Flex Ltd. Q2 FY26 Results — Earnings Call Analysis
Published 29 May 2026 | Electronic Equipment, Instruments and Components | Market Cap: ₹53.1K Cr
- **Cloud and Power Infrastructure (CPI) segment:** - Expected revenue growth of 65% to 75% in fiscal 2027. - Fiscal 2027 revenue expected between $32.3B and $33.8B, up 18% at midpoint. - Adjusted operating margin forecasted between 7% and 7.1%, up approx.
From Flex Ltd.'s Q2 FY26 earnings-call transcript · updated 29 May 2026.
Price
₹144.85
Market Cap
₹53.1K Cr
P/E Ratio
61.5
Revenue Rank
Margin Rank
How does Flex Ltd. rank in Electronic Equipment, Instruments and Components?
Compare Flex Ltd. against every Electronic Equipment, Instruments and Components company this quarter on revenue, margins and earnings-call signals.
📊 Revenue & Sales Performance
Rank 1- →**Cloud and Power Infrastructure (CPI) segment:**
- → - Expected revenue growth of 65% to 75% in fiscal 2027.
- → - Further acceleration with growth over 80% projected for fiscal 2028.
- → - Growth driven by increasing demand from hyperscalers, neoclouds, colos, and utilities.
- →**Post-spin Flex (RemainCo):**
- → - Targeting low to mid-single-digit revenue growth in fiscal 2027 and beyond.
- → - Growth focus on regulated and technology-driven markets such as healthcare, warehouse automation, and networking related to data center infrastructure.
- →**Overall company:**
- → - Fiscal 2027 revenue expected between $32.3 billion and $33.8 billion, up 18% at midpoint.
- →**Segment dynamics:**
- → - CPI growth to continue through fiscal 2028 and potentially beyond.
- → - Significant investment in capacity with multiyear contracts supporting sustained growth.
- →**Market trends:**
- → - Addressable data center market expanding rapidly with power growth outpacing cloud growth.
📈 Profitability & Margins
Rank 2- →Fiscal 2027 revenue expected between $32.3B and $33.8B, up 18% at midpoint.
- →Adjusted operating margin forecasted between 7% and 7.1%, up approx. 80 basis points.
- →Adjusted EPS expected between $4.21 and $4.51, up 32% at midpoint (full year).
- →FY 2027 guidance: RMS revenue up low to mid-single digits, ITS flat to low single digits, CPI revenue up 65% to 75%.
- →CPI segment growth continues strong with 80%+ growth expected in FY 2028.
- →Margin expansion expected with CPI margins to recoup 100 basis points losses in FY 2027 and expand 50-100 basis points in FY 2028.
- →First quarter FY 2027 EPS expected $0.86 to $0.92, up 24%.
- →Focus on both growth and margin expansion post spin for Flex and SpinCo.
- →Free cash flow conversion expected approx. 60% excluding spin costs.
🏗️ Capital Expenditure Plans
Yes- →Capital deployment is already underway for projects with hyperscalers, including Google, covering power infrastructure, thermal systems, and complex hardware manufacturing.
- →Elevated investment levels are expected through fiscal year (FY) 2027 to support CPI growth and expanded capacity needs.
- →FY 2027 will see unique, higher capex due to these growth investments.
- →CapEx is expected to return to historical levels in FY 2028: approximately 2.5% to 3% of revenue for CPI and below 2% for ITS and RMS.
- →The company plans continued disciplined capacity expansion with a focus on margin expansion and growth in high-return areas, including health care and data center infrastructure.
- →Strategic investments include the acquisition of Electrical Power Products (EP2) to enhance power portfolio for utility-grade and grid modernization solutions.
- →Post-spin, both Flex and SpinCo will pursue tailored capital allocation aligned with their respective growth and margin priorities.
💰 Fundraising & Capital Structure
No information- →The company expects CapEx (capital expenditures) to be in the range of $1.4 billion to $1.6 billion for fiscal year 2027.
- →Free cash flow conversion is expected to be approximately 60%, excluding costs associated with the spin transaction.
- →Capital deployment for key projects in Cloud and Power Infrastructure is already underway and will remain elevated through fiscal year 2027.
- →They expect this elevated investment level to be unique to fiscal year 2027, with CapEx normalizing in fiscal year 2028.
- →No explicit mention of new fundraising through debt or equity during the call.
- →The company is focused on strong cash flow generation and shareholder returns, including share repurchases.
- →Overall, the financing appears to come from operational cash flows and existing resources rather than new debt or equity issuance.
📋 Order Book & Pipeline
Yes- →Flex secured significant business, including a multiyear contract with Google and multiple other hyperscalers, neoclouds, colos, and utilities.
- →The multiyear contracts span multiple product lines and customers, supporting strong CPI growth expectations of 65%-75% in FY ’27 and over 80% in FY ’28.
- →The company's order book is robust, underpinning foundational investments in power and cooling infrastructure to support data center markets through FY ’28 and FY ’29.
- →Growth is driven by ramping multiple hyperscaler deals and programs signed that are expected to continue expanding beyond FY ’28 into FY ’29.
- →Capacity is being added to fulfill these multiyear commitments, with factories set up to enable ongoing growth.
- →The strategic focus includes expanding geographic reach and product portfolio, as well as scaling operational capabilities for full product and service integration models.
Key Metrics
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Capex
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Order Book
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Frequently Asked Questions
What were Flex Ltd. Q2 FY26 results?
- **Cloud and Power Infrastructure (CPI) segment:** - Expected revenue growth of 65% to 75% in fiscal 2027. - Fiscal 2027 revenue expected between $32.3B and $33.8B, up 18% at midpoint. - Adjusted operating margin forecasted between 7% and 7.1%, up approx.
What is Flex Ltd. share price analysis?
Flex Ltd. currently shows a strong growth signal based on ranking data. The stock trades at a P/E of 61.5 with a market cap of $53,070. Investors should review the full earnings analysis for detailed insights.
Is Flex Ltd. planning capital expenditure?
- Capital deployment is already underway for projects with hyperscalers, including Google, covering power infrastructure, thermal systems, and complex hardware manufacturing.
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This analysis is AI-generated based on publicly available earnings data and concall transcripts. This is not investment advice. Please consult a SEBI-registered advisor before making investment decisions.