28-Jan-2016 Flextronics International Ltd. · performance reflects a substantial progress we are making as we continue to evolve our sketch-to-scale portfolio and focus on fulfilling

Corrected Transcript

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28-Jan-2016

Flextronics International Ltd. (FLEX)

Q3 2016 Earnings Call

Flextronics International Ltd. (FLEX) Q3 2016 Earnings Call

Corrected Transcript 28-Jan-2016


2 Copyright © 2001-2016 FactSet CallStreet, LLC

CORPORATE PARTICIPANTS

Kevin Kessel Vice President-Investor Relations

Christopher E. Collier Chief Financial Officer

Michael M. McNamara Chief Executive Officer & Director

................................................................................................................................................................................................................................

OTHER PARTICIPANTS

Steven M. Milunovich UBS Securities LLC

Irvin Liu RBC Capital Markets LLC

James Dickey Suva Citigroup Global Markets, Inc. (Broker)

Brian G. Alexander Raymond James & Associates, Inc.

Steven Fox Cross Research LLC

Austin Bone Goldman Sachs & Co.

Adrienne Colby Deutsche Bank Securities, Inc.

Andrew Huang B. Riley & Co. LLC

Sean K. F. Hannan Needham & Co. LLC

................................................................................................................................................................................................................................

MANAGEMENT DISCUSSION SECTION

Operator: Good afternoon and welcome to the Flex Third Quarter Fiscal Year 2016 Earnings Conference Call.

Today 's call is being recorded and all lines have been placed on mute to prevent any background noise. After the

speakers' remarks, there will be a question-and-answer session.

At this time for opening remarks and introductions, I would like to turn the call over to Mr. Kevin Kessel, Flex's

Vice President of Investor Relations. Sir, y ou may begin. ................................................................................................................................................................................................................................


Thank y ou, operator, and welcome to Flex's conference call to discuss the results of our fiscal 2016 third quarter

ended the December 31, 2015. We published slides for today's discussion that can be found on the Investor

Relations section of our new website. Joining me today is our Chief Executive Officer, Mike McNamara an d our

Chief Financial Officer, Chris Collier.

Today 's call is being webcast live and recorded and contains forward -looking statements, which are based on

current expectations and assumptions that are subject to risks and uncertainties, and actual results could

materially differ. Such information is subject to change and we undertake no obligation to update those forward -

looking statements. For a discussion of the risks and uncertainties, see our most recent filings with the Securities

and Exchange Commission including our current, annual and quarterly reports.





If this call references non-GAAP financial measures, these measures are located in the Investor Relations section

of our website along with the required reconciliation to the most comparable GAAP fin ancial measures.

Before I hand the call over to Chris, I want to mention a save the date for our investor and analyst day which will

be hosted on May 12, 2016. We are particularly excited to be bringing it back to Silicon Valley where we last hosted

it two y ears ago and had a fantastic event. More details will be forthcoming from us v ia email.

With that, I will pass the call to our CFO, Chris Collier. Chris? ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer

Thank y ou, Kevin, and good afternoon to those jo ining us on the conference call and also listening in online. We

appreciate your time and interest in Flex.

Our third quarter income statement highlights begin on slide three. As you can see, our third quarter financial

performance reflects a substantial progress we are making as we continue to evolve our sketch-to-scale portfolio

and focus on fulfilling our financial commitments.

Revenue grew $446 million or 7% sequentially to approximately $6.8 billion and it was at the high -end of our

guidance range. Every one of our business groups grew sequentially and met or exceeded our expectations. While

our revenue declined $262 million or 4% y ear-over-year, it was entirely driven by a decline in sales to our largest

customer. Excluding our largest customer, on a y ear-over-year basis, every one of our business groups grew, and

our overall business rose over 6%.

Our profitability is reflecting a richer mix of business and improving execution, as our third quarter adjusted

operating income increased 14% over the prior y ear to $236 million, which was above the high-end of our

guidance range and up 20% sequentially. Our adjusted net income totaled $196 million, reflecting a solid 12%

increase year-over-year and a 28% increase sequentially.

Our adjusted earnings per diluted share for our third quarter was $0.35, which represented a 17% y ear-over-year

improvement and a 30% sequential growth. This was above our adjusted EPS guidance range of $0.28 to $0.34

and represents the highest quarterly adjusted earnings per shar e the company has ever reported.

Turning to slide four, y ou will see our quarterly financial highlights. Our third quarter adjusted gross profit

increased 14% sequentially and 11% y ear-over-year to $455 million. Our improving operational execution on the

many new product ramps coupled with a richer business mix resulted in an adjusted gross margin of 6.7%,

expanding 40 basis points sequentially and 90 basis points from the prior year.

Our execution continues to improve across all our business groups, while we simultaneously bring on many new

customers across a variety of new technologies and markets. Our margin is fundamentally a function of our

business mix and it has been our strategic objective over the past couple years to evolve our portfolio towards a

greater mix of businesses that have longer product life cycles and higher margins; and we continue to actively

manage our investments and resources to deliver on this commitment.

This quarter, our adjusted operating income increased by $29 million or 14 % y ear-to-year to $236 million. This

quarter also represented our ninth straight quarter of y ear -over-year margin expansion with our adjusted

operating margin expanding 60 basis points y ear-over-year to 3.5%.





Our improved operating profit performance continues to be supported by sustaining a strong discipline over our

operating expenses combined with improved operational execution. Our return on invested capital was 22.4% in

the quarter, exceeding our targeted level of 20%, and remains above our cost of ca pital.

Please turn to slide five for our quarterly operating performance by business group. This quarter, every one of our

business segments operated at or above their targeted adjusted operating margin ranges.

Our Integrated Network Solutions, or INS business, generated $76 million in operating profit and its operating

margin increased to 3.1%, which was within our targeted range of 3% to 4%. This expansion was aided by solid

sequential topline growth providing for improved utilization levels and our str ong operational execution over the

multiple new programs that have been ramping.

Our Consumer Technologies Group, or CTG business, generated $49 million in operating profit, which resulted in

an operating margin of 2.4%. This was within our targeted range of 2% to 3% as we continue to drive a deeper

consumer engagement model, where we are providing more meaningful product design and innovations in a

sketch-to-scale value proposition. We are consciously making investments into our capabilities to support th is

model today, which should allow us to push our CTG business to a richer margin profile.

Our Industrial and Emerging Industries, or IEI business, produced $49 million in operating profit with a 4.1%

operating margin. This fulfilled our expectations for meaningful sequential improvement and now sits within our

targeted range of 4% to 6% for this segment. Our margin performance this period reflects the incremental benefit

of our new solar tracking acquisition NEXTracker as well as improvement in our operations as we continue to

drive further productivity and y ield improvements.

Lastly , our High Reliability Solutions, or HRS business, generated $83 million in operating profit, which equates

to 8.1% operating margin. Again, this quarter, it exceeded our targeted operating margin range of 5% to 7 %,

reflecting the continued solid execution of this business while we're managing numerous new programs and

product ramps and the successful integration of our MCi acquisition earlier this fiscal y ear. This performance

placed HRS as our highest operating profit business group this quarter.

Let's turn to slide six for some insight around our other income statement elements. Net interest and other

expense was approximately $22 million for this quarter, which was better t han our guidance of $25 million. For

our March quarter, we believe that modeling quarterly net interest and other expense at $25 million remains

appropriate.

The adjusted income tax expense for the third quarter was $18 million, reflecting an adjusted inc ome tax rate of

approximately 8.4%, which is within our targeted tax rate range of 8% to 10%. Our estimated annual fiscal 2016

effective tax rate remains between 8% and 10%. When reconciling between our quarterly GAAP and adjusted EPS,

y ou'll see an $0.08 impact. This impact relates to a few different elements: $0.03 is driven from $19 million of

intangible amortization expense, and $0.04 is the result of $24 million of stock-based compensation expense. The

remaining $0.01 comes from a combined impact of a non-cash loss on a small divestiture and investment

impairments offset by a tax benefit.

Turning to slide seven, I'll review our cash flows. We continue to operate with discipline. And this quarter we

generated $278 million in cash flow from operations, b ringing our y ear-to-date cash flow from operations to $940

million. We efficiently managed our operations as our net working capital decreased by 3% sequentially despite

the 7 % sequential growth in our business.





Net working capital as a percentage of sales declined sequentially to 6.7%. Most notable for our net working

capital was a reduction in inventory days, which we brought down by three days sequentially to 51 days, reflecting

inventory turns of 7 .2 times. Our cash conversion cycle totaled 24 days , which decreased by one day sequentially.

Given our current and prospective mix of business, we continue to believe that our net working capital as a

percentage of sales will remain within our targeted range of 6% to 8%. We remain committed to investing in

technologies and capacity that support our future growth. This quarter, our net capital expenditures were $120

million, exceeding depreciation by $10 million, as we continue to invest in additional capability and capacity

expansion to primarily support our growing automotive, medical and energy businesses.

Strong sustainable free cash flow generation remains a cornerstone of Flex. We generated $158 million of free

cash flow during the quarter, and over the last 12 months our free cash flow generation to taled $575 million. This

provides a clear illustration of why we remain fundamentally structured, disciplined and on pace to achieve our

commitment to generate free cash flow of $3 billion to $4 billion for the five-year period ending in fiscal 2017.

Lastly , we continue to use our strong cash flow generation to consistently return value to our shareholders

through repurchasing our shares. This quarter we invested $90 million to repurchase over 8 million shares or

roughly 2% of our ordinary shares during the quarter. Our actions this quarter underscore our unwavering

commitment to return over 50% of our annual free cash flow to our shareholders.

Now, turning to slide eight; let's rev iew our balanced capital structure. Our capital structure is sound and prov ides

us with ample flexibility to support our business. We have no significant debt maturities until calendar 2018 and

our maximum debt maturity in any given y ear is below our expected average annual free cash flow generation. We

have over $3.1 billion in liquidity, total cash of approximately 1 .6 billion, and our debt-to-EBITDA ratio was 2.3

times.

And that concludes the recap of our financial performance for the third quarter. Before I turn the call over to

Mike, I would like to summarize that our results clearly demonstrate that we are executing on our strategy,

delivering on our sketch-to-scale solutions, transforming our portfolio, and providing our customers with more

value than ever before. We continue to be focused on improving our execution, operating with discipline, and

consistently delivering on our commitments amid this very dy namic macroenvironment.

Now, I'll turn the call over to Mike. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director

Thanks, Chris. We continue to competitively position our company as a leader in the IoT space, or as we call it, the

Intelligence of Things. Our company is well-positioned to take advantage of many new opportunities across

multiple industries by providing design, engineering, manufacturing and suppl y chain solutions for all products.

This provides us with new markets and opportunities that will grow our business, diversify, and bring increased

value to our customers from sketch-to-scale. This progress is ev ident in earnings.

Please turn to slide nine for our Q3 2016 highlights and key trends. Our focus strategy and richer engagement

model, coupled with our continued diversification in industries, resulted in an exceptionally strong performance

in our third quarter of fiscal 2016. This was ev idenced b y broad sequential growth across all four of our business

groups resulting mostly from new program wins. These factors helped us overcome some of the macro headwinds

during the quarter.





All four of our business groups grew sequentially and met or surpassed our guidance and revenue projections. We

reached the highest levels of quarterly revenue in the company's history in our medical, automotive, industrial and

energy businesses.

Our High Reliability Solutions business, which contains automotive and medica l [ph] eclipsed (15:30) $1 billion in

quarterly revenue. The evolving mix of our business and margins continue to improve. All four of our business

groups also ended the quarter within or above their respective target adjusted operating margin ranges. In

addition, the combined revenue of HRS and IEI rose to 33% of sales, up 11% y ear -over-year, and above 29% last

y ear. Further, the combined operating profit of HRS and IEI accounted for over 55% of total operating profit up

69% y ear-over-year and further evidencing our progress in building a more balanced and diversified portfolio.

Lastly , we continue to effectively manage our business and deploy capital in disciplined way, remain focused on

driv ing return on invested capital above our cost to capital. This focus drives free cash flow, which at $526 million,

through three quarters of the y ear, is solid and keeps us on track for a five -y ear free cash flow commitment of $3

billion to $4 billion.

Our consistent free cash flow generation provide us the business to grow our business through smart capital

investments or acquisitions like our recent MCi, NEXTracker and Wink transactions while still continuing to

return significant capital to shareholders.

Our capital return to shareholders continued this quarter as we invested $90 million to repurchase 8.4 million

shares at an average price of $11.12. Year-to-date, we have bought back $332 million in stock, which equates to

63% of our y ear-to-date free cash flow. Since beginning our current capital return program in fiscal 2011, we've

now repurchased nearly a third of our net shares.

Please turn to slide 10 for a look at revenue by business group. INS increased 12% sequentially and was well above

our expectation for a mid to high-single digit increase. Revenue was $2.5 billion, reflecting a $264 million increase

from last quarter. With this performance, INS is up over $0.5 billion over the last two quarters, representing over

25% growth. The strong performance is reflective of the significant new business we captured over the past y ear

and outstanding result, given the muted growth environment for our end customers.

In the quarter, all businesses within INS Group were above forecast. Our strength was led by telecom and

converged infrastructure, or what we call Ci3. In our fourth quarter, we expect INS revenues to be down mid to

high-single digits, primarily driven by general seasonality of a higher revenue base in December and a challenging

macro. This guidance reflects the continuation of y ear-over-year growth for INS.

CTG's revenue was up 2% sequentially, above our expectation for a low -single digit decline. This resulted in

revenue of $2 billion. The better-than-forecasted performance in CTG was due to strong demand in connected

home and wearables, along with better demand in gaming. Roughly in line with what CTG has experienced in

three out of the last four quarters, we're guiding it to decline 30% to 35% sequentially in Q4, as most products we

build experience strong seasonality.

We do not expect our largest customer to be a 10% customer in the future. This improves our CTG mix toward

products that are more technology-driven and sketch-to-scale businesses with better margin profiles.

IEI rose 6% sequentially to $1.2 billion and saw its y ear-over-year growth climb to 10%. This performance met our

sequential growth expectations of mid to high-single digits. The growth was driven by strong contributions from

new business ramps and our NEXTracker acquisition, which we closed earlier in the quarter. However, the

broader macro pressures we highlighted last quarter remained present and impact our core business.





NEXTracker is a global market leader, a leading smart solar tracking solutions company that nicely complements

our existing $1 billion plus energy business. During its first quarter with us, NEXTracker performed well and met

or exceeded all of our expectations. The NEXTracker management team also provided a huge boost to our talent

base and ability to drive a stronger Flex energy offering.

For the March quarter, we're forecasting IEI sales to decline mid-single digits sequentially, as we continue to see

macro pressures weighing on our IEI business.

Our HRS Group performed exceptionally well, growing year -over-year for its 24th straight quarter. Sales continue

to reach record levels, rising 7% sequentially and 12% y ear-over-year. Growth in our automotive and medical

businesses outpaced our expectations on successful new program ramps.

We continue to leverage our strong technology and engineering position within HRS to drive very strong

bookings. Our automotive business remains on an upward trajectory and continues to outperform. We now have

automotive solutions and content in over 250 different models worldwide.

On the medical front, we had one of the best bookings quarters ever, which bolsters a long-term growth in that

business. For the next quarter, we expect HRS to be stable sequentially, as automotive strength is offset by

medical seasonality.

Now turning to our March quarter guidance on slide 11. Our expectations are for revenue to be in the range of $5.5

billion to $6.1 billion. This range reflects a sequential increase of 14% at the midpoint, in line with our historical

five-y ear seasonality for the March quarter, as the growth from our new program ramps are offset by macro

pressures and seasonality.

Our guidance for adjusted operating income is to be in the range of $175 million to $215 million. This equates to

an adjusted EPS guidance range of $0.25 to $0.31 per share based on weighted average shares outsta nding of 558

million. The adjusted EPS guidance is expected to be approximately $0.07 per share higher than the quarterly

GAAP earnings per diluted share due to intangible amortization and stock-based compensation.

Before I open the call for Q&A, I would like to thank the entire team at Flex. It takes a lot of focus and hard work

to deliver the exceptionally strong results we had this quarter despite the challenging macro circumstances.

With that, I would like to open up the call for Q&A. Operator?





QUESTION AND ANSWER SECTION

Operator: [Operator Instructions] And our first question is from Steve Milunovich with UBS. Y our line is open. ................................................................................................................................................................................................................................

Steven M. Milunovich UBS Securities LLC Q Thank y ou very much. Could y ou talk about y our largest customer and what's going on there? Y ou indicated it's

going to be less than 10% going forward. Is that a change relative to where you expected it would be three months

ago? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A No. This continues to be kind of at expectations. We've always expected a slight adjustment in terms of the

revenue profile, particularly in our China operations. We actually expected around the rest of the world that we

would continue to perform well and have quite a bit of business; and w e just continued to see that play out as

certain products roll off and new products come on board. So it's a continuing of a transition that was well

expected. And as a result, the ability to manage down the cost structure as we've moved along has gone very, very

well. And we continue to be a very strong partner in Brazil and India; and that's really where we expect it to be

when this transaction was announced probably a y ear-and-a-half ago now. ................................................................................................................................................................................................................................

Steven M. Milunovich UBS Securities LLC Q And regarding IEI, could you talk a bit about the program ramp difficulties that y ou had the last couple of

quarters? How far through those we are? And what's going on in macro? Y ou mentioned macro in a couple

categories I think, but particularly in IEI, what are y ou seeing from the macro side of things and where regionally

are y ou seeing weakness? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. As far as the macro, what we see is kind of broadly across the industrial set of businesses particularly –

probably more so in the United States, but also in Europe. We see it's just been a challenge. We've started seeing

the macro push probably in the September quarter. We talked a little bit about it – may be even at the end of the

June quarter. We continue to see it going into the December quarter. And our forecast for March reflects kind of a

weaker industrial demand pull-through. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A And then, Steve, with regards to the performance around the operational execut ion, in the prepared remarks I was

highlighting, for the group, OP grew to $49 million; grew over 50% sequentially and rose to the 4.1%, which is

inside our target range. That was definitely – a lion's share was built off of the improvements that have been

taking shape last quarter that we had actually spent a fair bit of time discussing. It stems from just getting better

control over the various programs that we've been driving, whether it's in workforce and material planning, better

execution around y ield and scrap improvements and even reductions in terms of logistic type fees, freight inbound

and outbound. So a whole host of things that the IEI team has





been focused on. And it was great to see the improvement. And we see ourselves fundamentally structured to

deliver inside that range as we move forward. ................................................................................................................................................................................................................................

Steven M. Milunovich UBS Securities LLC Q Thank y ou. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Welcome. ................................................................................................................................................................................................................................

Operator: The next question is from Amit Dary anani with RBC Capital Markets. Y our line is open. ................................................................................................................................................................................................................................

Irvin Liu RBC Capital Markets LLC Q Hi. This is Irv in Liu calling in for Amit. So first question, within CTG, could y ou just talk about what y ou saw in

the December quarter? It looks to be a little bit below normal seasonal uptick th at we've seen in the past. And your

March quarter guide looks consistent with the historical seasonality. Can y ou just provide some color on what's

going on in this business, perhaps within smartphones and other CTG markets? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. Well, we actually were slightly above our forecast for what we thought we'd see in the December quarter.

December has usually a small increase [ph] than (26:34) what's ty pical. So if I think about the normal seasonalit y

in the December quarter, it's like 2% growth. Now it's really pretty – y eah, it was a little bit slower this y ear. So we

actually expected low to mid-single digits down. September was very, very strong. A large part of that is basically

some the smartphone sell-through, but we kind of expected it to be down. And as far as the rest of the business,

they outperformed pretty normally. We have a pretty strong base of business in gaming. We have a pretty strong

base of business in wearables, all of which seem to work very, very well and have quite a bit of penetration in the

connected home market with a variety of different products.

So I would say everything was pretty much at expectation or typical seasonality. I think our smartphone business

was down a little bit may be partly because of the transition if I think about it from some of the China business

with our largest customer. But relative to where we expected the quarter to go, we're actually up a little bit. ................................................................................................................................................................................................................................

Irvin Liu RBC Capital Markets LLC Q Got it. Thanks. I was also wondering if y ou could just touch on the magnitude of y our Brazil exposure from a

revenue basis today and what sort of headwind that you may be seeing in the March quarter as it relates to Brazil? ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A So Brazil for us is – it's roughly nearing a, say , $2 billion type of revenue for the region. All of that is primarily

consumption within that economy. There is not much export for that. We've seen revenue drop in Brazil this y ear

as everybody, in the range of 30% plus. And even as we move into our Q4, we anticipate seeing a similar type of an





erosion y ear-over-year. It's been a challenged market. It has a lot of different aspects, whether it's the currency,

whether it's the general macro softness.

Our larger segment down there is around our consumer side of things and even within our mobile handset side. So

that's actually reflected in some of the performance that y ou're seeing this y ear. Brazil definitely has an impact on

our overall growth in those two segments. ................................................................................................................................................................................................................................

Irvin Liu RBC Capital Markets LLC Q Got it. Thanks. ................................................................................................................................................................................................................................

Operator: The next question is from Jim Suva with Citi. Y our line is open. ................................................................................................................................................................................................................................

James Dickey Suva Citigroup Global Markets, Inc. (Broker) Q Thank y ou and congratulations to you and y our team at Flextronics. I have a question and a follow-up and I'll give

them both at the same time. On the HRS y ou had really, really strong execution, I think, y ou've mentioned auto

and medical was just great. Is there anything in there to say, hey, we benefited this quarter and it shouldn't re-

occur? Or is this something that we could see re-occurring and maybe that range actually needs to be brought up

for y our target range given the outperformance there? Or may be there is something in there we should be mindful

of, so we don't put in overly exuberant expectations.

And then my follow-up question is on the stock buyback. You've been very diligent with returning cash to

shareholders with y our cash flow and stock buyback over the past few y ears. Given the market vo latility, especially

calendar y ear-to-date, past four weeks or so and it's [indiscernible] (29:57) that Flextronics stock has been under

pressure, have y ou guys kind of been active in the market and can y ou help us understand about – if so how

should we model in stock buyback for this quarter given the recent pullback? Or y ou'd be even more aggressive

[ph] or y ou more have a (30:12) steady cadence of just every single quarter that x percent of free cash flow? Thank

y ou. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Hey , Jim. Let me talk about a little bit of the sustainability of automotive and medical and the range that we have

as a target price. We don't have any one-time effects boosting that up. This is basically how this group is

performing right now. One of the reasons we like the way the group is performing is because it's actually been very

predictable and very stable. And it's one of the reasons that we push so hard to try to tilt some of our acquisitions

and as well a lot of the resources internally at Flex into these business groups. So it is sustainable. It doesn't move

as much either up or down, quite frankly, across seasonality and it doesn't move that much y ear-on-year. So it's a

very sustainable business.

So the numbers y ou are seeing are something that we expect to continue to move forward, and I guess ev idence of

that is, we talked about a few business groups being down in March due to normal seasonality; and HRS, we have

relatively flat. So it continues to – we continue to see how this business is going to perform. And whether or not

we'll change the range, we'll obviously talk a lot about it when we get to analy st day as to whether or not we'll

consider moving that range, but we continue to be really excited about that business and the operating profit y ear-

on-y ear grew like 48%. So it's a strong driver for us and very stable. ................................................................................................................................................................................................................................





Christopher E. Collier Chief Financial Officer A And then, Jim, with regards to the inquiry on the share repurchase and the appetite. For us, we've sta ted all along,

we have an unwavering commitment to increase shareholder value. And that's been taking the shape through our

share repurchase plans. And so the share repurchase plan has been, is, and will continue to be the key feature in

returning value; whether it's last y ear or over a five-year period, we have been returning roughly 75% of our free

cash flow to shareholders.

If y ou look on a y ear-to-date basis, we've generated $526 million of free cash flow and we've repurchased $332

million of shares. So we're well north of 60%, 63% in terms of taking that strong cash flow and returning it.

We don't guide to specific quarterly amounts. And I think y ou're going to see the company continuing to maintain

its disciplined approach and optimizing where we se e it fit and using the strong cash flow to continue to do an

active share repurchase. ................................................................................................................................................................................................................................

James Dickey Suva Citigroup Global Markets, Inc. (Broker) Q Great. And it's good to see y ou guys hitting corporate -wide operating margins at 3.5%. And so is it fair to say like

in y our stronger mix quarters that now this is hopefully the new norm? I'm just kind of very encouraged by that

[indiscernible] (33:13) one-off that should cause that to be a [ph] bit above or below of (33:18) this quarter? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. Yeah, Jim, as y ou know, we've been on the same mission for probably four years now, about moving the

portfolio into a more balanced portfolio where a greater percentage of that portfolio is coming from longer

product life cy cle products with a lot more stability both from a seasonality standpoint and y ear -to-year.

We're now up to – like 55% of the total operating profit is – are out of our two target business groups, HRS and

IEI. If y ou look across these guys over the last three y ears, four y ears, I think y ou'll see that they're probably

running pretty close to double-digit growth on average across that period. So we feel that we've structurally moved

the profitability of the company, we've structurally moved the margin profile of the company, and have

structurally moved the stability of earning. So this is real.

And what's also really interesting is we've grown compounded 10% growth over the last three y ears, four years,

five y ears maybe. It's also given us a stronger and stronger position in those industries. So our ability to penetrate

even more business in those industries is actually being enhanced every single y ear. And we feel that we've got a

very, very strong profile by which to compete and win going fo rward. So we actually think, while we've moved the

portfolio over to where it's like 33% of the revenue, 55% of the operating profit, we also feel we have moved the

portfolio where we can compete even more aggressively and more competitively in the marketp lace. And there is

no reason for this continued shift to decelerate going forward. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A And, Jim, just to complement some of what Mike just said, and to address one point. There is nothing unusual

inside of the quarter that you saw. And like we've said always, margin is fundamentally the result of the mix of our

business.





And if I was actually to point you to the guide next quarter, it's a good example. Even at the midpoint, y ou see

again a healthy return to around a 3.4% margin at the midpoint; y ear-on-year up over 10 basis points – 10% in

operating profit; and again, 40 basis points plus in margin expansion. So y ou should see another quarter where

it'll be our tenth straight quarter of y ear-over-year margin expansion. And again it goes back to our strategic focus

[inaudible] (35:44). ................................................................................................................................................................................................................................

James Dickey Suva Citigroup Global Markets, Inc. (Broker) Q Thank y ou and congratulations to you and y our team at Flextronics. Oh, I guess, I actually should call it the new

Flex. Congratulations. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. Great. Thank y ou. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A Thank y ou. ................................................................................................................................................................................................................................

Operator: The next question is from Brian Alexander with Ray mond James. Your line is open. ................................................................................................................................................................................................................................

Brian G. Alexander Raymond James & Associates, Inc. Q All right. Thanks. Chris, I just want to follow-up on what y ou just said. So the margin in terms of the March

quarter, you are looking for them to be roughly flattish sequentially. Obviously, mix will help with CTG down, but

it implies that y ou can hold or improve margins in each of the indiv idual segments despite revenue that's going to

be flat to down in each of those segments. So can y ou talk about that a little bit? And just how y ou're able to hold

margins or perhaps even improve them in the indiv idual businesses? What looks to be across the board while

volumes are coming down? ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A Certainly , Brian. So actually at the midpoint you'll see a 3.4%. It's actually 10 basis points down. And again, it

comes into the implications of the leverage of the downshift in that ty pe of the revenue.

If y ou look across each of the businesses, IEI we spent a fair amount of the front end of this discussion, first Q&A,

talking about its improving operational execution, moving its performance back into that range, so sustaining at

the 4% plus. Y ou see in INS business that's now back into its range.

The pressure comes from the CTG group where you see the significant 30% to 35% decline in revenue that puts

some leverage pressure on it. But, overall, you're seeing a disciplined approach to the way we invest in our spend.

It allows us to sustain within this range. We're feeling very comfortable setting a midpoint at targ ets around a

3.4% operating margin, which again is 10% in dollars is up y ear -over-year, will be up 40 basis points from a y ear

ago. So continue to see that improvement. ................................................................................................................................................................................................................................





Michael M. McNamara Chief Executive Officer & Director A And then, Brian, I'd like to just add a little bit. Independent of the performance of each of the indiv idual business

groups, as the mix, which is due to the higher margin businesses, those individual business groups don't even

need to have margin improvement in order for the company to have margin improvement, because we'll continue

to move the percentage mix in a really positive way. And not just the margin, but I'll also say the stability of

earnings. So once y ou move to those kind of business groups, y ou have a significantly low er risk profile associated

with the business and significantly more predictability. ................................................................................................................................................................................................................................

Brian G. Alexander Raymond James & Associates, Inc. Q Y eah. Makes sense. Just a quick follow-up. Would y ou break-out how much acquisitions contributed to revenue

and operating profits in the quarter? And then, Mike, didn't hear much about NIKE on the call. So I don't know if

there's any thing new to talk about there? ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A Brian, we're not specifically carving out the impacts o f the acquisitions on it. However, in our discussions along

the way , it's a combination of the benefits of the strategic investments in these acquisitions, plus an overall

improving execution within the business. So it's not slanted to a acquisition-benefited performance here. It's a

combination of all that and our execution. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A And just on NIKE, we continue to make really good progress. I think the relationship with our customer is very,

very strong. We're moving to a new way of manufacturing, a new way of managing the supply chain, a new way of

delivering products to the marketplace quicker and with more automation. So I do think about this as being kind

of a long-term journey and we continue to make really strong progress. And we're very pleased with it. Like I said,

I think our customers are very pleased with it. But think about that as being more of a long -term journey that's

going to build. It's going to be more like a locomotive. ................................................................................................................................................................................................................................

Brian G. Alexander Raymond James & Associates, Inc. Q Okay . Thank y ou so much. ................................................................................................................................................................................................................................

Operator: The next question is from Steven Fox with Cross Research. Your line is open. ................................................................................................................................................................................................................................

Steven Fox Cross Research LLC Q Thanks. Good afternoon. Just two questions from me. First of all, I think in the prepared remarks y ou talked

about the deeper engagement model in CTG starting to take hold. I was curious if – and also that it leads to a

richer margin profile going forward. I was curious if there's any examples y ou could provide of some of that

success and how that scales? Because, I guess, my understanding is that a lot of the design work is with smaller

companies. So I'm curious it eventually impacts the margins?





And then just a second quick question would be around the converged infra structure wins that y ou're getting. Can

y ou talk about how y ou expect it to play out over the next, I don't know, few quarters and how it also affects INS

margins? Thanks. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Sure. Y eah. So when we think about, what we call, like in CTG, like a much richer engagement model, more

sketch-to-scale, more technology-enabled businesses; a lot of those are new companies, but the process

technologies and the techniques and the strategies used on those apply a cross to many different companies. And,

in fact, we find consumer being kind of a leading-indicator of bringing technology into marketplace that then can

apply across into automotive and medical and industrial.

So we kind of v iew that. A lot of these small companies, while the individual profitability or the individual

operating dollars of the small companies don't add that much, they actually do add a lot in terms of apply ing them

across to every other industry. So that's a huge part of our consumer play. And as we do these new companies,

we're still going to have some business segments within those consumer companies that are going to hit pretty

high volumes.

And, I guess, a good example of that I might suggest would be Fitbit, where there was a tremendo us amount of co-

innovation that needed to occur to, in order to bring those products to marketplace. We worked significantly with

Fitbit to bring those products to marketplace, to solve some of the technical challenges associated with the

wristbands. And it ended up turning into a pretty high volume product.

So there's really two way s to create value out of that CTG engagement model. One is the process technologies we

develop as a result of those learnings and apply them across to big companies, and also s ometimes the smaller

companies will end up taking off. ................................................................................................................................................................................................................................

Steven Fox Cross Research LLC Q Thanks for that. And then just on the converged business? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y es. So on the converged business, we're clearly seeing a transition of products into a place, which everybody calls

converged technologies, where you are getting routers and storage and switches, and all integrated into a single

box and with software loaded on it.

So a lot of our investment is built around that set of capabilities. It continues to be a small part, but significant,

quite frankly , of our business. But it's been growing double-digits for – like the last few y ears and this is going to

continue to build as we move forward.

So I would say this also is going to have better margins. It's going to have better growth rates. And, over time, if

y ou give it a few y ears, with the solid double-digit growth and the amount of new logos that we're securing, you're

going to see a very – it's going to make – well, it's already contributing, but it's going to contribute even more as a

percentage of total. ................................................................................................................................................................................................................................





Steven Fox Cross Research LLC Q Great. That's very helpful. Thanks. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A This is an evolving business trend that we need to be in the middle of. ................................................................................................................................................................................................................................

Steven Fox Cross Research LLC Q Great. Thank y ou so much. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y ou're welcome. ................................................................................................................................................................................................................................

Operator: The next question is from Mark Delaney with Goldman Sachs. Y our line is open. ................................................................................................................................................................................................................................

Austin Bone Goldman Sachs & Co. Q Hi. This is Austin Bone filling in for Mark. Can y ou help us think about the size of the auto business within HRS?

And what's the geographic exposure of the auto business? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A So it's roughly $2 billion, use some nice round numbers on the automotive. It's obviously grown pretty rapidly

over the last four y ears, five y ears. We have operations in automotive certified factories in v irtually every region. I

think we're probably more exposed in the United States market than anywhere else, but we have significant

exposure to the European market. I would say China is a little bit less, but I actually don't know the percentage

breakthrough – breakout of end demand in that market. ................................................................................................................................................................................................................................

Austin Bone Goldman Sachs & Co. Q Got it. Thanks. That's very helpful. And then, as a follow-up; can y ou talk about the trends that you're seeing for

the energy business that's now surpassed $1 billion? And then, also w ithin that, do you have an estimate of how

much y ou think that business has compressed given the recent headwinds from low oil prices? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. So most of our energy businesses – so we do – to kind of summarize, we have quite a bit of capacity over 1.5

gigawatts of capacity to do solar panels. We do a huge percentage of the micro-inverters today. We do a huge

percentage of the smart meters. And now we own the leading tracker sy stem in the world today. We think it

probably has more market share than anybody else and a very, very strong and compelling value statement. And

we're doing – probably work with eight or 10 different storage companies, energy storage companies, which is also

going to be part of that whole renewable thing.





So when we think about electricity generation, which these newer technologies are all built on, focusing on, oil is a

very small part of it. So I don't know what percent of the overall energy -electricity generation market oil is, but in

the United States it's less than 5%. So the reality is, the lower oil price doesn't really matter that much. But we

think the trend over a 10-year period is phenomenal. Because we think technology can solve a lot of the problems

with energy generation. It gets 10% to 15% cheaper every year. Once we add on energy storage later on, it's going

to even be more compelling and it has a lot of environmental implications. So it's got technology, it's got

continuously lower cost, it's got sustainable feature to it. So we think that it's got a long run. And oil doesn't matter

that much when it comes to electricity generation.

We also had – something happened this last quarter which was the ITC came back, it was set to expire in 2017,

and it was now extended for multi-years which is just going to take what's already a pretty strong double -digit

growth business with very strong decade-long macros and it's going to improve it.

So we just think our positioning is very good. We have a management team tha t's just killer on the energy sy stem,

very strong and very broad. And we have all these different technologies and all these different penetrations in the

variety of different markets within energy. So we're pretty excited about it. ................................................................................................................................................................................................................................

Austin Bone Goldman Sachs & Co. Q Got it. Thanks very much. ................................................................................................................................................................................................................................

Operator: The next question is from Sherri Scribner with Deutsche Bank. Y our line is open. ................................................................................................................................................................................................................................

Adrienne Colby Deutsche Bank Securities, Inc. Q Hi. It's Adrienne Colby calling in for Sherri Scribner thanks for taking my question. Can y ou comment on how

important the absolute volume of global auto sales is for Flex 's overall business? Some of the December and

January data have suggested a leveling off in U.S. sales. I am just wondering what the implications that might

have for the CTG segment? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. Well, y eah, HRS segment but – well, like we talked about the overall automotive business are about $2

billion out of our $25 billion or nice round numbers. So it's small. If those numbers move at the far end up being

$17 billion instead of $17 .5 billion, it's not going to have a huge impact on us. And remember the volume is just

one indication. If we were doing tires, you know, then we'd be real concerned about volume. But as the

electrification of the vehicle occurs, as people start heading towards zero emissions and zero accidents and

connected cars and more and more technology in those head units, those themselves, even with a flat total vehicle

model can continue to be a growth rate.

And those of the areas that we're focused in and where a lot of our bookings have occurred over the last few y ears.

So it definitely impact us a little bit. But again it's $2 billion of the $25 billion and within that $2 billion most of

it's driven by new technologies which as a percentage of content of the car, is going to keep going up pretty

significantly. ................................................................................................................................................................................................................................





Adrienne Colby Deutsche Bank Securities, Inc. Q Thanks. And as a follow-up, I wanted to go back to the question about the IEI margins, ask may be slightly

differently. If y ou could just quantify maybe qualitatively how much of the benefit to margin was from the

ramping of the new programs versus contribution from NEXTracker? And also too how we should think about the

cadence of margin improvement going forward? Just wondering if there's a clear runway now to achieving the

higher end of the target range y ou've given? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A So, y ou know, I'm not sure of the exact margin contribution of NEXTracker versus the other. NEXTracker is

obviously additive, but to actually – but we moved both the margins of the core business as well as the

NEXTracker both went up. And that's how we were able to move this thing all the way into 4.1%, which was a

pretty big jump right away in a quarter.

The biggest challenge, we have, of moving that even farther and by the way it would be farther, if it wasn't for the

macro. So if we weren't hav ing a number of different slowdowns of the number of different industrial companies –

so what's happening is the revenue is coming down in a lot of different customers and we're offsetting that with

new program wins. So y ou've got lower revenue because of the macro, but you have simultaneously more revenue

as a result of new programs, which tend to have [indiscernible] (49:54). Even with that, we were able to drive the

margins higher this last quarter.

So if we had any kind of macro pick up, we would see those margins probably move into the middle of that range

relatively quickly. So that's the biggest challenge that we're having right now. A lot of the margin profiles or the

start-up costs we're having are very normal and typical and usually can be offset by more and more revenue that

absorbs more cost.

So in absence of that more and more revenue absorbing more costs as a result of the weak macro, we're fighting

and keeping our revenues even or a little bit even stronger, but it'd be more efficient if we had some help with the

core customers and they weren't struggling with revenue on a quarter-on-quarter basis. ................................................................................................................................................................................................................................

Adrienne Colby Deutsche Bank Securities, Inc. Q Thank y ou. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A And may be I'll just try to put it into quantitative terms, north of 50% of the growth, $17 million sequential growth,

was due to our own operational execution and the improvements that I had explained earlier. ................................................................................................................................................................................................................................

Adrienne Colby Deutsche Bank Securities, Inc. Q Great. That's helpful. ................................................................................................................................................................................................................................

Operator: The next question is from Andrew Huang with B. Riley . Y our line is open. ................................................................................................................................................................................................................................





Andrew Huang B. Riley & Co. LLC Q Thanks for taking my questions. So it seems like y ou've done a pretty good job preparing for the worse and hoping

for the best. So I was curious if y ou were able to sign any new multi-hundred million dollar outsourcing

agreements in the December quarter that could ramp over the next 12 months to 18 months? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y ep. We definitely have some. I'm try ing to think through those. That's a good q uestion. I'm not sure I can give

y ou the details on that. But without question, we have some; one in INS, we have one in medical, which we're

pretty excited about, and have one in Consumer Technologies Group. So I'm just looking at the list, two in

Consumer Technologies Group.

So I'd say there's almost no quarter that we don't have a multi-hundred or multi-hundred million dollar win. So –

and the medical one will ramp not for 18 months and the consumer one will ramp next y ear.

So they all have different profiles associated with them. In terms of [indiscernible] (52:21), but alternatively one of

the things we mentioned like, for example, in medical is that we have very strong bookings. In fact, our medical

bookings last quarter were the highest they've ever been. So – but they may not ramp for 12 months to 18 months,

but we've been – so a lot of the growth that we're having in all these industries are a function of what we've done a

y ear ago or even two years ago. So...

We continue to make very good progress. Almost never is there a quarter that we don't bring on a couple hundred,

some million dollar businesses. And I mean, to me, it wasn't any thing more than normal, wasn't any thing less

normal, it was just a continuous strong quarter for us. ................................................................................................................................................................................................................................

Andrew Huang B. Riley & Co. LLC Q Okay . Thanks. And then kind of on the topic of operating margin improvement streak. It's almost as good as the

Warriors' home game streak, but I'm just worried – wondering what you're worried about, like what would cause

that streak to end? ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Well, the one thing I kind of – what I talked about earlier is, I actually think by the time y ou move your – into the

55% operating profit, y ou've actually structurally moved into a differe nt margin profile. And we've talked and

pushed that a little bit. The HRS business coming in with 8% plus is sustainable. We believe it's sustainable, not

one-time hit. It's actually a structurally improved business.

The IEI, we talked a little bit about, it's moved into 4% and it's pressured by the macro. If it wasn't pressured by

the macro, I think we'd be more – heading more towards the middle of that range. So – and both of those, this

coming y ear, will again have a target of growing those 10% as a bundle. So we'll continue to – and we believe we

have good visibility into these programs. We know what automotive looks like next y ear, we know what medical

looks like next y ear with some degrees of freedom. And we'll continue to try to drive those into 10% growth next

y ear. So that's something that we can see today already.





So I think we feel really good about it that the operating margin performance is sustainable. And, in fact, we would

hope to move it even forward. One of the things about our business, i t's not like we are taking an existing business

and just grinding productivity and moving the margins up and then margins get stuck, we actually have a belief

that we can continually move the portfolio into a continuously higher margin profile and can do t his sustainably

over the next few y ears. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A Operator, we have time for one more question. ................................................................................................................................................................................................................................

Operator: Certainly. The final question is from Sean Hannan with Needham & Co. Y our line is open. ................................................................................................................................................................................................................................

Sean K. F. Hannan Needham & Co. LLC Q Thanks. Sean Hannan. So there were a lot of mentionings of new programs in the course of the commentary. Is

there a way to mention a little bit more in detail where some of these new programs were ramping perhaps on a

sub-segment basis? And then, particularly within the CTG group, are there any types of those sub -segments or

ramping programs, I don't know, wearables might be a part of them that are explicitly a part of the net margin

profile that y ou were looking to accomplish over a longer period? Thanks. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Okay . That's kind of a tough question. We have such a broad business where the bookings go any where from $10

million to $300 million and they ramp anywhere from six months from now to two y ears from now. So it's hard to

draw a direct correlation between each and go through each one of these bookings where we have like hundreds

and hundreds of customers and when they actually hit. So... ................................................................................................................................................................................................................................

Sean K. F. Hannan Needham & Co. LLC Q Mike, just to clarify , what I was getting at is the commentary y ou had provided for the quarter that there was a

benefit of ramping programs for each four of y our segments. So, for example, if I look at INS the degree of

ramping programs may have been particularly more pronounced within telecom and that's where you got the

strength. So just try ing to get some color in that sense. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. So let me try to answer them kind of segment-by-segment and I'll start with the telecom piece. So we talked

about may be two quarters or three quarters, maybe even four quarters ago that we booked like four multi -

hundred million dollar programs that would ramp over the next y ear to year -and-a-half and that started like a

y ear ago. And what you saw is a lot of strength come into the September quarter where we grew double-digits and

then also into the December quarter where we grew double -digits.

Now, those programs offset any kind of macro weakness and provided a tremendous amount of growth. The

growth over the last two quarters was like 25%. Those programs largely played their way out in the December

quarter. So as a result, what we're seeing is a kind of a normal seasonality going into the March quarter for th e INS

business. Still nice growth... ................................................................................................................................................................................................................................





Sean K. F. Hannan Needham & Co. LLC Q Okay . ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A ...on a y ear-on-year basis on the background. On the CTG, it's kind of a different kind of sty le. We ended up having

– we'll have less of the larger smartphone business, but we'll have more connected home. We expect to continue to

penetrate into wearables, all of which have a little bit more uncertain and longevity to them, but the startup is

much quicker.

In IEI, everything that the macro takes us down, we actually offset with new programs; and we're booking those

programs in appliances and we're booking those programs in kind of a variety of different things. But those tend

to be a lot of singles and doubles just in terms of the ty pe of business it is. They tend to be $20 million, $30

million, $40 million programs on average. And all those things take time to start up. So what we're doing is, we're

fighting a bad macro with a nice set of bookings, but they're kind of washing to a certain standpoint.

And then, HRS is just – does really well. So we continue to book very large automotive programs. We continue to

book large medical programs. We actually booked those programs even last year and even two y ears ago. So it's

not like that we'll actually see those ramping this coming year. And that's why we believe we can continue to drive

a 10% growth rate.

So I think each one, [ph] in the same way (59:22), it's just kind of a complicated question to answer because there

are so many different puts and takes, there are so many different product life cy cles and there are so many

different segments that we operate in. ................................................................................................................................................................................................................................

Sean K. F. Hannan Needham & Co. LLC Q That's helpful. I think the perspective is helpful. But it sounds like the new win momentum in winning those

programs – with all this momentum that y ou have over the course of the last couple of y ears, I think it's been

pretty consistent [indiscernible] (59:48) folks. The degree and the substance of that new win momentum, it

sounds like has continued in the December quarter into present. ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A Y eah. So just to give y ou some numbers, because we don't really like to talk about bookings, because bookings are

complicated, it's hard to drive bookings directly into revenue, because like I said, sometimes it takes 18 months,

sometimes it takes three months. So it's hard to draw the causality into revenue. But what I can tell y ou in this last

quarter, three out of four of our business groups, we actually had the highest bookings that we had all y ear. ................................................................................................................................................................................................................................

Sean K. F. Hannan Needham & Co. LLC Q Okay . ................................................................................................................................................................................................................................

Michael M. McNamara Chief Executive Officer & Director A





And the other one we didn't have the highest bookings was INS and that's the group where we've like booked –

booking everything already, I mean a lot of stuff already. But both in IEI, CTG and HRS every one of those things

we have out-booked the last five quarters. ................................................................................................................................................................................................................................

Christopher E. Collier Chief Financial Officer A And then, Sean, may be just to tie out one last thing. When we talked about the December quarter and the multiple

ramps throughout the different businesses in the prepared remarks, we isolated – if y ou take away the largest

customer that had a decline, every single one of our groups grew y ear-over-year, and as a company we're growing

north of 6%.

That same feature set kind of play s its way out when y ou even think of our March quarter. If y ou actually take

away the largest customer and the declines that we've seen on a y ear-over-year compare, you actually see the

company again growing at its core 6% plus. ................................................................................................................................................................................................................................

Sean K. F. Hannan Needham & Co. LLC Q That's great feedback folks. Thank y ou. ................................................................................................................................................................................................................................


All right. Thank y ou for joining the call. We appreciate all the questions and interest. Please remember to mark

the calendars for May 12 for our investor and analyst day. And we'll be sending an email with more information

soon. This concludes our call. ................................................................................................................................................................................................................................

Operator: Ladies and gentlemen, this concludes today's conference call. You may now disconnect.

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28-Jan-2016 Flextronics International Ltd. · performance reflects a substantial progress we are making as we continue to evolve our sketch-to-scale portfolio and focus on fulfilling