Melissa Ann Dailey Fairbanks

Melissa Ann Dailey Fairbanks asked about the trends in Avnet's transportation business, specifically if favorable trends were observed across all geographies. She also inquired about Avnet's exposure to pure EV/hybrid versus traditional ICE vehicles and any changes in booking linearity for the data center business, especially for higher-value components.

Answer

Phil Gallagher (CEO) clarified that transportation business was up year-over-year and sequentially in Asia, up sequentially in the Americas (though down year-over-year), and negative in Europe. He did not have exact figures for EV/ICE exposure but estimated higher EV in Asia, higher combustible in Americas, and Europe in between. For data center bookings, he explained that most are supply chain arrangements, appearing as turns in the quarter (book and bill almost simultaneously), and not unrealistically inflating long-term bookings.

Melissa Ann Dailey Fairbanks asked about trends with healthcare customers related to the latest Section 232 issues and potential tariffs. She also inquired about Jabil's overall capacity utilization and inefficiencies, particularly in the auto business, and its ability to address potential upside. Finally, she questioned the new North Carolina facility's timeline for full loading, revenue contribution, and depreciation expense.

Answer

Matt Crowley (EVP - Global Business Units, Jabil) noted Jabil's region-for-region manufacturing in healthcare and viewed potential pharma tariffs as a net positive opportunity for U.S. production, especially for PII operations. He confirmed existing capacity for auto upsides but noted that FY26 growth isn't predicted due to market volatility. Matt also stated the North Carolina facility will be ready in H2 FY26, fully loaded by mid-2027, making a significant contribution in FY27. Greg Hebard (CFO, Jabil) added that CapEx for the facility is estimated at $75-100M in FY26, within Jabil's overall CapEx range.