PLEXUS CORP (PLXS)

ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

"SAFE HARBOR" CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995:

The statements contained in this Form 10-Q that are guidance or which are not historical facts (such as statements in the future tense and statements including believe, expect, intend, plan, anticipate, goal, target and similar terms and concepts), including all discussions of periods which are not yet completed, are forward-looking statements that involve risks and uncertainties. These risks and uncertainties include the effects of tariffs, trade disputes, trade agreements and other trade protection measures; the effects of shortages, delays and price fluctuations in obtaining components as a result of economic cycles, capacity constraints, natural disasters or otherwise; the risk of customer delays, changes, cancellations or forecast inaccuracies in both ongoing and new programs; the particular risks relative to new or recent customers, programs or services, which risks include customer and other delays, start-up costs, potential inability to execute, the establishment of appropriate engagement terms, and the lack of a track record of order volume and timing; the risk that new program wins and/or customer demand may not result in the expected revenue or profitability; the lack of visibility of future orders, particularly in view of changing economic conditions; the economic performance of the industries, sectors and customers we serve; the effects of the volume of revenue from certain sectors or programs on our margins in particular periods; our ability to secure new customers, maintain our current customers and deliver product on a timely basis; the risks of concentration of work for certain customers; the effects of start-up costs of new programs and facilities or the costs associated with winding down programs or the closure or consolidation of facilities; possible unexpected costs and operating disruption in transitioning programs, including transitions between Company facilities; the risks associated with excess and obsolete inventory, including the risk that inventory purchased on behalf of our customers may not be consumed or otherwise paid for by the customer, resulting in an inventory write-off; the fact that customer orders may not lead to long-term relationships; our ability to manage successfully and execute a complex business model characterized by high product mix and demanding quality, regulatory, and other requirements; the outcome of litigation and regulatory investigations and proceedings, including the results of any challenges with regard to such outcomes; the ability to realize anticipated savings from restructuring or similar actions, as well as the adequacy of related charges as compared to actual expenses; risks related to information technology systems and data security; increasing regulatory and compliance requirements; any tax law changes and related foreign jurisdiction tax developments; current or potential future barriers to the repatriation of funds that are currently held outside of the United States as a result of actions taken by other countries or otherwise; the potential effects of jurisdictional results on our taxes, tax rates, and our ability to use deferred tax assets and net operating losses; the weakness of the economy regionally or globally; the effect of changes in the pricing and margins of our services; raw materials and component cost fluctuations; the potential effect of fluctuations in the value of the currencies in which we transact business; the effects of changes in economic conditions, political conditions and regulatory matters in the United States and in the other countries in which we do business; the potential effect of other events outside our control, such as the conflict between Russia and Ukraine, conflict in the Middle East (including in Iran), escalating tensions between China and Taiwan or China and the United States, tensions in or amongst countries in which we operate or transact business; changes in energy prices, terrorism, global health epidemics and weather events; the impact of increased competition; an inability to successfully manage human capital, including succession planning for and transition of senior executives; changes in financial accounting standards; and other risks detailed herein and in our other Securities and Exchange Commission filings, particularly in Risk Factors contained in our fiscal 2025 Form 10-K.

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OVERVIEW

At Plexus, we help create the products that build a better world. Driven by a passion for excellence, we partner with our customers to design, manufacture and service highly complex products in demanding regulatory environments. From life-saving medical devices and mission-critical aerospace and defense products to industrial automation systems and semiconductor capital equipment, our innovative solutions across the lifecycle of a product converge where advanced technology and human impact intersect. We provide these solutions to market-leading as well as disruptive global companies in the Aerospace/Defense, Healthcare/Life Sciences, and Industrial sectors, supported by a global team of over 20,000 members across our 27 facilities.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide an analysis of both short-term results and future prospects from management’s perspective, including an assessment of the financial condition and results of operations, events and uncertainties that are not indicative of future operations and any other financial or statistical data that we believe will enhance the understanding of our company’s financial condition, cash flows and other changes in financial condition and results of operations.

The following information should be read in conjunction with our condensed consolidated financial statements included herein and "Risk Factors" included in Part II, Item 1A included herein as well as Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended September 27, 2025, and our "Safe Harbor" Cautionary Statement included above.

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RESULTS OF OPERATIONS

Consolidated Performance Summary. The following table presents selected consolidated financial data (dollars in millions, except per share data):

Net sales. For the three months ended July 4, 2026, net sales increased $286.5 million, or 28.1%, as compared to the three months ended June 28, 2025. For the nine months ended July 4, 2026, net sales increased $563.8 million, or 19.0%, as compared to the nine months ended June 28, 2025.

Net sales are analyzed by management by geographic segment, which reflects our reportable segments, and by market sector. Management measures operational performance and allocates resources on a geographic segment basis. Our global business development strategy is based on our targeted market sectors.

A discussion of net sales by reportable segment is presented below (in millions):

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AMER. Net sales for the three months ended July 4, 2026 in the AMER segment increased $116.0 million, or 37.2%, as compared to the three months ended June 28, 2025. The increase in net sales was driven by an increase of $107.4 million due to production ramps of new products for existing customers, an increase of $29.4 million due to production ramps for new customers and overall net increased customer end-market demand. The increase was partially offset by a decrease of $20.4 million due to disengagements with customers and a decrease of $19.4 million for end-of-life products.

During the nine months ended July 4, 2026, net sales in the AMER segment increased $288.6 million, or 32.8%, as compared to the nine months ended June 28, 2025. The increase in net sales was driven by an increase of $293.3 million due to production ramps of new products for existing customers and an increase of $59.8 million due to production ramps for new customers. The increase was partially offset by a decrease of $41.9 million due to disengagements with customers and a decrease of $14.3 million for end-of-life products.

APAC. Net sales for the three months ended July 4, 2026 in the APAC segment increased $180.2 million, or 30.4%, as compared to the three months ended June 28, 2025. The increase in net sales was driven by overall net increased customer end-market demand and an increase of $21.8 million due to production ramps of new products for existing customers. A meaningful portion of increased end-market demand are continued ramps of semi-cap wins reflecting share gains from prior periods.

During the nine months ended July 4, 2026, net sales in the APAC segment increased $249.7 million, or 14.0%, as compared to the nine months ended June 28, 2025. The increase in net sales was driven by overall net increased customer end-market demand, an increase of $37.3 million due to production ramps of new products for existing customers and an increase of $7.8 million due to production ramps for a new customer. A meaningful portion of increased end-market demand are continued ramps of semi-cap wins reflecting share gains from prior periods. The increase was partially offset by a decrease of $5.9 million due to a disengagement with a customer.

EMEA. Net sales for the three months ended July 4, 2026 in the EMEA segment decreased $7.7 million, or 6.6%, as compared to the three months ended June 28, 2025. The decrease in net sales was driven by a decrease of $9.1 million due to a disengagement with a customer and overall net decreased customer end-market demand. The decrease is partially offset by an increase of $7.6 million due to production ramps of new products for existing customers.

During the nine months ended July 4, 2026, net sales in the EMEA segment increased $22.5 million, or 7.0%, as compared to the nine months ended June 28, 2025. The increase in net sales was driven by an increase of $41.7 million due to production ramps of new products for existing customers. The increase was partially offset by a decrease of $14.

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ITEM 7.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

At Plexus, we help create the products that build a better world. Driven by a passion for excellence, we partner with our customers to design, manufacture and service highly complex products in demanding regulatory environments. From life-saving medical devices and mission-critical aerospace and defense products to industrial automation systems and semiconductor capital equipment, our innovative solutions across the lifecycle of a product converge where advanced technology and human impact intersect. We provide these solutions to market-leading as well as disruptive global companies in the Aerospace/Defense, Healthcare/Life Sciences, and Industrial sectors, supported by a global team of over 20,000 members across our 26 facilities in the Americas ("AMER"), Asia-Pacific ("APAC") and Europe, Middle East and Africa ("EMEA") regions.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide an analysis of both short-term results and future prospects from management’s perspective, including an assessment of the financial condition and results of operations, events and uncertainties that are not indicative of future operations and any other financial or statistical data that we believe will enhance the understanding of our company’s financial condition, cash flows and other changes in financial condition and results of operations. The information should be read in conjunction with our consolidated financial statements included herein and "Risk Factors" included in Part I, Item 1A herein.

A discussion regarding our financial condition and results of operations for fiscal 2025 compared to fiscal 2024 is presented below. A discussion regarding our financial condition and results of operations for fiscal 2024 compared to fiscal 2023 can be found in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," in our Annual Report on the Form 10-K for the fiscal year ended September 28, 2024, which was filed with the SEC on November 15, 2024, and is available on the SEC’s website at www.sec.gov as well as our Investor Relations website at www.plexus.com. However, such discussion is not incorporated by reference into, and does not constitute a part of this Annual Report on Form 10-K.

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RESULTS OF OPERATIONS

Consolidated Performance Summary. The following table presents selected consolidated financial data for the indicated fiscal years (dollars in millions, except per share data):

Net sales. Fiscal 2025 net sales increased $72.2 million, or 1.8%, as compared to fiscal 2024.

Net sales are analyzed by management by geographic segment, which reflects our reportable segments, and by market sector. Management measures operational performance and allocates resources on a geographic segment basis. Our global business development strategy is based on our targeted market sectors.

In the first quarter of fiscal 2025, we changed internal management reporting to focus on value-add sales in each region and adjusted the allocation of certain corporate costs among reportable segments. These changes have been implemented and are consistent with what was provided to the Chief Operating Decision Maker ("CODM"). Our composition of operating segments and reportable segments did not change. Net sales and operating income for our three reportable segments for the current period and comparative periods presented have been recast to conform to those changes. These changes had no effect on our consolidated net sales, operating income or net income for the current or comparative periods.

As a percentage of consolidated net sales, no customer accounted for over 10.0% or more of consolidated net sales in fiscal 2025 or 2024. Our 10 largest customers accounted for 49.1% and 47.8% of our net sales in fiscal 2025 and 2024, respectively.

A discussion of net sales by reportable segment is presented below for the indicated fiscal years (in millions):

AMER. Net sales for fiscal 2025 in the AMER segment decreased $2.9 million, or 0.2%, as compared to fiscal 2024. The decrease in net sales was driven by overall net decreased customer end-market demand, a decrease of $54.1 million due to disengagements with customers and a decrease of $13.9 million due to the discontinuation of a program with an existing customer. The decrease was partially offset by an increase of $71.4 million due to production ramps of new products for existing customers and an increase of $10.5 million due to production ramps for new customers.

APAC. Net sales for fiscal 2025 in the APAC segment increased $179.6 million, or 8.1%, as compared to fiscal 2024. The increase in net sales was driven by an increase of $103.1 million due to production ramps of new products for existing

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customers and overall net increased customer end-market demand. The increase was partially offset by a decrease of $12.6 million due to disengagements with customers.

EMEA. Net sales for fiscal 2025 in the EMEA segment decreased $98.1 million, or 18.2%, as compared to fiscal 2024. The decrease in net sales was driven by overall net decreased customer end-market demand and a decrease of $21.0 million due to disengagements with customers.

Our net sales by market sector for the indicated fiscal years were as follows (in millions):

Aerospace/Defense. Net sales for fiscal 2025 in the Aerospace/Defense sector decreased $10.0 million, or 1.4%, as compared to fiscal 2024. The decrease in net sales was driven by a decrease of $23.6 million due to disengagements with customers, a decrease of $13.9 million due to the discontinuation of a program with an existing customer and overall net decreased customer end-market demand. The decrease was partially offset by an increase of $44.4 million due to production ramps of new products for existing customers.

Healthcare/Life Sciences. Net sales for fiscal 2025 in the Healthcare/Life Sciences sector increased $74.5 million, or 4.8%, as compared to fiscal 2024. The increase in net sales was driven by an increase of $112.8 million in production ramps of new products for existing customers. The increase was partially offset by a decrease of $25.9 million due to disengagements with customers and overall net decreased customer end-market demand.

Industrial. Net sales for fiscal 2025 in the Industrial sector increased $7.7 million, or 0.5%, as compared to fiscal 2024. The increase in net sales was driven by overall net increased customer end-market demand, an increase of $15.1 million in production ramps of new products for existing customers and an increase of $10.5 million due to production ramps for new customers. The increase was partially offset by a decrease of $38.9 million due to disengagements with customers.

Cost of sales. Cost of sales for fiscal 2025 increased $44.2 million, or 1.2%, as compared to fiscal 2024. Cost of sales is comprised primarily of material and component costs, labor costs and overhead. In both fiscal 2025 and 2024, approximately 89% of the total cost of sales was variable in nature and fluctuated with sales volumes. Approximately 87% of these costs were related to material and component costs.

As compared to fiscal 2024, the increase in cost of sales in fiscal 2025 was primarily driven by an increase in net sales, partially offset by a positive shift in customer mix and a decrease in fixed costs resulting from progress on operational efficiency initiatives.

Gross profit. Gross profit for fiscal 2025 increased $28.0 million, or 7.4%, as compared to fiscal 2024. Gross margin of 10.1% increased 50 basis points compared to fiscal 2024. The primary drivers of the increase in gross profit and gross margin as compared to fiscal 2024 were a positive shift in customer mix as well as lower costs resulting from operational efficiencies and prior restructuring activities.

Operating income. Operating income for fiscal 2025 increased $34.7 million, or 20.7%, as compared to fiscal 2024. Operating margin of 5.0% increased 80 basis points compared to fiscal 2024. The primary drivers of the increase in operating income and operating margin as compared to fiscal 2024 were the increase in gross profit and gross margin as well as a decrease of $15.6 million in restructuring and other charges. The restructuring and other charges for fiscal 2025 primarily consisted of severance costs associated with a reduction in our workforce in the EMEA and AMER regions. The restructuring and other charges for fiscal 2024 consisted of employee severance costs associated with a reduction in our workforce as well as closure costs associated with sites in our AMER and EMEA regions, partially offset by insurance proceeds received in an arbitration decision regarding a contractual matter that took place in the our EMEA region in fiscal 2023. The increases in operating income were partially offset by an increase of $8.9 million in selling and administrative expenses ("S&A"). The increase in S&A was primarily due to an increase in compensation costs.

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A discussion of operating income by reportable segment for the indicated fiscal years is presented below (in millions):

AMER. Operating income increased $16.8 million in fiscal 2025 as compared to fiscal 2024, primarily as a result of a decrease in fixed costs resulting from progress on operational efficiency initiatives and a positive shift in customer mix, partially offset by a decrease in net sales.

APAC. Operating income increased $24.5 million in fiscal 2025 as compared to fiscal 2024, primarily as a result of an increase in net sales and a positive shift in customer mix, partially offset by an increase in fixed costs and an increase in S&A.

EMEA. Operating income decreased $9.7 million in fiscal 2025 as compared to fiscal 2024, primarily as a result of a decrease in net sales and an increase in S&A, partially offset by a decrease in fixed costs and a positive shift in customer mix.

Other expense. Other expense for fiscal 2025 decreased $23.8 million as compared to fiscal 2024. The decrease in other expense for fiscal 20

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