Last night after the close of regular market trading,
Jabil reported revenues of $5.2 billion and earnings of $0.85 per share for its quarter ended November 2015 (FQ1:16) versus Street expectations of $5.2 billion and $0.80. Revenues were up 13% and earnings were up 55% from the same quarter a year ago.
“I am extremely pleased with our strong first quarter results which were driven by improved product diversification and exceptional productivity across both of our business segments,” said Mark T. Mondello, Chief Executive Officer. “This record quarter illustrates the power of both our DMS and EMS businesses as highlighted by a 55 percent core EPS growth year-on-year. This is a great start to our fiscal year and Jabil remains well-positioned for a solid 2016,” added Mondello.
For FQ2, Jabil guided revenues between$4.4 and $4.7 billion and earnings between $0.54 per share and $0.70 per share. At the mid-points, we get $4.55 billion and $0.62 per share respectively, compared to current Street expectations of $4.72 billion and $0.62 per share for the current quarter. Let's call it slightly lower on revenues and in-line on earnings.
For fiscal 2016 (ending August 2016), management said that they are now expecting revenues of $20 billion and earnings of $2.65 per share versus Wall Street expectations of $19.85 billion and $2.58 per share. Let's call that a slight raise for the full year.
For the November quarter, the company reported revenues from its Diversified Manufacturing Services (DMS) segment of $2.5 billion, up 30% annually, and $2.7 billion from its Electronic Manufacturing Services (EMS) segment, up a much more sedate 3%.
Jabil Circuit's largest customer in the DMS segment is
Immediately after Jabil's earnings call was done with, Stifel, came out with a note saying that the company had lowered revenues for the DMS segment in the February quarter by 23% as a result of Apple related weakness.
Do the math and you will see that it's not possible for that segment to be guided down that much or even slightly when overall revenues would (per Jabil's own guidance) still come in higher by 4% in the February quarter compared to a year ago.
In fact, Jabil is actually guiding revenues from the DMS segment for the February quarter (current) up 14% year-on-year which could be more than likely due to strength in the company's Apple-related business.
So, if the sell-side used Dialog Semi's earnings as a negative catalyst for Apple, shouldn't they be using Jabil earnings from last night as a positive?
We shall soon find out.
(Long Apple, long and short calls)
