With today's earnings call, Todd will provide summary comments before turning the call over to Oliver and Pat for further details. Our consistent strategy and focus on delivering customer success continues to enable share gains and is facilitating our leadership in growth markets. We've seen strong year-over-year revenue growth to begin our fiscal 2026 as we ramp programs across all of our market sectors. As a result, Plexus now has the potential to meet or exceed the high end of our 9%-12% revenue growth goal for fiscal 2026.
In addition, we see significant opportunities to sustain our revenue growth momentum. We will continue to deploy all excess cash to create additional shareholder value. Revenue of $1.07 billion met the midpoint of our guidance range as we delivered our fourth consecutive quarter of sequential growth, representing a robust 10% increase year-over-year. A significant expansion in our healthcare life sciences and aerospace and defense market sectors associated with multiple program ramps and stronger than anticipated demand from semi-cap and energy drove our performance.
For the fiscal first quarter, we secured 22 new manufacturing programs worth $283 million in annualized revenue when fully ramped into production. Included in these wins was a record quarterly performance from our aerospace and defense market sector estimated at $220 million in annualized revenue. Finally, I would note we continue to see significant opportunities to drive market share gain and sustained revenue growth from our aerospace and defense market sector. For our fiscal second quarter, we are guiding revenue of $1.11-$1.15 billion, representing 6% sequential and 15% year-over-year revenue growth at the midpoint.
| Metric | Period | Current guidance |
|---|---|---|
| Revenue | Fiscal Q2 2026 | $1.11 billion - $1.15 billion (6% sequential and 15% year-over-year growth at midpoint) |
| Non-GAAP operating margin | Fiscal Q2 2026 | 5.6% - 6.0% |
| Non-GAAP EPS | Fiscal Q2 2026 | $1.80 - $1.95 |
| Gross margin | Fiscal Q2 2026 | 9.9% - 10.2% (slightly above last quarter at midpoint) |
| Selling and administrative expense | Fiscal Q2 2026 | $54 million - $55 million (higher on seasonal and variable incentive compensation) |
| Cash cycle days | Fiscal Q2 2026 | 65 - 69 days (two-day improvement at midpoint) |
| Effective tax rate | Fiscal Q2 2026 and fiscal 2026 | 16% - 18% |
| Capital spending | Fiscal 2026 | $100 million - $120 million (slightly higher than previous estimate) |
| Free cash flow | Fiscal 2026 | approximately $100 million (reconfirmed) |
| Revenue growth | Fiscal 2026 | potential to meet or exceed the high end of 9%-12% goal (raised) |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +10% | Expansion in healthcare life sciences and aerospace and defense from multiple program ramps plus stronger than anticipated semi-cap and energy demand. |
| Aerospace and Defense revenue | — | Up 3% sequentially, slightly below mid-single-digit expectation, due to customer end-of-year inventory management. |
| Healthcare Life Sciences revenue | — | Up 10% sequentially, aligned to high-single to low-double-digit expectation, from program ramps. |
| Industrial revenue | — | Declined 8% sequentially, in line with forecast, from seasonality and muted near-term demand. |
| Gross margin | — | 9.9%, consistent with guidance and prior quarter, with a slight headwind from the new Malaysia facility (under 10 basis points). |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Fiscal 2026 revenue growth | accelerating toward 9%-12% goal | potential to meet or exceed the high end of 9%-12%, reflecting positive momentum and stronger end-market demand | Improving |
| Semi-cap demand | low double-digit growth on share gains | major changes in the market with early-stage demand improvement starting about a month ago; outlook is well into double digits | Improving |
| Commercial aerospace (Boeing/Airbus) | no Boeing/Airbus recovery assumed | still not seeing full Boeing pull-through; Boeing/Airbus production rate increases not in the outlook, representing potential upside | Flat, potential upside |
| Component lead times / supply chain | tightening beginning | lead times ticking up in semiconductors and APAC printed circuit boards; pre-positioning inventory and extending PO coverage, better positioned than the post-COVID era | Tightening |
| Malaysia and Thailand facilities | Malaysia startup drag | Malaysia near break-even in Q2 and approaching corporate average in the back half; Thailand expected to add ~25-30 basis points to overall margins | Improving |
| Automation and AI initiatives | warehouse automation and SMT line consolidation | AutoStore and material robots deploying to all sites by spring 2026 (~1.5-2 FTEs each, sub-12-month ROI), AI/ML for work orders, standard work times, and quoting; over 30% daily AI tool usage by staff | Expanding |