Sanmina Corporation Q4 2024 Earnings Report

Sanmina Corporation (NASDAQ: SANM), a leading integrated manufacturing solutions company, announced its strong fourth-quarter earnings on November 4, 2024. The company achieved revenue of $2.02 billion, exceeding the projected range of $1.9 billion to $2.0 billion. Additionally, Sanmina's non-GAAP earnings per share (EPS) reached $1.43, surpassing expectations of $1.30 to $1.40. With $626 million in cash and no outstanding debt, Sanmina is well-positioned for growth in fiscal 2025.

Key Takeaways

• Sanmina's Q4 revenue reached $2.02 billion, a 9.6% sequential growth.
• Non-GAAP EPS for Q4 was $1.43, above forecasts.
• The fiscal year ended with $626 million in cash, no debt, and a 4% decrease in inventory.
• For fiscal 2025, revenue is expected between $1.925 billion and $2.025 billion, with EPS forecasted from $1.30 to $1.40.
• High-single-digit revenue growth is expected in fiscal 2025 driven by diversified markets and new programs.

Company Outlook

• Projected Q1 FY 2025 revenue is between $1.925 billion and $2.025 billion with non-GAAP EPS of $1.30 to $1.40.
• The company is focused on margin expansion, targeting operational margins of 5% to 6%.
• Management is optimistic about strategic positioning and growth opportunities.

Highlights

Bearish

• Non-GAAP EPS decreased 16% year-over-year in fiscal 2024.
• Revenue in the cloud segment fell from $1.4 billion to $1.1 billion.

Bullish

• Non-GAAP EPS grew 46% compared to fiscal 2021.
• Sanmina repurchased 945,000 shares for about $65 million in Q4.
• Nearly 100% of free cash flow was returned to shareholders through repurchases.

Misses

• Current cash conversion cycle is around 68 days, above the historical average in the mid-50s.

Q&A Highlights

• Sanmina is investing in AI to boost manufacturing efficiency and supply chain operations.
• Development with Reliance Industries in India is progressing, focusing on high-tech exports.

Conclusion

Sanmina's fiscal year 2024 marks a transitional period, demonstrating resilience, strong cash flow, and a positive trajectory for 2025. A focus on long-term growth, margin expansion, and cash generation positions the company favorably in evolving markets. Stakeholders anticipate further strategic updates in the next earnings call.