The following is a summary of the Sanmina Corporation (SANM) Q2 2024 Earnings Call Transcript:
Financial Performance:
Sanmina reported Q2 revenue of $1.835 billion, aligned with company guidance and a decrease of 2% sequentially.
Non-GAAP gross margin stood at 8.9%, due to favorable mix and operating discipline.
Non-GAAP operating expenses rose, mainly due to incremental expenses related to a deferred compensation plan.
Non-GAAP EPS was $1.30, within the higher end of company outlook.
Sanmina has good liquidity, with $651 million in cash and equivalents, and a total liquidity of over $1.5 billion.
Q2 non-GAAP pre-tax ROIC was strong at 22%, indicating the company's robust financial position.
Business Progress:
Despite a slight sequential drop, Sanmina observed a 67% growth in the industrial, medical, defense, aerospace, and automotive sectors.
Communications network and cloud infrastructures contributed 33% of the total revenue.
Sanmina is investing in high-growth markets like AI, defense and aerospace, medical, automotive, and renewable energy.
Q3 revenue is expected to grow sequentially, with a projected range of $1.8 billion to $1.9 billion.
Strong cash flow recorded in the first half is expected to continue for the rest of the year.
The company is planning to improve cash conversion cycle through working capital initiatives.
Encountered supply chain constraints and test capacity issues are expected to be resolved by the end of the quarter.
More details: Sanmina IR
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