What changed in this filing

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Item 1. Financial Statements

2024-01-09 compared with 2023-06-30 · 186 added, 132 removed, 424 unchanged (43% of the section changed)

3 unchanged sentences

(in millions, except for share data)

November 30, 2023

August 31, 2023

3 unchanged sentences

Contract assets

Inventories, net

Inventories, net of reserve for excess and obsolete inventory

Prepaid expenses and other current assets

Assets held for sale

Total current assets

Property, plant and equipment, net of accumulated depreciation of $ 6,055 as of May 31, 2023 and $ 5,624 as of August 31, 2022

Property, plant and equipment, net of accumulated depreciation of $ 4,612 as of November 30, 2023 and $ 4,512 as of August 31, 2023

Operating lease right-of-use asset

Intangible assets, net of accumulated amortization of $ 497 as of May 31, 2023 and $ 471 as of August 31, 2022

Intangible assets, net of accumulated amortization

Deferred income taxes

5 unchanged sentences

Current operating lease liabilities

Liabilities held for sale

Total current liabilities

10 unchanged sentences

Common stock, $ 0.001 par value, authorized 500,000,000 shares;

273,536,549 and 270,891,715 shares issued and 131,351,864 and 135,493,980 shares outstanding as of May 31, 2023 and August 31, 2022, respectively

275,716,586 and 273,949,811 shares issued and 128,647,431 and 131,294,422 shares outstanding as of November 30, 2023 and August 31, 2023, respectively

Additional paid-in capital

1 unchanged sentence

Accumulated other comprehensive loss

Treasury stock at cost, 142,184,685 and 135,397,735 shares as of May 31, 2023 and August 31, 2022, respectively

Treasury stock at cost, 147,069,155 and 142,655,389 shares as of November 30, 2023 and August 31, 2023, respectively

Total Jabil Inc.

7 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Cost of revenue

4 unchanged sentences

Restructuring, severance and related charges

Costs from the divestiture of businesses

Operating income

Loss on debt extinguishment

Other expense (income)

Interest income

Interest expense

Other expense

Interest expense, net

Income before income tax

9 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Other comprehensive income (loss):

2 unchanged sentences

Change in fair value of derivatives

Adjustment for net (gains) losses realized and included in net income

Adjustment for net losses realized and included in net income

Total change in derivative instruments

1 unchanged sentence

Prior service credit

Total other comprehensive (loss) income

Total other comprehensive income

Comprehensive income

6 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Total stockholders' equity, beginning balances

2 unchanged sentences

Beginning balances

Shares issued under employee stock purchase plan

Treasury shares purchased

Recognition of stock-based compensation

5 unchanged sentences

Ending balances

Accumulated other comprehensive income (loss):

Accumulated other comprehensive loss:

Beginning balances

Total other comprehensive (loss) income

Total other comprehensive income

Ending balances

14 unchanged sentences

(in millions)

Nine months ended

Three months ended

November 30, 2023

November 30, 2022

Cash flows provided by operating activities:

6 unchanged sentences

Cash paid for business and intangible asset acquisitions, net of cash

Proceeds from the divestiture of businesses

Net cash used in investing activities

4 unchanged sentences

Dividends paid to stockholders

Net proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan

Treasury stock minimum tax withholding related to vesting of restricted stock

1 unchanged sentence

Effect of exchange rate changes on cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents at beginning of period

12 unchanged sentences

(the “Company”) for the fiscal year ended August 31, 2023.

Results for the nine months ended May 31, 2023 are not necessarily an indication of the results that may be expected for the full fiscal year ending August 31, 2023.

Results for the three months ended November 30, 2023 are not necessarily an indication of the results that may be expected for the full fiscal year ending August 31, 2024.

Trade Accounts Receivable Sale Programs

1 unchanged sentence

As these accounts receivable are sold without recourse, the Company does not retain the associated risks following the transfer of such accounts receivable to the respective financial institutions.

As of May 31, 2023, the Company may elect to sell receivables and the unaffiliated financial institutions may elect to purchase specific accounts receivable at any one time up to a:

(i) maximum aggregate amount available of $ 2.0 billion under eight trade accounts receivable sale programs, (ii) maximum amount available of 400 million CNY under one trade accounts receivable sale program, (iii) maximum amount available of 100 million CHF under one trade accounts receivable sale program, and (iv) maximum amount available of 8.1 billion INR under one trade accounts receivable sale program.

The trade accounts receivable sale programs expire on various dates through 2028.

As of November 30, 2023, the Company may elect to sell receivables and the unaffiliated financial institutions may elect to purchase specific accounts receivable at any one time, at a discount, on an ongoing basis up to a:

(i) maximum aggregate amount available of $ 2.3 billion under nine trade accounts receivable sale programs, (ii) maximum amount available of 100 million CHF under one trade accounts receivable sale program, and (iii) maximum amount available of 8.1 billion INR under one trade accounts receivable sale program.

The trade accounts receivable sale programs either expire on various dates through 2028 or do not have expiration dates and may be terminated upon election of the Company or the unaffiliated financial institutions.

The Company continues servicing the receivables sold and in exchange receives a servicing fee under each of the trade accounts receivable sale programs.

Servicing fees related to the trade accounts receivable sale programs recognized during the three months and nine months ended May 31, 2023 and 2022 were not material.

Servicing fees related to the trade accounts receivable sale programs recognized during the three months ended November 30, 2023 and 2022 were not material.

The Company does not record a servicing asset or liability on the Condensed Consolidated Balance Sheets as the Company estimates that the fee it receives to service these receivables approximates the fair market compensation to provide the servicing activities.

1 unchanged sentence

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Trade accounts receivable sold (1)

4 unchanged sentences

Inventories consist of the following (in millions):

November 30, 2023

August 31, 2023

4 unchanged sentences

Inventories, net (1)

During fiscal year 2023, the Company entered into new operating and finance leases.

The future minimum lease payments under these new leases as of May 31, 2023 were as follows (in millions):

Payments due by period

After 5 years

Operating lease obligations (1)

Finance lease obligations (1)

(1) Excludes $ 224 million of payments related to operating and finance leases signed but not yet commenced.

Of these excluded payments, $ 163 million relates to a variable interest entity (“VIE”), for which the Company is not the primary beneficiary.

This is also the Company’s maximum exposure to loss related to the VIE.

The Company expects the lease related to the VIE to commence in fiscal year 2024.

Additionally, certain leases signed but not yet commenced contain residual value guarantees and purchase options not deemed probable.

(1) Excludes $ 354 million and $ 559 million of inventories, net classified as held for sale as of November 30, 2023 and August 31, 2023, respectively.

See Note 15 – “Business Acquisitions and Divestitures” for additional information.

Notes Payable and Long-Term Debt

Notes payable and long-term debt outstanding as of May 31, 2023 and August 31, 2022 are summarized below (in millions):

Notes payable and long-term debt outstanding as of November 30, 2023 and August 31, 2023 are summarized below (in millions):

Maturity Date

November 30, 2023

August 31, 2023

5 unchanged sentences

5.450 % Senior Notes

5.450 % Senior Notes (1)

Borrowings under credit facilities (1)

4 unchanged sentences

Notes payable and long-term debt, less current installments

(1) On April 13, 2023, the Company issued $ 300 million of publicly registered 5.450 % Senior Notes due 2029 (the “ 5.450 % Senior Notes”).

The Company intends to use the net proceeds for general corporate purposes, including, together with available cash, repayment of the $ 300 million aggregate principal amount of the Company’s 4.900 % Senior Notes due in July 2023.

(2) On February 10, 2023, the Company entered into an amendment (the “Amendment”) to its senior unsecured credit agreement dated as of January 22, 2020 (as amended, the “Credit Facility”).

The Amendment, among other things, (i) instituted certain amendments to the sustainability-linked adjustments to the interest rates applicable to borrowings under the three-year revolving credit facility (the “ Three-Year Revolving Credit Facility”) and the Company’s five-year revolving credit facility (the “ Five-Year Revolving Credit Facility”), (ii) established customary SOFR, CDOR, EURIBOR and TIBOR provisions, which replaced the LIBOR provisions set forth in the existing agreement, and (iii) extended the termination date of the Three-Year Revolving Credit Facility to January 22, 2025, and of the Five-Year Revolving Credit Facility to January 22, 2027.

(3) As of May 31, 2023, the Company has $ 3.9 billion in available unused borrowing capacity under its revolving credit facilities.

The Credit Facility acts as the back-up facility for commercial paper outstanding, if any.

(1) As of November 30, 2023, the Company has $ 3.8 billion in available unused borrowing capacity under its revolving credit facilities.

The senior unsecured credit agreement dated as of January 22, 2020 and amended on February 10, 2023 (the “Credit Facility”) acts as the back-up facility for commercial paper outstanding, if any.

The Company has a borrowing capacity of up to $ 3.2 billion under its commercial paper program.

2 unchanged sentences

incur additional indebtedness, sell assets, effect mergers and certain transactions, and effect certain transactions with subsidiaries and affiliates.

In addition, the revolving credit facilities and the 4.900 % Senior Notes contain debt leverage and interest coverage covenants.

In addition, the revolving credit facilities contain debt leverage and interest coverage covenants.

The Company is also subject to certain covenants requiring the Company to offer to repurchase the 3.950 %, 3.600 %, 3.000 %, 1.700 %, 4.250 % or 5.450 % Senior Notes upon a change of control.

As of May 31, 2023 and August 31, 2022, the Company was in compliance with its debt covenants.

As of November 30, 2023 and August 31, 2023, the Company was in compliance with its debt covenants.

Refer to Note 16 – “Fair Value Measurements” for the estimated fair values of the Company’s notes payable and long-term debt.

1 unchanged sentence

Certain Jabil entities participating in the global asset-backed securitization program continuously sell designated pools of trade accounts receivable to a special purpose entity, which in turn sells certain of the receivables at a discount to conduits administered by an unaffiliated financial institution on a monthly basis.

In addition, a foreign entity participating in the global asset-backed securitization program sells certain receivables at a discount to conduits administered by an unaffiliated financial institution on a daily basis.

In addition, a foreign entity participating in the global

asset-backed securitization program sells certain receivables at a discount to conduits administered by an unaffiliated financial institution on a daily basis.

The Company continues servicing the receivables sold and in exchange receives a servicing fee under the global asset-backed securitization program.

Servicing fees related to the global asset-backed securitization program recognized during the three months and nine months ended May 31, 2023 and 2022 were not material.

Servicing fees related to the global asset-backed securitization program recognized during the three months ended November 30, 2023 and 2022 were not material.

The special purpose entity in the global asset-backed securitization program is a wholly-owned subsidiary of the Company and is included in the Company’s Condensed Consolidated Financial Statements.

Certain unsold receivables covering up to the maximum amount of net cash proceeds available under the domestic, or U.S., portion of the global asset-backed securitization program are pledged as collateral to the unaffiliated financial institution as of May 31, 2023.

The global asset-backed securitization program expires on November 25, 2024 and the maximum amount of net cash proceeds available at any one time is $ 600 million.

As of May 31, 2023, the Company had no available liquidity under its global asset-backed securitization program.

As of November 30, 2023, the Company had no available liquidity under its global asset-backed securitization program.

In connection with the asset-backed securitization programs, the Company recognized the following (in millions):

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Trade accounts receivable sold (1)

5 unchanged sentences

The global asset-backed securitization program requires compliance with several covenants including compliance with the interest ratio and debt to EBITDA ratio of the Credit Facility.

As of May 31, 2023 and August 31, 2022, the Company was in compliance with all covenants under the global asset-backed securitization program.

As of November 30, 2023 and August 31, 2023, the Company was in compliance with all covenants under the global asset-backed securitization program.

Accrued Expenses

Accrued expenses consist of the following (in millions):

November 30, 2023

August 31, 2023

4 unchanged sentences

Accrued expenses (2)

(1) Revenue recognized during the nine months ended May 31, 2023 and 2022 that was included in the contract liability balance as of August 31, 2022 and 2021 was $ 353 million and $ 269 million , respectively.

(1) Revenue recognized during the three months ended November 30, 2023 and 2022 that was included in the contract liability balance as of August 31, 2023 and 2022 was $ 161 million and $ 139 million , respectively.

(2) Excludes $ 304 million and $ 364 million of accrued expenses classified as held for sale as of November 30, 2023 and August 31, 2023, respectively.

See Note 15 – “Business Acquisitions and Divestitures” for additional information.

Postretirement and Other Employee Benefits

Net Periodic Benefit Cost

The following table provides information about the net periodic benefit cost for all plans for the three months and nine months ended May 31, 2023 and 2022 (in millions):

The following table provides information about the net periodic benefit cost for all plans for the three months ended November 30, 2023 and 2022 (in millions):

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Service cost (1)

4 unchanged sentences

Amortization of prior service cost (2)

Net periodic benefit cost (credit)

Net periodic benefit cost

(1) Service cost is recognized in cost of revenue in the Condensed Consolidated Statements of Operations.

10 unchanged sentences

Forward contracts are put in place to manage the foreign currency risk associated with the anticipated foreign currency denominated revenues and expenses.

A hedging relationship existed with an aggregate notional amount outstanding of $ 640 million and $ 1.4 billion as of May 31, 2023 and August 31, 2022, respectively.

A hedging relationship existed with an aggregate notional amount outstanding of $ 153 million and $ 491 million as of November 30, 2023 and August 31, 2023, respectively.

The related forward foreign exchange contracts have been designated as hedging instruments and are accounted for as cash flow hedges.

The forward foreign exchange contract transactions will effectively lock in the value of anticipated foreign currency denominated revenues and expenses against foreign currency fluctuations.

The anticipated foreign currency denominated revenues and expenses being hedged are expected to occur between June 1, 2023 and November 30, 2023.

The anticipated foreign currency denominated revenues and expenses being hedged are expected to occur between December 1, 2023 and August 31, 2024.

In addition to derivatives that are designated as hedging instruments and qualify for hedge accounting, the Company also enters into forward contracts to economically hedge transactional exposure associated with commitments arising from trade accounts receivable, trade accounts payable, fixed purchase obligations and intercompany transactions denominated in a currency other than the functional currency of the respective operating entity.

The aggregate notional amount of these outstanding contracts as of May 31, 2023 and August 31, 2022, was $ 3.7 billion and $ 3.4 billion, respectively.

The aggregate notional amount of these outstanding contracts as of November 30, 2023 and August 31, 2023, was $ 4.3 billion and $ 4.0 billion, respectively.

The gains and losses on cash flow hedges recognized in earnings due to amounts excluded from effectiveness testing were not material for all periods presented and are included as components of net revenue, cost of revenue and selling, general and administrative expense, which are the same line items in which the hedged items are recorded.

2 unchanged sentences

Maturity date

November 30, 2023

August 31, 2023

1 unchanged sentence

The gains and losses on net investment hedges are included in change in foreign currency translation in OCI to offset the change in the carrying value of the net investment being hedged until the complete or substantially complete liquidation of the hedged foreign operation.

The amounts excluded from effectiveness testing were not material for all periods presented and are recognized in interest expense.

The amounts excluded from effectiveness testing were not material for all periods presented and are recognized in interest expense, net.

Refer to Note 16 – “Fair Value Measurements” for the fair values and classification of the Company’s derivative instruments.

The following table presents the net losses from forward contracts recorded in the Condensed Consolidated Statements of Operations for the periods indicated (in millions):

The following table presents the net gains (losses) from forward contracts recorded in the Condensed Consolidated Statements of Operations for the periods indicated (in millions):

Derivatives Not Designated as Hedging Instruments Under ASC 815

Location of Loss on Derivatives Recognized in Net Income

Amount of Loss Recognized in Net Income on Derivatives

Location of Gain (Loss) on Derivatives Recognized in Net Income

Amount of Gain (Loss) Recognized in Net Income on Derivatives

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Forward foreign exchange contracts (1)

Cost of revenue

(1) For the three months and nine months ended May 31, 2023, the Company recognized $ 24 million and $ 20 million, respectively, of foreign currency gains in cost of revenue, which are offset by the losses from the forward foreign exchange contracts.

For the three months and nine months ended May 31, 2022, the Company recognized $ 64 million and $ 27 million, respectively, of foreign currency gains in cost of revenue, which are offset by the losses from the forward foreign exchange contracts.

(1) For the three months ended November 30, 2023, the Company recognized $ 38 million of foreign currency losses in cost of revenue, which are offset by the gains from the forward foreign exchange contracts.

For the three months ended November 30, 2022, the Company recognized $ 49 million of foreign currency gains in cost of revenue, which are offset by the losses from the forward foreign exchange contracts.

Interest Rate Risk Management

The Company periodically enters into interest rate swaps to manage interest rate risk associated with the Company’s borrowings or anticipated debt issuances.

Contemporaneously with the issuance of the 5.450 % Senior Notes in April 2023, the Company settled cash flow hedges with an aggregate notional amount of $ 150 million and $ 100 million, with effective dates of May 2021 and August 2022, respectively.

The cash received for the cash flow hedges at settlement was $ 15 million.

The settled cash flow hedges are recorded in the Condensed Consolidated Balance Sheets as a component of accumulated other comprehensive income (“AOCI”) and are amortized to interest expense in the Condensed Consolidated Statements of Operations.

As of November 30, 2023, there are no outstanding interest rate swaps.

Accumulated Other Comprehensive Income

The following table sets forth the changes in AOCI, net of tax, by component for the nine months ended May 31, 2023 (in millions):

The following table sets forth the changes in AOCI, net of tax, by component for the three months ended November 30, 2023 (in millions):

Foreign Currency

Translation Adjustment

Net Investment Hedges

Actuarial Gain (Loss)

Service (Cost) Credit

Prior Service (Cost) Credit

Balance as of August 31, 2023

2 unchanged sentences

Other comprehensive income (loss) (1)

Balance as of May 31, 2023

Balance as of November 30, 2023

(1) Amounts are net of tax, which are immaterial.

1 unchanged sentence

Three months ended

Nine months ended

Comprehensive Income Components

Financial Statement Line Item

Realized (gains) losses on derivative instruments:

November 30, 2023

November 30, 2022

Realized losses (gains) on derivative instruments:

Foreign exchange contracts

1 unchanged sentence

Interest rate contracts

Interest expense

Interest expense, net

Actuarial gains

4 unchanged sentences

Refer to Note 7 – “Postretirement and Other Employee Benefits” for additional information.

(3) Amounts are net of tax, which are immaterial for the three months and nine months ended May 31, 2023 and 2022.

(3) Amounts are net of tax, which are immaterial for the three months ended November 30, 2023 and 2022.

Stockholders’ Equity

1 unchanged sentence

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Restricted stock units

Employee stock purchase plan

As of May 31, 2023 , the shares available to be issued under t he 2021 Equity Incentive Plan were 8,473,317 .

As of November 30, 2023 , the shares available to be issued under t he 2021 Equity Incentive Plan were 7,738,300 .

Restricted Stock Units

1 unchanged sentence

The time-based restricted stock units generally vest on a graded vesting schedule over three years .

T he performance-based restricted stock units generally vest on a cliff vesting schedule over three years and up to a maximum of 150 %, depending on the specified performance condition and the level of achievement obtained.

The performance-based restricted stock units generally vest on a cliff vesting schedule over three years and up to a maximum of 150 %, depending on the specified performance condition and the level of achievement obtained.

The performance-based restricted stock units have a vesting condition that is based upon the Company’s cumulative adjusted core earnings per share during the performance period.

The market-based restricted stock units generally vest on a cliff vesting schedule over three

years and up to a maximum of 200 % , depending on the specified performance condition and the level of achievement obtained.

The market-based restricted stock units ha ve a vesting condition that is tied to the Company’s total shareholder return based on the Company’s stock performance in relation to the companies in the Standard and Poor’s (S&P) Super Composite Technology Hardware and Equipment Index excluding the Company.

During the nine months ended May 31, 2023 and 2022, the Company awarded approximately 0.9 million and 0.7 million time-based restricted stock units, respectively, 0.2 million and 0.2 million performance-based restricted stock units, respectively, and 0.2 million and 0.2 million market-based restricted stock units, respectively.

The market-based restricted stock units generally vest on a cliff vesting schedule over three years and up to a maximum of 200 %, depending on the specified performance condition and the level of achievement obtained.

The market-based restricted stock units have a vesting condition that is tied to the Company’s total shareholder return based on the Company’s stock performance in relation to the companies in the Standard and Poor’s (S&P) Super Composite Technology Hardware and Equipment Index excluding the Company.

During the three months ended November 30, 2023 and 2022, the Company awarded approximately 0.4 million and 0.9 million time-based restricted stock units, respectively, 0.1 million and 0.2 million performance-based restricted stock units, respectively, and 0.1 million and 0.2 million market-based restricted stock units, respectively.

The following represents the stock-based compensation information as of the period indicated (in millions):

November 30, 2023

Unrecognized stock-based compensation expense – restricted stock units

3 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Common stock outstanding:

Beginning balances

Shares issued under employee stock purchase plan

Vesting of restricted stock

3 unchanged sentences

( 2,600,951 )

( 6,215,601 )

( 7,930,341 )

Ending balances

2 unchanged sentences

(2) In September 2022, the Board of Directors approved an authorization for the repurchase of up to $ 1.0 billion of the Company’s common stock (the “2023 Share Repurchase Program”).

As of May 31, 2023, 2.2 million shares had been repurchased for $ 179 million, excluding excise tax, and $ 821 million remains available under the 2023 Share Repurchase Program.

As of August 31, 2023, 2.7 million shares had been repurchased for $ 224 million, excluding excise tax.

In September 2023, the Board of Directors amended and increased the 2023 Share Repurchase Program to allow for the repurchase of up to $ 2.5 billion of the Company’s common stock.

As part of the 2023 Share Repurchase Program, the Company entered into an accelerated share repurchase (“ASR”) agreement with a bank in September 2023 to repurchase $ 500 million of the Company’s common stock.

During the first quarter of 2024, the ASR transaction was completed, and 3.9 million shares were delivered under the ASR agreement at an average price of $ 128.61 .

The final number of shares delivered upon settlement of the ASR agreement was determined based on a discount to the volume weighted average price of the Company’s common stock during the term of the agreement.

As of November 30, 2023, 3.9 million shares had been repurchased for $ 500 million, excluding excise tax, and $ 2.0 billion remains available under the 2023 Share Repurchase Program approved in September 2023.

Concentration of Risk and Segment Data

1 unchanged sentence

Sales of the Company’s products are concentrated among specific customers.

During the nine months ended May 31, 2023, the Company’s five largest customers accounted for approximately 43 % of its net revenue and 82 customers accounted for approximately 90 % of its net revenue.

During the three months ended November 30, 2023, the Company’s five largest customers accounted for approximately 44 % of its net revenue and 76 customers accounted for approximately 90 % of its net revenue.

Sales to these customers were reported in the Electronics Manufacturing Services (“EMS”) and Diversified Manufacturing Services (“DMS”) operating segments.

8 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Segment income and reconciliation of income before income tax

4 unchanged sentences

Restructuring, severance and related charges

Loss on debt extinguishment

Costs from the divestiture of businesses

Other expense (net of periodic benefit cost)

Interest income

Interest expense

Interest expense, net

Income before income tax

1 unchanged sentence

Three months ended

Timing of transfer

Point in time

Nine months ended

November 30, 2023

November 30, 2022

Timing of transfer

4 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Foreign source revenue

2 unchanged sentences

Three months ended

Nine months ended

May 31, 2023 (1)

November 30, 2023

November 30, 2022

Employee severance and benefit costs

1 unchanged sentence

Total restructuring, severance and related charges (1)

(1) Primarily relates to headcount reduction to further optimize the Company’s business activities and includes $ 0 million and $ 4 million recorded in the EMS segment, $ 0 million and $ 33 million recorded in the DMS segment and $ 0 million and $ 8 million of non-allocated charges for the three months and nine months ended May 31, 2023, respectively.

(1) Charges for the three months ended November 30, 2023, related to the 2024 Restructuring Plan and included $ 29 million recorded in the EMS segment, $ 79 million recorded in the DMS segment and $ 19 million of non-allocated charges.

Charges for the three months ended November 30, 2022, related to headcount reduction to further optimize the Company’s business activities and included $ 4 million recorded in the EMS segment, $ 33 million recorded in the DMS segment and $ 8 million of non-allocated charges.

Except for asset write-off costs, all restructuring, severance and related charges are cash costs.

(2) The restructuring liability is $ 25 million as of May 31, 2023, which primarily relates to employee severance and benefit costs incurred in fiscal year 2022 and the nine months ended May 31, 2023.

We expect the majority of the severance to be paid during fiscal year 2023.

2024 Restructuring Plan

On September 26, 2023, the Company’s Board of Directors approved a restructuring plan to (i) realign the Company’s cost base for stranded costs associated with the Company’s sale and realignment of its mobility business and (ii) optimize the Company’s global footprint.

This action includes headcount reductions across our Selling, General and Administrative (“SG&A”) cost base and capacity realignment (the “2024 Restructuring Plan”).

The 2024 Restructuring Plan reflects the Company’s intention only and restructuring decisions, and the timing of such decisions, at certain locations, are still subject to consultation with the Company’s employees and their representatives.

The Company currently expects to recognize approximately $ 300 million in pre-tax restructuring and other related costs over the course of the Company’s 2024 fiscal year.

This information will be subject to the finalization of timetables for the transition of functions, consultation with employees and their representatives as well as the statutory severance requirements of the jurisdictions impacted, and the amount and timing of the actual charges may vary due to a variety of factors.

The Company’s estimates for the charges discussed above exclude any potential income tax effects.

The table below summarizes the Company’s liability activity, primarily associated with the 2024 Restructuring Plan (in millions):

and Benefit Costs

Asset Write-off Costs

Other Related Costs

Balance as of August 31, 2023

Restructuring related charges

Asset write-off charge and other non-cash activity

Cash payments

Balance as of November 30, 2023

Effective Income Tax Rate

1 unchanged sentence

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

federal statutory income tax rate

Effective income tax rate

The effective income tax rate increased for the three months and nine months ended May 31, 2023, compared to the three months and nine months ended May 31, 2022, primarily due to a change in the jurisdictional mix of earnings, partially offset by a $ 17 million income tax expense during the three months and nine months ended May 31, 2022 for an unrecognized tax benefit related to the taxation of certain prior year intercompany transactions.

The effective income tax rate differed for the three months ended November 30, 2023, compared to the three months ended November 30, 2022, primarily due to:

(i) a change in the jurisdictional mix of earnings, driven in part by restructuring charges, (ii) a $ 19 million income tax benefit for the reversal of a non-U.S.

unrecognized tax benefit due to audit closure for the three months ended November 30, 2023, and (iii) an $ 11 million income tax benefit for the reversal of a portion of the U.S.

valuation allowance related to an acquisition for the three months ended November 30, 2023.

The effective income tax rate differed from the U.S.

federal statutory income tax rate of 21.0% during the three months and nine months ended May 31, 2023 and 2022, primarily due to:

(i) the jurisdictional mix of earnings, (ii) losses in tax jurisdictions with existing valuation allowances, (iii) tax incentives granted to sites in China, Malaysia, Singapore and Vietnam, and (iv) a $ 17 million income tax expense during the three months and nine months ended May 31, 2022 for an unrecognized tax benefit related to the taxation of certain prior year intercompany transactions.

federal statutory income tax rate of 21.0% during the three months ended November 30, 2023 and 2022, primarily due to:

unrecognized tax benefit due to audit closure for the three months ended November 30, 2023, and (v) an $ 11 million income tax benefit for the reversal of a portion of the U.S.

valuation allowance related to an acquisition for the three months ended November 30, 2023 .

Earnings Per Share and Dividends

8 unchanged sentences

Three months ended

Nine months ended

November 30, 2023

November 30, 2022

Restricted stock units

The following table sets forth cash dividends declared by the Company to common stockholders during the nine months ended May 31, 2023 and 2022 (in millions, except for per share data):

The following table sets forth cash dividends declared by the Company to common stockholders during the three months ended November 30, 2023 and 2022 (in millions, except for per share data):

Declaration Date

7 unchanged sentences

December 4, 2023

January 26, 2023

February 15, 2023

March 2, 2023

April 20, 2023

Fiscal Year 2023:

2 unchanged sentences

December 2, 2022

January 20, 2022

February 15, 2022

March 2, 2022

April 21, 2022

Business Acquisitions and Divestitures

On November 1, 2023, the Company completed the acquisition of ProcureAbility Inc.

(“ProcureAbility”) for approximately $ 60 million in cash.

ProcureAbility is a procurement services provider specializing in technology-enabled advisory, managed services, digital, staffing, and recruiting solutions.

The acquisition of ProcureAbility assets was accounted for as a business combination using the acquisition method of accounting.

Assets acquired of $ 86 million, including $ 40 million in intangible assets and $ 38 million in goodwill, and liabilities assumed of $ 25 million were recorded at their estimated fair values as of the acquisition date.

The allocation of the purchase price is considered preliminary pending final valuation for the Company.

The excess of the purchase price over the fair value of the acquired assets and assumed liabilities was recorded to goodwill and was fully allocated to the DMS segment.

The majority of the goodwill is currently not expected to be deductible for income tax purposes.

The results of operations were

included in the Company’s condensed consolidated financial results beginning on November 1, 2023.

Pro forma information has not been provided as the acquisition of ProcureAbility is not deemed to be significant.

The Company announced on September 26, 2023 that, through its indirect subsidiary, Jabil Circuit (Singapore) Pte.

Ltd., a Singapore private limited company (“Singapore Seller”), it agreed to sell to an affiliate of BYD Electronic (International) Co.

Ltd., a Hong Kong limited liability company (“Purchaser” or “BYDE”), its product manufacturing business in Chengdu, including its supporting component manufacturing in Wuxi (the “Business”) for cash consideration of approximately $ 2.2 billion, subject to certain customary purchase price adjustments.

On December 29, 2023 (the “Closing Date”), the Company completed the sale.

As of November 30, 2023, and August 31, 2023, the assets and liabilities of the Business were classified as held for sale and the carrying value is less than the estimated fair value less cost to sell and, thus, no adjustment to the carrying value of the disposal group is necessary.

For the three months ended November 30, 2023, depreciation and amortization expense for long-lived assets are not recorded while these assets are classified as held for sale.

The divestiture did not meet the criteria to be reported as discontinued operations and the Company continued to report the operating results for the Business in the Company’s Condensed Consolidated Statement of Operations in the DMS segment until the Closing Date.

Following is a summary of the carrying amounts of the major classes of assets and liabilities that were classified as held for sale (in millions):

November 30, 2023

August 31, 2023

Assets held for sale:

Accounts receivable, net of allowance for credit losses

Inventories, net of reserve for excess and obsolete inventory

Prepaid expenses and other current assets

Property, plant and equipment, net of accumulated depreciation

Operating lease right-of-use asset

Deferred income taxes

Liabilities held for sale:

Accounts payable

Accrued expenses

Non-current operating lease liabilities

Fair Value Measurements

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Fair Value Hierarchy

November 30, 2023

August 31, 2023

Cash and cash equivalents:

Cash equivalents

Prepaid expenses and other current assets:

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Derivatives not designated as hedging instruments (Note 8)

Other assets:

Forward interest rate swap:

Net investment hedges:

Derivatives designated as hedging instruments (Note 8)

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Derivatives not designated as hedging instruments (Note 8)

(1) Consist of investments that are readily convertible to cash with original maturities of 90 days or less.

Net investment hedges:

Derivatives designated as hedging instruments (Note 8)

(1) The Company’s forward foreign exchange contracts, including cash flow hedges and net investment hedges are measured on a recurring basis at fair value, based on foreign currency spot rates and forward rates quoted by banks or foreign currency dealers.

(3) Fair value measurements are based on the contractual terms of the derivatives and use observable market-based inputs.

The interest rate swaps are valued using a discounted cash flow analysis on the expected cash flows of each derivative using observable inputs including interest rate curves and credit spreads.

Fair Value of Financial Instruments

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The following table presents the carrying amounts and fair values of the Company's notes payable and long-term debt, by hierarchy level as of the periods indicated (in millions):

November 30, 2023

August 31, 2023

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5.450 % Senior Notes

(1) This fair value estimate is based on the Company’s indicative borrowing cost derived from discounted cash flows.

(1) The fair value estimates are based upon observable market data.

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You are advised, however, to consult any further disclosures we make on related subjects.

Factors that might cause such differences include, but are not limited to, those discussed in Part II, Item 1A to this Quarterly Report on Form 10-Q and in Part 1, Item 1A of the Company’s Annual Report on Form 10-K for the year ended August 31, 2022 such as, scheduling production, managing growth and capital expenditures and maximizing the efficiency of our manufacturing capacity effectively;

Factors that might cause such differences include, but are not limited to, those discussed in Part II, Item 1A to this Quarterly Report on Form 10-Q and in Part 1, Item 1A of the Company’s Annual Report on Form 10-K for the year ended August 31, 2023 such as, unexpected costs or unexpected liabilities that may arise from the Mobility transaction;

scheduling production, managing growth and capital expenditures and maximizing the efficiency of our manufacturing capacity effectively;

managing rapid declines or increases in customer demand and other related customer challenges that may occur;

the scope and duration of the COVID-19 outbreak and its impact on our operations, sites, customers and supply chain;

the effect of COVID-19 and its impact on our operations, sites, customers and supply chain;

our dependence on a limited number of customers;

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retaining key personnel;

risks associated with international sales and operations;

risks associated with international sales and operations, including geopolitical uncertainties;

energy price increases or shortages;

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risk arising from design or manufacturing defects;

and intellectual property risk);

risk arising from compliance, or failure to comply, with environmental, health and safety laws or regulations and intellectual property risk);

financial risks (including customers or suppliers who become financially troubled;

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changes in financial accounting standards or policies;

and risk of natural disaster, climate change or other global events.

risk of natural disaster, climate change or other global events;

and risks arising from expectations relating to environmental, social and governance considerations.

References in this report to “the Company,” “Jabil,” “we,” “our,” or “us” mean Jabil Inc.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements