Our second quarter exceeded expectations on both revenue and core operating margin, driving another step-up in core EPS.
— Gregory Hebard
03Detailed Report
JBL
Company JBL
Period
Q2 2026
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedMay 14, 2026
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Executive Summary
Jabil delivered a robust second quarter (fiscal 2026) with revenue of $8.282 billion and a core operating margin of 5.3%, driven predominantly by Intelligent Infrastructure (II), which posted a 52% year-over-year increase to about $4.0 billion. Management attributed the strength to broad-based demand in cloud and data center infrastructure, networking and communications, and accelerating capacity in capital equipment. GAAP earnings per share (EPS) came in at $2.08, while core diluted EPS was $2.69, underscoring meaningful margin discipline amid strong top-line growth. JBL affirmed its multi-year strategy of profitable growth through disciplined mix, margin expansion, and sustained cash generation, and raised full-year guidance for revenue to roughly $34 billion and core EPS to $12.25, with adjusted free cash flow (FCF) >$1.3 billion.
Management emphasized that AI-related revenue is accelerating, with AI-driven revenue expected to reach approximately $13.1 billion for fiscal 2026, a ~46% year-over-year increase. The company also signaled continued strength in Regulated Industries and ongoing, albeit more modest, improvement in Connected Living & Digital Commerce as robotics and automation initiatives scale. Free cash flow remains robust, enabling capital returns via buybacks (Q2 buybacks of $300 million) and disciplined balance-sheet management. Looking ahead, JBL expects Q3 revenue of $8.1–$8.9 billion and core operating income of $452–$512 million, with full-year 2026 guidance remaining anchored by a ~5.7% core operating margin and >$1.3 billion in adjusted FCF. While the outlook is positive, JBL notes macro volatility and supply constraints as the key macro tailwinds/headwinds to monitor, along with the need to sustain margin progression toward a 6% goal for FY2027.
Key Performance Indicators
Revenue
Increasing
8.28B
QoQ: -0.28% | YoY: 18.93%
Gross Profit
Increasing
746.00M
9.01% margin
QoQ: 0.54% | YoY: 12.52%
Operating Income
Increasing
387.00M
QoQ: 36.75% | YoY: 21.70%
Net Income
Increasing
223.00M
QoQ: 52.74% | YoY: 61.59%
EPS
Increasing
2.09
QoQ: 52.55% | YoY: 84.96%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue and profitability:
- Q2 revenue: $8.282 billion; YoY revenue growth: 18.9% (reported in earnings metrics), QoQ roughly flat to down modestly in prior periods. Gross margin: 9.01% (gross profit $746 million); core operating margin: 5.3% (GAAP operating margin: 4.67%). Net income: $223 million; net margin: 2.69%. Core diluted EPS: $2.69; GAAP diluted EPS: $2.08. EBITDA: $387 million.
Cash flow and liquidity:
- Operating cash flow: $411 million; capex: $95 million; free cash flow: $506 million for the quarter.
- Net debt position: total debt $4.389 billion; net debt $2.559 billion; cash and cash equivalents: $1.83 billion.
- Share buybacks: $300 million repurchased in Q2.
Updated guidance:
- FY2026 revenue guidance raised to approximately $34 billion (from $32.4 billion previously).
- Core EPS target raised to $12.25.
- Core operating margin guidance maintained around 5.7% for FY2026.
- Adjusted free cash flow target >$1.3 billion for the full year.
- AI-related revenue trajectory: $13.1 billion in FY2026 (approx. 46% YoY growth).
Balance sheet and capital allocation:
- The business remains cash generative with a strong liquidity position and investment-grade credit profile. Secondary emphasis on capital allocation remains buybacks (older guidance suggests ~80% of FCF to buybacks) and selective M&A financing capability, contingent on opportunities.
Key risks and catalysts:
- Ongoing supply chain constraints (e.g., memory/DDR4/DDR5 and PCB constraints) and geopolitical uncertainty could influence near-term component availability and pricing.
- AI data-center demand remains a key upside driver, with II margins expected to improve as capacity comes online and mix shifts toward higher-margin offerings such as power, liquid cooling, silicon photonics, and integrated system solutions.
- Macro sensitivity in automotive, renewables, and healthcare end-markets requires disciplined forecasting and capital allocation to manage volatility.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
8.28B
18.93%
-0.28%
Gross Profit
746.00M
12.52%
0.54%
Operating Income
387.00M
21.70%
36.75%
Net Income
223.00M
61.59%
52.74%
EPS
2.09
84.96%
52.55%
Key Financial Ratios
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