Important points
Jabil beat expectations for fourth-quarter profit and sales due to surging demand for its artificial intelligence infrastructure products. Apple’s suppliers approved $1 billion in stock buybacks. Jabil also announced a restructuring that includes layoffs that will cost between $150 million and $200 million in fiscal year 2025.
Jabiru (JBL) shares soared Thursday after the circuit board maker reported better-than-expected results on demand for artificial intelligence (AI), authorized a stock buyback program and embarked on a restructuring that includes layoffs.
The company, which supplies Apple (AAPL), reported fourth-quarter adjusted earnings per share (EPS) of $2.30, beating the consensus estimate of analysts surveyed by Visible Alpha. Revenues fell 17.7% from a year earlier to $6.96 billion, reflecting losses from the sale of its mobility division in December, but still beat expectations.
CEO Jabir: ‘We are well positioned to take advantage of long-term trends’
Chief Executive Officer Mike Dastall noted that during the fiscal year, Jabiru saw growth in its AI data center division due to mobility divestitures and while dealing with downturns in multiple end markets. He added that while short-term demand remains a challenge in some end markets, “we believe we are well-positioned to take advantage of long-term trends in the medium to long term.”
Jabil’s board of directors also approved a $1 billion stock repurchase plan.
Along with the earnings news, the company announced a restructuring plan to “adjust our support infrastructure to further optimize organizational effectiveness.” The company said this will involve workforce reductions and capacity restructuring across its selling, general and administrative (SG&A) and manufacturing cost bases. Jabil explained that implementing the changes is expected to cost between $150 million and $200 million in fiscal year 2025.
Despite rising nearly 12% to $126.85 Thursday afternoon, Jabiru stock remains slightly down year-to-date.
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