What happened
Shares of Flex (FLEX 4.10%) have jumped today, up by 7% as of 1:15 p.m. EDT, after the company reported fiscal fourth-quarter earnings. The contract manufacturer beat expectations for the bottom line.
So what
Revenue in the fiscal fourth quarter came in at $5.5 billion, mostly on target with the consensus estimate. That resulted in adjusted earnings per share of $0.28, beating Wall Street's forecast of $0.24 per share in adjusted profit. The contract manufacturer for tech companies acknowledged that the COVID-19 pandemic adversely impacted results during the quarter due to supply chain and demand disruptions.
Flex assembles Apple's Mac Pro in Texas. Image source: Apple.
"We are pleased with our fourth quarter results despite the negative impact from the COVID-19 pandemic," CEO Revathi Advaithi said in a statement. "Our Fiscal 2020 results demonstrate our progress on shifting our portfolio, operating with disciplined execution, managing our costs, focusing on generating free cash flow, and being prudent with our capital."
Now what
Flex is not providing guidance for the next quarter or fiscal year due to "the lack of visibility as to the duration and potential outcomes of the pandemic," which is having a "material impact" on the company's "workforce and operations."
Flex is taking various steps to respond to the public health crisis, including enforcing strict sanitation policies, reducing component shortages, cutting salaries and furloughing employees, and suspending capital expenditures for non-critical investments, as well as temporarily suspending share repurchases.
"We began the quarter with strong liquidity and acted quickly to further improve our financial position in this uncertain environment," said CFO Chris Collier. "Our actions put us on good footing to meet the demands of operating our business through this downturn."
