Electronic manufacturing services company Plexus (NASDAQ: PLXS) met Wall Streets revenue expectations in Q4 CY2025, with sales up 9.6% year on year to $1.07 billion. The company expects next quarter’s revenue to be around $1.13 billion, coming in 4.1% above analysts’ estimates. Its non-GAAP profit of $1.78 per share was 2.7% above analysts’ consensus estimates.

Is now the time to buy Plexus? Find out by accessing our full research report, it’s free.

Todd Kelsey, President and Chief Executive Officer, commented, “We have achieved significant momentum from our consistent focus on delivering customer success and our ongoing investments in talent, technology, facilities and advanced capabilities. Fiscal first quarter revenue of $1.070 billion met our guidance midpoint, increasing 1% sequentially and 10% year over year on robust growth from our Healthcare/Life Sciences and Aerospace/Defense market sectors, while non-GAAP EPS of $1.78 met the high end of our guidance.”

Company Overview

With over 20,000 team members across 26 global facilities, Plexus (NASDAQ: PLXS) designs, manufactures, and services complex electronic products for companies in aerospace/defense, healthcare, and industrial sectors.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years.

With $4.13 billion in revenue over the past 12 months, Plexus is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions. However, its scale is a double-edged sword because finding new avenues for growth becomes difficult when you already have a substantial market presence. For Plexus to boost its sales, it likely needs to adjust its prices, launch new offerings, or lean into foreign markets.

As you can see below, Plexus’s sales grew at a mediocre 4.1% compounded annual growth rate over the last five years. This shows it couldn’t generate demand in any major way and is a tough starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Plexus’s recent performance shows its demand has slowed as its revenue was flat over the last two years.

This quarter, Plexus grew its revenue by 9.6% year on year, and its $1.07 billion of revenue was in line with Wall Street’s estimates. Company management is currently guiding for a 15.3% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 7.6% over the next 12 months, an improvement versus the last two years. This projection is healthy and implies its newer products and services will spur better top-line performance.

The 1999 book Gorilla Game predicted Microsoft and Apple would dominate tech before it happened. Its thesis? Identify the platform winners early. Today, enterprise software companies embedding generative AI are becoming the new gorillas. a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.

Operating Margin

Plexus’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 5% over the last five years. This profitability was lousy for a business services business and caused by its suboptimal cost structure.

Looking at the trend in its profitability, Plexus’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

In Q4, Plexus generated an operating margin profit margin of 5.1%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Plexus’s EPS grew at a remarkable 11.7% compounded annual growth rate over the last five years, higher than its 4.1% annualized revenue growth. However, this alone doesn’t tell us much about its business quality because its operating margin didn’t improve.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Plexus, its two-year annual EPS growth of 19.4% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q4, Plexus reported adjusted EPS of $1.78, up from $1.73 in the same quarter last year. This print beat analysts’ estimates by 2.7%. Over the next 12 months, Wall Street expects Plexus’s full-year EPS of $7.48 to grow 1.8%.

Key Takeaways from Plexus’s Q4 Results

We were impressed by how significantly Plexus blew past analysts’ EPS guidance for next quarter expectations this quarter. We were also glad its revenue guidance for next quarter trumped Wall Street’s estimates. On the other hand, its revenue was in line. Zooming out, we think this quarter featured some important positives. The stock remained flat at $180.81 immediately following the results.

Big picture, is Plexus a buy here and now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).