What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-11-13 compared with 2024-11-27 · 153 added, 128 removed, 224 unchanged (56% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

This report on annual report Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

This report on Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

These statements relate to our expectations for future events and time periods.

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any statements regarding litigation or pending investigations, claims or disputes;

any statements regarding the timing of closing of, future cash outlays for, and benefits of acquisitions and other strategic transactions, including our Indian joint venture;

any statements regarding the timing of closing of, future cash outlays for, and benefits of acquisitions and other strategic transactions, including our India joint venture and our acquisition of ZT Group Int’l, Inc.

(“ZT Systems”);

any statements regarding expected restructuring costs and benefits;

any statements concerning the adequacy of our current liquidity and the availability of additional sources of liquidity;

any statements regarding the potential impact of any future outbreaks, including outbreaks caused by new variants of COVID-19 on our business, results of operations and financial condition;

any statements regarding the potential impact of any future pandemics on our business, results of operations and financial condition;

any statements regarding the potential impact of supply chain shortages and inflation on our business;

any statements regarding the future impact of tariffs and export controls on our business;

any statements relating to future tax rates and our expectations concerning developments in the audit by the IRS of certain tax returns filed by us, including the potential impact of the IRS revenue agent’s report received by us in November 2023;

any statements regarding the future impact of tariffs, export controls and evolving trade policies on our business;

any statements relating to future tax rates and tax policies and our expectations concerning developments in the audit by the IRS of certain tax returns filed by us, including the potential impact of the IRS revenue agent’s report received by us in November 2023;

any statements relating to the expected impact of accounting pronouncements not yet adopted;

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1) Integrated Manufacturing Solutions (“IMS”).

Our IMS segment consists of printed circuit board assembly and test, high-level assembly and test and direct-order-fulfillment.

IMS is a single operating segment consisting of printed circuit board (“PCB”) assembly and test, high-level assembly and test and direct-order-fulfillment.

2) Components, Products and Services (“CPS”).

Components include advanced printed circuit boards, backplanes and backplane assemblies, cable assemblies, fabricated metal parts, precision machined parts, and plastic injected molded parts.

Components include advanced PCBs, backplanes and backplane assemblies, cable assemblies, fabricated metal parts, precision machined parts, and plastic injected molded parts.

Products include optical, radio frequency (“RF”) and microelectronic design and manufacturing services from our Advanced Microsystems Technologies division;

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high-performance storage platforms for hyperscale and enterprise solutions from our Viking Enterprise Solutions division;

defense and aerospace product, design, manufacturing, repair and refurbishment services from our SCI Technology Inc.

defense and aerospace products, design, manufacturing, repair and refurbishment services from our SCI Technology, Inc.

(“SCI”) subsidiary;

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Our CPS business consists of multiple operating segments which do not individually meet the quantitative thresholds for being presented as reportable segments.

Therefore, financial information for these operating segments is combined and presented in a single category entitled “CPS”.

Therefore, financial information for these operating segments is combined and presented in a single category called “CPS”.

Our strategy is to leverage our comprehensive product and service offerings, advanced technologies and global capabilities to further penetrate diverse end markets that we believe offer significant growth opportunities and have complex products that require higher value-added services.

We believe this strategy differentiates us from our competitors and will help drive more sustainable revenue growth and provide opportunities for us to achieve operating margins that exceed industry standards.

A core component of our business strategy is to establish and retain long-term customer partnerships with companies.

A core component of our business strategy is to secure and retain long-term customer partnerships with leading companies in growth industries, capitalizing on our global/regional footprint and unique value proposition in advanced electronics manufacturing.

We provide tailored solutions by leveraging our technical capabilities in design, technology, assembly, integration, and after-sales services, aligning them with facilities globally.

Historically, we have had substantial recurring sales to existing customers.

Sales to our ten largest customers typically represent approximately 50% of our net sales in any given year.

We typically enter into supply agreements with our major OEM customers.

Sales to our ten largest customers represent approximately 50% of net sales.

We typically enter into long-term supply agreements with our major OEM customers.

These agreements generally have terms ranging from three to five years and cover the manufacture of a range of products.

Under these agreements, a customer typically purchases its requirements for specific products in particular geographic areas from us.

Under these agreements, we manufacture products to customers’ unique specification leveraging our global factory footprint in locations chosen by our customers.

However, these agreements generally do not obligate the customer to purchase minimum quantities of products.

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We generate about 80% of our net sales from products manufactured in our foreign operations.

The concentration of foreign operations has resulted primarily from a desire on the part of many of our customers to manufacture in lower-cost locations in regions such as Asia, Latin America and Eastern Europe and we plan to expand our presence as appropriate to meet the needs of our customers.

The concentration of foreign operations has resulted primarily from a desire on the part of many of our customers to manufacture in lower-cost locations in regions such as Latin America, Asia and Eastern Europe and we plan to expand our presence as appropriate to meet the needs of our customers.

We also intend to continue to invest in factory automation, process improvements, robotics and artificial intelligence, keeping up with the trends in technology to further enhance our efficiency output.

Trends and Uncertainties

We believe our end-to-end manufacturing solutions combined with our global supply chain management expertise differentiates us from our competitors and enables us to better serve the needs of OEMs.

We believe our end-to-end manufacturing solutions combined with our global supply chain management expertise differentiate us from our competitors and enable us to better serve the needs of OEM customers.

However, our business faces many challenges.

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This includes companies that are much larger than we are and smaller companies that focus on a particular niche product, service or end market.

Although we believe we are well-positioned in each of our key end markets and offer many advantages compared to our competitors, competition remains intense and profitably growing our revenues has been challenging.

Additionally, we are impacted by macroeconomic challenges such as inflation, supply chain constraints, foreign currency fluctuations, high interest rates, market volatility, recession concerns, tariffs and other factors that have been and could be in the future exacerbated by geopolitical conflicts such as the war in Ukraine, conflict in the Middle East and results of the U.S.

presidential election.

Although supply chain constraints have been easing, we expect headwinds to our revenue growth that will continue in 2025 due to customers absorbing their finished goods inventory in some of our end markets.

Although we believe we are well-positioned in each of our key end markets and offer many advantages compared to our competitors, profitably growing revenues are often constrained by intense competition.

Additionally, we are impacted by macroeconomic challenges such as tariffs, inflation, supply chain constraints, foreign currency fluctuations, high interest rates, market volatility and recession concerns that have been and could be in the future exacerbated by geopolitical environment such as the tensions between the U.S.

and other nations, conflict in the Middle East and the war in Ukraine.

Further, uncertainties around U.S.

tariffs, retaliatory tariffs from other countries, and import/export restrictions may impact customer decisions to use our services in certain manufacturing locations and increase the complexity and cost of our supply chain.

Although our customers are generally liable for tariffs we pay for components and finished products, our gross margins could be impacted if we are unable to fully recover these costs.

The timing of tariff recovery from customers could adversely affect our operating cash flow in a given period.

Despite these challenges, we remain focused on improving our operations, building flexibility and efficiencies in our processes and adjusting our business models to changing circumstances.

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As our end markets evolve and grow, our ability to optimize our product and portfolio mix towards higher value opportunities will continue to be an important driver for our business going forward.

Acquisition of ZT Systems

In line with our strategic intent to expand our presence in the Cloud and Artificial Intelligence ecosystem, we acquired the data center infrastructure manufacturing business, excluding certain research and development functions, of ZT Group Int’l, Inc.

(“ZT Systems”), from AMD Design, LLC, a wholly owned subsidiary of Advanced Micro Devices, Inc.

On October 27, 2025 (the “Closing Date”), we completed the acquisition of ZT Systems (the “ZT Acquisition”) for an aggregate consideration of $1.6 billion consisting of $1.46 billion in cash consideration (subject to adjustment for certain working capital and other items), a number of shares of our common stock valued at $150 million and up to $450 million contingent cash consideration upon the achievement of certain financial metrics during the three-year period following the closing of ZT Systems acquisition.

See Note 16, “Business Combination” of the notes to the Consolidated Financial Statements contained in this report for more information.

Critical Accounting Policies and Estimates

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The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, net sales and expenses and related disclosure of contingent liabilities.

On an ongoing basis, we evaluate the process used to develop estimates related to accounts receivable, inventories, income taxes, environmental matters, litigation and other contingencies, as well as estimates related to costs expected to be incurred to satisfy performance obligations under long-term contracts and variable consideration related to such contracts.

On an ongoing basis, we evaluate the processes used to develop estimates related to accounts receivable, inventories, income taxes, environmental matters, litigation and other contingencies, as well as estimates related to costs expected to be incurred to satisfy performance obligations under long-term contracts and variable consideration related to such contracts.

We base our estimates on historical experience and on various other assumptions that we believe are reasonable for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.

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We believe the following critical accounting policies reflect the more significant judgments and estimates used by us in preparing our consolidated financial statements:

Revenue Recognition.

We recognize revenue for the majority of our contracts on an over time basis.

Revenue Recognition — We recognize revenue for the majority of our contracts on an over time basis.

This is primarily due to the fact that we do not have an alternative use for the end products we manufacture for our customers and have an enforceable right to payment, including a reasonable profit, for work in progress upon a customer’s cancellation of a contract for convenience.

In certain circumstances, we recognize over time because our customer simultaneously receives and consumes the benefits provided by our services or, our customer controls the end product as we perform manufacturing services (continuous transfer of control).

For these contracts, revenue is recognized on an over time basis using the cost-to-cost method (ratio of costs incurred to date to total estimated costs at completion) which we believe best depicts the transfer of control to the customer.

In our Defense and Aerospace division, we apply the cost-to-cost method for government contracts which requires the use of significant judgments with respect to estimated materials, labor and subcontractor costs included in the total estimated costs at completion.

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If it is determined that a claim has been approved, the amount of the claim, if any, that can be included in transaction price is estimated considering a number of factors such as the length of time expected to lapse until uncertainty about the claim has been resolved and the extent to which our experience with claims for similar contracts has predictive value.

Changes in our estimates of transaction price and/or costs to complete result in a favorable or unfavorable impact to revenue and operating income.

Changes in our estimates of transaction price and/or costs to complete may result in a favorable or unfavorable impact to revenue and operating income.

The impact of changes in estimates on revenue and operating income resulting from application of the cost-to-cost method for recognizing revenue was as follows:

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2025 September 28,

2023 October 1,

2024 September 30,

(In thousands)

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2025 September 28,

2023 October 1,

2024 September 30,

Operating Income:

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Inventory write-downs are recorded based on forecasted demand, past experience with specific customers, the ability to redistribute inventory to other programs or return inventories to our suppliers, and whether customers are contractually obligated and have the ability to pay for the related inventory.

Certain payments received from customers for inventories that have not been shipped to customers or otherwise disposed of are netted against inventory.

We generally procure inventory based on specific customer orders and forecasts.

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Although we may be able to use some excess inventory for other products we manufacture, a portion of this excess inventory may not be returnable to vendors or recoverable from customers.

In certain instances, in accordance with agreed terms, we receive advances from customers to offset our working capital investment in raw materials.

Write-offs or write-downs of inventory could be caused by:

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Our raw materials inventories are generally acquired in anticipation of specific customer orders and pursuant to customer-specific design specifications.

When we and our customers agree that the quantity of customer-specific inventory is in excess of anticipated demand, we may transfer control of those inventories to our customers in exchange for a cash payment.

These transactions are reported as transfers of non-financial assets – i.e., reported on a net basis in the income statement.

Long-lived Assets — We review property, plant and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.

An asset group is the unit of accounting that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets.

An asset or asset group is considered impaired if its carrying amount exceeds the undiscounted future net cash flows the asset or asset group is expected to generate.

If an asset or asset group is considered impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset or asset group exceeds its fair value.

For asset groups for which a building is the primary asset, we estimate fair value primarily based on data provided by commercial real estate brokers.

For other assets, we estimate fair value based on projected discounted future net cash flows, which requires significant judgment.

Consolidation — In accordance with ASC Topic 810, Consolidation (“ASC 810”), we consolidate entities in which we have a controlling financial interest.

In fiscal 2023, we completed a joint venture transaction with Reliance Strategic Business Ventures Limited (“RSBVL”) to establish Sanmina SCI India Private Limited (“SIPL”), our existing Indian manufacturing entity, as a joint venture.

As a result of the transaction, RSBVL holds 50.1% of the outstanding shares of SIPL and we hold the remaining 49.9% of the outstanding shares of SIPL.

In connection with RSBVL’s investment, we entered into a management services contract pursuant to which we have the unilateral ability to make the significant financial and operating decisions made in the ordinary course of SIPL’s business.

We determined the voting interest model was applicable under ASC 810 and

concluded that, despite not having a majority ownership interest, we have a controlling financial interest in SIPL through the management services contract.

Therefore, we have, by contract, the unilateral ability to control the significant decisions made in the ordinary course of SIPL’s business and, as such, we consolidate SIPL.

However, we periodically assess whether any changes in facts and circumstances have occurred that could require us to deconsolidate SIPL.

When we and our customers agree that the quantity of customer-specific inventory is in excess of anticipated demand, we may seek advance payments from our customers against such inventories.

These advances are presented under deferred revenue and customer advances on the consolidated balance sheets.

In the past, in some arrangements with some customers, we transferred control of excess inventories to our customers in exchange for a cash payment, which resulted in a derecognition of the inventory.

Those transactions were reported as transfers of non-financial assets – i.e., reported on a net basis in the income statement – and not included in revenue.

Consolidation — In accordance with Accounting Standards Codification 810, we consolidate our Indian manufacturing entity, even though we only hold 49.9% of its outstanding shares.

This is because we have the unilateral ability to make all significant financial and operating decisions for the entity.

We concluded that, despite not having a majority ownership, we have a controlling financial interest, which requires us to consolidate the entity.

We periodically assess this arrangement to determine if there is any change in facts and circumstances that might require us to deconsolidate the entity.

Income Taxes— We estimate our income tax provision or benefit in each of the jurisdictions in which we operate, including estimating exposures related to examinations by taxing authorities.

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therefore, our assessments can involve a series of complex judgments about future events and rely heavily on estimates and assumptions.

To the extent the probable tax outcome of these matters changes, such changes in estimate will impact our income tax provision in the period in which such determination is made.

To the extent the probable tax outcome of these matters changes, such changes in estimate will impact our income tax provision in the period in which such

determination is made.

We only recognize or continue to recognize tax positions that meet a “more likely than not” threshold of being upheld.

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Refer to Item 7.

“Management's Discussion and Analysis of Financial Condition and Results of Operations” contained in our annual report on Form 10-K for the fiscal year ended September 30, 2023 filed with the SEC on November 16, 2023 for discussion of our results of operations for the fiscal year ended September 30, 2023 compared to the fiscal year ended October 1, 2022.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in our Annual Report on Form 10-K for the fiscal year ended September 28, 2024 filed with the SEC on November 27, 2024 for discussion of our results of operations for the fiscal year ended September 28, 2024 compared to the fiscal year ended September 30, 2023.

The following table presents our key operating results.

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2025 September 28,

2023 October 1,

2024 September 30,

(In thousands)

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Net income attributable to common shareholders $ 245,893 $ 222,536 $ 309,970

Net sales decreased from $8.9 billion for 2023 to $7.6 billion for 2024, a decrease of 15.3%.

Net sales increased from $7.6 billion for 2024 to $8.1 billion for 2025, an increase of 7.4%.

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2025 September 28,

2023 October 1,

2024 September 30,

2023 Increase/(Decrease) Increase/(Decrease)

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Comparison of 2025 to 2024 by End Market

The decrease in sales was primarily due to reduced demand caused by customers in some end markets, particularly communications networks, making adjustments to absorb their finished goods inventory.

The impact of this was partially offset by new program wins and program ramps in our automotive and communications networks end markets.

The increase in sales was primarily due to new program wins and program ramp-ups in our communications networks and cloud infrastructure, as well as our medical end markets.

Gross margin was 8.8%, 8.5% and 8.3% in 2025, 2024 and 2023, respectively.

IMS gross margin decreased slightly to 7.5% in 2024 from 7.7% in 2023.

CPS gross margin increased to 12.8% in 2024 from 11.6% in 2023, primarily due to significant losses recognized on certain fixed-price customer contracts in 2023 compared to 2024, the effect of which was partially offset by unfavorable product mix.

IMS gross margin increased slightly to 7.7% in 2025 from 7.5% in 2024.

CPS gross margin increased to 13.9% in 2025 from 12.8% in 2024, primarily due to improved operating efficiencies partially offset by unfavorable product mix.

We have experienced fluctuations in gross margin in the past and may continue to do so in the future.

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Selling, General and Administrative

Selling, general and administrative expenses were $266 million, $255 million and $245 million in 2024, 2023 and 2022, respectively.

Selling, general and administrative expenses were $290 million and $266 million in 2025 and 2024, respectively.

As a percentage of net sales, selling, general and administrative expenses were 3.6% and 3.5% for 2025 and 2024, respectively.

The increase in absolute dollars in 2024 from 2023 was primarily due to higher stock compensation expense from new equity grants, higher variable compensation and an increase in deferred compensation caused by strong stock market performance that increased the market value of participant investment accounts, partially offset by lower professional fees.

The increase in absolute dollars in 2025 from 2024 was primarily attributable to higher employee compensation, largely due to increased stock compensation expense from new equity grants and variable compensation, as well as higher professional fees and increased expenditures supporting IT systems.

Research and Development

Research and development expenses were $29 million, $26 million and $21 million in 2024, 2023 and 2022, respectively.

As a percentage of net sales, research and development expenses were 0.4% for 2024 and 0.3% for 2023 and 2022.

The increase in absolute dollars in 2024 from 2023 was primarily due to higher expenses for design and engineering support for existing and new projects.

Other Expense

Other expense was $1 million in 2024, $20 million in 2023 and a $26 million in 2022.

The decrease in other expense in 2024 was primarily caused by a $12 million decrease in discount of sold receivables in 2024 due to significantly lower factoring levels and an incremental gain of $5 million in the market value of participant investment accounts in our deferred compensation plan.

Research and development expenses were $31 million and $29 million in 2025 and 2024, respectively.

As a percentage of net sales, research and development expenses were 0.4% for each of 2025 and 2024.

The increase in absolute dollars in 2025 from 2024 was primarily due to higher expenses for design and engineering support for existing projects.

Acquisition and Integration Charges

Acquisition and integration charges were $34 million in 2025 and are related to the acquisition of ZT Systems.

There were no such charges in prior years.

Other Income (Expense), Net

Other income (expense), net was $(11) million in 2025 and $(1) million in 2024.

The increase in other expense in 2025 was primarily caused by a lower market-value gain on participant investment accounts in our deferred compensation plan compared to 2024 as a result of the total return swap contract (“TRS”) entered in the second quarter of 2025 that substantially offsets changes in the deferred compensation plan liabilities elections made by plan participants.

Provision for Income Taxes

We recorded income tax expense of $80 million, $85 million and $62 million in 2024, 2023 and 2022, respectively.

We recorded income tax expense of $73 million and $80 million in 2025 and 2024, respectively.

Our effective tax rate was 22% and 25% for 2025 and 2024, respectively.

The tax rate was lower in 2023 and 2022 primarily due to larger discrete items, including recognized tax benefits from the release of certain foreign tax reserves due to lapse of time and expiration of statutes of limitations.

The tax rate was lower in 2025 primarily due to the release of tax reserves.

As a result of an audit by the Internal Revenue Service (“IRS”) for fiscal 2008 through 2010, we received a Revenue Agent’s Report (“RAR”) on November 17, 2023 asserting an underpayment of tax of approximately $8 million for fiscal 2009.

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We disagree with the IRS’s position as asserted in the RAR and are vigorously contesting this matter through the applicable IRS administrative and judicial procedures, as appropriate.

We do not expect resolution of this matter within twelve months and cannot predict with any certainty the timing of such resolution.

We cannot predict with any certainty the timing of the resolution of this matter.

Although the final resolution of this matter remains uncertain, we continue to believe that it is more likely than not our tax position will be sustained.

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The Organization for Economic Co-operation and Development (“OECD”), an international association of 38 countries including the United States, has proposed changes to numerous long-standing tax principles, namely, its Pillar Two framework, which imposes a global minimum corporate tax rate of 15%.

Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax and where enacted, the rules begin to be effective for us in fiscal 2025.

Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax and where enacted, the rules began to be effective for us in fiscal 2025.

The Pillar Two rules are considered an alternative minimum tax and therefore deferred taxes would not be recognized or adjusted for the estimated effects of the future minimum tax.

The adoption and effective dates of these rules may vary by country and could increase tax complexity and uncertainty and may adversely affect our provision for income taxes.

We do not expect any material impact from these tax law changes in fiscal 2025.

There was no material impact from these tax law changes in fiscal 2025.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The majority of these changes take effect after our fiscal 2025 tax year.

Those that did have an effect on our fiscal 2025, such as 100% bonus reinstatement, have been calculated and included in our provision for income taxes.

There was no material impact from the OBBBA to fiscal 2025 financial statements.

Liquidity and Capital Resources

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2025 September 28,

2023 October 1,

2024 September 30,

(In thousands)

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Key Working Capital Management Measures

Management regularly reviews financial and non-financial performance indicators to assess our operating results.

Our working capital requirements are dependent on the effective management of our sales cycle, as well as timing of payments.

We believe the metrics set forth below are useful to investors in measuring our liquidity, as future liquidity needs will depend on fluctuations in levels of inventory, contract assets, customer inventory advances, accounts receivable and accounts payable.

In the second quarter of fiscal 2025, we changed the methodology for calculating key working capital management measures to standardize the number of days utilized in calculating the metrics, add a new metric for customer inventory advances days, and update the calculation of inventory turns to present inventory turns net of customer inventory advances, which is consistent with how we manage working capital.

Prior period amounts have been conformed to the current period presentation.

September 27,

2025 September 28,

Days sales outstanding (1) 56 55

Days in accounts receivable (1) 60 60

Contract asset days (2) 18 17

Inventory turns (3) 5.2 5.1

Days inventory on hand (4) 70 72

Accounts payable days (5) 71 80 *

Days in inventory (3) 94 70

Days in accounts payable (4) 75 70

Customer inventory advance days (5) 40 7

Cash cycle days (6) 57 70

(1) Days sales outstanding (a measure of how quickly we collect our accounts receivable), or “DSO”, is calculated as the ratio of average accounts receivable, net, to average daily net sales for the quarter.

(2) Contract asset days (a measure of how quickly we transfer contract assets to accounts receivable) are calculated as the ratio of average contract assets to average daily net sales for the quarter.

(3) Inventory turns (annualized) (a measure of how quickly we sell inventory) are calculated as the ratio of four times our cost of sales for the quarter to average inventory.

(4) Days inventory on hand (a measure of how quickly we turn inventory into sales) is calculated as the ratio of average inventory for the quarter to average daily cost of sales for the quarter.

(5) Accounts payable days (a measure of how quickly we pay our suppliers), or “DPO”, is calculated as the ratio of 365 days to accounts payable turns, in which accounts payable turns is calculated as the ratio of four times our cost of sales for the quarter to average accounts payable.

(6) Cash cycle days (a measure of how quickly we convert investments in inventory to cash) is calculated as days inventory on hand plus days sales outstanding minus accounts payable days.

* Certain prior period ratios reflect immaterial updates due to reclassifications of certain financial statement amounts to conform to the current period presentation.

Net inventory turns (7) 7 6

(1) Days in accounts receivable (a measure of how quickly we collect our accounts receivable), or “DSO”, is calculated as accounts receivable, net, at the end of the current quarter divided by net sales for the quarter multiplied by 90 days.

(2) Contract asset days (a measure of how quickly we transfer contract assets to accounts receivable) is calculated as contract assets at the end of the current quarter divided by net sales for the quarter multiplied by 90 days.

(3) Days in inventory (a measure of how quickly we turn inventory into sales) is calculated as inventory at the end of the current quarter divided by cost of sales for the quarter multiplied by 90 days.

(4) Accounts payable days (a measure of how quickly we pay our suppliers), or “DPO”, is calculated as accounts payable at the end of the current quarter divided by cost of sales for the quarter multiplied by 90 days.

(5) Customer inventory advances days (a measure of how long customer deposits for inventory are held) is calculated as customer inventory advances at the end of the current quarter divided by cost of sales for the quarter multiplied by 90 days.

(6) Cash cycle days is calculated as the sum of days in accounts receivable, contract asset days and days in inventory, minus the sum of accounts payable days and customer inventory advances days.

(7) Net inventory turns (annualized) is calculated as 360 days divided by the days in inventory minus customer inventory advances days.

Cash and cash equivalents were $926 million at September 27, 2025 and $626 million at September 28, 2024.

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Net cash provided by operating activities was $621 million, $340 million and $235 million for 2025, 2024 and 2023, respectively.

Our working capital metrics tend to fluctuate from quarter-to-quarter based on factors such as the linearity of our

shipments to customers and purchases from suppliers, customer and supplier mix, and payment terms with customers and suppliers.

Our working capital metrics tend to fluctuate from quarter-to-quarter based on factors such as the linearity of our shipments to customers and purchases from suppliers, customer and supplier mix, the extent to which we factor customer receivables and the negotiation of payment terms with customers and suppliers.

These fluctuations can significantly affect our cash flows from operating activities.

During 2024, we generated $447 million of cash from earnings, excluding non-cash items, and used $107 million of cash primarily because of a decrease in accounts payable of $112 million, an increase in accrued liabilities of $12 million and an increase in accounts receivable of $104 million, partially offset by a decrease in inventories of $36 million.

The decrease in accounts payable was primarily attributable to an unfavorable mix of supplier payment terms and lower inventory receipts, resulting in DPO decreasing from 80 days in 2023 to 71 days in 2024.

The increase in accrued liabilities was due primarily to customer payments for certain inventory partially offset by a decrease in amounts collected under our accounts receivable factoring program that had not been remitted as of the end of the period to the financial institutions that purchased the receivables.

During 2025, we generated $432 million of cash from earnings, excluding non-cash items, and generated $189 million of cash primarily because of increases in accounts payable of $99 million, accrued liabilities and other of $75 million and deferred revenue and customer advances of $663 million, partially offset by increases in accounts receivable of $64 million, contract assets of $42 million and inventories of $543 million.

These increases were consistent with the growth in business volume.

The change in deferred revenue and customer advances is driven by increased customer deposits against raw material inventory purchases.

During the third quarter of 2025, we initiated a program change with our customers that resulted in all inventory advance payments from customers to offset our working capital investment in raw materials inventory to be classified as deferred revenue and customer advances.

During 2024, we generated $447 million of cash from earnings, excluding non-cash items, and used $107 million of

cash primarily because of a decrease in accounts payable of $112 million and an increase in accounts receivable of $104 million, partially offset by an increase in deferred revenue and customer advances of $89 million.

The decrease in accounts payable was primarily attributable to an unfavorable mix of supplier payment terms and lower inventory receipts.

The increase in accounts receivable was primarily attributable to unfavorable customer payment terms mix.

The decrease in inventories is primarily due to our ongoing efforts to reduce inventory to more appropriate levels primarily by working with customers to ensure their demand forecasts are reasonable and incorporate appropriate lead times to secure materials.

During 2023, we generated $527 million of cash from earnings, excluding non-cash items, and used $292 million of cash primarily because of a decrease in accounts payable of $418 million and an increase in accounts receivable of $89 million, partially offset by a decrease in inventories of $210 million.

The decrease in accounts payable was primarily attributable to lower inventory receipts and an unfavorable mix of supplier payment terms, resulting in DPO decreasing from 90 days in 2022 to 80 days in 2023.

The decrease in inventories was primarily due to lower business volume and our efforts to reduce inventory to more appropriate levels primarily by working with customers to ensure their demand forecasts are reasonable and incorporate appropriate lead times to secure materials.

The increase in accounts receivable was primarily attributable to higher business volume and unfavorable customer payment terms mix.

The change in deferred revenue and customer advances is driven by increased customer deposits against raw material inventory purchases.

Net cash used in investing activities was $108 million, $114 million and $192 million for 2025, 2024 and 2023, respectively.

In 2024 and 2023, we used $111 million and $191 million, respectively, of cash for capital expenditures.

In 2025, we received $49 million from the liquidation of investments held in a former rabbi trust for our deferred compensation plan assets, purchased $15 million of long-term investments and used $147 million of cash for capital expenditures.

In 2024, we used $111 million of cash for capital expenditures.

Net cash provided by (used in) financing activities was $(174) million, $(270) million and $95 million for 2025, 2024 and 2023, respectively.

In 2024, we repurchased $254 million of common stock (including $26 million in settlement of employee tax withholding obligations), repaid an aggregate of $22 million of long-term debt and received $6 million of proceeds from issuances of common stock pursuant to stock option exercises.

In 2023, we repurchased $107 million of common stock (including $23 million in settlement of employee tax withholding obligations), repaid an aggregate of $18 million of long-term debt, paid a final payment of $9 million in connection with a previous business combination, received $216 million from sale of shares of SIPL to RSBVL and received $8 million proceeds from short-term borrowing.

Revolving Credit Facility.

The Fifth Amended and Restated Credit Agreement, dated as of September 27, 2022, as amended, (the “Credit Agreement”), provides for an $800 million revolving credit facility and a $350 million secured term loan (the “Term Loan Due 2027”), together with an accordion feature by which we can obtain, subject to the satisfaction of specified conditions and commitment of the lenders, additional revolving commitments in an aggregate amount of up to $200 million.

As of September 28, 2024, no borrowings and $14 million of letters of credit were outstanding under the Credit Agreement, under which $786 million was available to borrow.

There were no borrowings outstanding under the Credit Agreement as of September 30, 2023.

In 2025, we repurchased $114 million of common stock, paid $43 million in settlement of employee tax withholding obligations and repaid an aggregate of $18 million of long-term debt.

In 2024, we repurchased $228 million of common stock, paid $26 million in settlement of employee tax withholding obligations and repaid an aggregate of $22 million of long-term debt.

Existing Credit Facility.

The Fifth Amended and Restated Credit Agreement, dated as of September 27, 2022, as amended, (the “Existing Credit Agreement”), provides for an $800 million revolving credit facility and a $350 million secured term loan (the “Term Loan Due 2027”), together with an accordion feature by which we can obtain, subject to the satisfaction of specified conditions and commitment of the lenders, additional revolving commitments in an aggregate amount of up to $200 million.

On June 6, 2025, we amended the Existing Credit Agreement to permit the ZT Acquisition.

In connection with the closing of the ZT Acquisition, borrowings under the Credit Facilities (as defined below) were used to repay in full the amount remaining under the Term Loan Due 2027, and the Existing Credit Agreement was terminated.

Bridge Loan Facility .

On May 18, 2025, in connection with the acquisition of ZT Acquisition, we entered into a commitment letter with certain financial institutions that have agreed to provide us with, subject to satisfaction of customary conditions and covenants, a senior secured 364-day bridge loan facility in an aggregate principal amount of up to $2.5 billion (the “Bridge Loan Facility”) to fund a portion of the purchase consideration and to pay related fees and expenses.

The commitment was intended to be drawn only to the extent that permanent financing was not obtained prior to closing the ZT Acquisition.

On July 30, 2025, the Bridge Loan Facility was reduced from $2.5 billion to $800 million upon the Company entering into the New Credit Agreement (as defined below) and subsequently on the Closing Date, it was terminated in entirety.

New Credit Facility.

On July 29, 2025, we entered into a credit agreement (the “New Credit Agreement”) that provided for senior secured credit facilities in an aggregate principal amount of $3.5 billion (the “Credit Facilities”), consisting of a $1.5 billion revolving credit facility and a $2.0 billion term loan A facility.

As of September 27, 2025, the commitments under the New Credit Agreement were completely unfunded, and the Existing Credit Agreement remained in effect until the Credit Facilities were drawn at the closing of the ZT Acquisition, as described below.

On October 20, 2025, we entered into Amendment No.

1 to the New Credit Agreement to permit and finance the ZT Acquisition, including adding necessary definitions, funding conditions, and providing a delayed draw term loan A of $600 million with same terms and conditions as the Credit Facilities.

See Note 6 “Debt” of the notes to the Consolidated Financial Statements contained in this report for details.

Subsequent to the year ended September 27, 2025, we completed the acquisition of ZT Systems on the Closing Date for a purchase consideration of $1.6 billion (subject to adjustment for certain working capital and other items) consisting of $1.46 billion in cash consideration and a number of shares of our common stock valued at $150 million (at $130.32 market value representing 1.2 million shares).

Pursuant to the acquisition agreement, the seller is also entitled up to $450 million in contingent cash consideration upon the achievement of certain financial metrics during the three-year period following the Closing Date.

To finance the cash portion of the acquisition and to settle all outstanding amounts under our Existing Credit Agreement, we simultaneously amended our Credit Facilities.

The amendment included a new $800 million term loan B facility.

At the Closing Date, we drew $1.4 billion under the term loan A facility and the full $800 million under the term loan B facility.

Concurrently, with closing, the Bridge Commitment letter was terminated in its entirety.

See Note 6 and Note 16 of “Debt” and “Business Combination”, respectively, of the notes to the Consolidated Financial Statements contained in this report for details.

In addition, we entered into forward interest rate swap agreements with independent counterparties with an aggregate notional amount of $1.2 billion and a maturity date of October 31, 2030, effectively convert a portion of our variable interest rate obligations under the Credit Facilities to fixed interest rate obligations.

As of September 27, 2025, no borrowings and $9 million of letters of credit were outstanding under the Existing Credit Agreement, under which $791 million was available to borrow.

There were no borrowings outstanding under the Existing Credit Agreement as of September 28, 2024.

Short-term Borrowing Facilities.

We had no short-term borrowings outstanding as of September 28, 2024 and $8 million of short-term borrowings outstanding as of September 30, 2023.

Additionally, certain of our foreign subsidiaries had a total of $71 million of short-term borrowing facilities available, under which no borrowings were outstanding as of September 28, 2024.

Some of these facilities expire at various dates through the second quarter of 2025 and are expected to be renewed.

We had no short-term borrowings outstanding as of September 27, 2025.

Additionally, certain of our foreign subsidiaries had a total of $71 million of uncommitted short-term borrowing facilities available, under which no borrowings were outstanding as of September 27, 2025.

Some of these facilities expire at various dates through the first quarter of 2027 and are expected to be renewed.

Other Liquidity Matters

During 2024 and 2023, we repurchased 4.0 million shares and 1.6 million shares of our common stock for $227 million and $84 million (including commissions), respectively, under stock repurchase programs authorized by the Board of Directors.

During 2025, we repurchased 1.4 million shares of our common stock for $114 million (including commissions), under stock repurchase programs authorized by the Board of Directors.

These programs have no expiration dates and the timing of repurchases will depend upon capital needs to support the growth of our business, market conditions and other factors.

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As a result, the timing of future repurchases depends upon our future capital needs, market conditions and other factors.

As of September 28, 2024, an aggregate of $53 million remains available under these programs.

We are party to a Receivables Purchase Agreement (the “RPA”) with certain third-party banking institutions for the sale of accounts receivable generated from sales to certain customers.

As of September 27, 2025, an aggregate of $239 million remains available under the stock repurchase program.

We are party to a Receivables Purchase Agreement, as amended (the “RPA”), with certain third-party banking institutions for the sale of trade receivables generated from sales to certain customers.

The amount available under the RPA is uncommitted and, as such, is available at the discretion of our third-party banking institutions.

Under the Credit Agreement, the percentage of our total accounts receivable that can be sold and outstanding at any time is 50%.

Under the Existing Credit Agreement, the percentage of our total trade receivables that can be sold and outstanding at any time is 50%.

Therefore, as of September 27, 2025, a maximum of $490 million of sold receivables could be outstanding at any point in time under this program, as amended, as required by our Credit Agreement.

Accounts receivables sold pursuant to the RPA are serviced by us.

In addition to the RPA, we participate in accounts receivable sales programs that have been implemented by certain of our customers, as in effect from time to time.

We do not service accounts receivable sold under these other programs.

The sale of receivables under all of these programs is subject to the approval of the banks or customers involved and there can be no assurance that we will be able to sell the maximum amount of receivables permitted by these programs when desired.

Under each of the programs noted above, we sell our entire interest in an accounts receivable for 100% of face value, less a discount.

For the years ended September 28, 2024 and September 30, 2023, we sold approximately $1.1 billion and $2.6 billion, respectively, of accounts receivable under these programs.

As of September 28, 2024 and September 30, 2023, $34 million and $162 million, respectively, of accounts receivable sold under the RPA and subject to servicing by us remained outstanding and had not yet been collected.

Our sole risk with respect to receivables we service is with respect to commercial disputes regarding such receivables.

Commercial disputes include billing errors, returns and similar matters.

To date, we have not been required to repurchase any receivable we have sold due to a commercial dispute.

Additionally, we are required to remit amounts collected as servicer on a weekly basis to the financial institutions that purchased the receivables.

As of September 28, 2024 and September 30, 2023, $3 million and $33 million, respectively, had been collected but not yet remitted.

This amount is classified in accrued liabilities on the consolidated balance sheets.

We enter into forward interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in Secured Overnight Financing Rate benchmark interest rate associated with anticipated variable rate borrowings.

Trade receivables sold pursuant to the RPA are serviced by us.

In addition to the RPA, we participate in trade receivables sales programs that have been implemented by certain of our customers, as in effect from time to time.

We do not service trade receivables sold under these other programs.

receivables under all of these programs is subject to the approval of the banks or customers involved and there can be no assurance that we will be able to sell the maximum amount of receivables permitted by these programs when desired.

See Note 8, “Accounts Receivable Sale Programs” of the notes to the Consolidated Financial Statements contained in this report for details.

We enter into forward interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the Secured Overnight Financing Rate benchmark interest rate associated with anticipated variable rate borrowings.

In addition, in the second quarter of 2025, we entered into a TRS contract to manage the equity market risks associated with our deferred compensation plan liabilities.

See Note 5 “Financial Instruments and Concentration of Credit Risk” of the notes to the Consolidated Financial Statements contained in this report for details.

In the ordinary course of business, we are or may become party to legal proceedings, claims and other contingencies, including environmental, warranty and employee matters and examinations by government agencies.

In the ordinary course of business, we are or may become party to legal proceedings, claims and other contingencies, including environmental, regulatory, warranty and employee matters and examinations by government agencies.

As of September 27, 2025, we had accrued liabilities of $39 million related to such matters.

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In 2025, we generated $621 million of cash from operations.

Our primary sources of liquidity as of September 28, 2024 consisted of (1) cash and cash equivalents of $626 million;

(2) our Credit Agreement, under which $786 million, net of outstanding borrowings and letters of credit, was available;

Our primary sources of liquidity as of September 27, 2025 consisted of (1) cash and cash equivalents of $926 million (an aggregate of $215 million of our cash is held by Sanmina SCI India Private Limited (“SIPL”) and Sanmina SCI Technology India Private Limited, our existing Indian manufacturing entity, which is designated to fund its operations use);

(2) our Existing Credit Agreement, under which $791 million, net of outstanding borrowings and letters of credit, was available;

(3) our foreign short-term borrowing facilities of $71 million, all of which was available;

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and (5) cash generated from operations.

Subject to satisfaction of certain conditions, including obtaining additional commitments from existing and/or new lenders, we may increase the revolver commitments under the Credit Agreement by an additional $200 million.

We believe our existing cash resources and other sources of liquidity, together with cash generated from operations, will be sufficient to meet our working capital requirements through at least the next 12 months.

However, should demand for our services decrease significantly over the next 12 months, should we be unable to recover on inventory obligations owed to us

by our customers or should we experience significant increases in delinquent or uncollectible accounts receivable for any reason, our cash provided by operations could decrease significantly and we could be required to seek additional sources of liquidity to continue our operations at their current level.

We invest our cash in numerous financial institutions that we believe to be of high quality.

Subject to satisfaction of certain conditions, including obtaining additional commitments from existing and/or new lenders, we may increase the revolving commitments under the Existing Credit Agreement up to an additional $200 million.

However, should demand for our services decrease significantly over the next twelve months, should we be unable to recover on inventory obligations owed to us by our customers or should we experience significant increases in delinquent or uncollectible accounts receivable for any reason, our cash provided by operations could decrease significantly and we could be required to seek additional sources of liquidity to continue our operations at their current level.

We invest our cash among a number of financial institutions that we believe to be of high quality.

However, there can be no assurance that one or more of such institutions will not become insolvent in the future, in which case all or a portion of our uninsured funds on deposit with such institutions could be lost.

As of September 28, 2024, approximately 34% of our cash balance was held in the United States.

As of September 27, 2025, 42% of our cash balance was held in the United States.

Should we choose or need to remit cash to the United States from our foreign locations, we may incur tax obligations which would reduce the amount of cash ultimately available to the United States.

We believe that cash held in the United States, together with liquidity available under our Credit Agreement and cash from foreign subsidiaries that could be remitted to the United States without tax consequences, will be sufficient to meet our United States liquidity needs for at least the next 12 months.

SIPL’s cash and cash equivalents balance of $200 million as of September 28, 2024 is not available for general corporate purposes and must be retained in SIPL to fund its operations.

We believe that cash held in the United States, together with liquidity available under our Existing Credit Agreement and cash from foreign subsidiaries that could be remitted to the United States without tax consequences, will be sufficient to meet our United States liquidity needs for at least the next 12 months.

Contractual Obligations

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These obligations impact our liquidity and capital resource needs.

Our estimated future obligations consist of leases, our Term Loan Due 2027, pension plan funding obligations and unrecognized tax benefits as of September 28, 2024.

As of September 27, 2025, our estimated future obligations consist of leases, our Term Loan Due 2027, pension plan funding obligations and unrecognized tax benefits.

A summary of our operating lease obligations as of September 27, 2025 can be found in Note 7 “Leases” of the notes to the Consolidated Financial Statements contained in this report.

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See Note 15 “Employee Benefit Plans” of the notes to the Consolidated Financial Statements contained in this report.

The Company’s long-term liabilities arising from unrecognized tax benefits can be found in Note 10 “Income Tax” of the notes to the Consolidated Financial Statements contained in this report.

Our long-term liabilities arising from unrecognized tax benefits can be found in Note 10 “Income Tax” of the notes to the Consolidated Financial Statements contained in this report.

We also have outstanding firm purchase orders with certain suppliers for the purchase of inventory which are generally short-term in nature.

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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-K

Item 7. Management’s Discussion and Analysis