Q1 2026 Performance Sets the Pace—Core Earnings and Margins Top Forecasts
Jabil Inc. opened fiscal 2026 on a high note, reporting results for the first quarter that surpassed its own expectations. The company's preliminary, unaudited numbers show net revenue reached $8.31 billion, up sharply from $6.99 billion a year ago. U.S. GAAP operating income rose to $283 million, with core (non-GAAP) operating income at $454 million. Core diluted earnings per share came in at $2.85—well ahead of consensus and internal guidance, underscoring robust execution across its portfolio.
CEO Mike Dastoor emphasized, "Fiscal 2026 is off to an excellent start, with Q1 performance ahead of expectations across revenue, core operating margins, and core EPS. Our Intelligent Infrastructure segment continues to lead, bolstered by accelerating demand for cloud and data center infrastructure. Other business units, like Regulated Industries and Connected Living & Digital Commerce, are also performing above initial projections, fueling broad-based momentum."
Key Segments Deliver—Strength Broadens Beyond Core Growth Engine
The main driver remains the Intelligent Infrastructure division, as cloud, data center, networking, and capital equipment markets show sustained expansion. However, Jabil’s other major units—Regulated Industries and Connected Living & Digital Commerce—also posted upside surprises this quarter. This breadth of strength not only de-risks Jabil’s near-term outlook but supports management’s confidence in boosting its 2026 guidance.
Guidance Raised—Jabil Signals Higher Margins, Earnings, and Cash Flow for Full Year
On the back of this solid start, Jabil raised its fiscal 2026 full-year targets. Management now expects:
| Metric | Q2 2026 Guidance | FY 2026 Guidance |
|---|---|---|
| Net Revenue | $7.5B–$8.0B | $32.4B |
| Core Operating Income (Non-GAAP) | $375M–$435M | Not provided |
| Core Operating Margin (Non-GAAP) | — | 5.7% |
| Core Diluted EPS (Non-GAAP) | $2.27–$2.67 | $11.55 |
| Adjusted Free Cash Flow (Non-GAAP) | — | $1.3B+ |
The company maintained its strong adjusted free cash flow expectation of $1.3 billion or more for the year—a sign of discipline even as growth accelerates.
Core Results and Balance Sheet Reflect Operational Resilience
Non-GAAP core metrics reinforce Jabil’s improving profitability and focus on shareholder value. In Q1, core operating income jumped to $454 million, with core EPS at $2.85 compared to $2.00 a year earlier. The company's balance sheet also remained steady, ending the quarter with $1.57 billion in cash and $272 million in adjusted free cash flow, despite sizable buybacks and continued investment in capacity.
| Key Q1 2026 Results | Q1 2026 | Q1 2025 |
|---|---|---|
| Net Revenue | $8.31B | $6.99B |
| Operating Income (GAAP) | $283M | $197M |
| Core Operating Income (Non-GAAP) | $454M | $347M |
| Core Diluted EPS (Non-GAAP) | $2.85 | $2.00 |
| Adjusted Free Cash Flow | $272M | $226M |
Takeaway: Momentum Building, with Guidance Uplift Supporting Confidence
Jabil’s first quarter of 2026 has clearly outperformed expectations, both at the top and bottom lines. The improvement spans major business segments and is fueling a guidance increase for the full fiscal year—especially for core margins and earnings per share. While macroeconomic uncertainties and sector risks remain, Jabil’s operating results and raised outlook suggest a strong foundation for profitable growth through the rest of the year.
Investors will want to monitor how key segments evolve—particularly as Jabil integrates acquisitions like Hanley Energy Group and capitalizes on expanding infrastructure demand. Management’s bullish tone and improved visibility set an optimistic stage, but discipline in execution will be essential for maintaining the company’s upward trajectory.
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