Flextronics FY 1Q16 Earnings Call Notes

Rebranding, renaming

“We are shortening our name from Flextronics to Flex to signify that our business continues to evolve past the boundaries and confines of electronics alone. Our new tagline, Live Smarter, highlights our belief that all devices are becoming intelligent and that value will ultimately be created in the intelligence of things and the convergence of technologies and digitization of products across multiple industries and market segments.”

Taken down smartphone demand for Lenovo and Motorola to where it needs to be

“we’re actually not finding the economy anything more difficult to understand or predict with the exception of those two. I think as it relates to Motorola or Lenovo or smartphone demand, we’ve actually taken our demand down to where we think it is the right place to be. We continue to get more feedback from the marketplace, from the customer. We think it’s the right place. So, this has been our highest-risk area and just the fact that it’s lower to start with is already put less risk into the model.”

Our Q1 performance has created a big hole that we have to dig out of

“our Q1 has created a reasonably big hole that we have to dig out of. Alternatively, I talked about the four or five different programs that are going to kick in. Some of those programs are going to offset natural kind of attrition, if you will. I think you’ll see the INS revenue pick up pretty significantly this next quarter, as I mentioned, high-single digits. I think we’re going to have some also significant increases the quarter after that. But I think we’re going to be chasing it all the way to the end to get close to a breakeven. ”

The smartphone business has already come down quite a bit

“if you think about the smartphone business portion of the computer business, it’s going to be – it’s already come down quite a bit and maybe it will come down some more, but we don’t necessarily think so”

Why they bought MCi

“I mean, why did we do the MCi acquisition? One, it was – it has higher margin, it has longer product life cycles, it has a stronger growth profile than the rest of Flextronics. I mean, all these are very, very positive”