Q2 2026 Plexus Corp Earnings Call

April 30, 2026

Speaker #1: After today's prepared remarks, we will host a question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand.

Speaker #1: To withdraw your question, press star 1 again. I will now hand the conference over to Shawn Harrison, IRO, Shawn, please go ahead.

Speaker #2: Good morning, and thank you for joining us today. Some of the statements made and information provided during our call today will be forward-looking statements including without limitation those regarding revenue, gross margin, selling and administrative expense, operating margin, other income and expense, taxes, cash cycle, capital allocation, and future business outlook.

Speaker #2: Forward-looking statements are not guaranteed since they're inherent difficulties in predicting future results and actual results could differ materially from those expressed or implied in the forward-looking statements.

Speaker #2: For a list of factors that could cause actual results to differ materially from those discussed, please refer to the company's periodic SEC filings particularly the risk factors in our Form 10-K filing for the fiscal year ended September 27, 2025, and the Safe Harbor and Fair Disclosure Statement in our press release.

Speaker #2: We encourage participants on the call this morning to access the live webcast and supporting materials at Plexus's website at www.plexus.com. Clicking on investors at the top of that page.

Speaker #2: Joining me today are Todd Kelsey, President and Chief Executive Officer; Oliver Minh, Executive Vice President and Chief Operating Officer; Pat Jermain, Executive Vice President and Chief Financial Officer; and David Abuhl, Senior Vice President of Finance.

Speaker #2: With today's earnings call, Todd will provide summary comments before turning the call over to Oliver, Pat, and David for further details. But before I turn the call over to Todd, I would first like to express my gratitude to Pat for his partnership, mentorship, and friendship and offer my best wishes for an amazing retirement.

Speaker #2: Second, I'm excited to announce that Todd will be appearing on CNBC's Fast Money this evening to discuss Plexus and our fantastic results and outlook.

Speaker #2: With that, let me now turn the call over to Todd Kelsey. Todd?

Speaker #3: Thank you, Shawn. Good morning, everyone. Please advance to slide 3. Before I begin my prepared remarks regarding the business, I want to celebrate Pat's incredible 12-year tenure as Plexus's CFO and wish him all the best during retirement.

Speaker #3: He's been an extraordinary business partner to me over the years. I also want to express my deep gratitude for Pat's leadership and integrity establishing a strong tone from the top.

Speaker #3: Pat has been instrumental in our growth journey, fostering and cultivating a high-performing finance team that has played a significant role in Plexus's tremendous financial results over the years.

Speaker #3: I'm also excited to welcome David Abuhl as our next CFO. Since joining Plexus last fall, David's impact on the organization has already been meaningful.

Speaker #3: I'm confident that as we continue our growth journey, David's extensive financial expertise, global perspective, and strategic mindset will position him to be an exceptional CFO.

Speaker #3: Please advance to slide 4. Plexus's momentum is accelerating broadly. We now expect to deliver mid-teens or greater fiscal 2026 revenue growth from the contribution of numerous program ramps, ongoing market share gains, and improving end-market demand.

Speaker #3: Our team generated a record $355 million in new manufacturing program wins with broad-based contributions across our market sectors. Against this tremendous result, we also expanded our funnel of qualified manufacturing opportunities.

Speaker #3: We're delivering non-GAAP operating margin expansion while increasing our already significant investments focused on expanding operational efficiency and capitalizing on continuing revenue growth momentum. Finally, we are sustaining strong financial discipline delivering better-than-expected working capital performance amidst substantial acceleration in revenue growth and tightening supply chain conditions.

Speaker #3: Please advance to slide 5. Fiscal second quarter revenue of $1.164 billion exceeded our guidance range, representing our fifth consecutive quarter of sequential revenue growth and a robust 19% year-over-year increase.

Speaker #3: While growth was strong throughout all of our market sectors, we experienced specific strength in aerospace and defense. As a result of increasing demand for our industry-leading solutions and supportive disruptive technologies, and in semi-cap, where our ongoing share gains are amplifying surging market demand.

Speaker #3: Non-GAAP EPS of $2.05 exceeded guidance. We delivered a robust 6% non-GAAP operating margin while continuing to heavily invest in program ramps, operational efficiency initiatives, and technologies.

Todd Kelsey: Please advance to slide five. Fiscal Q2 revenue of $1.164 billion exceeded our guidance range, representing our fifth consecutive quarter of sequential revenue growth and a robust 19% year-over-year increase. While growth was strong throughout all of our market sectors, we experienced specific strength in aerospace and defense as a result of increasing demand for our industry-leading solutions and supportive disruptive technologies, and in semi-cap, where our ongoing share gains are amplifying surging market demand. Non-GAAP EPS of $2.05 exceeded guidance. We delivered a robust 6% non-GAAP operating margin while continuing to heavily invest in program ramps, operational efficiency initiatives, and technology. Please advance to slide six. For the fiscal Q2, we secured 30 new manufacturing programs with a record $355 million in annualized revenue when fully ramped into production.

Speaker #3: Please advance to slide 6. For the fiscal second quarter, we secured 30 new manufacturing programs with a record $355 million in annualized revenue when fully ramped into production.

Speaker #3: All market sectors contributed to this tremendous performance which included broad-based opportunities in aerospace and defense, expanded relationships and share gains in surgical and imaging platforms, and new engagement in data center power solutions, and continued share gains in semiconductor capital equipment.

Non-gaap EPS of $2.05 exceeded guidance.

Speaker #3: Through expanded business development efforts, synergies with our engineering solutions and sustaining services, and our focus on providing unmatched quality and delivery, we are also seeing an increasing breadth of customer interest for our industry-leading solutions.

We delivered a robust 6% non-GAAP operating margin while continuing to heavily invest in program ramps, operational efficiency initiatives, and technology.

Please Advance the slide 6.

Speaker #3: As a result, for the second fiscal quarter, our funnel of qualified manufacturing opportunities expanded sequentially and year-over-year. We produced particularly notable growth in our industrial market sector where we are generating significant interest in automation and robotics, data center and energy solutions, and our aerospace and defense market sector.

Todd Kelsey: All market sectors contributed to this tremendous performance, which included broad-based opportunities in aerospace and defense, expanded relationships and share gains in surgical and imaging platforms, a new engagement in data center power solutions, and continued share gains in semiconductor capital equipment. Through expanded business development efforts, synergies with our engineering solutions and sustaining services, and our focus on providing unmatched quality and delivery, we're also seeing an increasing breadth of customer interest for our industry-leading solutions. As a result, for the Q2 fiscal quarter, our funnel of qualified manufacturing opportunities expanded sequentially and year-over-year. We produced particularly notable growth in our industrial market sector, where we are generating significant interest in automation and robotics, data center, and energy solutions, and our aerospace and defense market sector. Please advance to slide 7.

for the fiscal, second quarter, we secured 30 new manufacturing, programs with a record 355 million in annualized Revenue, when fully ramped into production,

All Market sectors contributed to this tremendous performance, which included broad-based opportunities in Aerospace and defense, expanded relationships, and share gains, and Surgical and imaging platforms.

A new engagement in data, center Power Solutions.

Speaker #3: Please advance to slide 7. At Plexus, we're committed to advancing sustainability through our value of innovating responsibly as we boldly drive positive change and promote a sustainable future for and through our people, our solutions, and our operations.

And continued share gains in semiconductor Capital Equipment.

Speaker #3: All of which is built on a foundation of trust and transparency. Critical to our success is our people who are at the heart of who we are and what we do.

through expanded Business Development, efforts synergies, with our engineering Solutions, and sustaining services and our focus on providing unmatched quality and delivery where all, so seeing an increase in breadth of customer interest for our industry-leading Solutions,

As a result for the second fiscal quarter, our funnel of qualified, manufacturing opportunities, expanded sequentially and year-over-year.

Speaker #3: Our second fiscal quarter was particularly memorable as we celebrated two major organizational milestones. First, I was honored to join members of our Plexus leadership team at Nasdaq's market site in Times Square to ring the closing bell in celebration of our 40th anniversary as a publicly listed Nasdaq company.

We produced particularly notable growth in our Industrial market sector, where we are generating significant interest in Automation and Robotics, Data Center, and Energy Solutions, as well as in our Aerospace and Defense market sector.

Please Advance the slide 7.

Todd Kelsey: At Plexus, we're committed to advancing sustainability through our value of innovating responsibly as we boldly drive positive change and promote a sustainable future for and through our people, our solutions, and our operations, all of which is built on a foundation of trust and transparency. Critical to our success is our people, who are at the heart of who we are and what we do. Our Q2 was particularly memorable as we celebrated two major organizational milestones. First, I was honored to join members of our Plexus leadership team at Nasdaq's market site in Times Square to ring the closing bell in celebration of our 40th anniversary as a publicly listed Nasdaq company. This significant accomplishment was a celebration of the trust we've created with our customers and the unwavering dedication of our people. Our Kelso, Scotland site celebrated its 25th anniversary.

Speaker #3: The significant accomplishment was a celebration of the trust we've created with our customers and the unwavering dedication of our people. Additionally, our Scotland site celebrated its 25th anniversary.

At plexus, we are committed to advancing sustainability, through our value of innovating. Responsibly, as we boldly Drive, positive change and promote a sustainable future for and through our people, our Solutions and our operations, all of which is built on a foundation of trust and transparency.

Speaker #3: Since opening in 2001, the Kelso team has evolved from printed circuit board assembly to manufacturing complex life-impacting products. An evolution made possible by our team members.

Critical to Our Success is our people who are at the heart of who we are and what we do.

Speaker #3: Many of whom have been with us since day one. Our commitment to delivering excellence in innovating responsibly also continues to earn external recognition. We're proud to be named a finalist for the 2026 Manufacturing Leadership Awards in two categories: AI Vision and Strategy and Sustainability in the Circular Economy.

our second fiscal quarter was particularly memorable as we celebrated 2 major organizational milestones

First, I was honored to join members of our plexus leadership team at nasdaq's Market site in Times Square to ring. The closing bell in celebration of our 40th anniversary, as a publicly listed NASDAQ company.

Speaker #3: The awards will be presented in June by the manufacturing leadership council, which is part of the National Association of Manufacturers. These awards highlight our emphasis on innovation and delivering a positive environmental impact as we help create the products that build a better world.

The significant accomplishment was a celebration of the trust. We've created with our customers and the unwavering dedication of our people.

Todd Kelsey: Since opening in 2001, the Kelso team has evolved from printed circuit board assembly to manufacturing complex life-impacting products, an evolution made possible by our team members, many of whom have been with us since day one. Our commitment to delivering excellence and innovating responsibly also continues to earn external recognition. We were proud to be named a finalist for the 2026 Manufacturing Leadership Awards in 2 categories: AI Vision and Strategy, and Sustainability and the Circular Economy. The awards will be presented in June by the Manufacturing Leadership Council, which is part of the National Association of Manufacturers. These awards highlight our emphasis on innovation and delivering a positive environmental impact as we help create the products that build a better world. Finally, we are excited to announce the upcoming release of our annual sustainability report during our fiscal Q3.

Additionally, our council's, Scotland site celebrated its 25th anniversary.

Speaker #3: Finally, we are excited to announce the upcoming release of our annual Sustainability Report during our fiscal third quarter. The fiscal 2025 report highlights our continued commitment to innovating responsibly as we've always been driven to do something more for our customers, our team members, and the world.

Since opening in 2001 the council team has evolved from printed circuit board assembly to manufacturing complex life. Impacting products and evolution made possible by our team members. Many of whom have been with us since day 1.

Our commitment to delivering excellence and innovating. Responsibly also continues to earn external recognition,

we are proud to be named a finalist for the 2026 manufacturing leadership awards. In 2 categories.

Speaker #3: Please advance to slide 8. For our fiscal third quarter, we are guiding revenue of $1.2 to $1.25 billion. Representing 5% sequential and 20% year-over-year growth at the midpoint.

AI vision and strategy and sustainability in the circular economy.

The awards will be presented in June, by the manufacturing Leadership Council, which is part of the National Association of Manufacturers.

Speaker #3: We are guiding non-GAAP operating margin of 5.9 to 6.3% and non-GAAP EPS of $2.02 to $2.18. We believe we are outgrowing our end markets many of which are seeing improving demand by leveraging new program ramps, market share gains, and our supportive disruptive technologies.

These awards highlight our emphasis on innovation and delivering a positive environmental impact, as we helped create the products that build a better world.

Finally.

Todd Kelsey: The fiscal 2025 report highlights our continued commitment to innovating responsibly, as we've always been driven to do something more for our customers, our team members, and the world. Please advance to slide 8. For our fiscal Q3, we are guiding revenue of $1.2 to 1.25 billion, representing 5% sequential and 20% year-over-year growth at the midpoint. We are guiding non-GAAP operating margin of 5.9% to 6.3% and non-GAAP EPS of $2.02 to $2.18. We believe we are outgrowing our end markets, many of which are seeing improving demand, by leveraging new program ramps, market share gains, and our supportive disruptive technologies.

We are excited to announce the upcoming release of our annual sustainability report during our fiscal third quarter.

Speaker #3: As a result, we anticipate double-digit revenue growth in each of our market sectors in fiscal 2026 with particularly strong performance in aerospace and defense and industrial.

The fiscal 2025 report highlights our continued commitment to innovating responsibly as we've always been driven to do something more for our customers. Our team members in the world,

Please Advance the slide 8.

Speaker #3: Led by significant growth in our semi-cap subsector. Accordingly, for fiscal 2026, we now expect to deliver mid-teens or greater revenue growth overall, a substantially increased forecast from our initial expectations last October.

For our fiscal third quarter. We are guiding revenue of 1.2 to 1.25 billion dollars representing 5% sequential and 20% year-over-year. Growth at the midpoint

We are guiding non-GAAP operating margin of 5.9% to 6.3% and non-GAAP EPS of $2.18 to $2.22.

Speaker #3: We anticipate delivering this revenue growth performance with robust profitability anticipating a 6% or greater non-GAAP operating margin for fiscal 2026 and continued strong working capital efficiencies.

Todd Kelsey: As a result, we anticipate double-digit revenue growth in each of our market sectors in fiscal 2026, with particularly strong performance in aerospace and defense and industrial, led by significant growth in our semi-cap sub-sector. For fiscal 2026, we now expect to deliver mid-teens or greater revenue growth overall, a substantially increased forecast from our initial expectations last October. We anticipate delivering this revenue growth performance with robust profitability, anticipating a 6% or greater non-GAAP operating margin for fiscal 2026 and continued strong working capital efficiencies. In closing, our consistent focus on redefining excellence through our unmatched quality and delivery is shaping our decision-making and sustaining our tremendous momentum.

By leveraging, new program, ramps market, share gains, and our support of disruptive Technologies.

Speaker #3: In closing, our consistent focus on redefining excellence through our unmatched quality and delivery is shaping our decision-making and sustaining our tremendous momentum. We are expanding and accelerating investments in technology, capabilities, and our people to enable customer success, drive greater long-term operational efficiency, and increase our revenue growth potential.

As a result, we anticipate double-digit Revenue growth in each of our Market sectors, in fiscal 2026, with particularly strong performance in Aerospace, and defense and Industrial.

Led by significant growth in our semi cap sub sector.

Speaker #3: These efforts will position us to sustain our momentum well beyond fiscal 2026. We'll now turn the call over to Oliver for additional analysis of the performance of our market sectors.

Accordingly for fiscal 2026. We now expect to deliver mid teens or greater Revenue growth overall. A substantial increase forecast from our initial expectations last October

Speaker #3: Oliver.

Speaker #2: Thank you, Todd. Good morning. I will begin with a review of the fiscal second quarter performance of each of our market sectors. Our expectations for each sector for the fiscal third quarter and directional sector commentary for fiscal 2026.

We anticipate delivering this Revenue growth performance with robust profitability, and anticipating a 6% or greater non-gaap operating margin for fiscal, 2026 and continued, strong, working capital efficiency.

Todd Kelsey: We are expanding and accelerating investments in technology, capabilities, and our people to enable customer success, drive greater long-term operational efficiency, and increase our revenue growth potential. These efforts will position us to sustain our momentum well beyond fiscal 2026. We'll now turn the call over to Oliver for additional analysis of the performance of our market sectors. Oliver.

In closing, our consistent focus on redefining Excellence, through our unmatched quality and delivery the shaping, our decision-making and sustaining our tremendous momentum.

Speaker #2: I will also review the annualized revenue contribution of our wins performance for each market sector and then provide an overview of our funnel of qualified manufacturing opportunities.

Speaker #2: Starting with our aerospace and defense sector on slide 9. Revenue increased 19% sequentially in the fiscal second quarter significantly outperforming our expectation of a mid-single-digit increase.

We are expanding and accelerating investments in technology capabilities and our people to enable customer success Drive greater long-term, operational efficiency, and increase our Revenue growth potential.

These efforts will position us to sustain our momentum well beyond fiscal 2026.

Speaker #2: Improved end market demand across all subsectors and our team's efforts to expand component availability drove the result. For the fiscal third quarter, we expect revenue for the aerospace and defense sector to be up mid-single digits as we see programs scaling up in our space and defense subsectors.

When I'll turn the call over to Oliver for additional analysis of the performance of our Market, sectors. Oliver.

Oliver Mihm: Thank you, Todd. Good morning. I will begin with a review of the fiscal Q2 performance of each of our market sectors, our expectations for each sector for the fiscal Q3, and directional sector commentary for fiscal 2026. I will also review the annualized revenue contribution of our wins performance for each market sector, and then provide an overview of our funnel of qualified manufacturing opportunities. Starting with our aerospace and defense sector on slide 9, revenue increased 19% sequentially in the fiscal Q2, significantly outperforming our expectation of a mid-single-digit increase. Improved end market demand across all subsectors and our team's efforts to expand component availability drove the result. For the fiscal Q3, we expect revenue for the aerospace and defense sector to be up mid-single digits as we see programs scaling up in our space and defense subsectors.

Thank you, Todd.

Good morning.

I will begin with the review of the fiscal second quarter performance of each of our market sectors.

Our expectations for each sector for the fiscal third, quarter and directional sector, commentary for fiscal 2026.

Speaker #2: Our fiscal second quarter wins for the aerospace and defense sector were $44 million. Our Kelso Scotland site won a follow-on share gain award from an existing customer in the defense subsector.

I will also review the annualized revenue contribution of our wins performance for each market sector and then provide an overview of our funnel of qualified manufacturing opportunities.

Starting with our Aerospace and Defence sector on slide 9.

Speaker #2: The customer noted the strength of our partnership and our operational excellence as factors in their decision. Relationship strength and operational excellence were also factors in a significant follow-on award from an existing unmanned defense customer.

Revenue increased 19%, sequentially in the fiscal. Second quarter significantly, outperforming our expectation of a mid single digit increase.

Speaker #2: This product is built and our Boise, Idaho facility. We anticipate fiscal 2026 revenue growth for the aerospace and defense sector to exceed our 9 to 12 percent goal.

Improved and market demand across all sub-sectors, and our team's efforts to expand component availability, drove the result.

For the fiscal third quarter, we expect revenue for the Aerospace and Defence sector to be up mid single digits. As we see programs scaling up in our space and defense sub sectors.

Speaker #2: With growth expected to be well into the double digits. The sector's growth continues to gain momentum supported by new and existing customers with strong demand growth and the commercial aerospace and space subsectors and exceptional growth in the defense subsector.

Oliver Mihm: Our fiscal Q2 wins for the aerospace and defense sector were $44 million. Our Kelso, Scotland site won a follow-on share gain award from an existing customer in the defense subsector. The customer noted the strength of our partnership and our operational excellence as factors in their decision. Relationship strength and operational excellence were also factors in a significant follow-on award from an existing unmanned defense customer. This product is built in our Boise, Idaho facility. We anticipate fiscal 2026 revenue growth for the aerospace and defense sector to exceed our 9% to 12% goal, with growth expected to be well into the double digits. The sector's growth continues to gain momentum, supported by new and existing customers with strong demand growth in the commercial aerospace and space subsectors, and exceptional growth in the defense subsector. Please advance to slide 10.

Our fiscal second quarter wins for the Aerospace and Defence sector were 44 million.

Our Kelso, Scotland site. We want to follow up on the share gain award from an existing customer in the defense sub-sector.

Speaker #2: Please advance to slide 10. Fiscal second quarter revenue in our healthcare life sciences market sector was up 1% sequentially, aligned to our expectation of flat to up low single-digit performance.

The customer noted, the strength of our partnership and our operational excellence as factors in their decision.

Speaker #2: For the fiscal third quarter, we expect the healthcare life sciences market sector to be flat ahead of an anticipated return to sequential revenue growth in our fiscal fourth quarter.

Relationship, strength and operational. Excellence were also factors in a significant follow-on award from an existing unmanned defense. Customer. This product is built and our Boise Idaho facility.

Speaker #2: Our fiscal second quarter wins were strong at $116 million. Our team in Shaman, China, won a next-generation point-of-care ultrasound system. Due to the strength of our new product launch capabilities, our seamless engineering-to-production transition capabilities also contributed to a significant award for our Nina Wisconsin facility.

We anticipate fiscal 2026 Revenue growth for the Aerospace and Defence sector to exceed our 9 to 12% goal with growth expected to be well into the double digits.

The sector's growth continues to gain momentum supported by new and existing customers with strong demand growth, and the commercial Aerospace and space sub sectors and exceptional growth and the defense sub sector.

Oliver Mihm: Fiscal Q2 revenue in our healthcare life sciences market sector was up 1% sequentially, aligned to our expectation of flat to up low single-digit performance. For the fiscal Q3, we expect the healthcare life sciences market sector to be flat ahead of an anticipated return to sequential revenue growth in our fiscal Q4. Our fiscal Q2 wins were strong at $116 million. Our team in Xiamen, China won a next-generation point-of-care ultrasound system due to the strength of our new product launch capabilities. Our seamless engineering-to-production transition capabilities also contributed to a significant award for our Neenah, Wisconsin facility. The products support a robotic surgical platform.

Please Advance the slide 10.

Speaker #2: The products support a robotic surgical platform. We continue to have a robust fiscal 2026 outlook for the healthcare life sciences sector, anticipating revenue growth to exceed our 9 to 12 percent goal.

Fiscal second quarter revenue in our Healthcare/Life Sciences market sector was up 1% sequentially, aligned to our expectation of flat to up low single-digit performance.

Speaker #2: Supported by contributions from ongoing and new program ramps, share gains, and strong end market demand across our therapeutics, and monitoring subsectors. Advancing to the industrial sector on slide 11, fiscal second quarter revenue was up 12% sequentially, in line with our forecast.

The fiscal third quarter. We expect the healthcare Life Sciences Market sector to be flat ahead of an anticipated. Return to sequential Revenue growth in our fiscal fourth quarter,

Our fiscal second quarter, winds were strong at 116 million.

Our team in xiamen, China won a Next Generation point of care ultrasound system due to the strength of our new product launch capabilities.

Speaker #2: Our industrial sector fiscal third quarter outlook of a low double-digit increase is supported by substantial growth within the semi-cap subsector and strength in the industrial equipment subsector from new program ramps and strengthening demand.

Our seamless engineering-to-production transition capabilities also contributed to a significant award for our Neenah, Wisconsin facility.

Products support a robotic surgical platform.

Oliver Mihm: We continue to have a robust fiscal 2026 outlook for the healthcare life sciences sector, anticipating revenue growth to exceed our 9% to 12% goal, supported by contributions from ongoing and new program ramps, share gains, and strong end market demand across our therapeutics and monitoring subsectors. Advancing to the industrial sector on slide 11, fiscal Q2 revenue was up 12% sequentially, in line with our forecast. Our industrial sector fiscal Q3 outlook of a low double-digit increase is supported by substantial growth within the semi-cap subsector and strength in the industrial equipment subsector from new program ramps and strengthening demand. The industrial market sector had record high wins of $195 million for the fiscal Q2. Wins included a substantial award from an existing customer that is launching a new product line for data center power solutions.

Speaker #2: The industrial market sector had record high wins of $195 million, for the fiscal second quarter. Wins included a substantial award from an existing customer that is launching a new product line for data center Our long-term strategic partnership and strength of value proposition contributed to the win.

We continue to have a robust fiscal 2026 outlook for the healthcare Life Sciences. Sector anticipating Revenue growth, to exceed our 9 to 12 goal supported by contributions from ongoing a new program ramps.

Share gains and strong and market demand across our Therapeutics and monitoring sub sectors.

Speaker #2: The product will be built and our Bangkok, Thailand facility. We also want a substantial follow-on award from an existing robotics customer. Our strength of execution and ability to quickly ramp to fulfill their demand supported the win.

Advancing to the industrial sector on slide 11 fiscal. Second quarter Revenue was up 12% sequentially in line with our forecast

Speaker #2: This product is assembled and our Guadalajara, Mexico campus. Our Guadalajara, Mexico campus is also welcoming a new customer to Plexus as we are selected to support production of an energy storage system for electric commercial vehicles.

And strengthening demand.

The industrial Market sector had record high. Winds of 195 million for the fiscal, second quarter.

Speaker #2: Our outlook for the industrial sector for fiscal 2026 continues to gain momentum. We are now anticipating growth well in excess of our 9 to 12 percent growth goal.

Oliver Mihm: Our long-term strategic partnership and strength of value proposition contributed to the win. The product will be built in our Bangkok, Thailand facility. We also won a substantial follow-on award from an existing robotics customer. Our strength of execution and ability to quickly ramp to fulfill their demand supported the win. This product is assembled in our Guadalajara, Mexico campus. Our Guadalajara, Mexico campus is also welcoming a new customer to Plexus as we are selected to support production of an energy storage system for electric commercial vehicles. Our outlook for the industrial sector for fiscal 2026 continues to gain momentum. We are now anticipating growth well in excess of our 9% to 12% growth goal.

Wins included a substantial award from an existing customer that is launching a new product line for data center Power Solutions.

Our long-term strategic partnership and strength of value proposition contributed to the win.

Speaker #2: Our growth outlook is supported by new program ramps and robust growth that's in excess of market for our semi-cap subsector. And demand improvement in program ramps offsetting pockets of demand softness within other subsectors.

The product will be built and our Bangkok Thailand facility.

We also want a substantial following award from the existing robotics customer.

A strength of execution and ability to quickly ramp to fulfill their demand supported the win.

Speaker #2: Please advance to slide 12 for a review of our funnel of qualified manufacturing opportunities. In recognition of Plexus's industry-leading capabilities and focus on building partnerships, our customers are providing increasing opportunities to capture share in new program wins.

This product is assembled and our guadalahara Mexico campus.

Our guadalahara Mexico campus is also welcoming a new customer to plexus as we are selected to support production of an energy storage system for Electric commercial vehicles.

Speaker #2: As evidence, our funnel of qualified manufacturing opportunities expanded 11% sequentially in the fiscal second quarter. And is now $4 billion. This expansion is due in part to record high funnels in our aerospace and defense sector and our industrial sector.

For the industrial sector, fiscal 2026 continues to gain momentum.

Oliver Mihm: Our growth outlook is supported by new program ramps and robust growth that's in excess of market for our semi-cap subsector and demand improvement and program ramps offsetting pockets of demand softness within other subsectors. Please advance to slide 12 for a review of our funnel of qualified manufacturing opportunities. In recognition of Plexus' industry-leading capabilities and focus on building partnerships, our customers are providing increasing opportunities to capture share and new program wins. As evidence, our funnel of qualified manufacturing opportunities expanded 11% sequentially in Q2 and is now $4 billion. This expansion is due in part to record high funnels in our aerospace and defense sector and our industrial sectors. The funnel in those two sectors has expanded in excess of 45% as compared to Q2 of 2025.

We are now anticipating growth well, in excess of our 9 to 12% growth goal.

Our growth outlook is supported by new program ramps and robust growth. That's an excess of market for our semi-cap subsector.

Speaker #2: The funnel in those two sectors has expanded in excess of 45% as 2025. In summary, the revenue growth we are experiencing from ongoing and new program ramps, inclusive of share gains, and improving end market demand support our revised outlook for Plexus to now deliver mid-teens or greater fiscal 2026 revenue growth.

And demand Improvement and program ramps, offsetting pockets of demand, softness within other sub-sectors.

Please advance to slide 12 for a review of our funnel of qualified manufacturing opportunities.

In recognition of plexus, industry-leading capabilities and focus on building Partnerships. Our customers are providing opportunities to capture, share and new program wins.

Speaker #2: Before I turn the call over to Pat, I'd also like to wish Pat well on his retirement. You've been an incredible partner. And done a lot in support of the success of Plexus and the incredible journey that we are on.

As evidence, our funnel of qualified manufacturing opportunities, expanded 11%, sequentially in the fiscal second quarter and is now 4 billion dollars.

Speaker #2: Congratulations. Now over to you. Pat?

This expansion is due, in part, to record-high funnels in our Aerospace and Defense sector and our Industrial sector.

Speaker #1: Thank you, Oliver, and good morning, everyone. Our fiscal second quarter results are summarized on slide 13. Gross margin at 10.2% was at the top end of our guidance due to a favorable mix of service offerings and fixed cost leverage.

The funnel and those 2 sectors has expanded in excess of 45% as compared to the fiscal second quarter of 2025.

Oliver Mihm: In summary, the revenue growth we are experiencing from ongoing and new program ramps, inclusive of share gains and improving end market demand, support our revised outlook for Plexus to now deliver mid-teens or greater fiscal 2026 revenue growth. Before I turn the call over to Pat, I'd also like to wish Pat well on his retirement. You've been an incredible partner and done a lot in support of the success of Plexus and the incredible journey that we are on. Congratulations. Now over to you, Pat.

Speaker #1: In addition, productivity improvements associated with ongoing operational efficiency initiatives helped to offset the impact from our typical seasonal compensation cost increases. Selling and administrative expense of $57.3 million was slightly above our guidance due to additional incentive compensation expense driven by our robust revenue growth and strong ROIC performance.

In summary, the revenue growth, we are experiencing from ongoing and new program, ramps inclusive of share gains, and improving and market, demand support. Our revised outlook for plexus to now deliver mid- teens or greater fiscal 2026 Revenue growth,

Before I turn the call over to Pat. I'd also like to wish Pat well, and his retirement.

Patrick Jermain: Thank you, Oliver. Good morning, everyone. Our fiscal Q2 results are summarized on slide 13. Gross margin at 10.2% was at the top end of our guidance due to a favorable mix of service offerings and fixed cost leverage. Productivity improvements associated with ongoing operational efficiency initiatives helped to offset the impact from our typical seasonal compensation cost increases. Selling and administrative expense of $57.3 million was slightly above our guidance due to additional incentive compensation expense driven by our robust revenue growth and strong ROIC performance. We expanded our technology and automation investments in support of future efficiencies and sustaining revenue growth momentum. The result was a non-GAAP operating margin of 6%, which was at the top end of our guidance.

Speaker #1: In addition, we expanded our technology and automation investments in support of future efficiencies and sustaining revenue growth momentum. The result was a non-gap operating margin of 6%, which was at the top end of our guidance.

You've been an incredible partner and done a lot in support of the success of plexus, and The Incredible Journey that we are on. Congratulations now over to you. Okay? Thank you. Oliver and good morning everyone. Our fiscal second quarter results are summarized on slide 13.

Gross margin at 10.2% was at the top end of our guidance, due to a favorable mix of service, offerings and fixed cost Leverage.

Speaker #1: Non-operating expense of $4 million was favorable to expectations due to foreign exchange gains and lower than anticipated interest expense. Non-gap diluted EPS of $2.05 exceeded the top end of our guidance due to the items mentioned and the favorable tax rate.

In addition, productivity improvements associated with ongoing operational efficiency initiatives help to offset the impact from our typical seasonal compensation cost increases.

Speaker #1: Turning to our cash flow and balance sheet on slide 14, for the fiscal second quarter, we delivered $28.5 million in cash from operations and spent $12.5 million on capital expenditures generating $16 million of free cash flow, which exceeded our forecast of break-even to a slight usage of cash.

Selling and administrative expense of 57.3 million with slightly above our guidance, due to additional incentive compensation, expense driven by our robust Revenue growth and strong roic performance.

In addition, we expanded our technology and automation investments in support of future efficiencies and sustaining Revenue growth momentum.

The result was a non-gaap operating margin of 6% which which was at the top end of our guidance.

Patrick Jermain: Non-operating expense of $4 million was favorable to expectations due to foreign exchange gains and lower than anticipated interest expense. Non-GAAP diluted EPS of $2.05 exceeded the top end of our guidance due to the items mentioned and a favorable tax rate. Turning to our cash flow and balance sheet on slide 14. For the fiscal Q2, we delivered $28.5 million in cash from operations and spent $12.5 million on CapEx, generating $16 million of free cash flow, which exceeded our forecast of break even to a slight usage of cash. For the fiscal Q2, we acquired approximately 109,000 shares of our stock for $20.6 million. At the end of the quarter, we had approximately $42 million remaining on the current repurchase authorization.

Patrick Jermain: Non-operating expense of $4 million was favorable to expectations due to foreign exchange gains and lower than anticipated interest expense. Non-GAAP diluted EPS of $2.05 exceeded the top end of our guidance due to the items mentioned and a favorable tax rate. Turning to our cash flow and balance sheet on slide fourteen. For the fiscal Q2, we delivered $28.5 million in cash from operations and spent $12.5 million on CapEx, generating $16 million of free cash flow, which exceeded our forecast of break even to a slight usage of cash. For the fiscal Q2, we acquired approximately 109,000 shares of our stock for $20.6 million. At the end of the quarter, we had approximately $42 million remaining on the current repurchase authorization.

Speaker #1: For the fiscal second quarter, we acquired approximately $109,000 shares of our stock for $20.6 million. At the end of the quarter, we had approximately $42 million remaining on the current repurchase authorization.

Non operating expense of million dollars was favorable to expectations due to Foreign Exchange gains and lower than anticipated interest expense.

Speaker #1: Similar to last quarter, we ended the fiscal second quarter in a net cash position. We had $137 million outstanding under our revolving credit facility with over $350 million available to borrow.

Non-gaap diluted EPS of $2.05 exceeded. The top end of our guidance, due to the items mentioned and the favorable tax rate.

Turning to our cash flow and balance sheet on slide 14.

For the fiscal, second quarter, we delivered 28.5 million in cash from operations and spend 12.5 million on Capital expenditures.

Speaker #1: For the fiscal second quarter, we delivered a return on invested capital of 13.8%, which was $480 basis points above our weighted average cost of capital.

Generating 16 million dollars of free cash flow, which exceeded our forecasts of Break Even to a slight usage of cash.

Speaker #1: Despite an increase in invested capital to support robust revenue growth, we continue to generate healthy ROIC given strong operational performance. Cash cycle at the end of the fiscal second quarter was $64 days, which was favorable to expectations and five days lower than last quarter.

For the fiscal. Second quarter, we acquired approximately 109,000 shares of our stock for 20.6 million.

Patrick Jermain: Similar to last quarter, we ended the fiscal Q2 in a net cash position. We had $137 million outstanding under our revolving credit facility with over $350 million available to borrow. For the fiscal Q2, we delivered a return on invested capital of 13.8%, which was 480 basis points above our weighted average cost of capital. Despite an increase in invested capital to support robust revenue growth, we continue to generate healthy ROIC given strong operational performance. Cash cycle at the end of the fiscal Q2 was 64 days, which was favorable to expectations and 5 days lower than last quarter. Please turn to slide 15 for additional details regarding this positive result. Sequentially, days and receivables improved 3 days due to exceptional collection efforts by our team.

Patrick Jermain: Similar to last quarter, we ended the fiscal Q2 in a net cash position. We had $137 million outstanding under our revolving credit facility with over $350 million available to borrow. For the fiscal Q2, we delivered a return on invested capital of 13.8%, which was 480 basis points above our weighted average cost of capital. Despite an increase in invested capital to support robust revenue growth, we continue to generate healthy ROIC given strong operational performance. Cash cycle at the end of the fiscal Q2 was 64 days, which was favorable to expectations and five days lower than last quarter. Please turn to slide fifteen for additional details regarding this positive result. Sequentially, days and receivables improved three days due to exceptional collection efforts by our team.

At the end of the quarter, we add approximately 42 million remaining on the current repurchase authorization.

Similar to last quarter. We ended the fiscal second quarter and the net cash position.

Speaker #1: Please turn to slide 15 for additional details regarding this positive Sequentially, days in receivables improved three days due to exceptional collection efforts by our team.

We had 137 million outstanding under our revolving credit facility with over 350 million dollars available to borrow

Speaker #1: Days in inventory sequentially improved four days from continued progress on working capital initiatives and increased revenue. Accounts payable days increased three days due to the timing of supplier payments and procuring inventory in anticipation of a significant revenue growth.

Delivered. A return on invested capital of 13.8%, which was 480 basis points above our weighted, average cost of capital,

Despite an increase in invested Capital to support robust Revenue growth. We continue to generate healthy roic, given strong operational performance.

Speaker #1: Last, our days in advance payments experienced a six-day reduction with a net $15 million being returned to customers during the quarter. Before I hand the call to David, I'd like to make a few closing comments.

Cash cycle at the end of the fiscal second quarter was 64 days, which was favorable to expectations and 5 days lower than last quarter.

Please turn to slide 15 for additional details regarding this positive result.

Speaker #1: It has been an absolute pleasure and honor to serve as CFO for Plexus under Todd's leadership and guided by our outstanding board of directors.

Patrick Jermain: Days in inventory sequentially improved 4 days from continued progress on working capital initiatives and increased revenue. Accounts payable days increased 3 days due to the timing of supplier payments and procuring inventory in anticipation of a significant revenue growth. Last, our days in advance payments experienced a 6-day reduction with a net $15 million being returned to customers during the quarter. Before I hand the call to David, I'd like to make a few closing comments. It has been an absolute pleasure and honor to serve as CFO for Plexus under Todd's leadership and guided by our outstanding board of directors. I want to thank Todd, our board, and everyone at Plexus for your support and trust over the last 12 years. I especially want to thank our finance organization for maintaining the highest standards and integrity, something I'm confident will endure.

Patrick Jermain: Days in inventory sequentially improved four days from continued progress on working capital initiatives and increased revenue. Accounts payable days increased three days due to the timing of supplier payments and procuring inventory in anticipation of a significant revenue growth. Last, our days in advance payments experienced a six day reduction with a net $15 million being returned to customers during the quarter. Before I hand the call to David, I'd like to make a few closing comments. It has been an absolute pleasure and honor to serve as CFO for Plexus under Todd's leadership and guided by our outstanding board of directors. I want to thank Todd, our board, and everyone at Plexus for your support and trust over the last thwelve years. I especially want to thank our finance organization for maintaining the highest standards and integrity, something I'm confident will endure.

Sequentially days and receivables, improved 3 days due to exceptional collection, efforts by our team.

Speaker #1: I want to thank Todd, our board, and everyone at Plexus for your support and trust over the last 12 years. I especially want to thank our finance organization for maintaining the highest standards and integrity—something I'm confident will endure.

As an inventory, sequentially improved 4 days from continued progress on working capital initiatives and increased Revenue.

Speaker #1: The company is in great hands with David moving into the CFO role, and I know the transition will be seamless over the coming months.

Accounts payable days, increased 3 days due to the timing of supplier, payments and procuring, inventory, in anticipation of a significant Revenue growth.

Speaker #1: It has been a true privilege to be part of this fantastic organization. I will now turn the call over to David to discuss additional details regarding our fiscal third quarter expectations as well as some commentary regarding fiscal 2026.

Last our days in advance payments experienced a 6-day reduction with a net 15 million dollars being returned to customers during the quarter.

Before I hand the call to David, I'd like to make a few closing comments. It has been an absolute pleasure and honor to serve as CFO for plexus under Todd's leadership and guided by our outstanding board of directors.

Speaker #1: David?

Speaker #2: Thank you, Pat, and good morning, everyone. Let me begin by offering my congratulations to Pat. And wishing him all the best in this next chapter.

I want to thank Todd our board and everyone at plexus for your support and Trust over the last 12 years.

Speaker #2: I'm excited to step in and lead a tremendous team, and carry on the legacy of a really strong finance organization. I'm also optimistic about Plexus' growth journey, and confident that our consistent strategy will sustain our momentum as we help create the products that build a better world.

Patrick Jermain: The company is in great hands with David moving into the CFO role, and I know the transition will be seamless over the coming months. It has been a true privilege to be part of this fantastic organization. I will now turn the call over to David to discuss additional details regarding our fiscal Q3 expectations, as well as some commentary regarding fiscal 2026. David.

I especially want to thank our finance Organization for maintaining the highest standards and integrity something. I'm confident will endure.

The company is in great hands with David moving into the CFO role and I know the transition will be seamless over the coming months.

Speaker #2: Now let me turn to our guidance for the fiscal third quarter, summarized on slide 16. As Todd has already provided the revenue and EPS guidance, I will review some additional details.

It has been a true privilege to be part of this fantastic organization.

Speaker #2: Fiscal third quarter gross margin is expected to be in the range of 9.9% to 10.2%. At the midpoint, gross margin would be slightly below last quarter, impacted by the timing of program ramps, capability investments, and ongoing higher incentive compensation.

Kristy DeLeeuw: Thank you, Pat, and good morning, everyone. Let me begin by offering my congratulations to Pat and wishing him all the best in this next chapter. I'm excited to step in and lead a tremendous team and carry on the legacy of a really strong finance organization. I'm also optimistic about Plexus' growth journey and confident that our consistent strategy will sustain our momentum as we help create the products that build a better world. Now let me turn to our guidance for the fiscal Q3, summarized on slide 16. As Todd has already provided the revenue and EPS guidance, I will review some additional details. Fiscal Q3 gross margin is expected to be in the range of 9.9% to 10.2%.

I will now turn the call over to David to discuss additional details regarding our fiscal third quarter expectations, as well as some commentary regarding fiscal 2026, David

Thank you, Pat, and good morning, everyone.

Let me Begin by offering my congratulations to Pat and wishing him all the best. In this next chapter.

I'm excited to step in and lead a tremendous team and carry on the legacy of a really strong Finance organization.

Speaker #2: Given our robust revenue growth and strong financial returns, we anticipate ongoing productivity improvements and additional fixed cost leverage will serve as offsets. Our outlook for selling and administrative expense for the fiscal third quarter is in the range of $69 to $70 million.

I'm also optimistic about plexus growth journey and confident that our consistent strategy will sustain our momentum as we helped create the products that build a better world.

Now, let me turn to our guidance for the fiscal third quarter, summarized on slide 16.

Speaker #2: Including our typical stock-based compensation expense, and additional stock-based compensation expense as a result of executive retirement. Excluding these expenses, we expect to gain leverage sequentially on higher revenue.

As Todd has already provided the revenue and EPS guidance, I will review some additional details.

David Williams: At the midpoint, gross margin would be slightly below last quarter, impacted by the timing of program ramps, capability investments, and ongoing higher incentive compensation, given our robust revenue growth and strong financial returns. We anticipate ongoing productivity improvements and additional fixed cost leverage will serve as offsets. Our outlook for selling and administrative expense for the fiscal Q3 is in the range of $69 to 70 million, including our typical stock-based compensation expense and additional stock-based compensation expense as a result of executive retirement. Excluding these expenses, we expect to gain leverage sequentially on higher revenue. Fiscal Q3 non-GAAP operating margin is expected to be in the range of 5.9% to 6.3%, exclusive of stock-based compensation expense.

Fiscal third quarter, gross margin is expected to be in the range of 9.9% to 10.2%.

Speaker #2: Fiscal third quarter non-gap operating margin is expected to be in the range of 5.9% to 6.3%, exclusive of stock-based compensation expense. At the midpoint, this would demonstrate sequential improvement and good progress toward our goal of consistently delivering at or above a 6% non-gap operating margin.

at the midpoint gross margin would be slightly below last quarter impacted by the timing of program ramps capability Investments and ongoing higher incentive compensation, given our robust Revenue, growth and strong financial returns,

We anticipate ongoing productivity improvements and additional fixed cost. Leverage will serve as offsets.

Speaker #2: Non-operating expense is anticipated to be approximately 5.4 million dollars in the fiscal third quarter, up sequentially primarily due to higher interest expense and foreign exchange comparisons.

Our outlook for selling and administrative expense for the fiscal. Third quarter is in the range of 69 to 70 million including our typical stock-based compensation expense.

And additional stock-based compensation expense, as a result of executive retirement.

Speaker #2: We are estimating a non-gap effective tax rate of between 16% and 18% for the fiscal third quarter, and the same range for fiscal 2026, unchanged from our previous outlook for the year.

excluding these expenses, we expect to gain, leverage sequentially on higher Revenue,

Speaker #2: Now turning to the balance sheet. For the fiscal third quarter, we are expecting higher investments in working capital, to support the accelerating revenue growth outlook.

David Williams: At the midpoint, this would demonstrate sequential improvement and good progress toward our goal of consistently delivering at or above a 6% non-GAAP operating margin. Non-operating expense is anticipated to be approximately $5.4 million in the fiscal Q3, up sequentially primarily due to higher interest expense and foreign exchange comparisons. We are estimating a non-GAAP effective tax rate of between 16% and 18% for the fiscal Q3, and the same range for fiscal 2026, unchanged from our previous outlook for the year. Now turning to the balance sheet. For the fiscal Q3, we are expecting higher investments in working capital to support the accelerating revenue growth outlook. We anticipate cash cycle days will be in a range of 67 to 71 days. As a result, we expect a usage of cash of free cash flow for the fiscal Q3.

Let's go. Third quarter. Non-gaap. Operating margin is expected to be in the range of 5.9% to 6.3% exclusive of stock-based compensation expense.

Speaker #2: We anticipate cash cycle days will be in the range of 67 to 71 days. As a result, we expect a usage of cash, a free cash flow for the fiscal third quarter.

At the midpoint, this would demonstrate sequential Improvement and good progress. Toward our goal of consistently delivering, at or above a 6%, non-gaap operating margin

Speaker #2: In support of our accelerating revenue momentum, we are strategically increasing our working capital investments in fiscal 2026. Yet through our focus on working capital efficiency, we continue to expect to end the fiscal year with cash cycle days in the low 60s.

Non-operating expense is anticipated to be approximately 5.4 million in the fiscal third quarter of sequentially primarily due to higher interest, expense and foreign exchange comparisons.

Speaker #2: We also continue to expect fiscal 2026 capital expenditures in the range of 100 to 120 million dollars. Our focus on operational efficiency is creating tangible benefits.

We are estimating a non-gaap effective tax rate of between 16% and 18% for the fiscal third quarter, and the same range for fiscal 2026, unchanged from our previous outlook for the year.

Now, turning to the balance sheet.

For the fiscal third quarter, we are expecting higher investments in working capital to support the accelerating revenue growth outlook.

Speaker #2: By generating higher throughput on existing production lines, which is deferring new equipment purchases, while also increasing site revenue capacity. We are now forecasting fiscal 2026 free cash flow of 50 to 75 million dollars.

We anticipate cash cycle days will be in a range of 67 to 71 days.

David Williams: In support of our accelerating revenue momentum, we are strategically increasing our working capital investments in fiscal 2026. Yet through our focus on working capital efficiency, we continue to expect to end the fiscal year with cash cycle days in the low sixties. We also continue to expect fiscal 2026 CapEx in a range of $100 to 120 million. Our focus on operational efficiency is creating tangible benefits by generating higher throughput on existing production lines, which is deferring new equipment purchases while also increasing site revenue capacity. We are now forecasting fiscal 2026 free cash flow of $50 to 75 million.

As a result, we expect a usage of cash. A free cash flow for the fiscal third quarter.

Speaker #2: Over the longer term, we remain confident that by leveraging our focus on working capital efficiency, and our significant investments in operational efficiency, we will capitalize upon our substantial revenue growth opportunities and generate robust free cash flow.

In support of our accelerating Revenue. Momentum, we are strategically increasing our working capital investments in fiscal 2026.

the fiscal year with cash, cycle days in a low 60s,

Speaker #2: With that, Ben, let's now open the call for questions.

We also continue to expect fiscal 2026 Capital expenditures in a range of 100 to 120 million.

Speaker #1: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If asking more than one follow-up, we kindly ask you to re-queue.

Our focus on operational efficiency is creating tangible benefits by generating higher throughput on existing production lines.

Which is deferring, new equipment purchases while also increasing site Revenue capacity.

Speaker #1: If you would like to ask a question, please press *1 to raise your hand. To withdraw your question, press *1 again. We ask that you pick up your headset when asking a question to allow for optimum sound quality.

David Williams: Over the longer term, we remain confident that by leveraging our focus on working capital efficiency and our significant investments in operational efficiency, we will capitalize upon our substantial revenue growth opportunities and generate robust free cash flow. With that, Ben, let's now open the call for questions.

We are now forecasting, fiscal 2026, free cash flow of 50 to 75 million.

Speaker #1: If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Melissa Fairbanks with Raymond James.

Over the longer term. We remain confident, that by leveraging our focus on working capital efficiency and our significant investments in operational efficiency.

We will capitalize Upon Our substantial Revenue growth opportunities and generate robust free, cash flow.

With that been. Let's now open the call for questions,

Operator: We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If asking more than one follow-up, we kindly ask you to re-queue. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your headset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Melissa Dailey Fairbanks with Raymond James. Melissa, your line is open. Please go ahead.

Speaker #1: Melissa, your line is open. Please go ahead.

we will now begin the question and answer session.

Speaker #3: Hey, guys. Thanks so much. Congratulations on the quarter, and of course, congratulations to Pat. We're going to miss you, but Dave, I look forward to working with you more in the future.

Please limit yourself to 1 question and 1 follow-up.

If asking more than 1 follow-up, we kindly ask you to req.

Speaker #3: I would be remiss if I didn't ask Pat about cash cycle days one more time. I know I'm a little bit focused on it, and Dave, thanks for additional color looking into cash cycle days, exiting the year.

If you would like to ask a question, please press star 1 to raise your hand to withdraw. Your question, press star 1 again.

we ask that you pick up your headset when asking a question to allow for Optimum sound quality if you are muted locally,

Please remember to unmute your device, please. Stand by while we compile the Q&A roster,

Speaker #3: But we're obviously seeing a really strong acceleration in growth in the near term. So I know they're going to trend higher next quarter, sounds like they're going to trend slightly lower, exiting the year.

Your first question comes from the line of Melissa Fairbanks with Raymond James, Melissa. Your line is open, please go ahead.

Melissa Fairbanks: Hey, guys. Thanks so much. Of course, congratulations to Pat. We're gonna miss you, David, I look forward to working with you more in the future. I would be remiss if I didn't ask Pat about cash cycle days one more time.

Speaker #3: But just wondering how to think about working capital investment longer term, to support this level of growth, whether it's through CapEx, through new site investments, or just working capital investments.

Speaker #2: Yeah, I can start, and then maybe David can add on to it. I'd say two things, Melissa. I think from a day's perspective, I think we're in a really good spot in this low to mid-60s going forward.

Kristy DeLeeuw: Christy

Kristy DeLeeuw: Christy.

Melissa Fairbanks: I'm a little bit focused on it and Dave, thanks for, you know, additional color looking into cash cycle days exiting the year. But we're obviously seeing a really strong acceleration in growth in the near term. I know they're gonna trend higher next quarter. Sounds like they're gonna trend slightly lower exiting the year. Just wondering how to think about working capital investment longer term to support this level of growth, whether it's through CapEx, through new site investments or, you know, just working capital investments.

Speaker #2: And I think that would carry into fiscal 27. I think the other thing to look at is with revenue growth, we're probably around 10 to 15 percent additional working capital dollars associated with any growth in revenue.

Hey guys, thanks so much. Um, congratulations on the quarter, and, of course, congratulations to Pat. We're going to miss you, but Dave, I look forward to working with you more in the future. Um, I would be remiss if I didn't ask Pat about cash, cycle Days 1 more time. Uh, I know I'm a little bit focused on it and, uh, Dave thanks for, you know, additional color looking into Cash cycle days, exiting the year. Um, but we're obviously seeing a really strong acceleration in growth in the near term so I know they're going to Trend higher next quarter. Sounds like they're going to Trend slightly lower exiting the year.

Speaker #2: So I think that's a good barometer if you're looking at from a dollar's perspective. But from a day's perspective, I think low to mid-60s is a good range for us.

Patrick Jermain: Yeah, I can start and then maybe David can add on to it. I'd say two things, Melissa. I think from a days perspective, I think we're in a really good spot in this low to mid-sixties going forward, and I think that would carry into fiscal 2027. I think the other thing to look at is with revenue growth, we're probably around, you know, 10% to 15% additional working capital $ associated with any growth in revenue. I think that's a good barometer if you're looking at from a $ perspective. From a days perspective, I think low to mid-sixties is a good range for us. Yeah, Melissa, maybe I'd build-

But just wondering how to think about working capital investment longer term to support this level of growth. Whether it's through capex, through new site, Investments or uh, you know, just working capital Investments.

Speaker #4: Yeah, Melissa, maybe I'd build the other part of your question was about investing in even capital in the long term. And we just reconfirmed our 100 to 120 million dollars of capital investment.

Speaker #4: Recently, in the last six months, our teams have actually improved the throughput of some of our assets by 10%, which is avoided in the neighborhood of 20 million dollars of capital investment.

Speaker #4: So we're able to grow revenue on a very similar capital base. So those types of efficiencies are not only happening in CapEx, but also there's the same type of efficiencies in our working capital environment as well.

Speaker #4: So hence, that gives us confidence in the long term.

Speaker #1: Okay. Amazing. Thanks, just one more question that's maybe for Oliver, because he kind of touched on some of this in his commentary. Wanted to ask about some trends in industrial we focus on semi-cap and test equipment so much, but it sounds as though one of your customers, I think you do some energy storage solutions for them, they raise their full year outlook for this year almost doubling the growth rate.

Kristy DeLeeuw: Okay

Kristy DeLeeuw: Okay,

Kristy DeLeeuw: You know, the other part of your question was about investing in even capital in the long term. You know.

Yeah, I can start and then maybe David can add on to it, I'd say 2 things, Melissa, I think, from a days perspective, I think we're in a really good spot in this low, to mid-60s going forward. Um, and I think that would carry into, uh, fiscal 27. I think the other thing to look at is with Revenue growth, we're probably around, you know, 10 to 15%, um, additional working capital dollars associated with any growth in Revenue, so I think that's a good barometer if you're looking at from a dollars perspective, but from a day's perspective, I think low to mid-60s is a good range for us.

Melissa Fairbanks: Mm-hmm

Kristy DeLeeuw: we just reconfirmed our $100 to $120 million of capital investment. You know, recently in the last 6 months, our teams have actually improved the throughput of some of our assets by 10%, which is avoided in the neighborhood of $20 million of capital investment. We're able to grow revenue on a very similar capital base. Those types of efficiencies are not only happening in CapEx, but also there's the same type of efficiencies in our working capital environment as well. Hence that gives us confidence in the long term.

Kristy DeLeeuw: we just reconfirmed our $100 to $120 million of capital investment. You know, recently in the last six months, our teams have actually improved the throughput of some of our assets by 10%, which is avoided in the neighborhood of $20 million of capital investment. We're able to grow revenue on a very similar capital base. Those types of efficiencies are not only happening in CapEx, but also there's the same type of efficiencies in our working capital environment as well. Hence that gives us confidence in the long term.

Speaker #1: So in part, because of strength and power supply. So I know you kind of touched on you've got some new wins in industrial for these types of applications, you've been winning in there for a long time.

Yeah, Melissa. Maybe I build the other part of your question was about investing in in even capital in the long term? You know, when we we we just reconfirmed our our 100 to 120 million dollars of capital investment. You know, recently in the last 6 months our teams have actually improved. The throughput of some of our assets by 10% which is avoided in the neighborhood of 20 million dollars of capital investment. So we're able to grow revenue on a very similar Capital base. So those types of efficiencies are not only happening in aspects but also there there's the same type of type of efficiencies in our working capital environment.

Melissa Fairbanks: Okay. Amazing. Thanks. Just 1 more question that's maybe for Oliver, because he kind of touched on some of this in his commentary. Wanted to ask about some trends in industrial. You know, we focus on semi-cap and test equipment so much, but it sounds as though 1 of your customers, I think you do some energy storage solutions for them, they raised their full-year outlook for this year, almost doubling the growth rate. In part because of strength in power supply. I know you kind of touched on you've got some new wins in industrial for these types of applications. You've been winning in there for a long time. Just wondering how you're looking at some more near-term demand, you know, assuming that some of these new wins are going to be longer term in scope.

Melissa Fairbanks: Okay. Amazing. Thanks. Just one more question that's maybe for Oliver, because he kind of touched on some of this in his commentary. Wanted to ask about some trends in industrial. You know, we focus on semi-cap and test equipment so much, but it sounds as though one of your customers, I think you do some energy storage solutions for them, they raised their full-year outlook for this year, almost doubling the growth rate. In part because of strength in power supply. I know you kind of touched on you've got some new wins in industrial for these types of applications. You've been winning in there for a long time. Just wondering how you're looking at some more near-term demand, you know, assuming that some of these new wins are going to be longer term in scope.

So, hence that gives us confidence in in the long term.

Speaker #1: Just wondering how you're looking at some more near-term demand assuming that some of these new wins are going to be longer term in scope.

Speaker #4: Thanks, Melissa. Happy to talk about that. Yeah, and we are excited.

Speaker #3: I'm sorry to put you on the spot, Oliver.

Speaker #4: Oh, that's fine. Happy to talk about it. We are excited about our customers in the energy infrastructure space. We've talked about some wins there over the past few quarters.

Speaker #4: We also referencing back a few quarters ago, we talked about a specific regulatory compliance standard that we have for our Boise facility that enables us to do control systems for nuclear power.

Speaker #4: And so we think that gives us a bit of competitive differentiation which enables some of this growth that we're seeing in this subsector. Yeah, and I would bleed that through to saying our the adjacencies that we're seeing here relative to data centers.

Okay, amazing. Um, thanks, uh, just 1, more question. This may be for Oliver because he kind of touched on some of this in his commentary wanted to ask about some Trends in industrial. Um, you know, we focus on semi cap and test equipment so much but it sounds as though 1 of your customers. I think you do some energy storage solutions for them. They raise their full year outlook for this year, almost doubling the growth rate. So in part because of strength and power supply. So I know you kind of touched on, you've got some new winds in industrial for these types of applications. Um you've been winning in there for a long time. Just wondering how you're looking at some more near-term demand, you know, assuming that some of these new winds are going to be longer term in scope.

Oliver Mihm: Thanks, Melissa. Happy to talk about that. We are excited.

Melissa Fairbanks: Sorry to put you on the spot, Oliver.

Oliver Mihm: No, that's fine. Happy to talk about it. We are excited about our customers in the energy infrastructure space. We've talked about some wins there over the past few quarters.

Speaker #4: We talked about a win here this quarter specific to a power platform solution. But just the funnel that we have related to items in the data center, whether that's power management and storage, thermal cooling, thermal density, fluidics, really well allowing to our value proposition and capabilities.

Oliver Mihm: Mm-hmm

Oliver Mihm: referencing back a few quarters ago, we talked about a specific regulatory compliance standard that we have for our Boise facility that enables us to do control systems for nuclear power. We think that gives us a bit of competitive differentiation, which enables some of this growth that we're seeing in this sub-sector. Yeah, I just, I would bleed that through to saying our excitement there also extends into the adjacencies that we're seeing here relative to data centers. We talked about a win here this quarter specific to a power platform solution. Just the funnel that we have related to items in the data center, whether that's power management storage, thermal cooling, thermal density, fluidics, really well-aligned to our value proposition and capabilities.

Oliver Mihm: Mm-hmm,

Oliver Mihm: Referencing back a few quarters ago, we talked about a specific regulatory compliance standard that we have for our Boise facility that enables us to do control systems for nuclear power. We think that gives us a bit of competitive differentiation, which enables some of this growth that we're seeing in this sub-sector. Yeah, I just, I would bleed that through to saying our excitement there also extends into the adjacencies that we're seeing here relative to data centers. We talked about a win here this quarter specific to a power platform solution. Just the funnel that we have related to items in the data center, whether that's power management storage, thermal cooling, thermal density, fluidics, really well-aligned to our value proposition and capabilities.

Speaker #4: But then again, that energy distribution and infrastructure, we just talked about storage control systems, we're also seeing companies push AI out to what has been referred to as at the edge.

About our customers and the energy infrastructure space, we've talked about some wins there over the past few quarters. We also referencing back a few quarters ago, we talked about uh a specific Regulatory Compliance standards that we have for our Boise facility that enables us to do control systems for nuclear power. So we think that gives a gives us a bit of competitive differentiation which enables some of this growth that we're seeing in this sub sector.

Speaker #4: So on equipment, on devices, these are often ruggedized applications. And so the redesign to put that solutions in place the manufacturing and then the need to sustain those and service those we view as being really well aligned to our capabilities and strengths and we have a very strong and active funnel in that space.

Speaker #3: Okay, great. That's great. Thank you so much for the detail. That's it for me. I'll get back in the queue if I need something else.

Oliver Mihm: Again, that energy distribution and infrastructure we just talked about, storage control systems, we're also seeing companies push AI out to what has been referred to as at the edge, so on-

Speaker #3: Thanks so much, guys, and congratulations, Pat.

Speaker #4: Thanks, Melissa.

Speaker #2: Thanks, Melissa.

Speaker #1: Your next question comes from the line of Ruben Roy with Steiffel. Ruben, your line is open. Please go ahead.

Oliver Mihm: Mm-hmm

Oliver Mihm: Mm-hmm.

Oliver Mihm: ... on equipment, on devices. These are often ruggedized applications, so they're redesigned to put that, those, solutions in place. The manufacturing, then the need to sustain those and service those we view as being really well-aligned to our capabilities and strengths, we have a very strong and active funnel in that space.

Oliver Mihm: On equipment, on devices. These are often ruggedized applications, so they're redesigned to put that, those, solutions in place. The manufacturing, then the need to sustain those and service those we view as being really well-aligned to our capabilities and strengths, we have a very strong and active funnel in that space.

Speaker #5: Yes, thank you, congratulations to all. But especially Pat, thanks for all the help, Pat. And David, obviously, congratulations too. But Pat, before you go, maybe we'll start with you.

Speaker #5: Todd, in his prepared remarks, mentioned sustained momentum well beyond fiscal 26. And I'm wondering, if we could just maybe think a little bit about the operating margin structure of the company as you sort of line up a funnel of new wins, etc.

Melissa Fairbanks: Okay, great. That's great. Thank you so much for the detail. That's it for me. I'll get back in the queue if I need something else. Thanks so much, guys, and congratulations, Pat.

Um, yeah. And I just, I would believe that through to saying our excitement, there are also extends into the adjacencies that we're seeing here relative to Data Centers. So we talked about, uh, a win here. This particular this quarter specific to uh, a Power Platform solution. Um, but just the the funnel that we have related to items in the data center whether that's power management and storage thermac cooling thermal density, fluidics, really. Well, aligned to our value proposition and capabilities, but then again that energy distribution and infrastructure. We just talked about storage Control Systems. We're also seeing companies pushing AI out to what, what has been referred to as at the edge. So on on equipment on devices, these are often ruggedized, applications and so the redesign to put that those uh Solutions in place to manufacturing and then and then the need to sustain those and service. Those we view as being really well aligned to our capabilities and strengths and we have a very strong and active funnel in that space.

Oliver Mihm: Thanks, Melissa.

Todd Kelsey: Thanks. Thanks, Melissa.

Okay great. That's great. Thank you so much for the detail. Um that's it for me, I'll get back in the queue if I need something else. Thanks so much guys and congratulations. Pat.

Thanks. Thanks Melissa.

Operator: Your next question comes from the line of Ruben Roy with Stifel. Ruben, your line is open. Please go ahead.

Speaker #5: And it's probably premature and you're probably not going to give us a longer-term target above what above six means. But just in terms of some of the wins that are coming into the funnel, etc., maybe you can walk us through the puts and takes across the different segments on how we should think about that operating margin.

Your next question comes from the line of Ruben Roy with stifle Ruben. Your line is open, please go ahead.

Ruben Roy: Yes, thank you. Congratulations to all, but, especially Pat. Thanks for all the help, Pat, and David, obviously, congratulations too. Pat, before you go, maybe we'll start with you. Todd, in his prepared remarks, mentioned sustained momentum well beyond fiscal 2026, and I'm wondering if we could just maybe think a little bit about, the operating margin structure of the company as you know, sort of line up, you know, a funnel of new wins, et cetera. It's probably premature, and you're probably not gonna give us a, you know, a longer term target above what above 6 means.

Thank you, uh, congratulations to all. But uh, especially Pat um, thanks for all the help Pat and uh,

Speaker #5: And I have a follow-up, which is sort of similar for Oliver after we talk about this a bit. Thank you. Sure. Yeah, and I'll start if others want to join in.

Speaker #5: Ruben, the margin differential between market sectors is not that different nowadays with the markets we're serving. With the additional wins, there is some ramping costs that's involved.

Speaker #5: So that's a little bit of a drag on our margins. But the fixed cost leverage we're gaining both on our fixed costs and SG&A definitely overrides that.

Ruben Roy: Just in terms of, you know, some of the wins that are coming into the funnel, et cetera, you know, maybe you can walk us through the puts and takes across the different segments on, you know, how we should think about, you know, that operating margin. I have a follow-up, which is sort of similar for Oliver after we talk about this a bit. Thank you.

Speaker #5: And provides that target of 6% or above. And as we look to F27, yeah, we're not going to make any new commitments at this point.

Uh and David obviously congratulations to. Um, but Pat before you go, maybe we'll start with you Todd in his prepared remarks. Uh mentioned sustained momentum will be on fiscal 26. And I'm wondering if we could just maybe think a little bit about, um the uh the operating margin structure of the company, as as you, you know, sort of line up, you know, a funnel of new wins, Etc. And it's probably premature and you're probably not going to give us a, you know, a longer term Target above what above 6 means. But just in terms of, you know, some of the wins that are coming into the funnel Etc. You know, maybe you can walk us through to, put the takes across the different segments on, you know, how we should think about. Um,

Patrick Jermain: Sure. I'll start if others wanna join in. Ruben, the margin differential between market sectors is not that different nowadays with the markets we're serving. With the additional wins, there is some ramping cost that's involved, so that's a little bit of a drag on our margins. The fixed cost leverage we're gaining both on our fixed costs and SG&A definitely overrides that and provides that target of 6% or above. As we look to F'2027, we're not gonna make any new commitments at this point, but seeing a consistency in that margin performance going back a few years ago when we saw that consistency is when we started to think about what is that next target.

You know, that operating margin— and I have a follow-up, which is sort of similar for Oliver, after we talked about this a bit. Thank you.

Speaker #5: But seeing a consistency in that margin performance going back a few years ago when we saw that consistency is when we started to think about what is that next target.

Speaker #5: And I think we'll be in that position, but obviously not wanting to commit to anything at this point. But I think there's definite opportunity with the fixed cost leverage.

Speaker #5: Some of the services we're providing around sustaining services and engineering that carry higher margins. And then probably around the automation efforts, David talked about some of that with capital spending, the impact that has on margin, is pretty pronounced.

Speaker #5: So I think you'll see benefits there as well.

Speaker #4: Yeah, one of the things that I would add is with the what we would expect is in improving or increasing margins as we continue to move out.

Patrick Jermain: I think we'll be in that position, obviously not wanting to commit to anything at this point. I think there's definite opportunity with the fixed cost leverage, some of the services we're providing around sustaining services and engineering that carry higher margins, and probably around the automation efforts. David talked about some of that with capital spending. The impact that has on margin is pretty pronounced. I think you'll see benefits there as well.

Speaker #4: And that's because of the leverage that we'll be gaining as well as the operational efficiency initiatives. We're probably not too far from establishing a new target.

Sure. Um, yeah and I'll start if others want to join in. Um Ruben, the the margin differential between Market sectors is not that different nowadays with the the markets we're serving, um, with the additional wins, there is some ramping cost that's involved so that that's a little bit of a drag on our margins but the, the fixed cost leverage. We're gaining both on our, um, fixed costs and sgna, um, definitely, um, uh, overrides that, um, and, and provides that Target of 6% or above. And as we look to f27, yeah. We're not going to make any new commitments at this point, but seeing a consistency in that margin performance. Um, going back a few years ago, when, when we saw that consistency is when we started to think about what is that next Target? And I think we'll be in that position, but obviously not wanting to commit to anything at this point. But I, I think there is

Speaker #4: Pat's been working on it with David in the finance team. And we'll let David get comfortable in the chair for a couple of quarters, perhaps, before coming out with a new target here.

Speaker #1: Yeah, makes sense. Thank you, Todd. If I pull that sort of discussion and maybe pull in working capital nearer to Oliver, you called out some tightening supply chain conditions and that's been a consistent sort of theme across a lot of calls so far in earnings season.

Todd Kelsey: Yeah. One of the things that I would add is, you know, what we would expect is improving or increasing margins as we continue to move out, and that's because of the leverage that we'll be gaining as well as the operational efficiency initiatives. We're probably not too far from establishing a new target. Pat's been working on it with David and the finance team, and we'll let David get comfortable in the chair for a couple of quarters perhaps before coming out with a new target here.

Definite opportunity with the fixed cost. Leverage some of the services were providing around sustaining services and Engineering that carry higher margins and then probably around the automation efforts. David talked about some of that with capital spending, the impact that has on margin is pretty pronounced. Um, so I think you'll see benefits there as well.

Speaker #1: I'm wondering if you could maybe give us a little more detail on what you're seeing around supply and whether or not that's acting as a little bit of a gating factor as you think about some of the program ramps s embedded in your Q3 or fiscal year guidance here.

Speaker #1: Obviously, the raise is great to see, but what are the puts and takes against supply and sort of the demand improvement you're seeing across the markets?

Yeah, 1 1 of the things that I would add is, um, you know, with the, what we would expect is in in improving or increasing margins. As we continue to move out and that's because of the leverage that will be gaining as well as the operational efficiency initiatives. Um we're probably not too far from establishing a new Target, Pat's been working on it with David and the finance team and we'll let David get comfortable in the chair. For a couple of quarters. Perhaps before uh I'm coming out with a new Target here.

Ruben Roy: Yeah. Makes sense. Thank you, Todd. If I pull that, you know, sort of discussion and maybe pull in working capital near term, Oliver, you called out some tightening supply chain conditions, and that's been a consistent, you know, sort of theme across a lot of calls so far in earnings season. I'm wondering if you could maybe give us a little more detail on what you're seeing around supply and whether or not, you know, that's acting as a little bit of a gating factor as you think about some of the program ramps embedded in your Q3 or, you know, fiscal year guidance here. Obviously, the raise is great to see. You know, what are the puts and takes against supply and, you know, sort of the demand improvement you're seeing across the end markets? Thank you.

Speaker #1: Thank you.

Speaker #4: Yeah, maybe I'll start with this, Ruben, and Oliver can jump in and provide additional color. I think as we set our forecast, we certainly have taken into account the realities of the supply chain.

Speaker #4: So I think I don't feel like we have undue risk as a result of supply chain. Within our forecast right now, now there's certainly more upside that exists.

Speaker #4: Should things go in the right direction for us, but the other thing that we're doing is we're working very proactively with our customers around, call it the golden screws, to make sure that we get supply for those tough-to-obtain parts.

Ing season wondering if you could, maybe give us a little more detail on on what you're seeing around Supply. And whether or not, you know, that's acting as a little bit of a gating Factor, as you think about, uh, some of the program ramps embedded in your Q3 or, you know, fiscal year guidance here obviously the rates is great to see but you know, what are the puts of dates against

Todd Kelsey: Yeah. Maybe I'll start with this, Ruben, and Oliver can jump in and provide additional color. I think as we set our forecast, we certainly have taken into account the realities of the supply chain. I think I don't feel like we have undue risk as a result of supply chain within our forecast right now. Now, there's certainly more upside that exists should things go in the right direction for us. The other thing that we're doing is we're working very proactively with our customers around, call it the golden screw, to make sure that we get supply for those tough-to-obtain parts.

Supply and, you know, sort of the demand Improvement. You're seeing across the UN markets. Thank you.

Speaker #2: Yeah, and so more specifically there, the specific commodities that we are seeing allocation or tightening, Ruben, portions of semiconductor, portions of passives, memory, no surprise for anybody, raw PCB fabs, behind that, lead times extending.

Speaker #2: But not allocation yet around extended lead times around high-performance passives, magnetics, and some portions of microcontrollers. And so as Todd noted, a lot of proactive work here asking our sourcing teams to identify risk early that enables a consultative engagement with our customers, asking them to extend forecast visibility, expand alternates, enable some advanced materials planning from our side for instance, early PO placement, extended PO horizon, and then I would just generally say that the interconnection between those teams and the processes around that were well honed during the constrained market post-COVID.

Oliver Mihm: Yeah. More specifically there, the specific commodities that we are seeing allocation or tightening, Ruben, portions of semiconductor, portions of passives, memory, no surprise for anybody, raw PCB fabs. Behind that, lead times extending, so but not allocation yet around extended lead times around high-performance passives, magnetics in some portions of microcontrollers. As Todd noted, a lot of proactive work here, asking our sourcing teams to identify risk early. That enables a consultative engagement with our customers, asking them to extend forecast visibility, expand alternates, enable some advanced materials planning from our side, for instance, early PO placement, extended PO horizon. Then I would just generally say that the interconnection between those teams and the processes around that were well-honed during the constrained market post-COVID.

Yeah, maybe I'll start with this Reuben and Oliver can jump in and provide additional color. Um, I I think as we, we set our forecasts, we certainly have taken into account the realities of the supply chain. Um, so I think, um, I don't feel like we have undue risk. Um, as a result of the supply chain within our forecast, right now, now, there's certainly more upside, um, that exists. Um, should things go in the right direction for us. Um, but the the other thing that we're doing is we're working, very proactively with our customers around, call it the golden screws, to make sure that we, um, that we get supply for those tough to obtain parts.

Yeah. So more specifically there, that the specific Commodities that we are seeing um, allocation or tightening proven um, portions of semiconductor portions of passes memory. No, surprise for anybody, raw PCB Fabs

Speaker #2: And so we're seeing that bring to bear today. Including some AI tools that we had developed to help interrogate the open market and find supply for us.

Speaker #1: Understood. Very helpful. Thanks, Chance.

Speaker #3: Your next question comes from the line of David Williams with Needham. David, your line is open. Please go ahead.

Speaker #5: Hey, good morning, everyone. Thanks for letting me ask a question. And Pat, let me say congratulations and we will certainly miss you very much.

Um behind that lead times extending. So but not allocation yet around. Uh, lead extended lead times around high performance passes, uh, magnetics in some portions of microcontrollers. And so as Todd had a lot of proactive work here, asking our sourcing teams to uh, identify risk early. That enables a a consultative engagement with our customers asking them to extend forecast, visibility, expand, alternates. Uh, enable some Advanced Materials planning from our side. For instance, early Poe placement, extended Poe Horizon

Speaker #5: So hate to see you go, but David, welcome and look forward to working with you.

Oliver Mihm: We're seeing that bring to bear today, including some AI tools that we had developed to help interrogate the open market and find supply for us.

Speaker #4: Thanks, David.

Oliver Mihm: We're seeing that bring to bear today, including some AI tools that we had developed to help interrogate the open market and find supply for us.

Speaker #6: Thank you, David.

Speaker #5: Yeah. Maybe first on the capacity side, you've talked about that 100 to 120 million dollars this year. And just kind of curious, do you think that you can keep up some of the automation efforts and some of these efficiencies?

And then I would, I would just generally say that the interconnection between those teams and the processes around that we're well honed during the constrained market postco. And so, we're seeing that bring to bear today, uh, including some AI tools that we had developed to help interrogate the open market and find uh, find uh, supply for us.

Ruben Roy: Understood. Very helpful. Thanks, gents. Your next question comes from the line of David Williams with Needham. David, your line is open. Please go ahead.

Understood very helpful, thanks.

Speaker #5: Can you keep up with the type of demand that you're seeing in front of you? Or should we think maybe next year you'll need some additional greenfield capacity expansion that you haven't considered or haven't thought in the past that you would need just given the strength of the demand?

Your next question comes from the line of David Williams with NEM.

David Williams: Hey, good morning, everyone. Thanks for letting me ask a question. Pat, let me say congratulations, and we will certainly miss you very much. Hate to see you go. David, welcome, and I look forward to working with you.

David. Your line is open, please go ahead.

Speaker #6: Yeah, thanks, David. That's a good question. We're really pleased with the results our teams are delivering with those efficiencies and throughput we talked about.

Patrick Jermain: Thanks, David. Thank you, David.

Hey, good morning everyone. Thanks uh, for letting me. Ask a question and Pat. Let me uh, let me say congratulations. And we will certainly miss you very much. So, uh, I hate to see you go, but David, welcome in. I look forward to working with you.

Speaker #6: And so at this point, if we think about our capacity around the world, it's really well balanced. We think we can service well in excess of 5 billion in annualized revenue.

David Williams: Yeah, you know, maybe first on the capacity side, you've talked about that $120 million this year, and just kind of curious, do you think that you can keep up, you know, some of the automation efforts and some of these efficiencies, can you keep up with the type of demand that you're seeing in front of you? Or should we think maybe next year you'll need some additional greenfield capacity expansion that you haven't considered or haven't thought in the past that you would need, just given the strength of the demand?

Thank you, David. Thank you, David.

First on the, the capacity.

Speaker #6: But then as the growth continues, we're just going to continue to reassess how our sites are doing. Where we might need to invest in capacity.

Speaker #6: But at the moment, we're feeling pretty good about what we have. With the growth, it depends on the type of product and the location.

Speaker #6: But at the moment, we're sticking to that guidance and we're going to continue to drive efficiency with our current footprint. And we have a lot of initiatives that are increasing the utilization within our current sites so that progress is going to continue.

Todd Kelsey: Yeah. Thanks, Dave. That's a good question. You know, we're really pleased with the results our teams are delivering with those efficiencies and throughput we talked about. You know, at this point, if we think about our capacity around the world, it's really well-balanced. We think we can service, you know, well in excess of $5 billion in annualized revenue. You know, as the growth continues, we're just gonna continue to reassess how our sites are doing, where we might need to invest in capacity. At the moment, we're feeling pretty good about what we have. With the growth, it depends on the type of product and the location.

Just kind of curious. Do you think that you can keep up, you know, some of the automation efforts and some of these efficiencies can you keep up with the type of demand that you that you're seeing if you or should we think maybe next year you'll need some some additional uh Greenfield capacity expansion uh that you haven't considered or or haven't thought in the past that you would need just given the strength of the demand

Speaker #6: So far, so good, David, but we're constantly assessing the situation for sure.

Speaker #4: Yeah, one of the things I'd also note is with David, with our newer building deployments that we do, the way we put those into play enable us to add incremental capacity without substantial CapEx.

Speaker #4: And so that enables us to add some additional bricks and mortar footprint when we need to. Yeah, I just thought that was an important point to add.

Todd Kelsey: At the moment, we're sticking to that guidance, and we're gonna continue to drive efficiency with our current, with our current footprint. We have a lot of initiatives that are increasing the utilization within our current sites, so that progress is gonna continue. So far, so good, David, we're constantly assessing the situation for sure.

Speaker #5: Yeah, thanks. That's certainly helpful. And then maybe secondly, just you talked about the exceptional strength of defense and the semi-cap. And I guess in this environment, as we think about this demand, how much of this do you think is demand-driven from the efforts you've put in previously versus just the backdrop is so heavy in terms of that demand that you're just seeing more shifting to you?

Oliver Mihm: Yeah. One of the things, and I'd also note is with, David, with our newer building deployments that we do, the way we put those into play enable us to add incremental capacity without substantial CapEx. That enables us to add some additional bricks and mortar footprint when we need to. Yeah, just thought that was an important point to add.

Yeah, thanks, Dave. That's, that's a good question. You know, we're really pleased with the with the results. Our teams are delivering with those efficiencies and throughput. We talked about, uh, you know, and so at this point, if we think about our, our capacity around the world, it's really well balanced. We think we can service, you know, well, in excess of 5 billion in annualized Revenue, uh, you know, but then as as the growth continues, we're going to just going to continue to reassess how our sites are doing where we might need to invest in capacity. But at the moment, we're feeling pretty good about what we have, uh, you know, with the with the growth, it depends on the type of product and the location. Um, but at the moment, we're sticking to that guidance and we're going to continue to drive efficiency with our current with our current footprint. Uh, and we have a lot of initiatives that are increasing the, the utilization within our current sites. So that progress is going to continue so far so good David. But we're constantly assessing the situation for sure.

Speaker #5: So I guess I'm trying to ask, how much is share gains because of your operational excellence versus what do you think just the market overall is being pushed towards you?

Speaker #4: Yeah, there's large components from both, David. We've got significant share gain in semiconductor capital equipment that's going on right now and continues even through this quarter.

Yeah, 1 of the things. Uh, I'd also note, is with, uh, David with our newer building deployments that we do, uh, the way we put those into play and enable us to add incremental capacity without substantial capex. So that enables us to add some, uh, some additional, um, bricks and mortar footprint when we need to, um,

Yes, I thought that was an important point to add.

David Williams: Yeah. Thanks. That's really helpful. Then maybe secondly, just, you know, you talked about the exceptional strength of the sense in the semi-cap. You know, I guess in this environment, as we think about this demand, how much of this do you think is demand driven from the effort you've put in previously versus just the backdrop is so heavy in terms of that demand that you're just seeing more shifting to you? I guess I'm trying to ask how much is share gains because of your operational excellence versus what do you think just the market overall is being pushed towards you?

Yeah, thanks. Uh,

Speaker #4: We also are gaining share within aerospace and defense on several of the subsectors with defense being a significant one. But those markets are good too.

Speaker #4: So we're getting a double benefit, I would say, in that we're taking share in a really strong market. So we expect some excellent growth within those markets at far exceeds market growth.

Todd Kelsey: Yeah. There's large components from both, David. We've got significant share gain in semiconductor capital equipment that's going on right now, and continues even through this quarter. We also are gaining share within aerospace and defense on several of the sub-sectors, with defense being a significant one. Those markets are good too. There we're getting a double benefit, I would say, in that we're taking share in a really strong market. We expect some excellent growth within those markets that far exceeds market growth.

How much is share gains, uh, because of your operational excellence versus, what do you think? Just the market overall is being pushed towards you?

Speaker #5: Thanks so much.

Speaker #3: A friendly reminder to ask a question, please press star one to enter the queue. Your next question comes from the line of Steven Fox with Fox Advisors, LLC.

Speaker #3: Steven, your line is open. Please go ahead.

Speaker #1: Thanks very much. And good morning, everyone. First of all, Pat, thanks very much for all your help over the years. Always a pleasure to work with you.

Yeah, there there's there's large components from both David. We've got significant share, gain and semiconductor Capital Equipment that's going on right now. Um, and continues even through this quarter. Um, we also are are gaining share within Aerospace and defense on several of the sub sectors, with defense, being a significant 1, but those markets are good too. So they're, we're, we're getting a double benefit, I would say in that. Um,

Speaker #1: I guess first of all, just maybe following up on that operating margin question. Can you give us a sense for how operating leverage is developing numerically?

That we're, we're taking share in a really strong market. So we expect some excellent growth within those markets that far exceeds market growth.

Speaker #1: Obviously, not an exact number, but qualitatively from the sense you have some puts and takes in there. You're seeing margin expansion. How do we think about sort of the drop-through in this type of environment?

David Williams: Thanks so much.

Thanks so much.

Operator: A friendly reminder, to ask a question, please press star one to enter the queue. Your next question comes from the line of Steven Fox with Fox Advisors, LLC. Steven, your line is open. Please go ahead.

A friendly reminder to ask a question. Please press star 1 to enter the queue.

Speaker #1: Is it similar to what you've seen in prior upcycles or is there more investment going on that we should maybe consider a little less margin expansion?

Speaker #1: I was curious if you can provide more perspective there, and then I had a follow-up.

Your next question comes from the line of Steven Fox with Fox advisors LLC. Stephen your line is open, please go ahead.

Steven Fox: Thanks very much, good morning, everyone. First of all, Pat, thanks very much for all your help over the years. Always a pleasure to work with you. I guess first of all, just maybe following up on that operating margin question. Can you give us a sense for how operating leverage is developing numerically? Obviously not an exact number, but qualitatively from the sense you have some puts and takes in there, you are seeing margin expansion. How do we think about sort of the drop-through in this type of environment? Is it similar to what you've seen in prior up cycles, or is there more investment going on that we should maybe consider a little less margin expansion? I was curious if you can provide more perspective there, then I had a follow-up.

Steven Fox: Thanks very much, good morning, everyone. First of all, Pat, thanks very much for all your help over the years. Always a plasure to work with you. I guess first of all, just maybe following up on that operating margin question. Can you give us a sense for how operating leverage is developing numerically? Obviously not an exact number, but qualitatively from the sense you have some puts and takes in there, you are seeing margin expansion. How do we think about sort of the drop-through in this type of environment? Is it similar to what you've seen in prior up cycles, or is there more investment going on that we should maybe consider a little less margin expansion? I was curious if you can provide more perspective there, then I had a follow-up.

Speaker #4: Yeah, Steven, this is David. As we think through the leverage and drop-through, typically we can see maybe a 10 to 12 percent drop-through on revenue growth.

Speaker #4: And obviously, as we're driving our efficiency initiatives, we can see not only that leverage, but also some drop-through of other improvements. But we're also investing in capability.

Thanks very much, and good morning everyone. Uh, first of all Pat, thanks very much for all your help over the years. Always a pleasure to work with you. Um I guess first of all, just maybe following up on that operating margin question. Um,

Speaker #4: So for example, we've got the next generation of cybersecurity maturity models we're investing in to help us win new revenue. And so what we need to balance what we're doing with the efficiency, whether it's dropping to the bottom line, or enabling the next level of revenue growth.

Can you give us a sense for how operating leverages developing numerically? Um, obviously not an exact number, but qualitatively from the sense?

Speaker #4: And so we're confident that we're going to see that leverage come through and fairly typical to what we've seen before. And we're in a great period of driving efficiency and balancing that with investment.

You have some puts and takes in there, you're seeing margin expansion. How do we think about sort of the drop through in this type of environment? Is it is it similar to what you seen in Prior up Cycles? Or is there more investment going on that? We should maybe consider a little less margin expansion? I was curious if you can find more perspective there and then I had a follow up.

Kristy DeLeeuw: Yeah, Steven. This is David. You know, as we think through the leverage and drop-through, typically we can see maybe a 10% to 12% drop-through on revenue growth. Obviously, as we're driving our efficiency initiatives, we can see not only that leverage but also some drop-through of other improvements. We're also investing in capability. For example, we've got the next generation of Cybersecurity Maturity Model we're investing in to help us win new revenue. We need to balance what we're doing with the efficiency, whether it's dropping to the bottom line or enabling, you know, the next level of revenue growth. We're confident that we're gonna see that leverage come through, and it's fairly typical to what we've seen before.

Speaker #4: So yeah, that 10 to 12 percent drop-through is probably what you should keep in mind.

Speaker #1: Great. That's very helpful, actually. And then in terms of the aerospace markets, you guys threw a lot at us just now. I know last quarter you also had a huge amount of wins in that space.

Speaker #1: Can you give us a little more sense on sort of ranking the drivers here? How much is just some of these new markets like space really accelerating?

Speaker #1: How much is your own market share gains or new wins or new capabilities? There's a lot to unpack there. I was wondering if you could just sort of give us a sense of what's most important.

Kristy DeLeeuw: We're in a great period of driving efficiency and balancing that with investment. Yeah, that 10% to 12% drop-through is probably what you should keep in mind.

Speaker #4: Yeah. Steven, this is Oliver. I'll take that. If I break that sector down within and this is going to build a little bit on what Todd just talked about a second ago.

Yeah Stephen this is David you know as we think through the The Leverage and and and drop through typically we can see maybe a 10 to 12% drop through on Revenue growth. Um but and obviously as we're driving our efficiency uh initiative as we we can see, not only that leverage, but also some drop through of other improvements. But we're also investing in capability. So for example, we've got the next generation of cyber security maturity models we're investing in to help us win new Revenue. Um and so we need to balance what we're doing with the efficiency, whether it's dropping to the bottom line, but or enabling, you know, the next level of Revenue growth. And so we're confident that we're going to we're going to see that Leverage come through and fairly typical to what we've seen before uh and but and we're in a great period of driving efficiency and balancing that with investment. So yeah that 10 to 12% drop. There is probably what you should keep in mind.

Steven Fox: Great. That's very helpful, actually. In terms of the aerospace market, you guys threw a lot at us just now, and I know last quarter you also had a huge amount of wins in that space. Can you give us a little more sense on sort of ranking the drivers here? How much is, you know, just some of these new markets like space really accelerating? How much is, you know, your own market share gains or new wins or new capabilities? It's just there's a lot to unpack there. I was wondering if you could just sorta give us a sense for what's most important.

Speaker #4: Or a minute ago. Within defense and space, we see both the benefit of new program wins as well as end market demand driving the growth there.

Speaker #4: Within commercial aerospace, that's largely just organic growth. And then within commercial aerospace, also note that similar to prior quarters, our message that we really haven't seen a significant pull-through of additional end market demand due to recovery at the primes and how they're doing the production, right, or the OEMs and how they're doing their production.

Great. That's very helpful actually. Um and then in terms of the Aerospace markets, you guys threw a lot at us just now and I know last quarter. You also had a huge amount of wins in that space. Can you can you give us a little more sense on on on sort of ranking the drivers here? How much is? You know just some of these new markets like space uh really accelerating how much is

You know, your own market share, gains, or new wins or new capabilities. It's just there's a lot to unpack there as wondering if you could just sort of um give us a sense of what's most important.

Oliver Mihm: Yeah. Steven, this is Oliver. I'll take that. If I break that sector down within, this is going to build a little bit on what Todd just talked about a second ago, or a minute ago. Within defense and space, we see both the benefit of new program wins as well as end market demand driving the growth there. Within commercial aerospace, that's largely just organic growth. Within commercial aerospace, I'll also note that similar to prior quarters, our message that we really haven't seen a significant pull-through of additional end market demand due to recovery at the primes and how they're doing the production, right? The OEMs and how they're doing their production. We still have upside to bring to bear there as their production rates increase. Does that give you the insight you're looking for?

Speaker #4: So we still have upside to bring to bear there as their production rates increase. Does that give you the insight you're looking for?

Speaker #5: Pretty much. I mean, I just to follow up real quick, the new programs that you won last quarter, I guess, can you talk about how that influences maybe the growth in coming quarters?

Speaker #5: When do we start to see it and whether it's fits within all those buckets like you described or there's something different going on that we should think about as an inflection?

Yeah, Stephen this is Oliver. I'll take that um if I break that sector down within and and this is going to build a little bit. I want Todd just talked about a second ago or a minute ago within dispense and space. We see both the benefits of new program wins as well as and market demand driving the growth there within commercial Aerospace. That's largely just organic growth.

Speaker #4: Yeah, certainly fits within those buckets. And I recognize the answer it depends isn't going to be super helpful, Steven. But let me add some more words there.

Speaker #4: As we look at new program ramps, based on sectors, based on customers, we can get quite a bit of variation in terms of how long that we can hit that revenue rate.

Steven Fox: Pretty much. I mean, I just to follow up real quick, like the new programs that you won last quarter, I guess, can you talk about how that influences maybe the growth in coming quarters? When will we start to see it, and whether it's, you know, fits within all those buckets like you described, or there's something different going on that we should, you know, think about as an inflection?

Um, and I'm within commercial Aerospace, I also note that similar to Prior quarters, our message, that we really haven't seen a significant pull through of additional end market, demand due to recovery at the um the primes and how they're doing the production, right? Or the oems and how they're doing their production. So we still have upside to bring to bear their as their production. Uh, rate increase. Does that give you the insight you're looking for?

Speaker #4: If we're starting from scratch, say it's a new customer win and we've got to ramp up the supply chain, potentially the customer, if they have some end market regulatory work that they got to do, but it's in, say, healthcare life sciences, that can be a six to eight-quarter ramp for us to get into production and start hitting some volumes.

Speaker #4: If we try to note in our comments this morning, if it's an existing customer, an add-on product, or even with an existing customer, if it's a new product, you've got some supply chain work already there.

Oliver Mihm: Yeah. Certainly fits within those buckets. I recognize the answer it depends isn't gonna be super helpful, Steven, but let me add some more words there. As we look at new program ramps based on sectors, based on customers, we can get quite a bit of variation in terms of how long that we can hit that revenue rate. If we're starting from scratch, say it's a new customer win, and we've got to ramp up the supply chain, potentially the customer, they have some end market regulatory work that they gotta do if it's in, say, healthcare life sciences. That can be a 6 to 8-quarter ramp for us to get into production and start hitting some volumes.

Oliver Mihm: Yeah. Certainly fits within those buckets. I recognize the answer it depends isn't gonna be super helpful, Steven, but let me add some more words there. As we look at new program ramps based on sectors, based on customers, we can get quite a bit of variation in terms of how long that we can hit that revenue rate. If we're starting from scratch, say it's a new customer win, and we've got to ramp up the supply chain, potentially the customer, they have some end market regulatory work that they gotta do if it's in, say, healthcare life sciences. That can be a six to eight quarter ramp for us to get into production and start hitting some volumes.

Uh, pretty much. I mean, I just to follow up real quick, like the new programs that you won last quarter. I guess. Can you talk about how that influences maybe the growth in coming quarters? When where do we start to see it and what whether it's you know, fits within all those buckets like you described or there's something different going on that we should you know think about as an inflection.

Speaker #4: And our ability to ramp into production is faster.

Speaker #1: And hey, Steve, it's Shawn. Just to get a bit more acute for you, some of the wins we had in aerospace and defense in our first fiscal quarter, will contribute to the latter part of this fiscal year, capacity is already coming online and so that is a little bit of a help this year, but it's actually a greater contributor to fiscal 2027 and beyond.

Yeah, certainly fits within those buckets and I I recognize the answer, it depends isn't going to be super helpful, Stephen. But um, let me add some more words there. Um, as we look at new program Rams,

Oliver Mihm: If we tried to note in our comments this morning, if it's an existing customer, an add-on product, or, even with an existing customer, if it's a new product, you've got some supply chain work already there, and our ability to ramp into production is faster.

Speaker #1: So a lot of the growth we're seeing right now is based either upon programs or market share gains that we had over the course of the past couple of years.

Speaker #1: And so this sustains the momentum as Todd talked about into 27 and beyond.

Shawn Harrison: Hey, Steve, it's Sean. Just to get a bit more acute for you. Some of the wins we had in aerospace and defense in our Q1 will contribute to the latter part of this fiscal year. You know, capacity is already coming online, and so that, you know, is a little bit of a help this year, but it's actually, a greater contributor to fiscal 2027 and beyond. So a lot of the growth we're seeing right now is based either upon, you know, programs or market share gains that we had over the course of the past couple years. So this sustains the momentum, as Todd talked about, into 2027 and beyond.

Speaker #5: Great. No, that is very helpful. Thank you very much.

Speaker #3: Your next question comes from the line of Anya Soderstrom with Sodati. Anya, your line is open. Please go ahead.

Speaker #6: Hi, and thank you for taking my question and congratulations on the great quarter and guidance and on the retirement path and the appointment, David.

Speaker #6: Looking forward to be working with you. So a lot of my questions have been addressed already, but in terms of just want to check with Malaysia facility.

Speaker #6: You mentioned last quarter that you expected that to break even in terms of margins. In the second quarter, how's that tracking?

For us to get into production and start hitting some volumes. If uh and we we try to note in our comments. This morning, if it's an existing customer an add-on product or, uh, even with an existing customer if it's a new product. You've got some supply chain work already there and our ability to ramp into production, um, is faster. Hey, hey, Steve, it's Sean. Just to get a bit more acute for you. Some of the Winds we had in Aerospace and defense in our first fiscal quarter will contribute to the latter part of this fiscal year, you know, capacity is already coming online. And so that, you know, is a little bit of a health this year, but it's actually uh, a greater contributor to fiscal 2027 and Beyond. Um, so a lot of the growth we're seeing right now is based either upon, you know, programs or market share gains that we had over the course of the past couple of years. And so this sustains the momentum, it's I've talked about um, in the 27 and Beyond

Steven Fox: Great. No, that is very helpful. Thank you very much.

Speaker #4: Yeah, it was a little bit behind break even this past quarter. And the reason being that the revenue has actually ramped faster there. So we're making additional investments early on, but we're still on track to exit the fiscal year with it having strong profitability.

Great. Now that is. That is very helpful. Thank you very much.

Operator: Your next question comes from the line of Anja Soderstrom with Sidoti. Anja, your line is open. Please go ahead.

Your next question comes from the line of Anya soda strum with sedati. Anya, your line is open, please go ahead.

Anja Soderstrom: Hi, thank you for taking my question, and congratulations on the great quarter and guidance and on the retirement path and appointment, David. Looking forward to be working with you. A lot of my questions have been addressed already. In terms of just wanna check with the Malaysia facility. You mentioned last quarter that you expected that to break even in terms of margins in Q2. How's that tracking?

Speaker #6: Okay. Thank you. And then just with the targets that you set for the healthcare and life sciences for the full year and the third quarter, how should we think about the growth there going forward?

Hi. And thank you for taking my question and congratulations on the great quarter and guidance and on the retirement path. And and uh,

And the appointment. David looking forward to be working with you.

Speaker #6: Seems like that's going to be slowing down a bit or coming down.

Speaker #4: Yeah, I would say that we see I talked about the sequential growth we're looking at in Q4. And so I think from a and we also talked about the wins here this quarter.

Oliver Mihm: It was a little bit behind break even this past quarter, and the reason being that the revenue is actually ramping faster there. We're making additional investments early on, but we're still on track to exit the fiscal year with it having strong profitability.

Uh, so a lot of my questions has been addressed already, but in terms of just want to check with the Malaysia, uh, facility. You mentioned last quarter that you expected that to break, even in terms of the margins, in the second quarter house that tracking

Speaker #4: Historical wins from F25, quite strong, which will help to create some sustained growth as we look to F27. So.

Yeah, it was a little bit behind uh, Break Even this past quarter and the reason being that the revenue is actually ramping faster there. So we're making additional Investments early on but we're still on track to exit the fiscal year with it having strong profitability.

Anja Soderstrom: Okay. Thank you. Then just with the targets that you set for the healthcare and life sciences for the full year and the Q3, how should we think about the growth there, going forward? Seems like that's gonna be slowing down a bit or coming down.

Speaker #6: Okay. Thank you. And then just. I'm sorry?

Speaker #4: Does that cover it, Anya, for you?

Speaker #6: Yes, it is. It did. And just one last question on the competitive environment. Have you seen any sort of changes there at all in the?

Okay, thank you and then just with the targets that you set for the healthcare and Life Sciences for the full year and the third quarter. Uh how should we think about the growth there um, going forward?

Seems like that's going to be slowed down a bit, so coming down.

Oliver Mihm: Yeah, I would say that we see, I talked about the sequential growth we're looking at in Q4. We also talked about the wins here this quarter. Historical wins from F'2025 quite strong, which will help to create some sustained growth as we look to F'2027.

Speaker #4: Yeah, I'm reflecting on you. I don't think we've seen any significant changes from a competitive environment. In fact, we have noted that in this past quarter, the number of large opportunities that we've won up had a slight uptick, which we view as positive both for how we're conveying ourselves in the marketplace and our ability to differentiate.

Yeah, I would say that uh, we see uh, I talked about the sequential growth. We're looking at in Q4. And so, I think from a, and we also talked about the winds here. This, this, uh, this quarter, um, historical winds from f25 quite strong which will help to create some sustained growth as we look to f-27

um,

Anja Soderstrom: Okay. Thank you.

Oliver Mihm: Outlook there in a second. Yeah.

Speaker #6: Okay. Thank you. That was all for me.

so okay. Thank you.

Anja Soderstrom: I'm sorry?

Oliver Mihm: Does that cover it, Anja, for you?

Anja Soderstrom: Yes, it is. It did. Just one last question on the competitive environment. Have you seen any sort of changes there at all in the

I'm sorry. Does that cover the Anya for you?

Speaker #3: There are no further questions at this time. I will now turn the call back to Todd Kelsey for closing remarks. Todd? Go ahead.

Yes it is. It did and just 1 last question on on the competitive environment. Have you seen any sort of changes there at all in the

Speaker #4: Yeah. Thank you, Ben. I'd like to thank our shareholders' investors' analysts and our Plexus team members who joined the call this morning. In closing, we're generating significant momentum and I anticipate that fiscal 2026 will be a great year for Plexus and set us up for a strong fiscal 2027.

Oliver Mihm: Anja, I don't think we've seen any significant changes from a competitive environment. In fact, we have noted that in this past quarter, the number of large opportunities that we won had a slight uptick.

um,

Todd Kelsey: Which we view as positive, both for how we're, how we're conveying ourselves in the marketplace and our ability to differentiate.

Speaker #4: So thank you again to our team members, our customers, and our shareholders. Have a great day.

Yeah I'm just I'm reflecting on you. I I don't think we've seen any significant changes from a competitive environment um and and in fact I you know we have noted that in this past quarter, the number of large opportunities that we've on won up was had a slight uptick which we view as positive, both for how our power conveying ourselves in the marketplace and our ability to differentiate

Anja Soderstrom: Okay. Thank you. That was all for me.

Okay, thank you.

Operator: There are no further questions at this time. I will now turn the call back to Todd Kelsey for closing remarks. Todd.

Todd Kelsey: All right. Thank you.

Operator: Please go ahead.

Todd Kelsey: Yeah. Thank you, Ben. I'd like to thank our shareholders, investors, analysts, and our Plexus team members who joined the call this morning. In closing, we're generating significant momentum, and I anticipate that this fiscal 2026 will be a great year for Plexus and set us up for a strong fiscal 2027. Thank you again to our team members, our customers, and our shareholders. Have a great day.

There are no further questions at this time. I will now turn the call back to Todd Kelsey for closing remarks Todd. Go ahead. Yeah,

thank you been um I'd like to thank our shareholders investors analysts and our plexus team members who join the call this morning.

In closing, we're generating significant momentum and I anticipate that fiscal 2026 will be a great year for plexus and set us up for a strong fiscal 2027. So, thank you again to our team members, our customers, and our shareholders, have a great day.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

This concludes today's call, thank you for attending. You may now disconnect

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