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Research Alert: Flex Announces Cloud Spin-off Following Strong Fy 26

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

FLEX delivered strong Q4 results with net sales of $7B+ (+17% Y/Y) and adjusted EPS of $0.93 (+27% Y/Y), above consensus, while full-year net sales reached ~$28B (+8% Y/Y) with record adjusted operating margin of 6.3%. The company achieved its sixth consecutive quarter with adjusted operating margin of 6%+ at 6.7% in Q4, demonstrating disciplined execution. FLEX announced plans to spin off its Cloud and Power Infrastructure segment into a public company by Q1 2027, which we believe will unlock value by creating two focused entities aligned with distinct strategic priorities. Management provided FY 27 guidance of $32.3B-$33.8B net sales (+18% at midpoint) and adjusted EPS of $4.21-$4.51 (+32% at midpoint), with projected adjusted operating margin of 7.0%-7.1%. We believe the Cloud and Power Infrastructure segment's exceptional 31% Y/Y growth to ~$2B validates the strategic pivot toward AI infrastructure, where FLEX benefits from secular hyperscaler capex tailwinds and exponential power density requirements.

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