• Flex to move ahead with plans to separate into two companies by spinning off the cloud and power infrastructure portfolio.
• The SpinCo will be a high-growth, critical digital and electrical infrastructure company, led by current CEO Revathi Advaithi.
• For the fourth quarter, revenue came in at $7.5 billion and adjusted earnings per share were $0.93, both beating consensus estimates.

Shares of Flex Ltd. (FLEX) hit an all-time high on Wednesday after the company announced it will separate into two public entities to maximize shareholder value and capitalize on demand for artificial intelligence. This move comes alongside a solid quarterly beat and guidance.

At the time of writing, FLEX stock was up more than 32% at $127.92. On Stocktwits, retail sentiment about FLEX turned ‘bullish’ from ‘neutral’ while message volumes rose 19x over the last 24 hours.

The FLEX Separation

The company said the board has approved a plan to separate its cloud and power portfolio and transfer those assets into a new SpinCo. In doing so, the new entity will focus on providing thermal management technologies and integrated infrastructure systems for AI data centers and mission-critical applications.

Current CEO of Flex, Revathi Advaithi, will lead the new company and is targeting revenue growth of 65%-75% in fiscal 2027 and above 80% in 2028.

The remaining entity, to be helmed by Flex president Michael Hartung, will continue to focus on offering manufacturing and supply chain solutions to companies in the healthcare, industrial, automotive, and communications sectors, among others.

Even after separation, the remaining entity expects to be well-positioned for low- to mid-single-digit growth, continued margin expansion, cash generation, and a robust capital return framework.

FLEX Q4 Results At A Glance

For the fourth quarter (Q4), revenue increased 17% to $7.5 billion, significantly ahead of the Fiscal AI estimate of $6.87 billion, and adjusted earnings per share of $0.93 beat the $0.88 estimate.

For the first quarter (Q1) of fiscal 2027, revenue is expected to be around $7.35 billion to $7.65 billion, above the $7.09 billion estimate, and adjusted earnings per share are expected to be around $0.86 to $0.92, ahead of the $0.84 estimate.

What Retail Traders Think About FLEX

One user on the platform noted that the company’s fundamentals are sharp with a leaner focus.

Another user thinks the move signals “a structural re-rating effort, allowing the core business and infrastructure segment to operate with more focused capital allocation and distinct valuation frameworks.”

FLEX stock has more than doubled in value so far this year and more than tripled over the past 12 months, outperforming the S&P 500.

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