already, addition with multiple Photonics Silicon of wins space. the of benefits seeing are in the transceiver

think about I the free commercial our billion. while and excess portfolio, across opportunities As $X in EPS delivering I'm as expand in $XX.XX year-on-year also more our to ability coupled margins optimized a flow exiting this numerous core year confident with cash of of company,

that year 'XX, the Note divestiture. modeling anticipate we levels, excluding total to year mobility fiscal revenues in 'XX similar fiscal

markets, mix expect we improved be secular trend continues as long-term business much to trends. Importantly, benefiting toward from our to

executive XX the In new privilege had [indiscernible] celebrated I with award. team as days, and multiple we at the customers time closing, spending organizations, of in have Solutions last the including internal

as from long-held In and Chinese a teams Asia we procurability tradition. celebrate addition our with to with Year and team Jabil the Intel Jabil [indiscernible], New in

last XX Shingle accept care awarded device it to in health years. this to Shanghai, the med largest Asia, was in While the our also side to honor site prize in my award a receive

markets, right buy I have that in and addition unique we I end believe the also right in further team to the being having their to our culture. the of capabilities demonstrates As every this, strengthen day, reflect actions it right global all on

you All for Jabil. firm in to I Adam. of now hand 'XX this for us your on will fiscal beyond. Thank interest footing puts back and call the

Adam Berry

Thanks, Kenny.

there summarize key was in quickly lot today. the So some I'd a of closing, to here like messages. And

mix fiscal end 'XX, are X Our back renewable XG for outlook exception guidance 'XX impact including in largely the buybacks 'XX outlook provided to is with fiscal in along second despite due core quarter signals target. December, margins accelerated we the our transaction of and Jabil. wireless. interest core the energy mobility your chose Q&A. $XX.XX And results now our we're and specific higher of line in which EPS us from lower wins, for new the with shift the demand the market, in confidence our positive markets, to we give the and proceeds for in with why Thank from you ready maintain Operator,

Operator

questions come line Advisors. with of first Fox Our Instructions] [Operator Fox from Steven the

Steven Fox

Two a I guess, numbers? have going and if time programs. back could. year, all, what on within the of think from cuts us XG sense you last on why renewables me, not questions fiscal first Can front? I you're for give to just but is this you and are the come that the customers through through the from year. calendar to cut indications, maybe Like the those

biggest if color then targeting exclude now, that you're drivers better maybe on we mobility little bit the mix shift more the And but understand mix that. on shift, the a from the margins math like secondly, I

Kenneth Wilson

demand telco a across exception forecast, channels. with our the with that in that right our when a on process XG we've the of in of looking we've We seen inventory renewables. in specifics where pretty let broad-based I customers end intimate the markets there's at the of space mentioned the couple And got their and terms of and Yes, we're called there. we reduction QX me demand. inventory do take question all

no here the I mentioned reliance we issue substantial we there the effect, here is from India although said, was that see rollout in what Mike think from with stopped was the happened basically this pullback. with instance. In a So and what -- input

that. there's going we've baked basically, forward. at look indication that, we no into number And when our of So now

India. recover everything that seen a in just the we else forecasting we've comfortable was we're and gotcha So or space, in this expecting We're to This not year. that in telco understood.

think working inventories we've do decided be safe through renewable pretty In to So there there. again, it's that customer we're is and space, basically, And we QX. in what the the to with we not the the into calendar channel, sold going been through. QX

they plan, seeing that we're is inventory they're to in we've the And what So going now now register reduced reducing. the what build is channel ship.

We haven't forecasted covering that year also. this a

look we've very, So we've and been very rates we've been 'XX. we very going conservative. to those as forward Also, just modeled into conservative, run 'XX,

expect you recover. when what about X at we're markets end don't to we these in talking look 'XX, So

So we we've think been conservative. appropriately

Steven Fox

Great. margin And the then on question?

Michael Meheryar Dastoor

Steve, yes.

We've AI networking AI-related don't does in So space, have the there, by line impact. in you our of line legacy it shift considerably revenue itself with the obviously, mix effect, replaced a a that storage see item the lot item. although higher-margin business consignment the up the because particular huge cloud in obviously, and of business are volumes

of big suggested. optimization. margin mix on on there's cost And a we've that, that coming So shift top of a play lot through the done you

If quarter the that customers, have optimization cost in you look -- transition fruits maybe recoveries I then. even the and then at footprint was showing we year. a cost back of of getting at a from through. are of QX fiscal look call are in restructuring you half the Obviously, our that in we the talked up a the of earlier taken effort. though sudden our optimization bit been cost -- cost that little the on we're some the are The had of cut. stranded nature But And second we've we year, we getting that's for think about because recoveries down, go revenues if coming of the successful

revenue you, margin moving out, have of those don't I'll quarters QX, ramps there. QX line is that remind those in to we're we that have And Obviously, pushed had much ramps. item. when revenue lower the a up all on in some just plus initial So as are ramps then at

as a pushed So that out well. gets little

gives of good all comfort. us really Steve, a So that, combination

we've think think We've the that, more beyond actually X.X% Previously, X.X% be we good X.X% about not end. it margin. that. to to it we up, range, taken going feel and I just the high it's taken said in to and really we

Kenneth Wilson

also, is we and hit the cooled as the like good to switchgear been a voltage racks, space XX this which are X, view And have doing, like CDUs, a us. also, think we horsepower legacy running a when the got why I is with bid lot switching server X, instance we pretty pluggable supports Slide a think longer follow-up look I that And deal here Intel the in in accelerated been the closed. incidentally, confident transceivers being this the hugely what of I about in Optical the we're Historically, I won But switching a We've with that great enterprise would at making to and that's distribution. Yes. term for then X Steve. voltage really or met years as in Singapore and transceivers back our in rack January power in there's here things you assembly terms from pictorial and gone we ago. of asset obviously, ground how yourself. interest we're AI from that and of going huge be that trying being that with we've else is team we're talking will robust. low the to the just as be But everything us. for that recently. vertical I if just liquid rack mentioned, difference, awards show now successful margins well the But to Intel

from we're all. that's what little in wouldn't other and bit just retail in to space historically we're the company, server customers, that margins. to finding confidence center markets help in can when the about getting of streams things things a what data planning with a done our we're disaggregated. I But value-added can we listen find will that activities their increase I us that now be is and can gives So so income costs historically, we've being It player at said them. leveraging that is our talking we where multiple We -- being was we're reduce we we

think longer underpin try our I to satisfy from and that make perspective term. we to margin can margins So that needs do a to customers' the grow sustainable what our in

Operator

the with Bank Ruplu Our of America. come next Bhattacharya questions from line of

Ruplu Bhattacharya

you to I was many in just times then how remarks, I and AI count. your mentioned prepared trying lost count

So margin needless for or to come what different Mike, markets. say, is a year AI over demand will how driver there a is from quantify next the revenue meaningful to AI end way much in the AI can impact would business? be? And lot little Jabil's people into you into A is competitive data cloud a center. doing are in What going delve the bit more what in of the you're advantage?

over years? see how do business So how And of couple do against you your growing next think cloud your the stands others? revenues competitive advantage you

Michael Meheryar Dastoor

times AI be said count. reports, just did Ruplu, so in to clear, I I XX my

AI prepared AI the look revenue. about the did On my piece, you talk remarks, at if Ruplu, so I

XX%, billion 'XX of north about to multiple think billion, $X billion $X.X and end as we're I network in markets. $X playing bunch the was the in business. be we're be that about FY whole in by going we'll XX%. across to switching. We legacy in Obviously, cloud range, infrastructure that's Kenny data mentioned, going grow business business our from or as areas space. AI-related switching from of play to There's replacing We're such network a

end XX% we them out that to as our different chart. items expand. billion markets spread that in line time $X this grow actually it's those XX%, But over overall, across revenue range proliferation about on we when plus, X in AI out, of particularly will Sort feel of just call continues continue to

here from And expect all momentum. And So cloud it start talking years then will to cloud was that our do is that hardware and all the benefit into AI X as markets out, in all it's more space, will hardware forward, work and spread that proliferation. I'm you gain end as even mainly the other you then starting well go we around the because as you off where space.

Kenneth Wilson

me let Ruplu, second question, Jabil's your competitive advantage. And on take

think say people. a Firstly, means to lot going that of area a I in would what be the for this there's of work I lot growth is that

So do and centers need to try in eyes When what through I These work and said, assembly. And to we look if to be go then our enough their be their to to more I the and able life -- good. look able life they think to be be around. there's the able we need the to do that's complicated the suppliers is need customers at a simpler. to our data think try to of -- the There's customers able look our at rack do to do more add, photonics you is switching. silicon find a the competitors, at becomes power What world look we That becomes. do make we more do need there's to transceivers. to life servers

So if that they them. can helpful different have a then credible for activities, supplier that's multiple do

can do example, card. that. pluggable you the That on don't and line an optical device then you but of becomes if transceivers, issue take, as You want cars can both we put do for do to line you a

becomes example. be us automotive, to something that able that that vertical across we're for be for mentioned think services producing Mike seen for is to to we view automotive, to So play in is more able cameras integrate the we've the and be a us.

for us negative I seen, think sure. but -- a not but remains well the I positive serves be think think So to thing that, basically it's other we that that a

North but We we footprint, secure we from perspective. been a and best have has the practices capabilities world, a term in the can in being see supply across longer helpful leverage global America, domiciled so

we that do to well got that together, we and all we're perform. positioned, think we put all we of So feel is

So we're and pretty opportunities in long-term bullish on this area. growth the

Ruplu Bhattacharya

And billion. million row about Okay. just follow-up, the year full you this time, the by revenues as in is cut bit. takedown little mean And ex a to billion. this $X.X $XXX last business, looks like mobility want guidance. I the time the second is it I for that time mean cutting push you're I $X.X a a

as had in that guidance? why fiscal I which if lower weaker? won't same example, confidence weak, last get the investors And in you 'XX, is come your renewables for it how So can't gives time, for can my question is what even get you even is really confidence

next these look -- for My mean attaining that you for all what be question what can should to some we would derail talked drivers Jabil just about out And what then for? improvement. on Mike, And margin the the year, that? I risks margin? of are

Kenneth Wilson

Yes.

customers is and been step let -- generally I with relationships back, in lot. because reflected me on we've So has long that a term has Ruplu, been instances, our -- a some we've multi-decades. so take The got

forecasts. have we So look kind connected. joined hip the inventory. a processes We're of at partnership share there. where We we got We've at

planners, cetera, pretty business it's we're So sites, whether development that got our tight. We've involved et people, people cetera, in this. in et are

the So this from up isn't bottom. this top the It's bubble down. we --

what if year we look So I markets, going can understand broad-based the majority the across predicted balance forward I reduction. looked of seen of QX, from And for is happen at -- to and what when happening. the is we end we In question. we've our a the QX,

we're So comfortable that. with

And the for India, sudden sometimes of higher, deployment the rate get with expected one radios a just out you that, of India that all would stop. -- no I in mean, like example,

X I we you renewable happen. than now will things So of months something that got sometimes spend we've we And space, customers time with -- had becomes in got accept lot lot this that, that In a that that spend more of them. ago. think we a the mainly we -- been lower and has than rollout that down. way also, a look inventory But residential expected. clear been the of the slowdown play in taken that way, soft. much channel We've in time our that's we it's numbers got with It's instance, the

commercial We and the that's space we'll been And read we more so market been becoming America in U.S. to consolidation much is like the you are share, Jabil -- our pivoting be it in that we're side, lot if more that that space also in We're building in supported winning North by and customers. robust and also. the the seems a lightly. there's of are commercial

holding our getting taking The is our down numbers significantly. balance we we're up. business, We're think, So share. of

control. you at happened. pullback of to recession, has call this control to remarks, question slowdown, in I whatever Whether like your at bottom my But think bit it, correction, is a the in we good though this here. to we're want what really, would and couple last be a we got add little we've back can I prepared So what to really been really has look inventory -- we mentioned times history, if our in the company's

down Our by EPS or has XX% points more. XXX or margins basis by gone

as we're more Here, much company our mentioned make remarks, we the hard, robust. in working and to resilient prepared really

businesses remarkably shops think I that So that punches, a our spite resilient. markets our but in demonstrate of staying that that couple couple end a taken has of we of in

So XXX investors much it company our I happen. that would my than robust EPS, be it sometimes I that historically. our think think margins I was demonstrates message But think like to more improving is it outliers was and

Michael Meheryar Dastoor

answer way Obviously, your it. the question about story And and you for good margin wrong in holds us. the risk go you different and were Ruplu, to asked than I'm going why a what slightly at can

me $XX.XX and do $XX.XX bit. let all factored try a is into that so strongly the that feel Because Why talking $XX.XX guide. by little about So it our number. about particular of I just answer

you that, let Before building some just blocks. give me

in interest So what if costs XXXs. at you look year high will the our this be

the in year next expect We be million. mid-$XXX to

a of buyback. building will $X.X we number completed you FY million 'XX, we'll more Wassa, the take FY have of about if done interest rate normalized run the $XXX So continue an billion if In will substantially block 'XX. there, you take for be by

Wassa $XXX expect be about million in So I FY to million $XXX to 'XX.

we're if numbers, to these million seeing $XX.XX, on are $XXX AI the net about should income $XXX of of take I to whole cetera, numbers incremental prepared that's some to FY based on in about the the of what effect million income. mentioned I our we're X around this my needed you and talked make revenue, about talked billion cloud, in into end We've as market benefiting other end trends of the billion storage, some remarks, where et $X.X I mentioned, macro that is from different 'XX alone, based automotive, markets that now. 'XX any are -- I play seeing proliferation. for presents. within how talked sort consignment I AI, about revenue, that markets, not well, sort growth. talked And FY coming add is incremental right net as about Now of assumption I we're incremental end $X

program big about new but have already and it's of not already under We're matter opportunity bad delivering year, it some expecting miracle that for We've 'XX, the talking assume if wins is end assumption on Our change a based those us. an FY wins. does, we you booked those belt. the environment just obviously, just actually close even right But it market a substantially. to will If we're XX%. to layer now, in in XX%, for be this next

modest again, there's expect substantially a very and reason it's health to if care take X% you And no be growth, lower So growth. maybe automotive XX%. to than then a

about AI $X this automotive up alone, add and billion you care If revenue. health of that's

it. X% margin, You're of you if even talking more about get X% leverage to out

talking coming. incremental a of is have you're is there balance customers and that's changed cap, in in I million, million positive already $XXX just their needed that of they quite not businesses, bit strong these X%, the talk changing of about markets direction. own the million a It's at $XXX income very I'm of showing by a markets. way, semi that So the end lot that's for signs the about the the way And here, all It's mentioned X $XX.XX. end which, and but recovery $XXX talking

calendar million talking mix So continue of you talk retail, year, recovery we agree, margin there. at on, so high million, our the little $XXX calendar to income $XXX year get basin we do that you the the in even is about. not mix very 'XX obviously, print you'll is Renewables this year small and expect probity sharpish totally do undertaken to a going talking full that that steady 'XX, about And to. optimization efforts 'XX. of of about the as see increase not slowing. we're of Eddie have connected we expect sort we've then then look play, not Digital a in this also year cost FY there low it's and 'XX. FY devices there's that certainly optimization, cost And shift difficult if impact we're But

answered perspective. from low. the I risk a is your hope question Look, risk very So I

break the if the at look achievable. 'XX, individual If highly for down of -- components sounds talking what about you we're FY $XX.XX you

Operator

of line Our next the Mark come Sachs. Goldman from with questions Delaney

Mark Delaney

of see in an where of then of from billion The $X care? billion, AI revenue? you much health understand some market Better fiscal company some maybe mentioned expectation about opportunities end revenue that and $X opportunities AI-related how how like defining how understand coming to then you're And also have data AI-related help center other 'XX. us these much out is are

Kenneth Wilson

just probably really. would advanced the X/X Yes. it of say center that Mark, north I of balance as maybe half is that of maybe slightly switching and magnitude. order related be -- it kind would optics It's so -- is data and the blend of it of of

Michael Meheryar Dastoor

and just revenue. you our remind you revenue And at if net data effect. of net again, Mark, look It's add, if consignment I center could that's

Our XX% are volumes because in at show is up XX%, will margin on. obviously growing gross really range growth good It's But doesn't the a what it pace. we're in in up value that adding that revenue. show the

I be So misleading. the the number by can revenue just revenue think a net itself, little number,

at in to got XX% -- up space. are XX%, particular that You've Volumes going volumes. look through look

Mark Delaney

to these Or hyperscale to sort categories. broader counted just be any AI? helpful. for need some GPUs as trying it But or Just Okay. to other of clarify, of the so of That's it? have versus understand in would does AI rack categorization

Michael Meheryar Dastoor

now our business server No, from predominantly cloud our it the has has attached. of to shifted in GPU, have AI-related Most legacy some GPU business. to business

Adam Berry

pretty -- Yes, much just we in opened we like just a that space. months new ago X doing facility GPU -- a like -- a all that's

Mark Delaney

that Is ability over you X% still bit EBIT to to us negotiate? how little is Maybe other then And still you go your 'XX. to recoveries you speak Mike, term. achieve the out the question X can talk mentioned are? cost fiscal for margin margins. a margin longer help resiliency on My that need maybe secure something a the around in was reason and fixed recoveries

Michael Meheryar Dastoor

Yes. The our event. already agreed It's not recoveries based are already done, future upon. Mark. It's on

you very secure. your second repeat it's Can question? So

Mark Delaney

longer you to specific a ability a EBIT but extent to could you EBIT in achievable. X% Your margin do I or non-GAAP something frame time still think you X% put on term, higher I be to margin? the said think eventually think you're to get the what get which don't is tracking it,

Michael Meheryar Dastoor

Right.

sort at conservative FY being We're plus very for saying of will X.X%. X.X% FY 'XX. exit we at by 'XX So

there. is X% maybe so away to getting It's a X 'XX. from years not think not FY or is I year from

It's So we're shift. think That to now. the margin getting we're story favor closer that X%. higher-margin I the and our definitely all right And mix that business seeing. is in is closer all

Operator

James. question the come from next Our Melissa Fairbanks of Raymond with line

Melissa Dailey Fairbanks

care. full quite of investment as health if equipment increasingly But constructive actually But been little exciting I it's heard dig expectation found not could assume business. you into us Could on we what outlook. year you recently a about challenged more wondering what's you're was AI. that give I that's capital peers as has there? lower the behind overall for seeing color some the your I know from your we've

Kenneth Wilson

of is a strongly. a GLP-X. with But going We kind Melissa entirely, up first bases and was how our it mean kind we like think made of that pharma that pharma mean expectation see med the there's -- break see of in think really that we recovers about ortho. digestion. I the I bit of we really, up break and half the Yes. and devices, kind Yes. inventory softer little if year What we

some that's -- little but there, is the and recovery still also think med obviously, we round running we're a factories, see much our better. bit pretty think We in devices, there. getting we So soft clock

we're So is think digested, half X% as half the is number. inventory I front comfortable looking at stronger with I think than and back our that year we're our of

think that care pretty to are we health we going continue. business our comfortable So is

we year. us entire and X% mentioned next for Mike in go comfortable I forward. of think We with to be growth got that opportunities as enough kind

Operator

Our Wang line the next with . from George questions Barclays. of come

Dong Wang

can You pre you within revenue north XX%, of talked margin on 'XX. FY growing profile AI. I kind $X XX% see of the want in subsegments of elaborate if to billion within to just specific kind about

the price the to GPU least about taking margin switching the more. to which order, element level the how of able kind power, you within at specific terms talked about order, optics, in highest to rank envelope You rackindof a structure transceivers in the high are of you think overall got margin AI

Michael Meheryar Dastoor

it's highest So would north AI switch would be yes, that we of earlier, sort next said piece, storage. the I at the order rank The The look in AI of roughly in and switching be the it's obviously, margin gear networking be different et is would cloud, line cetera. configuration photonics level integration, Rax's It's a margin, items enterprise margin. different.

you of the margin look enterprise plays dynamics, at these north all So total margins. overall, if

in again, what's us margin 'XX That's comfort what's for us in as FY for giving giving So that's FY comfort margins 'XX. our well.

Dong Wang

segment. the terms cloud. there? kind of color Can AI within in being of of Amazon the one whether maybe talk briefly hyperscalers Gosh, X, or kind base, the customer of Any bigger players other you obviously, X Tier there Tier other in

Kenneth Wilson

other of if Yes. capabilities. got at Yes. proliferation predominant We you [indiscernible] -- you look look at the

as the just George. thing across Mike of So we emphasize there And we've the pivoted been that capability I about area the we've are to that that And commoditized supplying to model. that whole we really TPU have we capabilities the multiple in talk that what other type switching that AI advanced the becomes there, mentioned, other the for to Look, think doing some switches blend enterprise years. hyperscalers drives

I optics made in the as doing well, go with of Steve, that, the DCI, kind to is So point done. historically hadn't margin comfortable I all that we're robust about what profile we coupled back think infrastructure And our means I stuff doing with we're which the that we're here.

real profit So we longer the got rich in term. a us we think pool here for

Operator

line next Our the from come Samik JPMorgan. of with Chatterjee questions

Unknown Analyst

for on wanted seeing on to ask [indiscernible] that region? on Chatterjee. just is to you the the particular incremental Like XG expand Samik or more of relative This Any you side. weakness some to that? are it particular customers on some set color is I

Michael Meheryar Dastoor

Yes.

are we North there. a see pretty for rollout was the where, -- baked is customers America India is that's world. if and look And XG generally, the of mean, come really, outlook really stopped. telco across there impact in in, we you what rollout So in some I at basically, much but most with The that seeing also biggest continued all soft we the and out calendar weakness

market. it's So have There's significant got amount it's paused. a We radios don't restart. know installed to that when of still Indian to be in the going

that It's doesn't away. demand paused. go just So

We years. sourced XX-some are found in build We our in we much our for single radios which that Pune, facility India. those in facility pretty and company

the So performed to that start waiting installed in a and that to doing We're to reopen that the we well. really and really job, and be gates build and get just nice as we're network. for allow

we've didn't demand expect the year. future it the for demand So just that completely there back come I mean, with will stopped no taken the to balance we of stop.

Operator

closing question-and-answer I would Adam our Berry reached to session. for floor report. the over of end We now turn like have back the to

Adam Berry

reach interest any Please questions. us out your if further for you. Jabil. you to Thanks Thank in have

Operator

We teleconference. participation. your conclude does appreciate Thank today's you. This

time. Enjoy You rest may disconnect your your of at this the lines day.

Jabil (JBL) 15 Mar 242024 Q2 Earnings call transcript