FLEX REPORTS THIRD QUARTER FISCAL 2025 RESULTS

SCHEDULE I

FLEX

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

Three-Month Periods Ended

December 31, 2024

December 31, 2023

GAAP:

Net sales

$ 6,556

$ 6,421

Cost of sales

5,952

5,927

Restructuring charges

10

61

Gross profit

594

433

Selling, general and administrative expenses

241

205

Restructuring charges

2

13

Intangible amortization

17

17

Operating income

334

198

Interest expense

57

50

Interest income

16

13

Other charges (income), net

5

9

Income from continuing operations before income taxes

288

152

Provision for (benefit from) income taxes

25

23

Net income from continuing operations

263

129

Net income from discontinued operations, net of tax

-

104

Net income

263

233

Net income attributable to noncontrolling interest

-

36

Net income attributable to Flex Ltd.

263

197

GAAP EPS

Diluted earnings per share from continuing operations

$ 0.67

$ 0.30

Diluted earnings per share from discontinued operations

-

0.15

Diluted earnings per share attributable to the shareholders of
Flex Ltd.

$ 0.67

$ 0.45

Diluted shares used in computing per share amounts

394

436

See Schedule II for the reconciliation of GAAP to non-GAAP financial measures. See the accompanying notes
on Schedule V attached to this press release.

FLEX

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

Nine-Month Periods Ended

December 31, 2024

December 31, 2023

GAAP:

Net sales

$ 19,415

$ 20,246

Cost of sales

17,777

18,737

Restructuring charges

42

81

Gross profit

1,596

1,428

Selling, general and administrative expenses

670

661

Restructuring charges

13

19

Intangible amortization

49

54

Operating income

864

694

Interest expense

166

155

Interest income

48

44

Other charges (income), net

2

34

Income from continuing operations before income taxes

744

549

Provision for (benefit from) income taxes

128

72

Net income from continuing operations

616

477

Net income from discontinued operations, net of tax

-

373

Net income

616

850

Net income attributable to noncontrolling interest

-

239

Net income attributable to Flex Ltd.

616

611

GAAP EPS

Diluted earnings per share from continuing operations

$ 1.54

$ 1.07

Diluted earnings per share from discontinued operations

-

0.30

Diluted earnings per share attributable to the shareholders of
Flex Ltd.

$ 1.54

$ 1.37

Diluted shares used in computing per share amounts

401

446

See Schedule II for the reconciliation of GAAP to non-GAAP financial measures. See the accompanying notes
on Schedule V attached to this press release.

SCHEDULE II

FLEX

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES ⁽¹⁾

(In millions, except per share amounts)

Three-Month Periods Ended

December 31, 2024

December 31, 2023

GAAP operating income

$ 334

$ 198

Intangible amortization

17

17

Stock-based compensation expense

33

26

Restructuring charges

12

73

Customer related asset impairment (recoveries)

(2)

-

Legal and other

5

$ -

Non-GAAP operating income

$ 399

$ 314

GAAP provision for income taxes

$ 25

$ 23

Intangible amortization benefit

3

3

Other tax related adjustments

27

10

Non-GAAP provision for income taxes

$ 55

$ 36

GAAP net income from continuing operations

$ 263

$ 129

Intangible amortization

17

17

Stock-based compensation expense

33

26

Restructuring charges

12

73

Customer related asset impairment (recoveries)

(2)

-

Legal and other

5

-

Interest and other, net

6

2

Adjustments for taxes

(30)

(13)

Non-GAAP net income from continuing operations

$ 304

$ 234

Diluted earnings per share from continuing operations:

GAAP

$ 0.67

$ 0.30

Non-GAAP

$ 0.77

$ 0.54

See the accompanying notes on Schedule V attached to this press release.

FLEX

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES ⁽¹⁾

(In millions, except per share amounts)

Nine-Month Periods Ended

December 31, 2024

December 31, 2023

GAAP operating income

$ 864

$ 694

Intangible amortization

49

54

Stock-based compensation expense

93

86

Restructuring charges

54

97

Customer related asset impairment (recoveries)

(2)

-

Legal and other

5

3

Non-GAAP operating income

$ 1,063

$ 934

GAAP provision for income taxes

$ 128

$ 72

Intangible amortization benefit

10

9

Other tax related adjustments

40

16

Non-GAAP provision for income taxes

$ 178

$ 97

GAAP net income from continuing operations

$ 616

$ 477

Intangible amortization

49

54

Stock-based compensation expense

93

86

Restructuring charges

54

97

Customer related asset impairment (recoveries)

(2)

-

Legal and other

5

3

Interest and other, net

5

11

Adjustments for taxes

(50)

(25)

Non-GAAP net income from continuing operations

$ 770

$ 703

Diluted earnings per share from continuing operations:

GAAP

$ 1.54

$ 1.07

Non-GAAP

$ 1.92

$ 1.58

See the accompanying notes on Schedule V attached to this press release.

SCHEDULE III

FLEX

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

As of December 31, 2024

As of March 31, 2024

ASSETS

Current assets:

Cash and cash equivalents

$ 2,313

$ 2,474

Accounts receivable, net of allowance

3,382

3,033

Contract assets

633

249

Inventories

5,270

6,205

Other current assets

1,158

1,031

Total current assets

12,756

12,992

Property and equipment, net

2,241

2,269

Operating lease right-of-use assets, net

578

601

Goodwill

1,332

1,135

Other intangible assets, net

343

245

Other non-current assets

1,022

1,015

Total assets

$ 18,272

$ 18,257

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Bank borrowings and current portion of long-term debt

$ 532

$ -

Accounts payable

5,033

4,468

Accrued payroll and benefits

511

488

Deferred revenue and customer working capital advances

1,942

2,615

Other current liabilities

1,019

968

Total current liabilities

9,037

8,539

Long-term debt, net of current portion

3,147

3,261

Operating lease liabilities, non-current

475

490

Other non-current liabilities

621

642

Total liabilities

13,280

12,932

Total Flex Ltd. shareholders' equity

4,992

5,325

Total liabilities and shareholders' equity

$ 18,272

$ 18,257

See the accompanying notes on Schedule V attached to this press release.

SCHEDULE IV

FLEX

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

Nine-Month Periods Ended

December 31, 2024

December 31, 2023

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

$ 616

$ 850

Depreciation, amortization and other impairment charges

401

390

Changes in working capital and other, net

55

(593)

Net cash provided by operating activities

1,072

647

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

(326)

(449)

Proceeds from the disposition of property and equipment

11

21

Acquisition of businesses, net of cash acquired

(347)

-

Other investing activities, net

21

14

Net cash used in investing activities

(641)

(414)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from bank borrowings and long-term debt

499

2

Payments of bank borrowings, long-term debt and other
financing liabilities

(58)

(398)

Payments for repurchases of ordinary shares

(958)

(781)

Proceeds from issuances of Nextracker shares

-

552

Payment for purchase of Nextracker LLC units from TPG

-

(57)

Other, net

(7)

(86)

Net cash used in financing activities

(524)

(768)

Effect of exchange rates on cash and cash equivalents

(48)

5

Net change in cash and cash equivalents and restricted cash
equivalents

(141)

(530)

Cash, cash equivalents, and restricted cash equivalents,
beginning of period

2,474

3,294

Cash, cash equivalents, and restricted cash equivalents, end of
period

$ 2,333

$ 2,764

SCHEDULE V

FLEX AND SUBSIDIARIES

NOTES TO SCHEDULES I and II

(1)

To supplement Flex's unaudited selected financial data presented consistent with U.S. Generally Accepted Accounting Principles ("GAAP"), the Company discloses certain non-GAAP financial measures that exclude certain charges and gains, including non-GAAP operating income, non-GAAP net income and non-GAAP net income per diluted share. These supplemental measures exclude certain legal and other charges, restructuring charges, customer-related asset impairments (recoveries), stock-based compensation expense, intangible amortization, other discrete events as applicable and the related tax effects. These non-GAAP measures are not in accordance with or an alternative for GAAP and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Flex's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Flex's results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of the Company's performance.

In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of the Company's operating performance on a period-to-period basis because such items are not, in our view, related to the Company's ongoing operational performance. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with forecasts and strategic plans, for calculating return on investment, and for benchmarking performance externally against competitors. In addition, management's incentive compensation is determined using certain non-GAAP measures. Also, when evaluating potential acquisitions, we exclude certain items described below from consideration of the target's performance and valuation. Since we find these measures to be useful, we believe that investors benefit from seeing results "through the eyes" of management in addition to seeing GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company's GAAP financials, provide useful information to investors by offering:

.

the ability to make more meaningful period-to-period comparisons of the Company's ongoing operating results;

.

the ability to better identify trends in the Company's underlying business and perform related trend analysis;

.

a better understanding of how management plans and measures the Company's underlying business; and

.

an easier way to compare the Company's operating results against analyst financial models and operating results of competitors that supplement their GAAP results with non-GAAP financial measures.

The following are explanations of each of the adjustments that we incorporate into non-GAAP measures, as well as the reasons for excluding each of these individual items in the reconciliations of these non-GAAP financial measures:

Stock-based compensation expense consists of non-cash charges for the estimated fair value of unvested restricted share units granted to employees and assumed in business acquisitions. The Company believes that the exclusion of these charges provides for more accurate comparisons of its operating results to peer companies due to the varying available valuation methodologies, subjective assumptions and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact stock-based compensation expense has on its operating results.

Intangible amortization consists primarily of non-cash charges that can be impacted by, among other things, the timing and magnitude of acquisitions. The Company considers its operating results without these charges when evaluating its ongoing performance and forecasting its earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. The Company believes that the assessment of its operations excluding these costs is relevant to its assessment of internal operations and comparisons to the performance of its competitors.

Restructuring charges include severance charges at existing sites and corporate SG&A functions as well as asset impairment, and other charges related to the closures and consolidations of certain operating sites and targeted activities to restructure the business. These costs may vary in size based on the Company's initiatives, are not directly related to ongoing or core business results, and do not reflect expected future operating expenses. These costs are excluded by the Company's management in assessing current operating performance and forecasting its earnings trends and are therefore excluded by the Company from its non-GAAP measures.

During the three and nine-month periods ended December 31, 2024, the Company recognized approximately $12 million and $54 million of restructuring charges, respectively, most of which related to employee severance. During the three and nine-month periods ended December 31, 2023, the Company recognized $73 and $97 million of restructuring charges, respectively, most of which related to employee severance.

Customer related asset impairments (recoveries) may consist of non-cash impairments of property and equipment to estimated fair value for customers from whom we have disengaged or are in the process of disengaging as well as additional provisions for doubtful accounts receivable for customers that are experiencing financial difficulties and inventory that is considered non-recoverable that is written down to net realizable value. In subsequent periods, the Company may recover a portion of the costs previously incurred related to assets impaired or reduced to net realizable value. During the three and nine-month periods ended December 31, 2024, the Company recognized approximately $2 million of customer related asset recoveries. These costs are excluded by the Company's management in assessing current operating performance and forecasting its earnings trends and are therefore excluded by the Company from its non-GAAP measures.

Legal and other consist primarily of costs not directly related to core business results and may include 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 as well as acquisition related costs and asset impairment. During the first three quarters of fiscal year 2025 and 2024, the Company accrued for a $5 million asset impairment and $3 million in loss contingencies where losses were considered probable and estimable, respectively. These costs are excluded by the Company's management in assessing current operating performance and forecasting its earnings trends and are therefore excluded by the Company from its non-GAAP measures.

Interest and other, net consist of various other types of items that are not directly related to ongoing or core business results, such as the gain or losses related to certain divestitures, currency translation reserve write-offs upon liquidation of certain legal entities, debt extinguishment costs and impairment charges or gains associated with certain non-core investments. The Company excludes these items because they are not related to the Company's ongoing operating performance or do not affect core operations. Excluding these amounts provides investors with a basis to compare Company performance against the performance of other companies without this variability.

Adjustments for taxes relates to the tax effects of the various adjustments that we incorporate into non-GAAP measures in order to provide a more meaningful measure on non-GAAP net income and certain adjustments related to non-recurring settlements of tax contingencies or other non-recurring tax charges, when applicable. During the three and nine month periods ended December 31, 2024, the Company recognized a $30 million and $50 million net tax benefit respectively. For the period ended December 31, 2024, the Company recognized approximately $26 million of interest recoverable on prior periods taxes paid by one of our Brazilian subsidiaries. The right to receive the interest became unconditional during this period. During the three and nine month periods ended December 31, 2023, the Company recognized a $13 million and $25 million net tax benefit, respectively, related to the tax effects of various adjustments that are incorporated into non-GAAP measures.