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What changed in FLEX LTD.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of FLEX LTD.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+416 added−446 removedSource: 10-K (2025-05-21) vs 10-K (2024-05-17)

Top changes in FLEX LTD.'s 2025 10-K

416 paragraphs added · 446 removed · 326 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

65 edited+20 added−37 removed33 unchanged
Biggest changeWe believe our key competitive advantages are our people, processes, and capabilities for making products, systems, and solutions for customers: • Time to market advantage : Our deep vertical and cross-industry expertise, unique set of full product lifecycle capabilities, and global and regional presence accelerate the production of complex products for increasingly interconnected markets and provide customers with a time to market advantage. • End-to-end specialized services : Our full range of services help customers optimize and streamline the product lifecycle and seamlessly design, build, deliver, and manage products at scale with increased quality, productivity and speed. • Global and regional scale : Flex’s physical infrastructure includes approximately 100 facilities in approximately 30 countries, staffed by approximately 148,000 employees, providing customers with truly global scale and strategic geographic distribution capabilities to meet their market needs.
Biggest changeFlex's physical infrastructure includes approximately 100 facilities in approximately 30 countries, staffed by approximately 148,000 employees, providing customers with truly global scale and strategic geographic distribution capabilities to meet their market needs.
Our post-sale services include returns management, spare parts logistics, asset recovery, repair, refurbishment, warranty services, recycling and e-waste management. We service multiple product lines such as consumer and midrange products, printers, smart phones, audio devices, consumer medical devices, notebook personal computers, floorcare products, and highly complex infrastructure products. Portfolio of Power Products .
Our post-sale services include returns management, spare parts logistics, asset recovery, repair, refurbishment, warranty services, recycling and e-waste management. We service multiple product lines such as consumer and midrange products, printers, smart phones, audio devices, consumer medical devices, notebook personal computers, floorcare products, and highly complex infrastructure products. Portfolio of Power and Cooling Products .
Additionally, we could be required to alter our operations in order to comply with any new standards or requirements under environmental laws or regulations. There can be no assurance that additional environmental matters will not arise in the future or that costs will not be incurred with respect to sites as to which no issue is currently known.
Additionally, we could be required to alter our operations in order to comply with any new standards or requirements under these laws or regulations. There can be no assurance that additional environmental matters will not arise in the future or that costs will not be incurred with respect to sites as to which no issue is currently known.
We believe our global scale and regional capabilities are a significant competitive advantage, as customers increasingly require a broad range of product lifecycle services globally. Increasingly, customers are evaluating regional-based supply chains to enhance resiliency and to take advantage of time to market and specific customization required to win in those markets.
Global Scale and Regional Strength . We believe our global scale and regional capabilities are a significant competitive advantage, as customers increasingly require a broad range of product lifecycle services globally. Increasingly, customers are evaluating regional-based supply chains to enhance resiliency and to take advantage of time to market and specific customization required to win in those markets.
We make available, free of charge, through our Internet website the Company's annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission (“SEC”).
We make available, free of charge, through our Internet website the Company's annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC").
In support of cultivating an inclusive, high-performing culture with our workforce, we continue to proliferate our Ways of Working, four specific behaviors that bring our values to life through actions, provide a framework for how we make decisions, and support ongoing progress on our Flex Forward strategy.
In support of cultivating a high-performing culture with our workforce, we continue to proliferate our Ways of Working, four specific behaviors that bring our values to life through actions, provide a framework for how we make decisions, and support ongoing progress on our Flex Forward strategy.
Long-Standing, Diverse Customer Relationships . We believe our long-term relationships with key customers are the result of our track record of meeting commitments and delivering value that increases customers' competitiveness. We serve a wide range of customers a cross six reporting units within the FAS and FRS segments.
Long-Standing, Diverse Customer Relationships . We believe our long-term relationships with key customers are the result of our track record of meeting commitments and delivering value that increases customers' competitiveness. We serve a wide range of customers across six reporting units within the FAS and FRS segments.
Our manufacturing operations and systems assembly generate the majority of our revenues and include printed circuit board assembly and assembly of systems and subsystems that incorporate printed circuit boards and complex electromechanical components. We assemble electronic products with custom electronic enclosures on either a build-to-order or configure-to-order basis.
Our manufacturing operations and systems assembly generate the majority of our revenues and include PCBA and assembly of systems and subsystems that incorporate printed circuit boards and complex electromechanical components. We assemble electronic products with custom electronic enclosures on either a build-to-order or configure-to-order basis.
We have established global scale through an extensive network of manufacturing operations and services sites in the world's major consumer and enterprise products markets (Asia, the Americas, and Europe) to serve the supply chain needs of both multinational and regional companies.
We have established global scale through an extensive network of manufacturing operations and services sites in the world's major products markets (Asia, the Americas, and Europe) to serve the supply chain needs of both multinational and regional companies.
The Flex Social and Environmental framework is based upon the principles, policies and standards prescribed by the RBA, a worldwide association of electronics companies committed to promoting an industry code of conduct to improve working and environmental, health and safety conditions, as well as other relevant international standards (e.g., ISO 14001, United Nations Guiding Principles on Business and Human Rights).
Our framework is based upon the principles, policies and standards prescribed by the RBA, a worldwide association of electronics companies committed to promoting an industry code of conduct to improve working and environmental, health and safety conditions, as well as other relevant international standards (e.g., ISO 14001, United Nations Guiding Principles on Business and Human Rights).
Some of the specific goals for which we measure our performance include increasing employee development, social and environmental management system audits, human rights policy training completion, Responsible Business Alliance ("RBA") compliance for rest day requirements and decreasing safety incident rates.
Some of the specific goals for which we measure our performance include increasing employee development, social and environmental management system audits, human rights policy training completion, Responsible Business Alliance ("RBA") compliance for rest day requirements and decreasing safety incident rates. Talent Attraction, Development, and Retention .
Through our component services, we provide manufacturing, customization, procurement, global logistics services and innovative supply chain solutions on a wide range of electronic components by utilizing the Flex global procurement and supply chain ecosystem to increase resiliency. Manufacturing Services .
Through our component services, we provide manufacturing, 5 Table of Contents customization, procurement, global logistics services and innovative supply chain solutions on a wide range of electronic components by utilizing the Flex global procurement and supply chain ecosystem to increase resiliency. Manufacturing Services .
We believe the principal competitive factors in the contract manufacturing services market are quality and range of services; design and technological capabilities; cost; location of sites; sustainability; and responsiveness and flexibility. We believe we are extremely competitive with regard to all of these factors.
We believe the principal competitive factors in the contract manufacturing services market are quality and range of services; design and technological capabilities; cost; location of sites; supply chain resiliency; sustainability; and responsiveness and flexibility. We believe we are extremely competitive with regard to all of these factors.
We leverage both formal and informal programs, including in-person, virtual, social and self-directed learning, mentoring, coaching, and external development to identify, foster, and retain top talent. Employees have access to courses through our learning and development platform, Flex Learn. In 2023, our employees completed more than six million hours of training programs.
We leverage both formal and informal programs, including in-person, virtual, social and self-directed learning, mentoring, coaching, and external development to identify, foster, and retain top talent. Employees have access to courses through our learning and development platform, Flex Learn. In 2024, our employees completed more than five million hours of training programs.
No customer accounts for more than 10% of our annual revenue and the ten largest accounted for 37% of our net sales in fiscal year 2024. Cross-Industry Synergies. One of our competitive strengths is our ability to leverage technology from one industry and apply it to a different application within another industry.
No customer accounts for more than 10% of our annual revenue and the ten largest accounted for 44% of our net sales in fiscal year 2025. Cross-Industry Synergies. One of our competitive strengths is our ability to leverage technology from one industry and apply it to a different application within another industry.
We offer one of the most trusted and resilient global supply chain services through a combination of digital supply chain capabilities, deep expertise, real time visibility and analytics, and collaborative supplier relationships to 5 Table of Content s help customers navigate complex, global supply chains.
We offer one of the most trusted and resilient global supply chain services through a combination of digital supply chain capabilities, deep expertise, real time visibility and analytics, and collaborative supplier relationships to help customers navigate complex, global supply chains.
We promote a “zero-injury” culture through health and safety management systems, some of which are certified ISO 45001:2018, that implement a data-driven and risk-based approach in monitoring and reporting performance regularly.
We promote a "zero-injury" culture through health and safety management systems, some of which are certified ISO 45001:2018, that implement a data-driven and risk-based approach in monitoring and reporting performance regularly.
We have a very balanced global manufacturing footprint with 40% of net sales in North America, 19% in China, 21% in Europe, the Middle East and Africa ("EMEA"), and 20% in other areas in our fiscal year ended March 31, 2024 (with net sales attributable to the country in which the product is manufactured, or service is provided).
We have a very balanced global manufacturing footprint with 43% of net sales in North America, 17% in China, 21% in Europe, the Middle East and Africa ("EMEA"), and 19% in other areas in our fiscal year ended March 31, 2025 (with net sales attributable to the country in which the product is manufactured, or service is provided).
At data center facilities, Anord Mardix, a Flex company, offers a broad array of critical power capabilities including building information modelling and pre-fabricated construction and turnkey installation of switchgear, busway, power distribution and modular power systems, along with monitoring solutions and services.
At data center facilities, Anord Mardix, a Flex company, offers a broad array of critical power capabilities including building information modelling and prefabricated construction and turnkey installation of switchgear, busway, power distribution and modular power pods, along with monitoring solutions and services.
Our market-focused approach to managing our business increases customers' competitiveness by leveraging our deep vertical and cross-industry expertise, as well as global scale, regional presence, and agility to respond to changes in market dynamics. Operations .
Our market-focused approach to managing our business increases 4 Table of Contents customers' competitiveness by leveraging our deep vertical and cross-industry expertise, as well as global scale, regional presence, and agility to respond to changes in market dynamics. Operations and People .
Our leadership uses the results of the survey to continue developing our strengths and identify and take action on opportunities for improvement. This year 93% of employees completed the Flex Voice survey and the results reflected continued engagement. Compensation and Benefits . Our total rewards are designed to attract, motivate and retain employees.
Our leadership uses the results of the survey to continue developing our strengths and identify and take action on opportunities for improvement. In fiscal year 2025, 92% of employees completed the Flex Voice survey and the results reflected continued engagement. Compensation and Benefits . Our total rewards are designed to attract, motivate and retain employees.
The historical financial results and financial position of our former Nextracker business, which was previously reported as a separate operating and reportable segment, are presented as discontinued operations in the consolidated statements of operations and balance sheets for all periods presented.
The historical financial results and financial position of our former Nextracker business, which was previously reported as a separate operating and reportable segment, are presented as discontinued operations in the consolidated statements of operations.
We are also focused on completing talent and performance reviews. Our in-depth talent reviews serve to identify high potential talent to advance in roles with greater responsibility, assess learning and development needs, and establish and refresh succession plans for critical leadership roles across the enterprise.
We are also focused on completing talent and performance reviews. Our in-depth talent reviews serve to identify high potential talent to advance in roles with greater responsibility, assess learning and development needs, and establish and refresh succession plans for critical leadership roles across the enterprise. Our Ways of Working are integrated into our talent assessment and performance assessment processes.
Through our 2030 goals, we are committed to reducing our environmental impact, advancing a safe, inclusive and respectful work environment for our employees, investing in our communities, partnering with our customers and suppliers to help mitigate value chain emissions, and driving sustainability-focused practices with transparency.
Through our 2030 goals, we are committed to reducing our environmental impact, investing in our communities, advancing a safe, and respectful work environment for all, partnering with our customers and suppliers to help mitigate value chain emissions, and driving ethical practices with strong transparency.
Several goals of note include cutting operational emissions in half, collaborating with customers and suppliers to reduce value chain emissions, increasing gender representation at the director-level and above, providing access to mental health and well-being services to all employees, and maintaining top quartile performance for governance and transparency.
Several goals of note include cutting operational emissions in half, collaborating with customers and suppliers to reduce value chain emissions, providing access to mental health and well-being services to all employees, and maintaining top quartile performance for governance and transparency.
Our embedded power capabilities span power shelves, battery back-up units, capacitive energy storage systems featuring battery management systems using lithium-ion batteries, and DC/DC converters, helping customers address board and rack power density requirements.
Our embedded power capabilities span power shelves, battery back-up units, capacitive energy storage systems, and DC/DC converters, helping customers address board and rack power density requirements.
RoHS and other similar legislation ban or restrict the use of lead, mercury and certain other specified substances in electronics products and WEEE requires European Union ("EU") importers and/or producers to assume responsibility for the collection, recycling and management of waste electronic products and components.
Restrictions on Hazardous Substances ("RoHS") 2011/65/EU and other similar legislation ban or restrict the use of lead, mercury and certain other specified substances in electronics products and Waste Electrical and Electronic Equipment ("WEEE") 2012/19/EU directives requires European Union ("EU") importers and/or producers to assume responsibility for the collection, recycling and management of waste electronic products and components.
ITEM 1. BUSINESS OVERVIEW Flex is the advanced, end-to-end manufacturing partner of choice that helps market-leading brands design, build, deliver and manage innovative products that improve the world.
ITEM 1. BUSINESS OVERVIEW Flex is the advanced, end-to-end manufacturing partner of choice that helps a diverse customer base design, build, deliver and manage innovative products that improve the world.
We determine the amount of our accruals for environmental matters by analyzing and estimating the probability of occurrence and the reasonable possibility of incurring costs in light of information currently available. Compliance with environmental laws and regulations, including those concerning climate change and other sustainability-related matters, requires continuing management efforts by the Company.
We determine the amount of our accruals for environmental matters by analyzing and estimating the probability of occurrence and the reasonable possibility of incurring costs in light of information currently available. 9 Table of Contents Compliance with laws and regulations, requires continuing management efforts by the Company.
Industrial Parks; Cost-Efficient Manufacturing Services. We have developed self-contained industrial parks that co-locate manufacturing and logistics operations with our suppliers in various cost-efficient locations. We offer a range of manufacturing services and capabilities in close proximity to vertically integrate the manufacturing process and offer additional value to our customers.
We have developed self-contained industrial parks that co-locate manufacturing and logistics operations with our suppliers in various cost-efficient locations. We offer a range of manufacturing services and capabilities in close proximity to vertically integrate the manufacturing process and offer additional value to our customers. These sites enhance supply chain management efficiency, while providing multi-technology solution value for customers.
As of March 31, 2024, our global workforce totaled approximately 148,000 employees including our contractor workforce. In certain international locations, our employees are represented by labor unions and by work councils. Region: Number of Employees Americas 58,251 Asia 60,091 Europe 29,773 Total 148,115 Well-being, Health, and Safety . Flex is committed to providing a safe and injury-free workplace.
As of March 31, 2025, our global workforce totaled approximately 148,000 employees including our contractor workforce. In certain international locations, our employees are represented by labor unions and by work councils. Region: Number of Employees Americas 59,786 Asia 59,754 Europe 28,439 Total 147,979 Well-being, Health, and Safety . Flex is committed to providing a safe and injury-free workplace.
In addition, the Company produced its first Task force on Climate-related Financial Disclosures (TCFD) report in 2022. More detailed information can be found in the Flex annual sustainability report located at https://flex.com/company/our-sustainability. The information in the sustainability report and on our sustainability webpage is not a part of this Annual Report on Form 10-K and is not incorporated by reference.
More detailed information can be found in the Flex annual sustainability report located at https://flex.com/company/our-sustainability. The information in the sustainability report and on our sustainability webpage is not a part of this Annual Report on Form 10-K and is not incorporated by reference.
We have implemented appropriate policies and procedures (including both technological means and training programs for our employees) to identify and protect our intellectual property, as well as that of our customers and suppliers.
We have implemented appropriate policies and procedures (including both technological means and training programs for our employees) to identify and protect our intellectual property, as well as that of our customers and suppliers. As of March 31, 2025, and 2024, the carrying value of our intellectual property was not material.
Examples include our expertise in power and compute technology. For example, we leverage our experience in data center servers to support next-generation mobility applications in automotive. Our expertise in power applications is helping customers across applications in our Industrial, Automotive, and CEC customers. These cross-industry synergies give our customers access to technology they would not otherwise have.
Examples include our expertise in power and compute technology. For example, we leverage our experience in the data center to support power and compute applications in automotive. These cross-industry synergies give our customers access to technology they would not otherwise have. Industrial Parks; Cost-Efficient Manufacturing Services.
The Compensation and People Committee of our Board of Directors is responsible for assisting the Board in oversight of our human capital management, including among other aspects, receiving periodic updates (not less than twice annually) regarding, and overseeing any significant change to our human capital management strategy including, corporate culture, diversity and inclusion, pay and opportunity equity, social initiatives and results, talent attraction training, development and retention programs.
The Compensation and People Committee of our Board of Directors is responsible for assisting the Board in oversight of our human capital management, including among other aspects, receiving 8 Table of Contents periodic updates regarding, and overseeing any significant change to our human capital management strategy including, corporate culture, compensation policies and practices, and talent attraction training, development and retention programs.
Our global expertise, footprint and diverse supply chain network provide customers with the ability to quickly adjust to changing regional, trade and manufacturing dynamics.
Our global expertise, footprint and diverse supply chain network provide customers with the ability to quickly adjust to changing regional, trade and manufacturing dynamics, including as a result of recent changes in tariffs and retaliatory tariffs.
On January 2, 2024, the Company completed its previously announced spin-off of its remaining interests in Nextracker (the "Spin-off") to Flex shareholders on a pro-rata basis based on the number ordinary shares of Flex held by each shareholder of Flex (the “Distribution”) as of December 29, 2023, which was the record date of the Distribution, pursuant to the Agreement and Plan of Merger, dated as of February 7, 2023.
("Nextracker") to Flex shareholders on a pro-rata basis based on the number ordinary shares of Flex held by each 3 Table of Contents shareholder of Flex (the "Distribution") as of December 29, 2023, which was the record date of the Distribution, pursuant to the Agreement and Plan of Merger, dated as of February 7, 2023.
Businesses are being held to a much higher standard for how and where their products are sourced and produced, and, increasingly, how they are serviced and disposed. These complexities are making it harder for companies to manage their own supply chains, manufacturing operations and products. They are looking for trusted partners to help them navigate this complex environment.
With sustainability as a continued area of focus, businesses are being held to a much higher standard for how and where their products are sourced and produced, and, increasingly, how they are serviced and disposed. These complexities are making it harder for companies to manage their own supply chains, manufacturing operations and products.
We offer an industry-leading, differentiated product portfolio of embedded and critical power solutions to help data center customers meet increasing power demands given the proliferation of Generative AI.
We offer an industry-leading, differentiated product portfolio of power and cooling products that tackle all power and data center heat challenges across compute densities. Our embedded and critical power products help data center customers meet increasing power demands given the proliferation of Generative AI.
ENVIRONMENTAL RISKS AND CLIMATE CHANGE Our operations, including past and present business operations as well as past and present ownership of real property, are subject to extensive and changing federal, state, local and international environmental, health and safety laws and regulations, concerning, among other things, the health and safety of our employees, the generation, use, storage, transportation, discharge and disposal of certain materials (including chemicals and hazardous materials) used in or derived from our operations, emissions or discharge of substances including pollutants into the air and water, and the investigation and remediation of contaminated sites.
ENVIRONMENTAL RISKS AND CLIMATE CHANGE We are subject to a variety of extensive and changing federal, state, local and international environmental, health and safety, product safety and stewardship, and producer responsibility laws and regulations, including those concerning, among other things, the health and safety of our employees, the generation, use, storage, transportation, discharge and disposal of certain materials (including chemicals and hazardous materials) used in or derived from our operations, the investigation and remediation of contaminated sites, and climate change and other sustainability-related matters.
In addition, we provide design and engineering services to our customers and also design and make our own products. As a consequence of these activities, our customers are sometimes requiring us to take responsibility for intellectual property to a greater extent than in our manufacturing and assembly businesses.
As a consequence of these activities, our customers sometimes require us to take responsibility for intellectual property to a greater extent than in our manufacturing and assembly businesses.
As described above, we are committed to maintaining compliance with sustainability-related laws applicable to our operations, products, and services. We do not believe that costs of compliance with these environmental laws and regulations will have a material adverse effect on our capital expenditures, operating results, or competitive position.
We have implemented processes and procedures aimed to ensure that our operations comply with all applicable laws and regulations. We do not believe that costs of compliance with these laws and regulations will have a material adverse effect on our capital expenditures, operating results, or competitive position.
Flex provides differentiated offerings and specialized capabilities in emerging technologies from edge AI and connectivity to sensors integration for specific industries and markets. The Company’s design and engineering services help customers de-risk technology adoption, develop products from concept to volume production and go to market in a rapid, cost effective and low risk manner.
The Company’s design and engineering services help customers de-risk technology adoption, develop products from concept to volume production and go to market in a rapid, cost effective and low risk manner.
We endeavor for our values-driven culture to align us as we pursue our purpose, uphold our mission, live our values, advance toward our vision, and activate our strategy.
HUMAN CAPITAL MANAGEMENT Culture underlies our stakeholder experience. Our values are intended to reflect and guide our behaviors and shape our culture. We endeavor for our values-driven culture to align us as we pursue our purpose, uphold our mission, live our values, advance toward our vision, and execute our strategy.
As of March 31, 2024, and 2023, the carrying value of our intellectual property was not material. 11 Table of Content s Although we believe that our intellectual property assets and licenses are sufficient for the operation of our business as we currently conduct it, from time to time third parties assert patent infringement claims against us or our customers.
Although we believe that our intellectual property assets and licenses are sufficient for the operation of our business as we currently conduct it, from time to time third parties assert patent infringement claims against us or our customers. In addition, we provide design and engineering services to our customers and also design and make our own products.
Through the collective strength of a global workforce across approximately 30 countries with responsible, sustainable operations, Flex supports our customers' entire product lifecycle with a broad array of services in every major region. The Company's full suite of specialized capabilities includes design and engineering, supply chain, manufacturing, post-production and post-sale services.
Through the collective strength of a global workforce across approximately 30 countries with responsible, sustainable operations, Flex delivers technology innovation, supply chain, and manufacturing solutions to diverse industries and end markets. The Company's full suite of specialized capabilities includes design and engineering, supply chain, manufacturing, post-production and post-sale services, and proprietary products.
The historical statements of comprehensive income and cash flows and the balances related to stockholders’ equity have not been revised to reflect the effect of the Spin-off.
The historical statements of comprehensive income and cash flows and the balances related to stockholders’ equity have not been revised to reflect the effect of the Nextracker spin-off. See note 7 "Discontinued Operations" to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further information.
We continue to invest in maintaining a leadership position in our world-class manufacturing services and capabilities including automation, simulation tools, digitizing our factories, and implementing leading edge advanced manufacturing methodologies.
We continue to invest in maintaining a leadership position in our world-class manufacturing services and capabilities including automation, simulation tools, digitizing our factories, and implementing leading edge advanced manufacturing methodologies. We leverage our broad set of capabilities globally to provide a competitive advantage by minimizing logistics costs, manufacturing costs, and cycle times while increasing flexibility, responsiveness, and supply chain resiliency.
We focus on delivering distinctive products and services in a cost-effective manner with fast time to market. We are highly collaborative and leverage our global system and processes to operate with speed and responsiveness to provide customers reliable and responsible solutions throughout the product lifecycle. Markets .
We are highly collaborative and leverage our global system and processes to operate with speed and responsiveness to provide customers reliable and responsible solutions throughout the product lifecycle. Markets . We focus on companies that are leaders in their industry and value our superior capabilities in design and engineering, supply chain, manufacturing, post-production and post-sale services.
We have a focused strategy on delivering value to customers through a comprehensive suite of product lifecycle capabilities, global and regional footprint, and vertical and cross-industry expertise. 6 Table of Content s Global Scale and Regional Strength .
We strive to maintain the efficiency and flexibility of the organization, with repeatable execution that adapts to macro-economic changes to provide clear value to customers, while increasing their competitiveness. We have a focused strategy on delivering value to customers 6 Table of Contents through a comprehensive suite of product lifecycle capabilities, global and regional footprint, and vertical and cross-industry expertise.
("Nextracker"), formerly our subsidiary and Nextracker segment, in the fourth quarter of fiscal year 2024, Flex now reports its financial performance based on two operating and reportable segments as follows: • Flex Agility Solutions ("FAS"), which is comprised of the following end markets: ◦ Communications, Enterprise and Cloud ("CEC") , including data infrastructure, edge infrastructure and communications infrastructure ◦ Lifestyle , including appliances, consumer packaging, floorcare, micro mobility and audio ◦ Consumer Devices , including mobile and high velocity consumer devices. • Flex Reliability Solutions ("FRS"), which is comprised of the following end markets: ◦ Automotive , including next generation mobility, autonomous, connectivity, electrification, and smart technologies ◦ Health Solutions , including medical devices, medical equipment, and drug delivery ◦ Industrial , including capital equipment, industrial devices, embedded and critical power offerings, and renewables and grid edge.
As of March 31, 2025, Flex's two operating and reportable segments were as follows: • Flex Agility Solutions ("FAS"), which is comprised of the following end markets: ◦ Communications, Enterprise and Cloud ("CEC") , including data center, edge, and communications infrastructure ◦ Lifestyle , including appliances, floorcare, smart living, Heating, Ventilation and Air-Conditioning ("HVAC"), and power tools ◦ Consumer Devices , including mobile and high velocity consumer devices. • Flex Reliability Solutions ("FRS"), which is comprised of the following end markets: ◦ Industrial , including industrial devices, capital equipment, renewables, critical power, and embedded power. ◦ Automotive , including compute platforms, power electronics, motion, and interface ◦ Health Solutions , including medical devices, medical equipment, and drug delivery In fiscal year 2025, Flex formally introduced the next phase in its strategic evolution, its EMS + Products + Services approach.
We leverage our broad set of capabilities globally to provide a competitive advantage by minimizing logistics costs, manufacturing costs, and cycle times while increasing flexibility and responsiveness. 4 Table of Content s SERVICE OFFERINGS Flex provides design and engineering, supply chain, manufacturing, post-production and post-sale services through a network of approximately 100 locations in approximately 30 countries across four continents.
SERVICE OFFERINGS Flex provides design and engineering, supply chain, manufacturing, post-production and post-sale services through a network of approximately 100 locations in approximately 30 countries across four continents. Beyond our core advanced manufacturing and supply chain capabilities, we maximize value to our customers through proprietary products and value-added services.
The FRS segment is optimized for longer product lifecycles requiring complex ramps with specialized production models and critical environments. Our customers include many of the world's leading technology, healthcare, automotive, and industrial companies. We are focused on establishing long-term relationships with our customers and have been successful in expanding relationships to incorporate additional product lines and services.
The FAS segment is optimized for speed to market, based on a highly flexible supply and manufacturing system. The FRS segment is optimized for longer product lifecycles requiring complex ramps with specialized production models and critical environments. Our customers include many of the world's leading data center, consumer products, healthcare, automotive, consumer products and industrial companies.
For more than 20 years, sustainability has been integrated into the fabric of our company, a key area of differentiation for Flex.
SUSTAINABILITY At Flex, our sustainability journey began in 2002 with the creation of the Flex Foundation. For more than 20 years, sustainability has been integrated into the fabric of our company, a key area of differentiation for Flex. We've continued to progress against our 2030 sustainability strategy and commitments, our most ambitious to date.
We believe that only a few outsourcing providers have the right capabilities and scale to meet these challenges effectively and profitably. Flex is one of these partners. STRATEGY Flex helps its customers responsibly design, build, deliver and manage products that create value and improve people’s lives.
They are looking for trusted partners to help them navigate this complex environment. We believe that only a few outsourcing providers have the right capabilities and scale to meet these challenges effectively and profitably. Flex is one of these partners.
Flex partners with customers across a diverse set of industries including cloud, communications, enterprise, automotive, industrial, consumer devices, lifestyle, healthcare, and energy. As of March 31, 2024, as a result of the Spin-off (defined below) of Nextracker Inc.
Flex partners with customers across a diverse set of industries including data center, communications, enterprise, consumer, automotive, industrial, healthcare, industrial and power.
We focus on companies that are leaders in their industry and value our superior capabilities in design and engineering, supply chain, manufacturing, post-production and post-sale services. Flex focuses on high-growth industries and markets where we have distinctive competence and a compelling value proposition. Examples include investments in specific technologies and industries such as automotive, cloud, healthcare, industrial, and energy.
We focus on high-growth industries and markets where we have distinctive competence and a compelling value proposition. In addition to our end-to-end services and power products for the data center, examples include investments in specific technologies and capabilities for automotive, healthcare, industrial, and consumer-related markets.
The performance and the talent reviews enable ongoing assessments, reviews, and mentoring to identify career development and learning opportunities for our employees. As a part of our efforts to improve employee experiences at Flex, we conduct the annual enterprise-wide employee engagement Flex Voice survey.
Our performance assessment process promotes transparent communication of team member performance, which we believe is a key factor in our success. The performance and the talent reviews enable ongoing assessments, reviews, and mentoring to identify career development and learning opportunities for our employees. Employee Engagement.
We believe that the performance of our Company is impacted by our human capital management, and as a result we consistently work to attract, select, develop, engage and retain strong, diverse talent. Our policies, philosophy and strategies support the inclusion of all people in our working environment.
We believe that the performance of our Company is impacted by our human capital management, and as a result we consistently work to attract, select, develop, engage and retain strong talent. 7 Table of Contents Our purpose, vision, mission and value statements aim to cultivate a high-performing culture where employees are empowered and given opportunities to reach their full potential.
Flex is committed to transparency in sustainability reporting. Since 2013, the Company has adhered to the Global Reporting Initiative framework and has published an annual sustainability report.
Since 2013, the Company has adhered to the Global Reporting Initiative framework and has published an annual sustainability report. The Company also aligned its sustainability report to the Sustainability Accounting Standards Board framework. In addition, the Company produced its first Task Force on Climate-related Financial Disclosures (TCFD) report in 2022.
Flex’s strategy is to continue investing in areas where we can differentiate and add value, whether through product lifecycle capabilities, manufacturing and product technologies or developing differentiated processes and business methods.
We are actively investing in areas that strengthen our competitive positioning, whether through advanced product lifecycle capabilities, cutting-edge manufacturing and product technologies, or innovative processes and business methods.
We have focused on attracting the best engineering, functional and operational leaders and are focused on developing the future leaders of the Company. Customer Focus . We believe that building strong partnerships with our customers and delivering on our commitments strengthens trust and customer retention.
We are committed to investing in our employees and communities. Customer Focus . We believe that building strong partnerships with our customers and delivering on our commitments strengthens trust and customer retention. We focus on delivering distinctive products and services in a cost-effective manner with fast time to market.
Additionally, rising global uncertainty over the past few years including trade and tariff issues, increasing geopolitical unrest, and severe labor shortages are creating further complexity. Companies are rethinking their entire production strategies. We are seeing a global rebalancing in sourcing and production locations to maximize resiliency and decrease time to market. Sustainability is no longer an afterthought.
Additionally, Flex is continuously building toward a vision of the future of manufacturing through strategic investments and implementations that drive increasing optimization and productivity for us and our customers. Additionally, rising global uncertainty over the past few years including trade and tariff issues, increasing geopolitical unrest, and severe labor shortages are creating further complexity.
In fiscal year 2024, our ten largest customers accounted for approximately 37% of net sales. No customer accounted for greater than 10% of the Company's net sales in fiscal year 2024. Flex believes that growth in the contract manufacturing services industry will continue to be driven by increased complexities in products, markets, and sustainability requirements.
We are focused on establishing long-term relationships with our customers and have been successful in expanding relationships to incorporate additional product lines and services. In fiscal year 2025, our ten largest customers accounted for approximately 44% of net sales. No customer accounted for greater than 10% of the Company's net sales in fiscal year 2025.
COMPETITIVE STRENGTHS We continuously enhance our business through the development and expansion of our product and service offerings. We strive to maintain the efficiency and flexibility of the organization, with repeatable execution that adapts to macro-economic changes to provide clear value to customers, while increasing their competitiveness.
COMPETITIVE STRENGTHS We continuously enhance our business through the development and expansion of our product and service offerings. Our EMS + Products + Services approach is designed to bolster our competitiveness through the expansion of our core manufacturing and supply chain capabilities alongside proprietary products and value-added services.
Removed
See note 7 "Discontinued Operations" to the consolidated financial statements in Item 8, “Financial Statements and Supplementary Data” for further information. 3 Table of Content s The FAS segment is optimized for speed to market, based on a highly flexible supply and manufacturing system.
Added
This hybrid model is focused on strengthening the Company’s core manufacturing and supply chain capabilities while expanding its portfolio of proprietary products and value-added services to maximize value creation for customers.
Removed
The “Digitization of Everything” is the mega-trend that is driving products—and even whole industries—to be smarter, more data-driven, and more connected. To make these next generation products, companies must integrate increasingly advanced technologies and build them at scale.
Added
To advance this approach, the Company completed several strategic acquisitions in fiscal year 2025 that enhance its differentiated portfolio to address critical data center customer challenges around power, heat and scale. These included the acquisitions of JetCool Technologies Inc.
Removed
We do this by providing our customers with full product lifecycle services, from design, engineering, supply chain, component services and manufacturing to forward logistics, value-added fulfillment, reverse logistics and circular economy offerings.
Added
("JetCool") to expand direct-to-chip liquid cooling capabilities and Crown Technical Systems ("Crown") to increase critical power capabilities while adding opportunities in grid modernization. On January 2, 2024, the Company completed its previously announced spin-off of its remaining interests in Nextracker Inc.
Removed
For example, Flex has developed unique offerings for hyperscalers and co-locators for embedded and critical power solutions which, combined with our traditional data center contract manufacturing business, provide integrated end to end solutions for our customers. We are strengthening our capabilities in factory automation, robotics, artificial intelligence, simulation, digital twins, connectivity and other disruptive technologies.
Added
Flex believes that long-term technology transitions and supply chain challenges are increasing complexity across the value chain, fueling demand for outsourcing partners with specialized services. In the data center sector, the rise of AI is pushing hyperscalers toward integrated solutions and comprehensive support from fewer suppliers.
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We select ethical partners and integrate the supply chain so that our customers can operate efficiently and responsibly. We are committed to investing in our employees and communities, which includes addressing critical environmental issues. People . To maintain competitiveness and world-class capabilities, we focus on hiring and retaining the world's best talent.
Added
With our EMS + Products + Services approach, Flex has positioned the Company as the only outsourcing partner offering fully integrated racks, vertical services, and a complete power products portfolio from the grid to the chip.
Removed
We believe we have the broadest product lifecycle capabilities within every major region in the industry, from concept design to sourcing to manufacturing to delivery and servicing through end-of-life.
Added
The recent tariffs imposed by the current U.S. administration and retaliatory tariffs imposed by other countries are accelerating these trends. As a result, companies are rethinking their entire production strategies. We are seeing a global rebalancing in sourcing and production locations to maximize resiliency and decrease time to market.
Removed
Our embedded and critical power offerings enable greater efficiency, reduced latency, space and risk, and faster time to market. Our power portfolio combined with our server and storage products, racks and enclosures and full systems assembly capability provides the opportunity for growth in the data center market. COMPETITION The contract manufacturing services market is extremely competitive.
Added
STRATEGY Our EMS + Products + Services strategy is centered upon enhancing our core manufacturing and supply chain capabilities while broadening our portfolio of proprietary products and value-added services, maximizing value creation for our customers and shareholders.
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These sites enhance supply chain management efficiency, while providing multi-technology solution value for customers. HUMAN CAPITAL MANAGEMENT Culture underlies our stakeholder experience. Our values are intended to reflect and guide our behaviors and shape our culture.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

136 edited+27 added−43 removed153 unchanged
Biggest changeWe or Nextracker may fail to perform under various transaction agreements that have been executed in connection with or as part of the separation of Nextracker. • We are subject to risks relating to our dependence on our executive officers and skilled personnel. • We are subject to the risk of increased income taxes. • We are subject to risks relating to litigation and regulatory investigations and proceedings, which may have a material adverse effect on our business. • Exports and imports of certain of our products are subject to various export control, sanctions, and import regulations and may require authorization from regulatory agencies of the U.S. or other countries. • Catastrophic events could have a material adverse effect on our operations and financial results. • Union disputes or other labor disruptions could adversely affect our operations and financial results. • Our operating results may fluctuate significantly due to seasonal demand. • Our strategic relationships with major customers create risks. • We may encounter difficulties with acquisitions and divestitures, which could harm our business. • The success of certain of our activities depends on our ability to protect our intellectual property rights; claims of infringement or misuse of intellectual property and/or breach of license agreement provisions against our customers or us could harm our business. • If our compliance policies are breached, we may incur significant legal and financial exposure. 13 Table of Content s • If our products or components contain defects, demand for our services may decline, our reputation may be damaged, and we may be exposed to product liability and product warranty liability. • We may not meet regulatory quality standards applicable to our manufacturing and quality processes for medical devices, which could have an adverse effect on our business, financial condition or results of operations. • Changes in our credit rating may make it more expensive for us to raise additional capital or to borrow additional funds.
Biggest changeIn addition, our customers may decide to manufacture their products internally, which could harm our business. • We conduct operations in a number of countries and are subject to the risks inherent in international operations. • Our components business is dependent on our ability to quickly launch world-class component products, and our investment in the development of our component capabilities, together with start-up and integration costs, has in the past adversely affected, and may in the future adversely affect, our margins and profitability. • Our margins and profitability have in the past been, and may in the future be, adversely affected due to substantial investments, start-up and production ramp costs in our design and engineering services. • If we do not effectively manage changes in our operations, our business may be harmed; we have taken substantial restructuring charges in the past and we may need to take material restructuring charges in the future. • A breach of our IT or physical security systems, or violation of data privacy laws, may cause us to incur significant legal and financial exposure and adversely affect our operations. • We may encounter difficulties with acquisitions and divestitures, which could harm our business. 11 Table of Contents • We are subject to risks relating to our dependence on our executive officers and other key employees and skilled personnel. • We are subject to the risk of increased income taxes. • We are subject to risks relating to litigation and regulatory investigations and proceedings, which may have a material adverse effect on our business. • Exports and imports of certain of our products are subject to various export control, sanctions, and import regulations and may require authorization from regulatory agencies of the U.S. or other countries. • Our strategic relationships with major customers create risks. • There are risks associated with the separation of Nextracker, which could negatively impact our business, financial condition and results of operations. • If the Nextracker spin-off fails to qualify for tax-free treatment, we, our subsidiaries and our former shareholders could incur significant tax liabilities. • Our operating results may fluctuate significantly due to seasonal demand. • Union disputes or other labor disruptions could adversely affect our operations and financial results. • Unforeseen or catastrophic events could have a material adverse effect on our operations and financial results. • The success of certain of our activities depends on our ability to protect our intellectual property rights; claims of infringement or misuse of intellectual property and/or breach of license agreement provisions against our customers or us could harm our business. • If our compliance policies are breached, we may incur significant legal and financial exposure. • If our products or components contain defects, demand for our services may decline, our reputation may be damaged, and we may be exposed to product liability and product warranty liability. • We may not meet regulatory quality standards applicable to our manufacturing and quality processes for medical devices, which could have an adverse effect on our business, financial condition or results of operations. • Changes in our credit rating may make it more expensive for us to raise additional capital or to borrow additional funds.
In the past there have been industry wide conditions, pandemics, natural disasters and global events that have caused material and component shortages. Most recently, we have experienced shortages of semiconductor components which have impacted our business, including curtailed production or delays in production, and delays in making scheduled shipments to customers.
In the past there have been industry wide conditions, pandemics, natural disasters and global events that have caused material and component shortages. Most recently, we experienced shortages of semiconductor components which impacted our business, including curtailed production or delays in production, and delays in making scheduled shipments to customers.
The defense and ultimate outcome of any lawsuits or other legal proceedings may result in higher operating expenses and a decrease in operating margin, which could have a material adverse effect on our business, financial condition, or results of operations.
The defense and ultimate outcome of any lawsuits or other legal proceedings may result in higher expenses and a decrease in operating margin, which could have a material adverse effect on our business, financial condition, or results of operations.
If our products or components contain defects, demand for our services may decline, our reputation may be damaged, and we may be exposed to product liability and product warranty liability. Our customers’ products and the manufacturing processes and design and engineering services that we use to produce them often are highly complex.
If our products or components contain defects, demand for our services may decline, our reputation may be damaged, and we may be exposed to product liability and product warranty liability. Our customers’ products and the manufacturing processes and design and engineering services that we use to produce them are often highly complex.
Other countries where we operate, including elsewhere in Asia and Latin America, have similar laws regarding the regulation of medical device manufacturing. In the event of any noncompliance with these requirements, interruption of our operations and/or ability to sell into these markets could occur, which in turn could cause our reputation and business to suffer.
Other countries where we operate, including elsewhere in Asia and in Latin America, have similar laws regarding the regulation of medical device manufacturing. In the event of any noncompliance with these requirements, interruption of our operations and/or ability to sell into these markets could occur, which in turn could cause our reputation and business to suffer.
Our supply chain has in the past been, and may in the future be, impacted by other events outside our control, including macro-economic events, trade restrictions, political crises, social unrest, terrorism, and conflicts (including the Russian invasion of Ukraine, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea and other geopolitical conflicts), public health emergencies, or natural or environmental occurrences in locations where we or our customers and suppliers have manufacturing, research, engineering and other operations.
Our supply chain has in the past been, and may in the future be, impacted by other events outside our control, including macro-economic events, tariffs and trade restrictions, political crises, social unrest, terrorism, and conflicts (including the Russian invasion of Ukraine, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea and other geopolitical conflicts), public health emergencies, or natural or environmental occurrences in locations where we or our customers and suppliers have manufacturing, research, engineering and other operations.
Our industry is extremely competitive; if we are not able to continue to provide competitive services, we may lose business. In addition, our customers may decide to manufacture their products internally, which could harm our business. We compete with a number of different companies, depending on the type of service we provide or the location of our operations.
Our industry is extremely competitive; if we are not able to continue to provide competitive products and services, we may lose business. In addition, our customers may decide to manufacture their products internally, which could harm our business. We compete with a number of different companies, depending on the type of service we provide or the location of our operations.
These recent and potential additional regulations and avenues for enforcement could result in, among other things, government inquiries, which could result in significant penalties. Additionally, new privacy and data protection laws and regulations are being considered, under development or are pending at the U.S. Federal and state level and many international jurisdictions.
These and potential additional regulations and avenues for enforcement could result in, among other things, government inquiries, which could result in significant penalties. Additionally, new privacy and data protection laws and regulations are being considered, under development or are pending at the U.S. Federal and state level and many international jurisdictions.
Additionally, mergers, acquisitions, consolidations or other significant transactions involving our key customers generally entail risks to our business. If a significant transaction involving any of our key customers results in the loss of or reduction in purchases by any of our largest customers, it could have a material adverse effect on our business, results of operations, financial condition and prospects.
Additionally, mergers, acquisitions, consolidations or other significant transactions involving our largest customers generally entail risks to our business. If a significant transaction involving any of our largest customers results in the loss of or reduction in purchases by any of our largest customers, it could have a material adverse effect on our business, results of operations, financial condition and prospects.
The expansion of our business, as well as business contractions and other changes in our customers' requirements, have in the past, and may in the future, require that we adjust our business and cost structures by incurring restructuring charges. Restructuring activities involve reductions in our workforce at some locations and closure of certain facilities.
The expansion of our business, as well as business contractions and other changes in our customers' requirements, have in the past required, and may in the future require, that we adjust our business and cost structures by incurring restructuring charges. Restructuring activities involve reductions in our workforce at some locations and closure of certain facilities.
There continues to be increasing concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide and other GHGs in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters.
There continues to be concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide and other GHGs in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters.
Rising interest rates could have a dampening effect on overall economic activity and/or the financial condition of our customers, either or both of which could negatively affect customer demand for our manufacturing services and our customers’ ability to repay obligations to us.
High or rising interest rates could have a dampening effect on overall economic activity and/or the financial condition of our customers, either or both of which could negatively affect customer demand for our manufacturing services and our customers’ ability to repay obligations to us.
If our sustainability initiatives fail to satisfy investors, current or potential customers, consumers and our other stakeholders, our reputation, our ability to manufacture and sell products and services, our ability to attract or retain employees, and our attractiveness as an investment, business partner or acquirer could be negatively impacted.
If our sustainability initiatives fail to satisfy investors, current or potential customers, and our other stakeholders, our reputation, our ability to manufacture and sell products and services, our ability to attract or retain employees, and our attractiveness as an investment, business partner or acquirer could be negatively impacted.
In addition to the private letter ruling, we have received an opinion from Deloitte Tax LLP to the effect that the Distributions will qualify as tax-free under Section 355 of the Code and the Mergers will qualify as a tax-free reorganization under Section 368(a) of the Code.
In addition to the private letter ruling, we received an opinion from Deloitte Tax LLP to the effect that the Distributions will qualify as tax-free under Section 355 of the Code and the Mergers will qualify as a tax-free reorganization under Section 368(a) of the Code.
Refer to note 2 to the consolidated financial statements and "Critical Accounting Estimates" in "Management's Discussion and Analysis of Financial Condition and Results of Operations" for further discussion of the impairment testing of goodwill and identifiable intangible assets.
Refer to note 2 to the consolidated financial statements and "Critical Accounting Policies and Estimates" in "Management's Discussion and Analysis of Financial Condition and Results of Operations" for further discussion of the impairment testing of goodwill and identifiable intangible assets.
Failure to meet sustainability, including environmental, social and governance (ESG) expectations or standards, or to achieve our sustainability goals, may have an adverse impact on our business, impose additional costs on us, and expose us to additional risks.
Failure to meet sustainability, including environmental, social and governance expectations or standards, or to achieve our sustainability goals, may have an adverse impact on our business, impose additional costs on us, and expose us to additional risks.
They are also affected by local and regional economic environments, supply chain constraints and policies in the U.S. and other markets that we serve, including interest rates, monetary policy, inflation, economic growth, recession, commodity prices, currency volatility, currency controls or other limitations on the ability to expatriate cash, sovereign debt levels and actual or anticipated defaults on sovereign debt.
They are also affected by local and regional economic environments, supply chain constraints and policies in the U.S. and other markets that we serve, including interest rates, monetary policy, inflation, stagflation, slower economic growth, recession, commodity prices, currency volatility, currency controls or other limitations on the ability to expatriate cash, sovereign debt levels and actual or anticipated defaults on sovereign debt.
Furthermore, in countries such as Brazil, China, India and Mexico, governmental authorities exercise significant influence over many aspects of the economy, and their actions could have a significant effect on us. We could be seriously harmed by inadequate infrastructure, including lack of adequate power and water supplies, transportation, raw materials and parts in countries in which we operate.
Furthermore, in countries such as the U.S., Brazil, China, India and Mexico, governmental authorities exercise significant influence over many aspects of the economy, and their actions could have a significant effect on us. We could be seriously harmed by inadequate infrastructure, including lack of adequate power and water supplies, transportation, raw materials and parts in countries in which we operate.
For example, the ongoing conflict between Russia and Ukraine and the related sanctions and other measures imposed by the European Union, the U.S. and other countries and organizations in response have led, and may continue to lead, to disruption and instability in global markets, supply chains and industries that could negatively impact our businesses, financial condition and results of operations.
For example, the ongoing conflict between Russia and Ukraine and the related sanctions and other measures imposed by the European Union, the U.S. and other countries and organizations in response have led, and may continue to lead, to disruption and instability in global markets, supply chains and industries that could negatively impact our business, financial condition and results of operations.
We rely on our information systems, some of which are managed by third parties, to process, transmit and store electronic information (including sensitive data such as confidential business information and personally identifiable information in each case relating to employees, customers, vendors, consumers, and other business partners), and to manage or support a variety of critical business processes and activities including manufacturing, design and engineering services, financial reporting, recordkeeping, compliance and internal controls, human and capital asset and inventory management, procurement, invoicing, treasury activities, and electronic communications.
We rely on our information systems, some of which are managed by third parties, to process, transmit and store electronic information (including sensitive data such as confidential business information and personally identifiable information in each case relating to employees, customers, vendors, consumers, and other business partners), and to manage or support a variety of critical business processes and activities including manufacturing, design and engineering services, financial reporting, recordkeeping, compliance and internal controls, human and capital asset and inventory management, procurement, invoicing, 15 Table of Contents treasury activities, and electronic communications.
Additionally, hiring, training and retaining skilled employees may be adversely impacted by global economic uncertainty and changes to office environments and workforce trends. From time to time, we face challenges that may impact employee retention, such as workforce reductions and facility consolidations and closures, and some of our most experienced employees are retirement-eligible which may adversely impact retention.
Additionally, hiring, training and retaining skilled employees may be adversely impacted by global economic uncertainty and changes to workforce trends. From time to time, we face challenges that may impact employee retention, such as workforce reductions and facility consolidations and closures, and some of our most experienced employees are retirement-eligible which may adversely impact retention.
Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change in the direction of the business or other instability and may make it more difficult to attract and retain qualified personnel and business partners and may affect our relationships with vendors, customers and other third parties.
Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change in the direction of the business or other instability and may make it more difficult to attract and retain qualified personnel and business partners and may affect our relationships with vendors, customers and other third parties. ITEM 1B.
If unauthorized parties gain physical access to our facilities, operations, assets, inventory, or information or if they gain electronic access to our information systems or if such facilities, operations, assets, inventory or information are used in an unauthorized manner, misdirected, or lost or stolen during transmission or transport, any theft or misuse of such operations, assets, inventory or information could result in, among other things, unfavorable publicity, loss of competitive advantage, governmental inquiry and oversight, difficulty in marketing and selling our services, increased security and compliance costs, significant costs related to rebuilding internal systems, higher 17 Table of Content s insurance premiums, allegations by our customers that we have not performed our contractual obligations, litigation by affected parties including our customers and possible financial penalties, fines or obligations for damages related to the theft or misuse of such assets, inventory or information, any of which could have a material adverse effect on our profitability and cash flows.
If unauthorized parties gain physical access to our facilities, operations, assets, inventory, or information or if they gain electronic access to our information systems or if such facilities, operations, assets, inventory or information are used in an unauthorized manner, misdirected, or lost or stolen during transmission or transport, any theft or misuse of such operations, assets, inventory or information could result in, among other things, unfavorable publicity, loss of competitive advantage, governmental inquiry and oversight, difficulty in marketing and selling our products and services, increased security and compliance costs, significant costs related to rebuilding internal systems, higher insurance premiums, allegations by our customers that we have not performed our contractual obligations, litigation by affected parties including our customers and possible financial penalties, fines or obligations for damages related to the theft or misuse of such assets, inventory or information, any of which could have a material adverse effect on our profitability and cash flows.
We are subject to, and at times have suffered from, breach or attempted breach of our security systems which have in the past and may in the future result in unauthorized access to our facilities and/or unauthorized acquisition, use or theft of the assets, inventory or information we are trying to protect.
We are subject to, and at times have suffered from, breaches or attempted breaches of our security systems which have in the past and may in the future result in unauthorized access to our facilities and/or unauthorized acquisition, use or theft of the assets, inventory or information we are trying to protect.
Additional legal claims or regulatory matters may arise in the future and could involve matters relating to commercial disputes, government regulatory and compliance, intellectual property, antitrust, tax, employment or shareholder issues, product liability claims and other issues on a global basis.
Legal claims or regulatory matters may arise in the future and could involve matters relating to commercial disputes, government regulations and compliance, intellectual property, antitrust, tax, employment or shareholder issues, product liability claims and other issues on a global basis.
We may not be successful in developing such alternatives or obtaining such licenses on reasonable terms or at all, and any such litigation might not be resolved in our favor, in which cases we may be required to curtail certain of our services and offerings.
We or our customers may not be successful in developing such alternatives or obtaining such licenses on reasonable terms or at all, and any such litigation might not be resolved in our or our customers' favor, in which cases we may be required to curtail certain of our services and offerings.
Supply chain disruptions, manufacturing interruptions or delays, or the failure to accurately forecast customer demand, have in the past affected, and may in the future affect, our ability to meet customer demand, lead to higher costs, or result in excess or obsolete inventory.
Supply chain disruptions, logistical constraints, manufacturing interruptions or delays, or the failure to accurately forecast customer demand, have in the past affected, and may in the future affect, our ability to meet customer demand, lead to higher costs, or result in excess or obsolete inventory.
Changes in weather patterns and an increased frequency, intensity and duration of extreme weather conditions, such as hurricanes, earthquakes, wildfires, water or other natural resource shortages, droughts, or flooding, could, among other things, pose physical risks to and impair our production capabilities, disrupt the operations of our supply chain and infrastructure, and impact our customers and their demand for our services.
Changes in weather patterns and an increased frequency, intensity and duration of extreme weather conditions, such as hurricanes, earthquakes, wildfires, water or other natural resource shortages, droughts, or flooding, could, among other things, pose physical risks to and could impair our production capabilities, disrupt our supply chain and infrastructure, and impact our customers and their demand for our products and services.
ITEM 1A. RISK FACTORS Our business, financial condition, results of operations and prospects are subject to various risks and uncertainties, including those described below. You should carefully consider the following risks and all of the other information contained in this report, including our consolidated financial statements and related notes, before investing in any of our securities.
ITEM 1A. RISK FACTORS 10 Table of Contents Our business, financial condition, results of operations and prospects are subject to various risks and uncertainties, including those described below. You should carefully consider the following risks and all of the other information contained in this report, including our consolidated financial statements and related notes, before investing in any of our securities.
Business and Operational Risks Our customers have in the past and may in the future cancel their orders, change production quantities or locations, or delay production, any of which could harm our business; the short-term nature of our customers’ commitments and rapid changes in demand have in the past caused, and may in the future cause, supply chain and other issues which could adversely affect our operating results.
Business and Operational Risks Our customers have in the past and may in the future cancel their orders, change production quantities or locations, or delay production, any of which could harm our business; the short-term nature of our customers’ commitments and rapid 12 Table of Contents changes in demand have in the past caused, and may in the future cause, supply chain and other issues which could adversely affect our operating results.
Failure to comply with domestic or international employment and related laws could result in the payment of significant damages, which would reduce our net income. We are subject to a variety of domestic and foreign employment laws, including those related to safety, wages and overtime, discrimination, whistle-blowing, classification of employees and independent contractors, and severance payments.
Failure to comply with domestic or international employment and related laws could result in the payment of significant damages, which would reduce our net income. We are subject to a variety of domestic and foreign employment laws, including those related to safety, wages and overtime, discrimination, whistleblowing, classification of employees and independent contractors, and severance payments.
Our operations and the execution of our business plans and strategies are subject to the effects of global economic trends, geopolitical risks and demand or supply shocks from events that could include political crises and conflict (including the Russian invasion of Ukraine, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea), war, a major terrorist attack, natural disasters or actual or threatened public health emergencies (such as COVID-19).
Our operations and the execution of our business plans and strategies are subject to the effects of global economic trends, geopolitical risks and demand or supply shocks from events that could include political crises and conflict (including the Russian invasion of Ukraine, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea), war, a major terrorist attack, natural disasters or actual or threatened public health emergencies.
The Russia-Ukraine conflict, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea, and other hostilities or armed conflicts, or the interruption or curtailment of trade or transport between the countries where our facilities are located and their respective trading partners, could adversely affect our operations and results of operations.
The Russia-Ukraine conflict, the Israel-Hamas war, the attacks on shipping vessels in the Red Sea, and other hostilities or armed conflicts, or the interruption or curtailment of trade or transport between the countries where our facilities are located and their respective trading partners, have in the past and could in the future adversely affect our operations and results of operations.
We may also decline to enter into licenses for intellectual property that we do not think is useful for or used in our operations, or for which our customers or suppliers have licenses or have assumed responsibility.
We may also decline to enter into licenses for intellectual property that we do not think are useful for or used in our operations, or for which our customers or suppliers have licenses or have assumed responsibility.
From time to time, we enter into intellectual property licenses (e.g., patent licenses and software licenses) with third parties which obligate us to report covered behavior to the licensor and pay license fees to the licensor for certain activities or products, or that enable our use of third party technologies.
From time to time, we enter into intellectual property licenses (e.g., patent and software licenses) with third parties 26 Table of Contents which obligate us to report covered behavior to the licensor and pay license fees to the licensor for certain activities or products, or that enable our use of third party technologies.
In the event of such a claim, we may be required to spend a significant amount of money to develop alternatives or obtain licenses or to resolve the issue through litigation.
In the event of such a claim, we or our customers may be required to spend a significant amount of money to develop alternatives or obtain licenses or to resolve the issue through litigation.
We evaluate, on a regular basis, whether events or circumstances have occurred that indicate all, or a portion, of the carrying amount of goodwill may no longer be recoverable, in which case an impairment charge to earnings would become necessary.
We evaluate, on a regular basis, whether events or circumstances have occurred that indicate all, or a portion, of the carrying amount of goodwill may no longer be recoverable, in which case an impairment charge 22 Table of Contents to earnings would become necessary.
We could be seriously harmed by the loss of any of our executive officers or other key employees. Future leadership transitions and management changes may cause uncertainty in, or a disruption to, our business, and may increase the likelihood of senior management or other employee turnover.
We could be seriously harmed by the loss of any of our executive officers or other key employees. Future 17 Table of Contents leadership transitions and management changes may cause uncertainty in, or a disruption to, our business, and may increase the likelihood of senior management or other employee turnover.
These factors include: • rapid changes in technology, including as a result of artificial intelligence, evolving industry standards, and requirements for continuous improvement in products and services that result in short product lifecycles; • demand for our customers' products may be seasonal; • our customers may fail to successfully market their products, and our customers' products may fail to gain widespread commercial acceptance; 21 Table of Content s • our customers' products may have supply chain issues; and • our customers may experience dramatic market share shifts in demand which may cause them to lose market share or exit businesses.
These factors include: • rapid changes in technology, including as a result of artificial intelligence, evolving industry standards, and requirements for continuous improvement in products and services that result in short product lifecycles; 19 Table of Contents • demand for our customers' products may be seasonal; • our customers may fail to successfully market their products, and our customers' products may fail to gain widespread commercial acceptance; • our customers' products may have supply chain issues; and • our customers may experience dramatic market share shifts in demand which may cause them to lose market share or exit businesses.
Our engineering, design and manufacturing services and component offerings involve the creation and use of intellectual property rights, which subject us to the risk of claims of infringement or misuse of intellectual property from third parties and/or breach of our agreements with third parties, as well as claims arising from the allocation of intellectual property risk among us and our customers.
Our engineering, design and manufacturing services and our products involve the creation and use of intellectual property rights, which subject us to the risk of claims of infringement or misuse of intellectual property from third parties and/or breach of our agreements with third parties, as well as claims arising from the allocation of intellectual property risk among us and our customers.
Such adverse 22 Table of Content s effects have in the past included and could in the future include one or more of the following: an increase in our provision for doubtful accounts, a charge for inventory write-offs, a reduction in revenue, and an increase in our working capital requirements due to higher inventory levels and increases in days our accounts receivables are outstanding.
Such adverse effects have in the past included and could in the future include one or more of the following: an increase in our provision for doubtful accounts, a charge for inventory write-offs, a reduction in revenue, and an increase in our working capital requirements due to higher inventory levels and increases in days our accounts receivables are outstanding.
We have significant operations located in China, which have been in the past, and could in the future be, adversely affected by evolving laws, regulations and policies, import and export tariffs and restrictions, and information security and privacy, as well as changes in the political and geopolitical environment involving China. U.S.-China bilateral trade relations remain uncertain.
We have significant operations located in China, which have been in the past, and could in the future be, adversely affected by evolving laws, regulations and policies, including with regard to import and export tariffs and restrictions, and information security and privacy, as well as changes in the political and geopolitical environment involving China. U.S.-China bilateral trade relations remain uncertain.
Due to increasing global tensions and conflicts, including involving China, the ongoing Russia/Ukraine conflict, and the conflict in the Middle East, we and the third parties upon which we rely may be vulnerable to a currently heightened risk of information technology breaches, computer malware, ransomware or other cyber attacks, including attacks that could materially disrupt our systems and operations, supply chain and ability to produce, sell and distribute our products.
Due to increasing global tensions and conflicts, including involving China, the ongoing Russia/Ukraine conflict, and the conflict in the Middle East, we and the third parties upon which we rely may be vulnerable to a currently heightened risk of information technology breaches, computer malware, ransomware or other cyber attacks, including attacks that could materially disrupt our systems and operations, supply chain and ability to provide our products and services.
Our principal customers have varied from year to year. These customers have in the past experienced, and may in the future experience, dramatic declines in their market shares or competitive position, due to economic or other forces, that may cause them to reduce their purchases from us or, in some cases, result in the termination of their relationship with us.
These customers have in the past experienced, and may in the future experience, dramatic declines in their market shares or competitive position, due to economic or other forces, that may cause them to reduce their purchases from us or, in some cases, result in the termination of their relationship with us.
The U.S.’s various trade actions, including imposing tariffs on certain goods imported from China or deemed to be of Chinese origin, as well as the potential for new tariffs, trade embargoes or sanctions by the U.S., and countermeasures imposed by China in response, could, depending on their duration and implementation as well as our ability to mitigate their impact, materially affect our business, including in the form of increased cost of goods sold, decreased margins, increased pricing for customers, and reduced sales.
The U.S.’s various trade actions, including imposing tariffs on certain goods imported from China or deemed to be of Chinese origin, as well as the potential for new tariffs, trade embargoes or sanctions by the U.S., and countermeasures imposed by China in response, have, in the past adversely affected, and could in the future, depending on their duration and implementation as well as our ability to mitigate their impact, adversely affect our business, including in the form of increased cost of goods sold, decreased margins, increased pricing for customers, and reduced sales.
We cannot assure you that present or future customers will not significantly change, reduce, cancel or delay their orders. On occasion, customers require rapid increases in production or require that manufacturing of their products be transitioned from one facility to another to reduce costs or achieve other objectives.
We cannot give assurance that present or future customers will not significantly change, reduce, cancel or delay their orders. On occasion, customers require rapid increases in production or require that manufacturing of their products be transitioned from one facility to another to reduce costs or achieve other objectives.
We are required to make substantial investments in the resources necessary to design and develop these products, and no revenue may be generated from these efforts if our customers do not approve the designs in a timely manner or at all.
We are required to make 14 Table of Contents substantial investments in the resources necessary to design and develop these products, and no revenue may be generated from these efforts if our customers do not approve the designs in a timely manner or at all.
We are subject to laws and regulations in the U.S. and in other countries relating to privacy and the collection, use, transfer, storage and security of personal data, including the European Union General Data Protection Regulation (“GDPR”), the UK GDPR, the EU ePrivacy Directive, Singapore’s Personal Data Protection Act, China’s Personal Information Protection Law (“PIPL”), and other privacy and data security laws throughout the Asia Pacific region and across the globe.
We are subject to laws and regulations in the U.S. and in other countries relating to privacy and the collection, use, transfer, storage and security of personal data, including the European Union General Data Protection Regulation ("GDPR"), the UK GDPR, the EU ePrivacy Directive, Singapore’s Personal Data Protection Act, China’s Personal Information Protection Law ("PIPL"), India's Digital Personal Data Protection Act, and other privacy and data security laws throughout the Asia Pacific region and across the globe.
This poses increasingly complex compliance challenges, which have resulted, and will continue to result in, increased compliance costs, and have required, and may in the future require, us to modify our data processing practices and policies and to incur substantial costs and expenses in an effort to comply.
This poses increasingly complex compliance challenges, which have resulted, and will continue to result in, increased compliance costs, and have required, and may in the future require, us to modify our data processing practices and policies and 16 Table of Contents to incur substantial costs and expenses in an effort to comply.
As of March 31, 2024, our total debt was approximately $3.3 billion. This level of indebtedness could limit our flexibility as a result of debt service requirements and restrictive covenants, and may limit our ability to access additional capital or execute our business strategy. The market price of our ordinary shares is volatile.
Our debt level may create limitations. As of March 31, 2025, our total debt was approximately $3.7 billion. This level of indebtedness could limit our flexibility as a result of debt service requirements and restrictive covenants, and may limit our ability to access additional capital or execute our business strategy. The market price of our ordinary shares is volatile.
Similarly, our failure or perceived failure to pursue or fulfill our goals, targets and objectives or to satisfy various reporting standards within the timelines we announce or otherwise as may be required, or at all, could also have similar negative impacts and expose us to government enforcement actions and private litigation.
Similarly, our failure or perceived failure to pursue or fulfill our goals, targets and objectives, adhere to our public statements, or satisfy various reporting laws, regulations or standards within the timelines we announce or otherwise as may be required, or at all, could also have similar negative impacts and expose us to government enforcement actions and private litigation.
Problems suffered by any of these common carriers, whether due to geopolitical issues due to the Russian invasion of Ukraine and the Israel-Hamas war, disruptions as a result of attacks on shipping vessels in the Red Sea, a natural disaster, labor problems, increased energy prices, criminal activity or some other issue, have in the past resulted, and may in the future result in shipping delays, increased costs, or other supply chain disruptions, and therefore have in the past had, and may in the future have, a material adverse effect on our operations.
Problems suffered by any of these common carriers, whether due to geopolitical issues such as due to the Russian invasion of Ukraine and conflict in the Middle East, disruptions as a result of attacks on shipping vessels in the Red Sea, a natural disaster, labor problems, increased energy prices, criminal activity or some other issue, have in the past resulted, and may in the future result in shipping delays, increased costs, or other supply chain disruptions, and therefore have in the past had, and may in the future have, a material adverse effect on our operations.
Should additional taxes be assessed as a result of a current or future examination, there could be a material adverse effect on our tax provision, operating results, financial position and cash flows in the period or periods for which that determination is made. Our debt level may create limitations.
Should additional taxes be assessed as a result of a current or future examination, there could be a material adverse effect on our tax provision, operating results, financial position and cash flows in the period or periods for which that determination is made.
In addition, in connection with expanding our design and 20 Table of Content s engineering services offerings, we must attract and retain experienced design engineers. Our failure to recruit and retain experienced design engineers could limit the growth of our design and engineering services offerings, which could adversely affect our business.
In addition, in connection with expanding our design and engineering services offerings, we must attract and retain experienced design engineers. Our failure to recruit and retain experienced design engineers could limit the growth of our design and engineering services offerings, which could adversely affect our business.
Catastrophic events could have a material adverse effect on our operations and financial results.
Unforeseen or catastrophic events could have a material adverse effect on our operations and financial results.
Political changes and trends such as populism, protectionism, economic nationalism and sentiment toward multinational companies and resulting tariffs, export controls or other trade barriers, or changes to tax or other laws and policies, have been and may continue to be disruptive and costly to our businesses, and these can interfere with our global operating model, supply chain, production costs, customer relationships and competitive position.
Political changes and trends such as populism, protectionism, economic nationalism and sentiment toward multinational companies and resulting tariffs, export controls or other trade barriers, or changes to tax or other laws and policies, have been and are expected to continue to be disruptive and potentially costly to our business, and these can interfere with our global operating model, supply chain, production costs, customer relationships, customer demand and competitive position.
Our 4.750% Notes due 2025, our 3.750% Notes due 2026, our 6.000% Notes due 2028, our 4.875% Notes due 2029 and our 4.875% Notes due 2030 are currently rated BBB- by Standard and Poor's ("S&P") which is considered to be “investment grade” by S&P, rated Baa3 by Moody’s which is considered to be “investment grade” by Moody's, and rated BBB- by Fitch which is considered to be "investment grade" by Fitch.
Our 4.750% Notes due June 2025, our 3.750% Notes due 2026, our 6.000% Notes due 2028, our 4.875% Notes due 2029, our 4.875% Notes due 2030, and our 5.250% Notes due 2032 are currently rated BBB- by Standard and Poor's ("S&P") which is considered to be "investment grade" by S&P, rated Baa3 by Moody’s which is considered to be "investment grade" by Moody's, and rated BBB- by Fitch which is considered to be "investment grade" by Fitch.
To create these world class components offerings, we must continue to make substantial investments in the development of our components capabilities, in resources such as research and development, technology licensing, test and tooling equipment, facility expansions, and personnel requirements.
To create these world class components offerings, we must continue to make substantial investments in the development of our components capabilities, in resources such as research and development, the development, acquisition or licensing of appropriate intellectual property, test and tooling equipment, facility expansions, and personnel requirements.
If we do not 16 Table of Content s properly manage or maintain adequate financial and management controls, including internal controls over financial reporting, reporting systems and procedures to manage our employees, our business could be harmed.
If we do not properly manage or maintain adequate financial and management controls, including internal controls over financial reporting, reporting systems and procedures to manage our employees, our business could be harmed.
Because our manufacturing operations are located in a number of countries throughout the Americas, Asia and Europe, we are subject to risks of changes in economic, social and political conditions in those countries, including: • fluctuations in the value of local currencies; • labor unrest, including labor strikes, difficulties in staffing and geographic labor shortages; • longer payment cycles; • cultural differences; • increases in duties, tariffs, and taxation levied on our products including anti-dumping and countervailing duties; • trade restrictions including limitations on imports or exports of components or assembled products, unilaterally or bilaterally; • trade sanctions and related regulatory enforcement actions and other proceedings; • potential trade wars; • increased scrutiny by the media and other third parties of labor practices within our industry (including but not limited to forced labor and adverse working conditions) which may result in allegations of violations, more stringent and burdensome labor laws and regulations and inconsistency in the enforcement and interpretation of such laws and regulations, higher labor costs, and/or loss of revenues if our customers become dissatisfied with our labor practices and diminish or terminate their relationship with us; • inflationary pressures, such as those the market is currently experiencing, which may increase costs for materials, supplies, and services; • imposition of restrictions on currency conversion or the transfer of funds; • environmental protection laws and regulations, including those related to climate change; • expropriation of private enterprises; • ineffective legal protection of our intellectual property rights in certain countries; • natural disasters; • exposure to infectious disease, epidemics and pandemics on our business operations in geographic locations impacted by the outbreak and on the business operations of our customers and suppliers; • inability of international customers and suppliers to obtain financing resulting from tightening of credit in international financial markets; 26 Table of Content s • ongoing global supply chain disruptions, including disruptions in international commerce as a result of attacks on shipping vessels in the Red Sea, which have slowed the ability of our facilities to import necessary materials and export our products and adversely affected our business; • political unrest; and • a potential reversal of current favorable policies encouraging foreign investment or foreign trade by our host countries.
Because our manufacturing operations are located in a number of countries throughout the Americas, Asia and Europe, we are subject to risks of changes in economic, social and political conditions in those countries, including: • fluctuations in the value of local currencies; • labor unrest, including labor strikes, difficulties in staffing and geographic labor shortages; • longer payment cycles; • cultural differences; • increases in duties, tariffs, and taxation levied on our products including anti-dumping and countervailing duties; • trade restrictions including limitations on imports or exports of components or assembled products, unilaterally or bilaterally, as well as; • trade sanctions and related regulatory enforcement actions and other proceedings; • potential trade wars; • scrutiny by the media and other third parties of labor practices within our industry which may result in allegations of violations, more stringent and burdensome labor laws and regulations and inconsistency in the enforcement and interpretation of such laws and regulations, higher labor costs, and/or loss of revenues; 24 Table of Contents • inflationary pressures, such as those the market has recently been experiencing, which may increase costs for materials, supplies, and services; • imposition of restrictions on currency conversion or the transfer of funds; • environmental protection laws and regulations, including those related to climate change; • expropriation of private enterprises; • ineffective legal protection of our intellectual property rights in certain countries; • natural disasters; • exposure to infectious disease, epidemics and pandemics on our business operations in geographic locations impacted by the outbreak and on the business operations of our customers and suppliers; • inability of international customers and suppliers to obtain financing resulting from tightening of credit in international financial markets; • global supply chain disruptions, including disruptions in international commerce as a result of attacks on shipping vessels in the Red Sea, which has in the past slowed, and may in the future slow the ability of our facilities to import necessary materials and export our products and adversely affect our business; • political or social unrest; and • a potential reversal of current favorable policies encouraging foreign investment or foreign trade by our host countries.
Our components business, which includes power supply manufacturing, is part of our strategy to improve our competitive position and to grow our future margins, profitability and shareholder returns by expanding our capabilities.
Our components business, which includes our data center power systems business, is part of our strategy to improve our competitive position and to grow our future margins, profitability and shareholder returns by expanding our capabilities.
These conditions could also adversely impact our customers and suppliers, which in turn could adversely affect us. 25 Table of Content s We have facilities across the globe including in Israel and Ukraine.
These conditions could also adversely impact our customers and suppliers, which in turn could adversely affect us. We have facilities across the globe including in Israel and Ukraine.
We retain certain intellectual property rights to some of the technologies that we develop as part of our engineering, design, and manufacturing services and components offerings. The measures we have taken to prevent unauthorized use of our technology may not be successful.
We create and retain certain intellectual property rights to some of the technologies that we develop related to our engineering, design, and manufacturing services and our products. The measures we have taken to prevent unauthorized use of our technology may not be successful.
(“Merger Sub”) dated as of February 7, 2023 (the “Merger Agreement”), on January 2, 2024, we effectuated a distribution of the remaining interests that we owned in Nextracker to all our shareholders through the following transactions (together, the “Transactions”): (i) a court-approved capital reduction carried out pursuant to Section 78G of the Singapore 18 Table of Content s Companies Act (the “Capital Reduction”), (ii) a distribution of all the shares of the common stock, par value $0.001, of Yuma (the “Yuma Common Stock”) by way of a distribution in specie to our shareholders (the “Distribution” and, together with any distribution in the series of internal distributions of the shares of Yuma Common Stock from Flextronics International USA, Inc.
("Merger Sub") dated as of February 7, 2023 (the "Merger Agreement"), on January 2, 2024, we effectuated a distribution of the remaining interests that we owned in Nextracker to all our shareholders through the following transactions (together, the "Transactions"): (i) a court-approved capital reduction carried out pursuant to Section 78G of the Singapore Companies Act (the "Capital Reduction"), (ii) a distribution of all the shares of the common stock, par value $0.001, of Yuma (the "Yuma Common Stock") by way of a distribution in specie to our shareholders (the "Distribution" and, together with any distribution in the series of internal distributions of the shares of Yuma Common Stock from Flextronics International USA, Inc.
In recent years, including fiscal years 2024, 2023, and 2022, we initiated targeted restructuring activities focused on improving operational efficiencies by reducing excess workforce capacity, optimizing our portfolio (in particular, customers and products in our consumer devices business), and optimizing our cost structure in lower growth areas.
In recent years, including fiscal years 2025, 2024, and 2023, we initiated targeted restructuring activities focused on improving operational efficiencies by reducing excess workforce capacity, optimizing our portfolio, and optimizing our cost structure in lower growth areas.
In many of the countries in which we operate, governmental bodies are increasingly enacting legislation and regulations in response to the potential impacts of climate change.
In many of the countries in which we operate, governmental bodies continue to enact legislation and regulations in response to the potential impacts of climate change.
Our continued ability to qualify for specific tax holiday extensions will depend on, among other things, our anticipated investment and expansion in these countries and the manner in which the local governments interpret the requirements for modifications, extensions or new incentives.
Our continued ability to qualify for specific tax holiday extensions will depend on, among other things, our anticipated investment and expansion in these countries and the manner in which the local governments interpret the requirements for modifications, extensions or new incentives. Further, the global minimum tax is expected to reduce the benefits achieved from tax incentives.
In the U.S., many states including California, Colorado, Connecticut, Utah and Virginia have enacted data privacy laws. The California Consumer Privacy Act (“CCPA”) became effective January 1, 2020 and was further amended by the California Privacy Rights Act (“CPRA”), which became effective on January 1, 2023.
In the U.S., many states including California, Colorado, Connecticut, Minnesota, New Hampshire, Tennessee, Texas, Utah and Virginia have enacted data privacy laws. The California Consumer Privacy Act ("CCPA") became effective January 1, 2020 and was further amended by the California Privacy Rights Act ("CPRA"), which became effective on January 1, 2023.
If we receive an adverse judgment in any such matter, we could be required to pay substantial damages and cease certain practices or activities. Regardless of the merits of the claims, litigation and other proceedings may be both time-consuming and disruptive to our business.
If we receive an adverse judgment in any such matter, we could be required to pay substantial damages, which could be in excess of amounts accrued, if any, and cease certain practices or activities. Regardless of the merits of the claims, litigation and other proceedings may be time-consuming, result in significant expense and disrupt our business.
If we fail to achieve some or all of the benefits expected to result from the separation of Nextracker, or if such benefits are delayed, our businesses, financial condition and results of operations could be materially and adversely affected.
If we fail to achieve all of the expected benefits , or if such benefits are delayed, our business, financial condition and results of operations could be materially and adversely affected.
In addition, we may be exposed to product liability or product warranty claims, which may include liability for personal injury or property damage. Product warranty claims may include liability to pay for the recall, repair or replacement of a product or component.
In addition, we are from time to time exposed to product liability or product warranty claims, which may include liability for personal injury or property damage, and liability to pay for the recall, repair or replacement of a product or component, in addition to significant spend to resolve the claims.
With increased work-from-home arrangements, we are increasingly dependent upon our information systems to operate our business and our ability to effectively manage our business depends on the security, reliability and adequacy of our information systems. We may be adversely affected if our information systems break down, fail, or are no longer supported.
Our ability to effectively manage our business depends on the security, reliability and adequacy of our information systems. We may be adversely affected if our information systems break down, fail, or are no longer supported.
We have manufacturing operations and industrial parks that are located in various part of the world, including Asia, Eastern Europe, Mexico and Brazil. A portion of our purchases and our sale transactions are denominated in currencies other than the United States dollar.
Fluctuations in foreign currency exchange rates could increase our operating costs. 25 Table of Contents We have manufacturing operations and industrial parks that are located in various part of the world, including Asia, Eastern Europe, Mexico and Brazil. A portion of our purchases and our sale transactions are denominated in currencies other than the United States dollar.
Any existing or future lawsuits could be time-consuming, result in significant expense and divert the attention and resources of our management and other key employees, as well as harm our reputation, business, financial condition or results of operations.
Any existing or future lawsuits or other proceedings could also divert the attention and resources of our management and other key employees, as well as harm our reputation, business, financial condition or results of operations.
We may be unable to pass along such higher costs to our customers. In addition, inflation may adversely affect customers’ financing costs, cash flows, and profitability, which could adversely impact their operations and our ability to collect receivables.
In addition, inflation may adversely affect customers’ financing costs, cash flows, and profitability, which could adversely impact their operations and our ability to collect receivables.
In connection with the separation of Nextracker, Nextracker has agreed to retain and indemnify us for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to insure us against the full amount of such liabilities, or that Nextracker’s ability to satisfy its indemnification obligation will not be impaired in the future.
However, third parties could also seek to hold us responsible for any of the liabilities that Nextracker has agreed to retain, and there can be no assurance that the indemnity will be sufficient to insure us against the full amount of such liabilities, or that Nextracker’s ability to satisfy its indemnification obligation will not be impaired in the future.
A number of our customers have adopted, or may adopt, procurement policies that include social and environmental responsibility provisions that their suppliers should comply with, or they may seek to include such provisions in their procurement terms and conditions.
A number of our customers have adopted, or may adopt, procurement policies that include sustainability provisions that their suppliers should comply with, or they may seek to include such provisions in their procurement terms and conditions. Moreover, a number of investors have adopted, or may adopt, sustainability policies with which they expect their portfolio companies to comply.
Furthermore, the central bank of any of these countries may have the authority to suspend, restrict or otherwise impose conditions on foreign exchange transactions or to approve distributions to foreign investors. Fluctuations in foreign currency exchange rates could increase our operating costs.
Furthermore, the central bank of any of these countries may have the authority to suspend, restrict or otherwise impose conditions on foreign exchange transactions or to approve distributions to foreign investors.
Any assessment of the potential impact of future climate change legislation, regulations or industry standards, as well as any international treaties and accords, is uncertain given the scope of potential regulatory change in the countries in which we operate.
Inconsistency of legislation and regulations among jurisdictions may also affect the costs of compliance with such laws and regulations. Any assessment of the potential impact of future climate change legislation, regulations or industry standards, as well as any international treaties and accords, is uncertain given the scope of potential regulatory change in the countries in which we operate.
We have established sustainability programs and practices aligned with sound principles and have established and publicly announced our strategy, certain goals, commitments, and targets, which we may refine in the future. These programs, goals, commitments and targets reflect our current initiatives, plans and aspirations, and are not guarantees that we will be able to achieve them.
We have established and publicly announced our sustainability strategy and certain goals, commitments, and targets, which we may change or refine in the future. These statements reflect our current initiatives, plans and aspirations, and are not 28 Table of Contents guarantees that we will be able to achieve them.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeComponents of our program include: • risk assessments designed to help identify cybersecurity threats to our critical IT systems, information, and our broader enterprise IT environment; 32 Table of Content s • the periodic engagement of independent security firms and other third-party experts, where appropriate, to assess, test, and certify components of our cybersecurity program, and to otherwise assist with aspects of our cybersecurity processes and controls; • annual cybersecurity awareness training for our employees; • regular assessments of the design and operational effectiveness of the program’s key processes and controls by our internal audit team as well as external consultants; and • a risk management process for third-party service providers and vendors that includes due diligence in the selection process and periodic monitoring regarding adherence to applicable cybersecurity standards.
Biggest changeComponents of our program include: • risk assessments designed to help identify cybersecurity threats to our critical IT systems, information, and our broader enterprise IT environment; • the periodic engagement of independent security firms and other third-party experts, where appropriate, to assess, test, and certify components of our cybersecurity program, and to otherwise assist with aspects of our cybersecurity processes and controls; • annual cybersecurity awareness training for our employees; • regular assessments of the design and operational effectiveness of the program’s key processes and controls by our internal audit team as well as external consultants; and • a risk management process for third-party service providers and vendors that includes due diligence in the selection process and periodic monitoring regarding adherence to applicable cybersecurity standards. 30 Table of Contents We also have a cybersecurity incident response plan to assess and manage cybersecurity incidents, which includes escalation procedures based on the nature and severity of the incident including, where appropriate, escalation to the Audit Committee and the Board.
The Chair of the Audit Committee reports to the full Board on these discussions as appropriate. The full Board also receives briefings from our CISO and CIO on cybersecurity matters twice annually. In addition, Board members periodically receive presentations on cybersecurity matters from external experts as part of the Board’s continuing education and overall risk oversight.
The Chair of the Audit Committee reports to the full Board on these discussions as appropriate. The full Board also receives briefings from our CISO on cybersecurity matters annually. In addition, Board members periodically receive presentations on cybersecurity matters from external experts as part of the Board’s continuing education and overall risk oversight.
For more information on our cybersecurity related risks, see Item IA,, “Risk Factors - “ A breach of our IT or physical security systems, or violation of data privacy laws, may cause us to incur significant legal and financial exposure and adversely affect our operations. ” Governance The Audit Committee of our Board of Directors has primary responsibility for overseeing our cybersecurity risks and other information technology risks, including our plans to mitigate cybersecurity risks and to respond to data breaches.
For more information on our cybersecurity related risks, see Item IA,, "Risk Factors - " A breach of our IT or physical security systems, or violation of data privacy laws, may cause us to incur significant legal and financial exposure and adversely affect our operations." Governance The Audit Committee of our Board of Directors has primary responsibility for overseeing our cybersecurity risks and other information technology risks, including our plans to mitigate cybersecurity risks and to respond to data breaches.
The Audit Committee receives regular reports (at least quarterly) from our CISO and our Chief Information Officer (“CIO”) on cybersecurity matters. These reports include a range of topics, including our cybersecurity risk profile, the current cybersecurity and emerging threat landscape, the status of ongoing cybersecurity initiatives, incident reports, and the results of internal and external assessments of our information systems.
The Audit Committee receives regular reports (at least quarterly) from our CISO on cybersecurity matters. These reports include a range of topics, including our cybersecurity risk profile, the current cybersecurity and emerging threat landscape, the status of ongoing cybersecurity initiatives, incident reports, and the results of internal and external assessments of our information systems.
ITEM 1C. CYBERSECURITY Risk Management and Strategy Our cybersecurity risk management program is intended to protect the confidentiality, integrity, and availability of our critical information technology (“IT”) systems and information.
ITEM 1C. CYBERSECURITY Risk Management and Strategy Our cybersecurity risk management program is intended to protect the confidentiality, integrity, and availability of our critical information technology ("IT") systems and information.
At the management level, our CISO leads our enterprise-wide cybersecurity program, and is responsible for assessing and managing our materials risks from cybersecurity threats.
At the management level, our CISO leads our enterprise-wide cybersecurity program, and is responsible for assessing and managing our material risks from cybersecurity threats.
Our global information security management program is ISO 27001:2013 certified. Our cybersecurity risk management program is led by our Chief Information Security Officer (“CISO”), who manages our security team principally responsible for managing our cybersecurity risk assessment processes, our security controls, and our detection and response to cybersecurity incidents.
Our global information security management program is ISO 27001:2022 certified. Our cybersecurity risk management program is led by our Chief Information Security Officer ("CISO"), who manages our security team principally responsible for managing our cybersecurity risk assessment processes, our security controls, and our detection and response to cybersecurity incidents.
In performing his role, our CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through the management of, and participation in, the cybersecurity risk management and strategy processes described above, including the operation of our incident response plan. Our CISO reports to our CIO who, in turn, reports directly to our CEO.
In performing his role, our CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through the management of, and participation in, the cybersecurity risk management and strategy processes described above, including the operation of our incident response plan.
Our CISO is an experienced cybersecurity executive with more than 20 years of experience building and leading cybersecurity, risk management, and information technology teams. Our CISO holds industry-recognized cybersecurity certifications, including Certified Information Systems Security Professional (CISSP) certification.
Our CISO reports to our Interim Chief Information Officer who, in turn, reports to our Chief Operating Officer and member of our executive leadership team. Our CISO is an experienced cybersecurity executive with more than 20 years of experience building and leading cybersecurity, risk management, and information technology teams.
Removed
We also have a cybersecurity incident response plan to assess and manage cybersecurity incidents, which includes escalation procedures based on the nature and severity of the incident including, where appropriate, escalation to the Audit Committee and the Board.
Added
Our CISO holds industry-recognized cybersecurity certifications, including having held Certified Information Systems Security Professional (CISSP) certification.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe majority of the square footage is active manufacturing space used by the FRS and FAS operating segments, as both use these properties. 33 Table of Content s Our facilities are well maintained and suitable for the operations conducted. The productive capacity of our plants is adequate for current needs.
Biggest changeOur facilities are well maintained and suitable for the operations conducted. The productive capacity of our plants is adequate for current needs.
As of March 31, 2024, the square footage of our facilities by region is as follows: Approximate Square Footage (In millions) Asia 19.7 Americas 15.8 Europe 11.2 Total (1) 46.7 (1) Consists of 21.6 million square feet in facilities that we own with the remaining 25.1 million square feet in leased facilities.
As of March 31, 2025, the square footage of our facilities by region is as follows: Approximate Square Footage (In millions) Asia 19.2 Americas 18.0 Europe 11.3 Total (1) 48.5 (1) Consists of 22.7 million square feet in facilities that we own with the remaining 25.8 million square feet in leased facilities. 31 Table of Contents
ITEM 2. PROPERTIES We own or lease facilities located primarily in the geographies listed below. Our facilities consist of a global network of industrial parks, regional manufacturing operations, and design, engineering and product introduction centers.
ITEM 2. PROPERTIES We own or lease facilities located primarily in the geographies listed below. Our facilities consist of a global network of industrial parks, regional manufacturing operations, and design, engineering and product introduction centers. The majority of the square footage is active manufacturing space used by the FRS and FAS operating segments, as both use these properties.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS For a description of our material legal proceedings, see note 14 "Commitments and Contingencies" to the consolidated financial statements included under Item 8, which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable 34 Table of Content s PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS For a description of our material legal proceedings, see note 14 "Commitments and Contingencies" to the consolidated financial statements included under Item 8, which is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable 32 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod (2) Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs January 1 - February 2, 2024 7,817,510 $ 23.58 7,817,510 $ 1,345,691,848 February 3 - March 1, 2024 6,306,583 $ 27.11 6,306,583 $ 1,174,692,742 March 2 - March 31, 2024 5,641,778 $ 28.71 5,641,778 $ 1,012,693,933 Total 19,765,871 19,765,871 (1) During the period from January 1, 2024 through March 31, 2024, all purchases were made pursuant to the program discussed below in open market transactions.
Biggest changePeriod (2) Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs January 1 - February 1, 2025 1,681,545 $ 41.42 1,681,545 $ 1,264,759,150 February 2 - March 1, 2025 1,866,481 $ 40.80 1,866,481 $ 1,188,610,528 March 2 - March 31, 2025 4,415,833 $ 34.92 4,415,833 $ 1,034,403,120 Total 7,963,859 7,963,859 (1) During the period from January 1, 2025 through March 31, 2025, all purchases were made pursuant to the program discussed below in open market transactions.
Shareholders who apply, or who are required to apply, the Singapore Financial Reporting Standard ("FRS") 39, FRS 109 or Singapore Financial Reporting Standard (International) 9 (“SFRS(I) 9”) (as the case may be) for the purposes of Singapore income tax may be required to recognize gains or losses (not being gains or losses in the nature of capital) in accordance with the provisions of FRS 39, FRS 109 or SFRS(I) 9 (as the case may be) (as modified by the applicable provisions of Singapore income tax law) even though no sale or disposal of shares is made.
Shareholders who apply, or who are required to apply, the Singapore Financial Reporting Standard ("FRS") 39, FRS 109 or Singapore Financial Reporting Standard (International) 9 ("SFRS(I) 9") (as the case may be) for the purposes of Singapore income tax may be required to recognize gains or losses (not being gains or losses in the nature of capital) in accordance with the provisions of FRS 39, FRS 109 or SFRS(I) 9 (as the case may be) (as modified by the applicable provisions of Singapore income tax law) even though no sale or disposal of shares is made.
This is in accordance with the share purchase mandate whereby our shareholders approved a repurchase limit of 20% of our issued ordinary shares outstanding at the Annual General Meeting held on the same date as the Board authorization. As of March 31, 2024, shares in the aggregate amount of $1.0 billion were available to be repurchased under the current plan.
This is in accordance with the share purchase mandate whereby our shareholders approved a repurchase limit of 20% of our issued ordinary shares outstanding at the Annual General Meeting held on the same date as the Board authorization. As of March 31, 2025, shares in the aggregate amount of $1.0 billion were available to be repurchased under the current plan.
This does not include persons whose stock is in nominee or "street name" accounts through brokers. DIVIDENDS Since inception, we have not declared or paid any cash dividends on our ordinary shares. We currently do not have plans to pay any cash dividends in fiscal year 2025. CERTAIN TAXATION CONSIDERATIONS UNDER SINGAPORE LAW Dividends.
This does not include persons whose stock is in nominee or "street name" accounts through brokers. DIVIDENDS Since inception, we have not declared or paid any cash dividends on our ordinary shares. We currently do not have plans to pay any cash dividends in fiscal year 2026. CERTAIN TAXATION CONSIDERATIONS UNDER SINGAPORE LAW Dividends.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET AND SHAREHOLDER INFORMATION Our ordinary shares are quoted on the Nasdaq Global Select Market under the symbol "FLEX." As of May 10, 2024, there were 2,821 holders of record of our ordinary shares.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES MARKET AND SHAREHOLDER INFORMATION Our ordinary shares are quoted on the Nasdaq Global Select Market under the symbol "FLEX." As of May 15, 2025, there were 2,736 holders of record of our ordinary shares.
Index Data: Copyright Standard and Poor's, Inc. Used with permission. All rights reserved. 36 Table of Content s Issuer Purchases of Equity Securities The following table provides information regarding purchases of our ordinary shares made by us for the period from January 1, 2024 through March 31, 2024.
Index Data: Copyright Standard and Poor's, Inc. Used with permission. All rights reserved. 34 Table of Contents Issuer Purchases of Equity Securities The following table provides information regarding purchases of our ordinary shares made by us for the period from January 1, 2025 through March 31, 2025.
All purchases were made in accordance with Rule 10b-18 under the Securities Exchange Act of 1934. (2) On August 2, 2023, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $2.0 billion.
All purchases were made in accordance with Rule 10b-18 under the Securities Exchange Act of 1934. (2) On August 8, 2024, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $1.7 billion.
The graph below compares the cumulative total shareholder return on our ordinary shares, the Standard & Poor's 500 Stock Index and a peer group comprised of Benchmark Electronics, Inc., Celestica Inc., Jabil Inc., and Sanmina Corporation. 35 Table of Content s The graph below assumes that $100 was invested in our ordinary shares, in the Standard & Poor's 500 Stock Index and in the peer group described above on March 31, 2019 and reflects the annual return through March 31, 2024, assuming dividend reinvestment.
The graph below compares the cumulative total shareholder return on our ordinary shares, the Standard & Poor's 500 Stock Index and a peer group comprised of Benchmark Electronics, Inc., Celestica Inc., Jabil Inc., and Sanmina Corporation. 33 Table of Contents The graph below assumes that $100 was invested in our ordinary shares, in the Standard & Poor's 500 Stock Index and in the peer group described above on March 31, 2020 and reflects the annual return through March 31, 2025, assuming dividend reinvestment.
RECENT SALES OF UNREGISTERED SECURITIES None. 37 Table of Content s ITEM 6. [ RESERVED ]
RECENT SALES OF UNREGISTERED SECURITIES None. 35 Table of Contents ITEM 6. [ RESERVED ]
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Flex, the S&P 500 Index, and Peer Group 3/19 3/20 3/21 3/22 3/23 3/24 Flex Ltd. 100.00 83.75 183.10 185.50 230.10 379.54 S&P 500 Index 100.00 93.02 145.44 168.20 155.20 201.57 Peer Group 100.00 84.67 163.15 184.77 254.99 403.96 Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2024.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Flex, the S&P 500 Index, and Peer Group 3/20 3/21 3/22 3/23 3/24 3/25 Flex Ltd. 100.00 218.63 221.49 274.75 453.19 524.00 S&P 500 Index 100.00 156.35 180.81 166.84 216.69 234.57 Peer Group 100.00 192.69 218.23 301.15 477.10 575.34 Prepared by Zacks Investment Research, Inc. Used with permission. All rights reserved. Copyright 1980-2025.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

97 edited+42 added−39 removed48 unchanged
Biggest changeThe effective rate varies from the Singapore statutory rate of 17.0% in each year as a result of the following items: Fiscal Year Ended March 31, 2024 2023 2022 Income taxes based on domestic statutory rates 17.0 % 17.0 % 17.0 % Effect of jurisdictional tax rate differential 10.3 % 6.4 % (10.1) % Change in unrecognized tax benefit (1.4) % (0.8) % 1.2 % Change in valuation allowance (102.9) % (35.9) % (14.0) % Foreign exchange movement on prior year taxes recoverable (0.2) % 0.5 % (0.9) % Liability for undistributed earnings 20.3 % — % 0.1 % Global intangible low-taxes income (GILTI) / Subpart F income 1.9 % 2.2 % 3.1 % Nextracker related transactions gains 17.2 % 19.5 % 11.5 % Earnings from partnership 7.0 % 4.8 % — % U.S. state taxes 1.5 % 0.2 % 0.5 % Excess compensation (Section 162(m)) 2.3 % 1.2 % 0.5 % Other (3.9) % 0.3 % 0.6 % (Benefit from) provision for income taxes (30.9) % 15.4 % 9.5 % The variation in our effective tax rate each year to the statutory rate is primarily a result of recognition of earnings in foreign jurisdictions which are taxed at rates lower than the Singapore statutory rate including the effect of tax holidays and tax incentives we received primarily for our subsidiaries in China, Malaysia, Netherlands, Costa Rica, and Israel of $20 million, $14 million and $23 million in fiscal years 2024, 2023 and 2022, respectively.
Biggest changeThe effective rate varies from the Singapore statutory rate of 17.0% in each year as a result of the following items: Fiscal Year Ended March 31, 2025 2024 Income taxes based on domestic statutory rates 17.0 % 17.0 % Effect of jurisdictional tax rate differential 1.3 % 10.3 % Change in unrecognized tax benefit (1.9) % (1.4) % Change in valuation allowance (3.6) % (102.9) % Foreign exchange movement on prior year taxes recoverable 0.4 % (0.2) % Liability for undistributed earnings 0.6 % 20.3 % Global intangible low-taxes income (GILTI) / Subpart F income 0.9 % 1.9 % Nextracker related transactions gains — % 17.2 % Earnings from partnership — % 7.0 % U.S. state taxes 1.0 % 1.5 % Excess compensation (Section 162(m)) 1.6 % 2.3 % Other 0.8 % (3.9) % (Benefit from) provision for income taxes 18.1 % (30.9) % A number of countries in which the Company is located allow for tax holidays or provide other tax incentives to attract and retain business.
We are regularly subject to tax return audits and examinations by various taxing jurisdictions around the world, and there can be no assurance that the final determination of any tax examinations will not be materially different than that which is reflected in our income tax provisions and accruals.
We are regularly subject to tax return audits and examinations by various taxing jurisdictions around the world, and there can be no assurance that the final determination of any tax examinations will not be materially different than that which is reflected in our income tax provisions and accruals.
Segment income is defined as net sales less cost of sales, and segment selling, general and administrative expenses, and does not include amortization of intangibles, stock-based compensation, restructuring charges, customer related asset impairment, legal and other, interest expense, interest income, other charges (income), net, and equity in earnings of unconsolidated affiliates.
Segment income is defined as net sales less cost of sales, and segment selling, general and administrative expenses, and does not include amortization of intangibles, stock-based compensation, certain restructuring charges, customer related asset impairment, legal and other, interest expense, interest income, other charges (income), net, and equity in earnings of unconsolidated affiliates.
CONTRACTUAL OBLIGATIONS AND COMMITMENTS Refer to the note 9 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for details of our debt obligations. In addition. we have leased certain of our property and equipment under finance lease commitments, and certain of our facilities and equipment under operating lease commitments.
Refer to note 9 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for details of our debt obligations. In addition. we have leased certain of our property and equipment under finance lease commitments, and certain of our facilities and equipment under operating lease commitments.
On January 2, 2024, we completed the previously announced Spin-off to Flex shareholders on a pro-rata basis based on the number ordinary shares of Flex held by each shareholder of Flex (the “Distribution”) as of December 29, 2023, which was the record date of the Distribution, pursuant to the Agreement and Plan of Merger, dated as of February 7, 2023.
On January 2, 2024, we completed the previously announced Nextracker spin-off to Flex shareholders on a pro-rata basis based on the number ordinary shares of Flex held by each shareholder of Flex (the "Distribution") as of December 29, 2023, which was the record date of the Distribution, pursuant to the Agreement and Plan of Merger, dated as of February 7, 2023.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and notes thereto included in Item 8, “Financial Statements and Supplementary Data.” In addition to historical consolidated financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and notes thereto included in Item 8, "Financial Statements and Supplementary Data." In addition to historical consolidated financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions.
We maintain a commercial paper program which provides short-term financing under which there were no borrowings outstanding as of March 31, 2024. Historically, we have funded operations from cash and cash equivalents generated from operations, proceeds from public offerings of debt securities, bank debt and lease financings.
We maintain a commercial paper program which provides short-term financing under which there were no borrowings outstanding as of March 31, 2025. Historically, we have funded operations from cash and cash equivalents generated from operations, proceeds from public offerings of debt securities, bank debt and lease financings.
As of March 31, 2024 and 2023, the outstanding balance on receivables sold for cash was $0.8 billion and $0.8 billion, respectively, under our accounts receivable factoring programs, which were removed from accounts receivable balances in our consolidated balance sheets. Historically we have been successful in refinancing and extending the maturity dates on our term loans and credit facilities.
As of March 31, 2025 and 2024, the outstanding balance on receivables sold for cash was $0.7 billion and $0.8 billion, respectively, under our accounts receivable factoring programs, which were removed from accounts receivable balances in our consolidated balance sheets. Historically we have been successful in refinancing and extending the maturity dates on our term loans and credit facilities.
These price adjustments include, but are not limited to, sharing of cost savings, committed price reductions, material margins earned over the period that are contractually required to be paid to the customers, rebates, refunds tied to performance metrics such as on-time delivery, and other periodic pricing resets that may be refundable to customers.
These price adjustments include, but are not limited to, sharing of cost savings, committed price reductions, material margins earned 40 Table of Contents over the period that are contractually required to be paid to the customers, rebates, refunds tied to performance metrics such as on-time delivery, and other periodic pricing resets that may be refundable to customers.
We have made substantial efforts to maintain a diverse portfolio which allows us to operate at scale in many different industries, and, as a result, no customer accounted for greater than 10% of net sales in fiscal year 2024, 2023 or 2022.
We have made substantial efforts to maintain a diverse portfolio which allows us to operate at scale in many different industries, and, as a result, no customer accounted for greater than 10% of net sales in fiscal year 2025 or 2024.
As of March 31, 2024, we had cash and cash equivalents of approximately $2.5 billion and bank and other borrowings of approximately $3.3 billion. We have a $2.5 billion revolving credit facility that is due to mature in July 2027 (the "2027 Credit Facility"), under which we had no borrowings outstanding as of March 31, 2024.
As of March 31, 2025, we had cash and cash equivalents of approximately $2.3 billion and bank and other borrowings of approximately $3.7 billion. We have a $2.5 billion revolving credit facility that is due to mature in July 2027 (the "2027 Credit Facility"), under which we had no borrowings outstanding as of March 31, 2025.
Where local restrictions prevent an efficient intercompany transfer of funds, our intent is that cash balances would remain outside of Singapore and we would meet our liquidity needs through ongoing cash flows, external borrowings, or both. Fiscal Year 2024 Cash provided by operating activities was $1.3 billion during fiscal year 2024.
Where local restrictions prevent an efficient intercompany transfer of funds, our intent is that cash balances would remain outside of Singapore and we would meet our liquidity needs through ongoing cash flows, external borrowings, or both. Fiscal Year 2025 Cash provided by operating activities was $1.5 billion during fiscal year 2025.
This decrease was primarily driven by a $1.2 billion decrease in inventories, a $0.5 billion decrease in accounts receivable, net and derecognition of $0.4 billion of Nextracker's working capital following the Spin-off, partially offset by a $1.3 billion decrease in accounts payables. 49 Table of Content s Cash used in investing activities totaled $0.5 billion during fiscal year 2024.
This decrease was primarily driven by a $1.2 billion decrease in inventories, a $0.5 billion decrease in accounts receivable, net and derecognition of $0.4 billion of Nextracker's working capital following the spin-off, partially offset by a $1.3 billion decrease in accounts payables. Cash used in investing activities totaled $0.5 billion during fiscal year 2024.
Some of the inherent estimates and assumptions used in determining fair value of the reporting units are outside the control of management, including interest rates, cost of capital, tax rates, market EBITDA market comparables and credit ratings.
Some of the inherent estimates and assumptions used in determining fair value of the reporting units are outside the control of management, including interest 41 Table of Contents rates, cost of capital, tax rates, market EBITDA comparables and credit ratings.
Our adjusted free cash flow is defined as cash from operations, less net purchases of property and equipment to present adjusted cash flows on a consistent basis for investor transparency. Our adjusted free cash flow was $0.8 billion and $0.3 billion for fiscal years 2024 and 2023, respectively.
Our adjusted free cash flow is defined as cash from operations, less net purchases of property and equipment to present adjusted cash flows on a consistent basis for investor transparency. Our adjusted free cash flow was $1.1 billion and $0.8 billion for fiscal years 2025 and 2024, respectively.
We provide for tax liabilities on these amounts for financial statement purposes, except for certain of our foreign earnings that are considered indefinitely reinvested outside of Singapore (approximately $0.7 billion as of March 31, 2024).
We provide for tax liabilities on these amounts for financial statement purposes, except for certain of our foreign earnings that are considered indefinitely reinvested outside of Singapore (approximately $0.8 billion as of March 31, 2025).
We intend to use our existing cash balances, together with anticipated cash flows from operations to fund our existing and future contractual obligations. RECENT ACCOUNTING PRONOUNCEMENTS Refer to note 2 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for recent accounting pronouncements. 52 Table of Content s
We intend to use our existing cash balances, together with anticipated cash flows from operations to fund our existing and future contractual obligations. RECENT ACCOUNTING PRONOUNCEMENTS Refer to note 2 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for recent accounting pronouncements. 49 Table of Contents
Our operating results are affected by a number of factors, including the following: • global economic conditions, including inflationary pressures, currency volatility, slower growth or recession, higher interest rates, and geopolitical uncertainty (including arising from the ongoing conflict between Russia and Ukraine and the Israel-Hamas war); • the mix of the manufacturing services we are providing, the number, size, and complexity of new manufacturing programs, the degree to which we utilize our manufacturing capacity, seasonal demand, and other factors; • the effects on our business when our customers are not successful in marketing their products, or when their products do not gain widespread commercial acceptance; 40 Table of Content s • our ability to achieve commercially viable production yields and to manufacture components in commercial quantities to the performance specifications demanded by our customers; • the effects on our business due to certain customers' products having short product lifecycles, our customers' ability to cancel or delay orders or change production quantities or locations, the short-term nature of our customers' commitments and rapid changes in demand; • the effects that current credit and market conditions (including as a result of the ongoing conflict between Russia and Ukraine and the Israel-Hamas war) could have on the liquidity and financial condition of our customers and suppliers, including any impact on their ability to meet their contractual obligations; • the impacts on our business due to supply chain issues, including component shortages, disruptions in transportation or other supply chain related constraints including disruptions in international commerce as a result of attacks on shipping vessels in the Red Sea; • integration of acquired businesses and facilities; • increased labor costs due to adverse labor conditions in the markets we operate; • changes in tax legislation; • changes in trade regulations and treaties; and • exposure to infectious disease, epidemics and pandemics on our business operations in geographic locations impacted by an outbreak and on the business operations of our customers and suppliers.
Our operating results are affected by a number of factors, including the following: • global economic conditions, including inflationary pressures, currency volatility, stagflation, slower economic growth or recession, high or rising interest rates, trade conflicts, tariffs, geopolitical uncertainty and instability in financial markets; • the mix of the manufacturing services we are providing, the number, size, and complexity of new manufacturing programs, the degree to which we utilize our manufacturing capacity, seasonal demand, and other factors; • the effects on our business when our customers are not successful in marketing their products, or when their products do not gain widespread commercial acceptance; • our ability to achieve commercially viable production yields and to manufacture components in commercial quantities to the performance specifications demanded by our customers; • the effects on our business due to certain customers' products having short product lifecycles, our customers' ability to cancel or delay orders or change production quantities or locations, the short-term nature of our customers' commitments and rapid changes in demand; • the effects that current credit and market conditions could have on the liquidity and financial condition of our customers and suppliers, including any impact on their ability to meet their contractual obligations; • the impacts on our business due to supply chain issues, including component shortages, disruptions in transportation or other supply chain related constraints including disruptions in international commerce as a result of attacks on shipping vessels in the Red Sea; • integration of acquired businesses and facilities; • increased labor costs due to adverse labor conditions in the markets we operate; • changes in tax legislation; • changes in trade regulations and treaties; and • exposure to infectious disease, epidemics and pandemics on our business operations in geographic locations impacted by an outbreak and on the business operations of our customers and suppliers.
Under our current share repurchase program, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $2 billion in accordance with the share purchase mandate approved by our shareholders at the date of the most recent Annual General Meeting which was held on August 2, 2023.
Under our current share repurchase program, our Board of Directors authorized repurchases of our outstanding ordinary shares for up to $1.7 billion in accordance with the share purchase mandate approved by our shareholders at the date of the most recent Annual General Meeting which was held on August 8, 2024.
Restructuring charges During fiscal year 2024, we committed to targeted restructuring activities to improve operational efficiency by reducing excess workforce capacity. As a result, we recognized approximately $175 million of restructuring charges, primarily related to employee severance. During fiscal year 2023 , we recognized approximately $27 million of restructuring charges, primarily related to employee severance.
Restructuring charges During fiscal year 2025, we committed to targeted restructuring activities to improve operational efficiency by reducing excess workforce capacity. As a result, we recognized approximately $86 million of restructuring charges, primarily related to employee severance. During fiscal year 2024 , we recognized approximately $175 million of restructuring charges, also primarily related to employee severance.
Net income from continuing operations Net income from continuing operations was $872 million during fiscal year 2024, compared to $683 million during fiscal year 2023, primarily driven by the same factors attributable to income from continuing operations before income taxes and the release of U.S. deferred tax asset valuation allowances in fiscal year 2024 as discussed above.
Net income from continuing operations Net income from continuing operations was $838 million during fiscal year 2025, compared to $872 million during fiscal year 2024, primarily driven by the same factors attributable to income from continuing operations before income taxes and the release of U.S. deferred tax asset valuation allowances in fiscal year 2024 as outlined above.
During fiscal year 2024, we paid $1.3 billion to repurchase shares under the current and prior repurchase plans at an average price of $25.65 per share. As of March 31, 2024, shares in the aggregate amount of $1.0 billion were available to be repurchased under the current plan.
During fiscal year 2025, we paid $1.3 billion to repurchase shares under the current and prior repurchase plans at an average price of $32.66 per share. As of March 31, 2025, shares in the aggregate amount of $1.0 billion were available to be repurchased under the current plan.
We may enter into debt and equity financings, sales of accounts receivable and lease transactions to fund acquisitions and anticipated growth as needed. During fiscal year 2024, 2023 and 2022, we received approximately $3.6 billion, $3.5 billion, and $1.6 billion, respectively, from other sales of receivables under our factoring programs.
We may enter into debt and equity financings, sales of accounts receivable and lease transactions to fund acquisitions and anticipated growth as needed. During fiscal year 2025 and 2024, we received approximately $4.0 billion and $3.6 billion, respectively, from other sales of receivables under our factoring programs.
Certain of our subsidiaries have, at various times, been granted tax relief in their respective countries, resulting in lower income taxes than would otherwise be the case under ordinary tax rates. The consolidated effective tax rates were (30.9)%, 15.4% and 9.5% for the fiscal years 2024, 2023 and 2022 respectively.
Certain of our subsidiaries have, at various times, been granted tax relief in their respective countries, resulting in lower income taxes than would otherwise be the case under ordinary tax rates. The consolidated effective tax rates were 18.1% and (30.9)% for the fiscal years 2025 and 2024, respectively.
Due to geopolitical conflicts (including the Russian invasion of Ukraine and the Israel-Hamas war), there has been and we expect there will continue to be uncertainty and disruption in the global economy and financial markets.
Due to global economic conditions, including the impact of ongoing trade conflicts and tariffs, and geopolitical conflicts (including the Russian invasion of Ukraine and the Israel-Hamas war), there has been and we expect there will continue to be uncertainty and disruption in the global economy and financial markets.
Prior to the IPO, we maintained an 82.6% indirect ownership in Nextracker and consolidated Nextracker. Subsequent to the IPO and follow-on offering, we retained a 51.5% indirect ownership in Nextracker and continued to consolidate Nextracker and report Nextracker as an operating segment.
Subsequent to the IPO and follow-on offering, we retained a 51.5% indirect ownership in Nextracker and continued to consolidate Nextracker and report Nextracker as an operating segment.
The margin increase during the period was driven by strong execution, product mix and cost actions taken. FRS segment margin increased 50 basis points, to 5.3% for fiscal year 2024, from 4.8% for fiscal year 2023.
The margin increase during the period was driven by strong execution, product mix and cost actions taken. FRS segment margin increased 50 basis points, to 5.8% for fiscal year 2025, from 5.3% for fiscal year 2024. The margin increase in the FRS segment was primarily driven by increased productivity, favorable mix and cost actions taken.
Fiscal Year 2022 Cash provided by operating activities was $1.0 billion during fiscal year 2022. The total cash provided by operating activities resulted primarily from $0.9 billion of net income for the period plus $0.6 billion of non-cash charges such as depreciation, amortization, non-cash lease expense, restructuring and impairment charges, provision for doubtful accounts, deferred income taxes and stock-based compensation.
Fiscal Year 2024 Cash provided by operating activities was $1.3 billion during fiscal year 2024. The total cash provided by operating activities resulted primarily from $1.2 billion of net income for the period plus $0.3 billion of non-cash charges such as depreciation, amortization, non-cash lease expense, restructuring and impairment charges, deferred income taxes and stock-based compensation.
Equity in earnings (losses) of unconsolidated affiliates During fiscal year 2024 , we recorded $8 million of equity in earnings of unconsolidated affiliates, compared to $4 million of equity in losses of unconsolidated affiliates during fiscal year 2023.
Equity in earnings (losses) of unconsolidated affiliates During fiscal year 2025 , we recorded $3 million of equity in losses of unconsolidated affiliates, compared to $8 million of equity in earnings of unconsolidated affiliates during fiscal year 2024.
Fiscal Year Ended March 31, 2024 2023 2022 Net sales 100.0 % 100.0 % 100.0 % Cost of sales 92.4 93.0 92.7 Restructuring charges 0.5 0.1 0.1 Gross profit 7.1 6.9 7.2 Selling, general and administrative expenses 3.5 3.1 3.4 Intangible amortization 0.3 0.2 0.2 Restructuring charges 0.1 — — Operating income 3.2 3.6 3.6 Interest expense 0.8 0.8 0.7 Interest income 0.2 — 0.1 Other charges (income), net 0.2 — (0.7) Equity in earnings (losses) of unconsolidated affiliates 0.1 — 0.2 Income from continuing operations before income taxes 2.5 2.8 3.9 (Benefit from) provision for income taxes (0.8) 0.4 0.4 Net income from continuing operations 3.3 2.4 3.5 Net income from discontinued operations, net of tax 1.4 1.2 0.3 Net income 4.7 3.6 3.8 Net income attributable to noncontrolling interest and redeemable noncontrolling interest 0.9 0.8 — Net income attributable to Flex Ltd. 3.8 % 2.8 % 3.8 % Net sales The following table sets forth our net sales by segment, and their relative percentages: Fiscal Year Ended March 31, 2024 2023 2022 Net sales: (In millions) Flex Agility Solutions $ 13,923 53 % $ 15,769 55 % $ 14,027 57 % Flex Reliability Solutions 12,492 47 % 12,733 45 % 10,606 43 % $ 26,415 $ 28,502 $ 24,633 Net sales for the fiscal year ended March 31, 2024 totaled $26.4 billion, representing a decrease of approximately $2.1 billion, o r 7%, fr om $28.5 billion for the fiscal year ended March 31, 2023.
Fiscal Year Ended March 31, 2025 2024 Net sales 100.0 % 100.0 % Cost of sales 91.4 92.4 Restructuring charges 0.2 0.5 Gross profit 8.4 7.1 Selling, general and administrative expenses 3.5 3.5 Intangible amortization 0.3 0.3 Restructuring charges 0.1 0.1 Operating income 4.5 3.2 Interest expense 0.8 0.8 Interest income 0.2 0.2 Other charges (income), net (0.1) 0.2 Equity in earnings (losses) of unconsolidated affiliates — 0.1 Income from continuing operations before income taxes 4.0 2.5 Provision for (benefit from) income taxes 0.8 (0.8) Net income from continuing operations 3.2 3.3 Net income from discontinued operations, net of tax — 1.4 Net income 3.2 4.7 Net income attributable to noncontrolling interest and redeemable noncontrolling interest — 0.9 Net income attributable to Flex Ltd. 3.2 % 3.8 % Net sales 42 Table of Contents The following table sets forth our net sales by segment, and their relative percentages: Fiscal Year Ended March 31, 2025 2024 Net sales: (In millions) Flex Agility Solutions $ 14,074 55 % $ 13,923 53 % Flex Reliability Solutions 11,739 45 % 12,492 47 % $ 25,813 $ 26,415 Net sales for the fiscal year ended March 31, 2025 totaled $25.8 billion, representing a decrease of approximately $0.6 billion, o r 2%, fr om $26.4 billion for the fiscal year ended March 31, 2024.
Adjusted free cash flow is not a measure of liquidity under U.S. GAAP, and may not be defined and calculated by other companies in the same manner. Adjusted free cash flow should not be considered in isolation or as an alternative to net cash provided by operating activities.
GAAP, and may not be defined and calculated by other companies in the same manner. Adjusted free cash flow should not be considered in isolation or as an alternative to net cash provided by operating activities.
These additions were offset by a net change in our operating assets and liabilities of $0.3 billion. We believe net working capital is a key metric that measures our liquidity. Net working capital is calculated as current assets less current liabilities.
Depreciation expense was $0.4 billion and relatively consistent with prior years. These additions were offset by a net change in our operating assets and liabilities of $0.3 billion. We believe net working capital is a key metric that measures our liquidity. Net working capital is calculated as current assets less current liabilities.
As a result of these various factors, our gross margin varies from period to period. Gross profit during fiscal year 2024 decreased $0.1 billion to $1.9 billion, or 7.1% of net sales, from $2.0 billion, or 6.9% of net sales, during fiscal year 2023 .
As a result of these various factors, our gross margin varies from period to period. Gross profit during fiscal year 2025 increased $0.3 billion to $2.2 billion, or 8.4% of net sales, from $1.9 billion, or 7.1% of net sales, during fiscal year 2024 .
We have made estimates and assumptions taking into consideration certain possible impacts due to the Russian invasion of Ukraine, the Israel-Hamas war, and other geopolitical conflicts. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the consolidated financial statements.
We have made estimates and assumptions taking into consideration certain possible impacts due to the foregoing factors. These estimates may change, as new events occur, and additional information is obtained. Actual results may differ from previously estimated amounts, and such differences may be material to the consolidated financial statements.
As of March 31, 2024, approximately 55% of our cash and cash equivalents were held by foreign subsidiaries outside of Singapore. Although substantially all of the amounts held outside of Singapore could be repatriated, under current laws, a significant amount could be subject to income tax withholdings.
Our cash balances are held in numerous locations throughout the world. As of March 31, 2025, approximately 81% of our cash and cash equivalents were held by foreign subsidiaries outside of Singapore. Although substantially all of the amounts held outside of Singapore could be repatriated, under current laws, a significant amount could be subject to income tax withholdings.
The sale or issuance of equity or convertible debt securities could result in dilution to current shareholders. Further, we may issue debt securities that have rights and privileges senior to those of holders of ordinary shares, and the terms of this debt could impose restrictions on operations and could increase debt service obligations.
Further, we may issue debt securities that have rights and privileges senior to those of holders of ordinary shares, and the terms of this debt could impose restrictions on operations and could increase debt service obligations.
Net sales for the fiscal year ended March 31, 2023 increased $2.5 billion to $11.9 billion in the Americas, increased $0.8 billion to $10.4 billion in Asia, and increased $0.6 billion to $6.2 billion in Europe. Our ten largest customers during fiscal years 2024, 2023 and 2022 accounted for approximately 37%, 37% and 36% of net sales, respectively.
Net sales for the fiscal year ended March 31, 2025 increased $0.4 billion to $12.7 billion in the Americas, decreased $0.8 billion to $7.7 billion in Asia, and decreased $0.2 billion to $5.5 billion in Europe. Our ten largest customers during fiscal years 2025 and 2024 accounted for approximately 44% and 37% of net sales, respectively.
Our adjusted free cash flow is defined as cash from operations, less net purchases of property and equipment to present adjusted cash flows on a consistent basis for investors. Our adjusted free cash flow was $0.8 billion, $0.3 billion and $0.6 billion for fiscal years 2024, 2023 and 2022, respectively.
Our adjusted free cash flow is defined as cash from operations, less net purchases of property and equipment to present adjusted free cash flows on a consistent basis for investors. Our adjusted free cash flow was $1.1 billion and $0.8 billion for fiscal years 2025 and 2024, respectively. Adjusted free cash flow is not a measure of liquidity under U.S.
We also are subject to other risks as outlined in Item 1A, "Risk Factors". Net sales for fiscal year 2024 decreased approximately 7%, or $2.1 billion, to $26.4 billion from the prior year.
We also are subject to other risks as outlined in Item 1A, "Risk Factors". Net sales for fiscal year 2025 decreased approximately 2%, or $0.6 billion, to $25.8 billion from the prior year.
The total cash provided by operating activities resulted primarily from $1.0 billion of net income for the period plus $0.5 billion of non-cash charges such as depreciation, amortization, non-cash lease expense, restructuring and impairment charges, provision for doubtful accounts, deferred income taxes and stock-based compensation. Depreciation expense was $0.4 billion and relatively consistent with prior years.
The total cash provided by operating activities resulted primarily from $0.8 billion of net income for the period plus $0.8 billion of non-cash charges such as depreciation, amortization, non-cash lease expense, restructuring and impairment charges, deferred income taxes and stock-based compensation.
Fiscal Year Ended March 31, 2024 2023 2022 (In millions) Segment income: Flex Agility Solutions $ 669 4.8 % $ 694 4.4 % $ 605 4.3 % Flex Reliability Solutions 666 5.3 % 607 4.8 % 546 5.1 % FAS segment margin increased 40 basis points, to 4.8% for fiscal year 2024, from 4.4% for fiscal year 2023.
Fiscal Year Ended March 31, 2025 2024 (In millions) Segment income: Flex Agility Solutions $ 854 6.1 % $ 669 4.8 % Flex Reliability Solutions 684 5.8 % 666 5.3 % FAS segment margin increased 130 basis points, to 6.1% for fiscal year 2025, from 4.8% for fiscal year 2024.
Refer to note 17 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our other charges (income), net.
Refer to note 16 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our restructuring activities.
Net income attributable to noncontrolling interest and redeemable noncontrolling interest Net income attributable to noncontrolling interest and redeemable noncontrolling interest was $239 million, prior to the Spin-off during fiscal year 2024, compared to $240 million during fiscal year 2023, primarily driven by the same factors noted in the discussion above for net income from discontinued operations in fiscal year 2024.
Net income attributable to noncontrolling interest Net income attributable to noncontrolling interest was zero in fiscal year 2025, c ompared to $239 million during fiscal year 2024, primarily driven by the same factors noted in the discussion above for net income from discontinued operations.
We believe that our existing cash balances, together with anticipated cash flows from operations and borrowings available under our credit facilities, will be sufficient to fund our operations through at least the next twelve months and beyond.
We do not currently expect such regulations and restrictions to impact our ability to pay vendors and conduct operations throughout the global organization. We believe that our existing cash balances, together with anticipated cash flows from operations and borrowings available under our credit facilities, will be sufficient to fund our operations through at least the next twelve months and beyond.
An impairment loss is recognized when the carrying amount of the asset group exceeds its fair value. Recoverability of property and equipment and acquired amortizable intangible assets are measured by comparing their carrying amount to the projected cash flows the assets are expected to generate.
Recoverability of property and equipment and acquired amortizable intangible assets are measured by comparing their carrying amount to the projected cash flows the assets are expected to generate.
The following tables set forth the relative percentages and dollar amounts of net sales by region and by country, and net property and equipment, by country, based on the location of our manufacturing sites (amounts may not sum due to rounding): 39 Table of Content s Fiscal Year Ended March 31, 2024 2023 2022 (In millions) Net sales by region: Americas $ 12,232 46 % $ 11,906 42 % $ 9,414 38 % Asia 8,540 32 % 10,384 36 % 9,615 39 % Europe 5,643 22 % 6,212 22 % 5,604 23 % $ 26,415 $ 28,502 $ 24,633 Net sales by country: Mexico $ 6,935 26 % $ 6,626 23 % $ 5,092 21 % China 5,117 19 % 6,562 23 % 6,160 25 % U.S. 3,598 14 % 3,394 12 % 2,414 10 % Malaysia 2,122 8 % 2,448 9 % 1,866 8 % Brazil 1,529 6 % 1,769 6 % 1,842 7 % Hungary 1,368 5 % 1,310 5 % 1,230 5 % Other 5,746 22 % 6,393 22 % 6,029 24 % $ 26,415 $ 28,502 $ 24,633 Fiscal Year Ended March 31, 2024 2023 (In millions) Property and equipment, net: Mexico $ 793 35 % $ 763 33 % U.S. 334 15 % 358 15 % China 307 14 % 338 14 % Malaysia 142 6 % 152 6 % Hungary 124 5 % 140 6 % Brazil 88 4 % 89 4 % Other 481 21 % 502 22 % $ 2,269 $ 2,342 We believe that the combination of our extensive open innovation platform solutions, design and engineering services, advanced supply chain management solutions and services, significant scale and global presence, and manufacturing campuses in low-cost geographic areas provide us with a competitive advantage and strong differentiation in the market for designing, manufacturing and servicing consumer and enterprise products for leading multinational and regional customers.
The following tables set forth the relative percentages and dollar amounts of net sales by region and by country, and net property and equipment, by country, based on the location of our manufacturing sites (amounts may not sum due to rounding): Fiscal Year Ended March 31, 2025 2024 (In millions) Net sales by region: Americas $ 12,656 49 % $ 12,232 46 % Asia 7,701 30 % 8,540 32 % Europe 5,456 21 % 5,643 22 % $ 25,813 $ 26,415 Net sales by country: Mexico $ 6,854 27 % $ 6,935 26 % China 4,319 17 % 5,117 19 % U.S. 4,162 16 % 3,598 14 % Malaysia 2,379 9 % 2,122 8 % Brazil 1,552 6 % 1,529 6 % Hungary 1,316 5 % 1,368 5 % Other 5,231 20 % 5,746 22 % $ 25,813 $ 26,415 Fiscal Year Ended March 31, 2025 2024 (In millions) Property and equipment, net: Mexico $ 815 35 % $ 793 35 % U.S. 376 16 % 334 15 % China 293 13 % 307 14 % Malaysia 163 7 % 142 6 % Hungary 140 6 % 124 5 % Brazil 83 4 % 88 4 % Other 460 19 % 481 21 % $ 2,330 $ 2,269 38 Table of Contents We believe that the combination of our extensive open innovation platform solutions, design and engineering services, advanced supply chain management solutions and services, significant scale and global presence, and manufacturing campuses, including many in low-cost geographic areas provide us with a competitive advantage and strong differentiation in the market for designing, manufacturing and servicing products for leading multinational and regional customers.
Should additional taxes be assessed as a result of a current or future examination, there could be a material adverse effect on our tax position, operating results, financial position and cash flows.
Should additional taxes be assessed as a result of a current or future examination, there could be a material adverse effect on our tax position, operating results, financial position and cash flows. Refer to note 15 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our tax position.
The objective of our business model is to allow us to be flexible and redeploy and reposition our assets and resources as necessary to meet specific customers' supply chain solution needs across all the markets we serve and earn a return on our invested capital above the weighted average cost of that capital.
The objective of our business model is to allow us to be flexible and redeploy and reposition our assets and resources as necessary to meet specific customers' supply chain solution needs across all the markets we serve and earn a return on our invested capital above the weighted average cost of that capital. 36 Table of Contents We believe that our strategy is positioning us to take advantage of the long-term, future growth prospects for outsourcing of advanced manufacturing capabilities, design and engineering services and after-market services.
This was primarily driven by approximately $0.5 billion of cash paid for the acquisition of Anord Mardix in December 2021, net of cash acquired, and approximately $0.4 billion of capital expenditures for property and equipment to continue expanding capabilities and capacity in support of our expanding Lifestyle, Automotive, and Industrial businesses.
This was primarily driven by $0.4 billion of cash paid for the acquisitions of the Orangeburg manufacturing facility, Crown and JetCool, net of cash acquired, and $0.4 billion of capital expenditures for property and equipment to continue expanding capabilities and capacity in support of our businesses.
Refer to note 15 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our tax position. 43 Table of Content s RESULTS OF OPERATIONS The following table sets forth, for the periods indicated, certain statements of operations data expressed as a percentage of net sales (amounts may not sum due to rounding).
RESULTS OF OPERATIONS The following table sets forth, for the periods indicated, certain statements of operations data expressed as a percentage of net sales (amounts may not sum due to rounding). The financial information and the discussion below should be read in conjunction with the consolidated financial statements and notes thereto included in Item 8, "Financial Statements and Supplementary Data".
As of March 31, 2024, as a result of the Spin-off in the fourth quarter of fiscal year 2024, we now report our financial performance based on two operating and reportable segments as follows: • Flex Agility Sol utions ("FAS"), which is comprised of the following end markets: ◦ Communications, Enterprise and Cloud ("CEC") , including data infrastructure, edge infrastructure and communications infrastructure ◦ Lifestyle , including appliances, consumer packaging, floorcare, micro mobility and audio ◦ Consumer Devices , including mobile and high velocity consumer devices. • Flex Reliability Solutions ("FRS"), which is comprised of the following end markets: ◦ Automotive , including next generation mobility, autonomous, connectivity, electrification, and smart technologies ◦ Health Solutions , including medical devices, medical equipment, and drug delivery ◦ Industrial , including capital equipment, industrial devices, embedded and critical power offerings, and renewables and grid edge.
As of March 31, 2025, we report our financial performance based on two operating and reportable segments as follows: • Flex Agility Sol utions ("FAS"), which is comprised of the following end markets: ◦ Communications, Enterprise and Cloud ("CEC") , including data center, edge, and communications infrastructure ◦ Lifestyle , including appliances, floorcare, smart living, HVAC, and power tools ◦ Consumer Devices , including mobile and high velocity consumer devices. • Flex Reliability Solutions ("FRS"), which is comprised of the following end markets: ◦ Industrial , including industrial devices, capital equipment, renewables, critical power, and embedded power. ◦ Automotive , including compute platforms, power electronics, motion, and interface ◦ Health Solutions , including medical devices, medical equipment, and drug delivery In fiscal year 2025, we formally introduced the next phase in our strategic evolution, its EMS + Products + Services approach.
Net sales for our FRS segment decreased $0.2 billion, or 2%, from the prior year, primarily driven by a decrease in net sales of 8% in our Industrial business due to lower customer demand, partially offset by a 6% increase in our Automotive business and a 3% increase in our Health Solutions business which benefited from ramps across various end markets.
Net sales for our FRS segment decreased $0.8 billion, or 6%, from the prior year, primarily driven by a decrease in net sales of 10% in our Industrial business which was driven by weaker demand in renewables, clean energy and industrial devices partially offset by strong growth and the Crown acquisition in critical power offerings, a 3% decrease in our Automotive business and a 3% decrease in our Health Solutions business, both due to lower customer demand.
The following table summarizes current and non-current material cash requirements as of March 31, 2024 including f uture payments due under our debt including finance leases and related interest obligations and operating leases (amounts may not sum due to rounding): 51 Table of Content s Total 1 Year or Less 2 - 3 Years 4 - 5 Years Greater Than 5 Years (In millions) Contractual Obligations: Bank borrowings, long-term debt and finance lease obligations: Bank borrowings and long-term debt $ 3,276 $ — $ 1,266 $ 424 $ 1,586 Finance leases 1 1 — — — Interest on long-term debt obligations 558 139 207 153 59 Operating leases, net of subleases 712 160 239 157 156 Restructuring costs 80 79 1 — — Total contractual obligations $ 4,627 $ 379 $ 1,713 $ 734 $ 1,801 We also have outstanding firm purchase orders with certain suppliers for the purchase of inventory, which are not included in the table above.
The following table summarizes current and non-current material cash require ments as of March 31, 2025 in cluding f uture payments due under our debt including finance leases and related interest obligations and operating leases (amounts may not sum due to rounding): 48 Table of Contents Total 1 Year or Less 2 - 3 Years 4 - 5 Years Greater Than 5 Years (In millions) Contractual Obligations: Bank borrowings, long-term debt and finance lease obligations: Bank borrowings and long-term debt $ 3,706 $ 1,209 $ 398 $ 709 $ 1,390 Interest on long-term debt obligations 642 146 242 174 80 Operating leases, net of subleases 670 158 232 146 134 Restructuring costs 51 51 — — — Total contractual obligations $ 5,069 $ 1,564 $ 872 $ 1,029 $ 1,604 We also have outstanding firm purchase orders with certain suppliers for the purchase of inventory, which are not included in the table above.
Our net income totaled $0.9 billion, representing an increase of $0.2 billion, or 28%, compared to fiscal year 2023, due to the factors explained above and a net $0.2 billion income tax benefit in fiscal year 2024 attributed primarily to the release of a U.S. deferred tax asset valuation allowance.
Our net income from continuing operations totaled $0.8 billion, representing a decrease of $34 million, or 4%, compared to fiscal year 2024, due to the factors explained above net of a $0.2 billion provision for income taxes in fiscal 2025 versus a $0.2 billion income tax benefit in fiscal 2024 primarily attributed to the release of a U.S. deferred tax asset valuation allowance occurring during fiscal year 2024, and not reoccurring in fiscal year 2025.
On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was enacted into law, which includes a new corporate minimum tax, a stock repurchase excise tax, numerous green energy credits, other tax provisions, and significantly increased enforcement resources.
The Company will continue to monitor the evolving tax legislation and OECD guidance, along with its impact to the effective tax rate and cash flows. 45 Table of Contents On August 16, 2022, the Inflation Reduction Act of 2022 ("IRA") was enacted into law, which includes a new corporate minimum tax, a stock repurchase excise tax, numerous green energy credits, other tax provisions, and significantly increased enforcement resources.
Refer to note 9 and note 20 to the consolidated financial statement in Item 8, "Financial Statements and Supplementary Data" for additional details. Fiscal Year 2023 Cash provided by operating activities was $1.0 billion during fiscal year 2023.
Refer to note 9 and note 20 to the consolidated financial statement in Item 8, "Financial Statements and Supplementary Data" for additional details.
To the extent our estimates relating to cash flows and fair value of assets change adversely we may have to recognize material impairment charges in the future. Goodwill Goodwill is tested for impairment on an annual basis and whenever events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable.
Goodwill Goodwill is tested for impairment on an annual basis and whenever events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable.
The historical statements of comprehensive income and cash flows and the balances related to stockholders’ equity have not been revised to reflect the effect of the Spin-off. See note 7 "Discontinued Operations" to the consolidated financial statements in Item 8, “Financial Statements and Supplementary Data” for further information.
The historical financial results and financial position of Nextracker are presented as discontinued operations in the consolidated statements of operations for all periods (through the date of the Nextracker spin-off) presented. The historical statements of comprehensive income and cash flows and the balances related to stockholders’ equity have not been revised to reflect the effect of the spin-off.
Refer to “Risk Factors - Supply chain disruptions, manufacturing interruptions or delays, or the failure to accurately forecast customer demand, have in the past affected, and may in the future affect, our ability to meet customer demand, lead to higher costs, or result in excess or obsolete inventory.” Russian Invasion of Ukraine and Israel-Hamas War We continue to monitor and respond to the conflict in Ukraine and the associated sanctions and other restrictions.
Refer to "Risk Factors - Supply chain disruptions, logistical constraints, manufacturing interruptions or delays, or the failure to accurately forecast customer demand, have in the past affected, and may in the future affect, our ability to meet customer demand, lead to higher costs, or result in excess or obsolete inventory" and "- Global economic conditions, including inflationary pressures, currency volatility, stagflation, slower economic growth or recession, high or rising interest rates, trade conflicts, tariffs, geopolitical uncertainty and instability in financial markets have in the past adversely affected, and may in the future adversely affect, our business, results of operations, financial condition, and access to capital markets." Russian Invasion of Ukraine and Israel-Hamas War We continue to monitor and respond to the conflict in Ukraine and the associated sanctions and other restrictions.
See additional discussion in the Liquidity and Capital Resources section below. 38 Table of Content s Nextracker Spin-off On February 13, 2023, our former subsidiary, Nextracker completed an initial public offering (the “IPO”) of its Class A common stock and on July 3, 2023 completed a follow-on offering to the IPO.
Nextracker Spin-off On February 13, 2023, our former subsidiary, Nextracker completed an initial public offering (the "IPO") of its Class A common stock and on July 3, 2023 completed a follow-on offering to the IPO. Prior to the IPO, we maintained an 82.6% indirect ownership in Nextracker and consolidated Nextracker.
We have established an extensive network of manufacturing facilities in the world's major consumer and enterprise markets (Asia, the Americas, and Europe) to serve the growing outsourcing needs of both multinational and regional customers.
We have established an extensive network of manufacturing facilities in the world's major markets (Asia, the Americas, and Europe) to serve the outsourcing needs of both multinational and regional customers. We design, build, ship, and service products for our customers through a network of approximately 100 facilities in approximately 30 countries across four continents.
For all other contracts that do not meet these criteria, we recognize revenue when we have transferred control of the related manufactured products which generally occurs upon delivery and passage of title to the customer. Refer to note 4 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further details.
For all other contracts that do not meet these criteria, we recognize revenue when we have transferred control of the related manufactured products which generally occurs upon delivery and passage of title to the customer. Service contract revenue is recognized on an overtime basis using the output method.
Customer Contracts and Related Obligations Certain of our customer agreements include potential price adjustments which may result in variable consideration.
Refer to note 4 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further details. Customer Contracts and Related Obligations Certain of our customer agreements include potential price adjustments which may result in variable consideration.
Adjusted free cash flows reconcile to the most directly comparable GAAP financial measure of cash flows from operations as follows: 50 Table of Content s Fiscal Year Ended March 31, 2024 2023 2022 (In millions) Net cash provided by operating activities $ 1,326 $ 950 $ 1,024 Purchases of property and equipment (530) (635) (443) Proceeds from the disposition of property and equipment 25 20 11 Adjusted free cash flow (1) $ 821 $ 335 $ 593 (1) Fiscal year 2022 figures in the table may not foot exactly due to rounding.
Adjusted free cash flows reconcile to the most directly comparable GAAP financial measure of cash flows from operations as follows: Fiscal Year Ended March 31, 2025 2024 (In millions) Net cash provided by operating activities $ 1,505 $ 1,326 Purchases of property and equipment (438) (530) Proceeds from the disposition of property and equipment 15 25 Adjusted free cash flow $ 1,082 $ 821 47 Table of Contents Our cash balances are generated and held in numerous locations throughout the world.
For comparability purposes, the prior periods have been recast to conform to the current presentation. The data below, and discussion that follows, represents our results from operations, and relative percentages.
The data below, and discussion that follows, represents our results from operations, and relative percentages.
In addition, unanticipated changes in the liquidity or financial position of our customers and/or changes in economic conditions may require additional write downs for inventories due to our customers' inability to fulfill their contractual obligations with regards to inventory procured to fulfill customer demand. 42 Table of Content s Carrying Value of Long-Lived Assets We review property and equipment and acquired amortizable intangible assets for impairment at least annually and whenever events or changes in circumstances indicate that the carrying amount of the asset group may not be recoverable.
In addition, unanticipated changes in the liquidity or financial position of our customers and/or changes in economic conditions may require additional write downs for inventories due to our customers' inability to fulfill their contractual obligations with regards to inventory procured to fulfill customer demand.
Our cash balances are generated and held in numerous locations throughout the world. Liquidity is affected by many factors, some of which are based on normal ongoing operations of the business and some of which arise from fluctuations related to global economics and markets.
Liquidity is affected by many factors, some of which are based on normal ongoing operations of the business and some of which arise from fluctuations related to global economics and markets. Local government regulations may restrict our ability to move cash balances to meet cash needs under certain circumstances; however, any current restrictions are not material.
Cash used in investing activities decreased by approximately $0.1 billion to a cash outflow of $0.5 billion for fiscal year 2024, compared with a cash outflow of $0.6 billion for fiscal year 2023, primarily due to a decrease of approximately $0.1 billion cash paid for purchases of property and equipment in fiscal year 2024.
Cash used in investing activities increased by approximately $0.3 billion to a cash outflow of $0.8 billion for fiscal year 2025, compared with a cash outflow of $0.5 billion for fiscal year 2024, primarily due to an increase of approximately $0.4 billion in cash paid for acquisitions of businesses, net of cash acquired in fiscal year 2025.
Our strategy is to provide customers with a full range of cost competitive, vertically-integrated global supply chain solutions through which we can design, build, ship and service a complete packaged product for our customers. This enables our customers to leverage our supply chain solutions to meet their product requirements throughout the entire product lifecycle.
These included the acquisitions of JetCool to expand direct-to-chip liquid cooling capabilities and Crown to increase critical power capabilities while adding opportunities in grid modernization. Our strategy is to provide customers with a full range of cost competitive, vertically-integrated global supply chain solutions through which we can design, build, ship and service a complete packaged product for our customers.
Cost of sales during fiscal year 2024 totaled $24.4 billion, representin g a decrease of ap proximately $2.1 billion, or 8% from $26.5 billion during fiscal year 2023. The decrease in cost of sales is primarily driven by decreased consolidated sales of $2.1 billion, or 7%.
Cost of sales during fiscal year 2025 totaled $23.6 billion, representin g a decrease of ap proximately $0.8 billion, or 3% from $24.4 billion during fiscal year 2024.
Our fiscal year 2024 gross profit totaled $1.9 billion, representing a decrease of $0.1 billion, or 6%, from the prior year. The decrease in gross profit due to lower sales was mitigated by higher gross profit margins and the $0.1 billion gross profit decrease was primarily driven by $0.1 billion in higher restructuring charges.
Our fiscal year 39 Table of Contents 2025 gross profit totaled $2.2 billion, representing an increase of $0.3 billion, or 16%, from the prior year. The increase was primarily driven by an increase in gross profit margin due to improved product mix, operational efficiencies and lower restructuring charges .
During the twelve- month period ended March 31, 2024, we repurchased approximately $15 million of our 4.750% Notes due 2025, resulting in an immaterial gain in our consolidated statement of operations. Our cash balances are held in numerous locations throughout the world.
In fiscal year 2024, we implemented a 10b5-1 bond buyback program, aiming to repurchase certain outstanding bonds issued by us. During the twelve-month period ended March 31, 2025, we repurchased approximately $53 million of our 4.750% Notes due June 2025, resulting in an immaterial gain in our consolidated statement of operations.
Unless otherwise indicated, any reference to income statement items in this "Management’s Discussion and Analysis of Financial Condition and Results of Operations" refers to results from continuing operations. Update on Component Shortages and Logistical Constraints on our Business Component shortages and logistical constraints improved as the year progressed.
See note 7 "Discontinued Operations" to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further information. Unless otherwise indicated, any reference to income statement items in this "Management’s Discussion and Analysis of Financial Condition and Results of Operations" refers to results from continuing operations.
Flex ordinary shares continue to trade on Nasdaq under the ticker symbol “FLEX” and shares of Nextracker Class A common stock continue to trade on Nasdaq under the ticker symbol “NXT”. The historical financial results and financial position of Nextracker are presented as discontinued operations in the consolidated statements of operations and balance sheets for all periods presented.
Flex ordinary shares continue to trade on Nasdaq under the ticker symbol "FLEX" and shares of Nextracker Class A common stock continue to trade on Nasdaq under the ticker symbol "NXT".
Interest income Interest income was $56 million during fiscal year 2024, compared to $30 million during fiscal year 2023, increasing $26 million primarily due to increased cash deposits and higher interest rates.
Interest income Interest income was $61 million during fiscal year 2025, compared to $56 million during fiscal year 2024, increasing $5 million primarily due to increased cash deposits. Other charges (income), net During fiscal year 2025, we recorded $14 million of other income, net, compared to $44 million of other charges, net, in fiscal year 2024.
During fiscal year 2022, we recognized approximately $15 million of restructuring charges, primarily related to employee severance. Refer to note 16 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our restructuring activities.
Refer to Note 19 to the consolidated financial statements in Item 8, "Financial Statements and Supplementary Data" for further discussion of our business acquisitions & divestitures. Cash used in financing activities was $0.8 billion during fiscal year 2025.
We believe that our strategy is positioning us to take advantage of the long-term, future growth prospects for outsourcing of advanced manufacturing capabilities, design and engineering services and after-market services. We are continuously evaluating our capital structure in response to the current environment and expect that our current financial condition, including our liquidity sources are adequate to fund future commitments.
We are continuously evaluating our capital structure in response to the current environment and expect that our current financial condition, including our liquidity sources are adequate to fund future commitments. See additional discussion in the Liquidity and Capital Resources section below.
We will continue to monitor the conflicts and assess the related restrictions and other effects and pursue prudent decisions for our team members, customers, and business. Business Overview We are one of the world's largest providers of global supply chain solutions, with revenues from continuing operations of $26.4 billion in the fiscal year ended March 31, 2024.
We will continue to monitor the conflicts and assess the related restrictions and other effects and pursue prudent decisions for our team members, customers, and business.
Our actual results could differ materially from those anticipated by these forward-looking statements as a result of many factors.
Our actual results could differ materially from those anticipated by these forward-looking statements as a result of many factors. We discuss factors that we believe could cause or contribute to these differences below and elsewhere in this report, including those set forth under Item 1A,"Risk Factors." Refer to Item 7.
Net sales for our FAS segment decreased $1.8 billion, or 12%, from the prior year, primarily driven by a decrease in net sales of 24% in our Consumer Devices business, a 17% decrease in our Lifestyle business and a 7% decrease in our CEC business due to softer demand in consumer end markets and difficult year-over-year comparisons in CEC.
Net sales for our FAS segment increased $0.2 billion, or 1%, from the prior year, primarily driven by a 1% increase in our CEC business, as strength in cloud outweighed softer demand in non-cloud.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of March 31, 2024, the approximate average fair value of our debt outstanding under our Notes due June 2025, February 2026, January 2028, June 2029, and May 2030 was 98.3% of the face value of the debt obligations based on broker trading prices in active markets.
Biggest changeAs of March 31, 2025, the approximate average fair value of our debt outstanding under our Notes due June 2025, February 2026, January 2028, June 2029, May 2030 and January 2032 was 99.8% of the face value of the debt obligations based on broker trading prices in active markets.
Based on our overall currency rate exposures as of March 31, 2024, including the derivative financial instruments intended to hedge the nonfunctional currency-denominated monetary assets, liabilities and cash flows, and other factors, a 10% appreciation or depreciation of the U.S. dollar from its cross-functional rates would not be expected, in the aggregate, to have a material effect on our financial position, results of operations and cash flows in the near-term. 53 Table of Content s
Based on our overall currency rate exposures as of March 31, 2025, including the derivative financial instruments intended to hedge the nonfunctional currency-denominated monetary assets, liabilities and cash flows, and other factors, a 10% appreciation or depreciation of the U.S. dollar from its cross-functional rates would not be expected, in the aggregate, to have a material effect on our financial position, results of operations and cash flows in the near-term. 50 Table of Contents
The majority of these foreign exchange contracts expire in less than three months. They will settle primarily in the Brazilian real, British pound, China renminbi, Euro, Malaysian ringgit, Mexican peso, and U.S. dollar.
The majority of these foreign exchange contracts expire in less than three months. They will settle primarily in the Brazilian real, Hong Kong dollar, China renminbi, Euro, Malaysian ringgit, Mexican peso, and U.S. dollar.
The fair value of currency derivative contracts is reported on the balance sheet. The aggregate notional amount of outstanding contracts as of March 31, 2024 amounted to $8.6 billion and the recorded fair values of the associated assets and liabilities were not material to the Company's consolidated financial position.
The fair value of currency derivative contracts is reported on the balance sheet. The aggregate notional amount of outstanding contracts as of March 31, 2025 amounted to $7.9 billion and the recorded fair values of the associated assets and liabilities were not material to the Company's consolidated financial position.
As of March 31, 2024, the outstanding amount in the highly liquid investment portfolio was $0.8 billion, the largest components of which were U.S. dollar, Indian rupee, Brazilian real and Israeli shekel denominated money market accounts with an average return of 4.0%.
As of March 31, 2025, the outstanding amount in the highly liquid investment portfolio was $1.5 billion, the largest components of which were U.S. dollar, Indian rupee, Brazilian real and Hong Kong dollar denominated money market accounts with an average return of 4.5%.

Other FLEX 10-K year-over-year comparisons