Electronic manufacturing services company Plexus (NASDAQ: PLXS) beat Wall Street’s revenue expectations in calendar Q3 2026 (fiscal Q4 2026), with revenue up 34.8% year on year to $1.43 billion. In addition, next quarter’s revenue guidance ($1.44 billion at the midpoint) was unexpectedly strong, coming in 5% above analysts’ consensus estimates. Its non-GAAP profit of $2.84 per share was 11.3% above analysts’ consensus estimates.

For more on Plexus, read our free full research report.

Mr. Kelsey concluded, “We are guiding fiscal first quarter revenue of $1.410 to $1.460 billion, up 1% sequentially and 34% year over year at the midpoint, with non-GAAP operating margin of 6.0% to 6.4% and non-GAAP EPS of $2.46 to $2.63. For fiscal 2027, we anticipate continued expansion in revenue and profitability, driven by market sector strength, program ramps and share gains while sustaining our investments in people, operational efficiency and technology. We now expect mid- to upper-teens revenue growth with increasing operating margin and sustained working capital efficiency. Finally, through our aligned focus on innovation and our continuous improvement culture, Plexus is creating customer success, scaling the company for the future and developing substantial long-term efficiencies that we expect to generate robust financial returns and shareholder value.”

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 $4.96 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.

Plexus grew its revenue at a solid 8.1% compounded annual growth rate over the last five years, showing demand was higher than at many business services companies.

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 annualized revenue growth of 12% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated.

This quarter, Plexus reported year-on-year revenue growth of 34.8%, and its $1.43 billion in revenue exceeded Wall Street’s consensus estimates by 4.9%. Company management is currently guiding for a 34.1% year-on-year increase in revenue next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 13.5% over the next 12 months, according to S&P, an improvement versus the last two years. This projection is noteworthy and indicates its newer products and services will fuel better top-line performance.

Adjusted operating margin

Adjusted operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D. It also removes various one-time costs to paint a better picture of normalized profits.

Plexus was profitable over the last five years but held back by its large cost base. Its average adjusted operating margin of 5.7% was weak for a business services business.

On the positive side, Plexus’s adjusted operating margin rose by 1.5 percentage points over the last five years, as its revenue growth provided operating leverage.

In Q3, Plexus generated an adjusted operating margin of 6.7%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings per share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Plexus’s EPS grew at a 13% compounded annual growth rate over the last five years, higher than its 8.1% annualized revenue growth. This indicates the company became more profitable on a per-share basis as it expanded.

A closer look at Plexus’s earnings quality helps explain the drivers of its performance. As mentioned earlier, Plexus’s adjusted operating margin was flat this quarter but expanded by 1.5 percentage points over the last five years. On top of that, its share count shrank by 5.3%. These are positive signs for shareholders because improving profitability and share buybacks boost EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Plexus, its two-year annual EPS growth of 30.5% was higher than its five-year trend. That acceleration is a positive sign, especially given the already high base.

In Q3, Plexus reported adjusted EPS of $2.84, up from $2.14 in the same quarter last year. This result comfortably topped analysts’ consensus estimates, a positive outcome for shareholders. Over the next 12 months, Wall Street expects Plexus’s full-year EPS to grow 12.5% from $8.99 to $10.11, according to S&P.

Key takeaways from Plexus’s Q3 results

Plexus’s outlook was a key positive in a good quarterly report: EPS guidance for next quarter came in well above analysts’ consensus estimates, and revenue guidance also topped Wall Street’s consensus. Shares remained flat at $238.50 immediately after the results.

When deciding whether to buy the stock, consider the bigger picture of valuation, business quality and the latest earnings. For more, read our full research report here (it’s free).