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Sanmina reported Q3 FY2026 revenue of $3.5 billion, above the $3.4 billion consensus and within its own guidance range. Adjusted earnings per share of $3.31 also exceeded the $2.78 consensus.
Revenue rose from $2.0 billion a year earlier. In its filing, Sanmina attributed the increase primarily to cloud infrastructure, driven by the ZT acquisition, and to new programs and production ramp-ups in communications networks. CFO Jon Faust said core Sanmina generated $2.4 billion in revenue and ZT Systems contributed $1.1 billion.
Sanmina reported diluted earnings per share of $2.12, compared with $1.26 a year earlier. Gross margin increased to 10.5% from 8.87%, while operating margin rose to 6.39% from 4.70%. The filing attributed the gross-margin increase to the ZT acquisition and product mix.
Sanmina reported free cash flow of $23.6 million, down from $163.7 million a year earlier.
| Q3 FY2026 | Q3 FY2025 | Change | |
|---|---|---|---|
| Revenue | $3.5 billion | $2.0 billion | 69.7% |
| Diluted EPS | $2.12 | $1.26 | 68.3% |
| Gross margin | 10.5% | 8.87% | 1.6 percentage points |
| Operating margin | 6.39% | 4.70% | 1.7 percentage points |
| Free cash flow | $23.6 million | $163.7 million | −85.6% |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Adjusted EPS | $3.31 | $2.78 | Beat by 19.1% |
| Revenue | $3.5 billion | $3.4 billion | Beat by 0.90% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
| Against its own guidance | For | Guided | Reported | Result |
|---|---|---|---|---|
| Revenue | Q3 FY2026 | $3.2 billion–$3.5 billion | $3.5 billion | Within the guide |
What management said on the call
CEO Jure Sola said AI demand was driving growth across communications networks, cloud and AI infrastructure. He said Sanmina was adding customers and projects in that market, while industrial and energy and medical revenue growth were expected to accelerate in FY2027.
Asked about the acceleration in the core communications and cloud business, CFO Jon Faust attributed it primarily to new programs and customers across several product types. He also said component shortages were constraining growth. Faust said the company had won additional platform business with Cerebrus as it pursued a broader range of cloud and AI infrastructure programs.
Analysts pressed Faust on the quarter’s margin performance. He attributed the result to business mix, growth in the components business and more engineering services than expected. Those services involved pre-production work for the next-generation accelerated compute program, with labor charges but relatively little associated revenue. He expected that contribution to continue into Q4 and decline over time.
Faust said ZT Systems had secured more customer orders and was investing in power, liquid cooling, test capacity and automation. He said Sanmina was working with AMD and customers on pre-production activities, but customer production schedules and operating models were still being finalized.
On the quarter ahead, Faust said lower expected ZT Systems revenue reflected customer timing on legacy programs. Asked about those programs, he said storage and general-purpose compute could vary from quarter to quarter. He expected working capital to build as the new program ramps, putting pressure on cash flow, and said the company would discuss the cash-flow dynamics further when it formally guides FY2027.
Guidance
Sanmina raised the lower end of its FY2026 revenue outlook and now expects $14.0 billion to $14.3 billion. It also raised its full-year non-GAAP operating margin outlook to 6.85%–7.25% and its non-GAAP diluted EPS outlook to $11.90–$12.20.
| Metric | For | Guide | Previous guide | Change |
|---|---|---|---|---|
| Revenue | FY2028 | Sanmina expects revenue growth to continue in FY2028. | — | — |
| Revenue, Medical | FY2027 | Sanmina expects medical revenue growth to accelerate in FY2027. | — | — |
| Revenue, Industrial and Energy | FY2027 | Sanmina expects industrial and energy revenue growth to accelerate in FY2027. | — | — |
| Revenue, Next Generation Accelerated Compute | Q1 FY2027 | Sanmina expects its next-generation accelerated compute program to begin contributing revenue in Q1 FY2027. | — | — |
| EPS, non-GAAP | FY2026 | $11.90–$12.20 | $10.75–$11.35 | Raised |
| Operating margin, non-GAAP | FY2026 | 6.85%–7.25% | 6.30%–6.60% | Raised |
| Revenue, Zt Systems | FY2026 | $4.8 billion–$5.0 billion | — | New |
| Revenue, Core Sanmina | FY2026 | $9.1 billion–$9.2 billion | — | New |
| Revenue | FY2026 | $14.0 billion–$14.3 billion | $13.7 billion–$14.3 billion | Raised |
| Capex | Q4 FY2026 | $135.0 million | Q3 FY2026: $95.0 million | Raised |
| EPS, non-GAAP | Q4 FY2026 | $3.05–$3.35 | Q3 FY2026: $2.55–$2.85 | Raised |
| Operating margin, non-GAAP | Q4 FY2026 | 7.50%–8.00% | Q3 FY2026: 6.40%–6.90% | Raised |
| Revenue, Zt Systems | Q4 FY2026 | $800.0 million–$1.0 billion | Q3 FY2026: $1.0 billion–$1.2 billion | Cut |
| Revenue, Core Sanmina | Q4 FY2026 | $2.5 billion–$2.6 billion | Q3 FY2026: $2.2 billion–$2.3 billion | Raised |
| Revenue | Q4 FY2026 | $3.3 billion–$3.6 billion | Q3 FY2026: $3.2 billion–$3.5 billion; reported $3.5 billion | Raised |
| Revenue | FY2027 | $16.0 billion | — | New |
| Revenue, Zt Systems Annualized | FY2026 | $5.0 billion–$6.0 billion | — | New |
| Revenue, Core Sanmina | FY2026 | Sanmina expects core Sanmina revenue to grow in the high single digits in FY2026. | — | — |