Flex Ltd at Goldman Sachs Communacopia & Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : I thought we could start off with some questions by end markets and certainly one of the bigger ones we've been hearing a lot this week at the Communacopia and Technology Conferences on the data center market for Flex last year, a $4.8 billion business, now nearly 20% of your revenue, I think $3.5 billion of that $4.8 million was tied to assembly and then $1.3 billion in power. Maybe you can speak a bit more to the breadth of your data center customer base. What's driving it to that size? And what do you think is positioning Flex well in the data center sector?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Michael, in your role as Chief Commercial Officer, you're engaged with a lot of the customers have a lot of conversations. As you look at the things that are driving that, mid-30% range growth rate for fiscal '26 in the data center business. Talk a little bit more around the breadth of that. And to what extent you're starting to see either neocloud customers or even sovereigns, enterprises starting to do some AI data center, where is that strength coming from?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Very helpful. The company recently announced a warrant agreement with Amazon. Help us better understand that, if you could, please? Why now? What does it add to the financial outlook for your data center business?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Michele, do you want to add anything?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Do you think this kind of structure could be something you would do with other hyperscalers?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : The very strong growth in the data center market is also attracting competition. So to what extent are you seeing more competitors come into that space? If so, what does that mean for margins and how you manage your margin structure for the data center space? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 8:05PM, FLEX.OQ - Flex Ltd at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : You just mentioned the importance of the whole portfolio and that full solution that you can bring to the customer set. You've done some deals to get to that level already mentioned JetCool, you've done Crown Technical. As you think about what you have in the portfolio today, how comfortable are you with this current product capabilities that you have in-house? And would you look to add more either with R&D or inorganic actions?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : One of the new adjacencies for your power product set is the utility market. I think it's an area that Revathi and Chris Butler who are really important senior leaders in your company have a lot of experience with. So as you think about the products you have, some of the management knowledge of some of these close adjacent markets like utility and grid to what extent do you think you can expand into some of these areas, especially now that you have something like Crown Technical?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Maybe we could shift gears a little bit to the automotive market. It was one of the areas that the company articulated as being a key growth driver at your last Investor Day. I think as of that point, you were expecting a 10% CAGR. There's obviously been some volatility in terms of the policy environment, macroeconomic conditions, level set us on what you've been seeing in the auto space and how investors should think about growth here going forward? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 8:05PM, FLEX.OQ - Flex Ltd at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : You mentioned power, you just brought up compute. Any other key content drivers for you in the automotive space? Anything around ADAS sensors, actuators, other important drivers we should have to mention?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : You mentioned some of the interesting, I wanted to follow up on about having product capabilities in the auto space. We were just talking about the data center market and having products and the margin profile of selling that product on your own to some of those customers. As you think about autos, is that same kind of an opportunity? Or do you mean more you've got some reference designs that can speed development of customers choose, but still a little bit more in line with the past model?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : And where are you seeing the most traction with customers in the automotive space? I think historically, Flex has skewed a little bit more to some of the traditional auto OEMs for revenue in this area. Are you having any momentum with some of the Chinese auto OEMs or EV pure plays? Just help us understand where you stand at that?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Very helpful. Maybe you could talk about a couple of other end markets that Flex has exposure to. I wanted to touch on networking. Talk about what you're seeing from an end market perspective but also some of the share opportunity because I think you alluded to some potential share gains on your last earnings call. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 09, 2025 / 8:05PM, FLEX.OQ - Flex Ltd at Goldman Sachs Communacopia & Technology Conference

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : And is that just traditional switching and routing or optical or both?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Okay. Very helpful. I want to talk on health solutions. That market has been a little flatter over the last few years, especially post some of the work you all did for COVID and some of the respiratory products, been in the $2.6 billion to $2.7 billion range. you talked about an expectation for some recovery in medical equipment toward the end of this fiscal year. What drives that? And what should investors think about growth over the medium to longer term in medical?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : But it is one, I think, has the potential to grow at least mid-single digits, if not even something a little bit better than that as you think over 3, 5, 10 years?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Okay. You mentioned services previously in our conversation. You spoke on some of the capabilities Flex brings to that area around metal bending, but I think it's a broader capability set that Flex brings. Talk a bit more on what you do in services.

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : And I think the services business, if I'm not mistaken, has pretty attractive margins.

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : I wanted to talk a bit more on manufacturing and your global footprint. Flex has, I think, about 100 sites across something like 30 countries. You already spoke around the networking and optical space and seeing some of the customers want to do more or close to where they're ultimately shipping their product. But talk a bit more on what you're seeing from geographic trends and to what extent, especially with tariffs in place, you're seeing more of a shift to your Mexico and US sites.

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : How important is automation in your manufacturing, especially as you do more in the United States, do you need to do incremental automation? And if so, are you seeing anything interesting on the technology front that is allowing for that?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Or humanoid something that you guys think you'll be using? And if so, is that next couple of years or five-plus years?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Always interesting to see all the things you guys are working on given all the different products and regions that you manufacture in. I did want to ask another one on end markets. I mean, we spoke a lot already around some of the different end market trends, especially over a medium- to long-term perspective. But coming out of the most recent earnings report, has anything surprised you in terms of what you're seeing in terms of market conditions?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Yes. And on a margin question, I mean, because you guys are at 6% margins, even with some of the tariffs and roughly double what you would have been doing 5 to 10 years ago. So it's been a remarkable journey a 6% a peak margin level as you guys think about the profitability potential of this business? Or is this something that you can build off over the longer term?

Question: Mark Delaney - Goldman Sachs Group Inc - Analyst : Well, it's been really great to see and we look forward to what you have coming ahead. Unfortunately, we are out of time, so we'll have to end it there. Michelle, Michael, really appreciate you joining us.