Sanmina

Overview Key strengths Key risks Conservative balance sheet positioned to weather tougher macroeconomic environment, higher operating costs, and elongated supply chain constraints. Continued supply chain constraints, a tougher macroeconomic environment, and volatile electronics manufacturing services (EMS) market can provide headwinds to the company's financial performance. Manufacture products that are considered mission-critical and highly complex. Highly competitive and intensely fragmented EMS space that includes larger players. Consistent unadjusted free operating cash flow generation. A smaller scale of operations compared to some of the larger peers in a highly competitive EMS space. The COVID-19 pandemic accelerated the digital transformation and enabled positive secular demand drivers, but the supply chain challenges, mainly around semiconductor chip shortages, limited the revenue generation capabilities across the

...While topline remained under pressure in fiscal 2021 due to supply chain constraints, Sanmina continued to show improved operational resilience. The COVID-19 pandemic accelerated the digital transformation and enabled positive secular demand drivers, but the supply chain challenges, mainly around semiconductor chip shortages, limited the revenue generation capabilities across the industry. As a result, Sanmina's topline decreased by almost 3% in fiscal 2021 on missed sales opportunities that plagued most technology hardware companies. Earlier in fiscal 2020, the topline declined 15.5%, mainly because of pandemic-led supply chain shortages and operational disruptions. During the first quarter of fiscal 2022, revenue was flat, but in the second quarter, it outperformed company estimates due to strong demand in its industrial segment and good operational management to mitigate supply constraints. We believe supply chain constraints will persist throughout the rest of the calendar year 2022....

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