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August 2015

Flextronics Investor Presentation August 2015

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Page 1: Flextronics Investor Presentation August 2015

August 2015

Page 2: Flextronics Investor Presentation August 2015

1

This presentation contains forward-looking statements, which are based on current expectations and assumptions

that are subject to risks and uncertainties and actual results could materially differ. Such information is subject to

change and we undertake no obligation to update these forward-looking statements. For a discussion of the risks

and uncertainties, see our most recent filings with the Securities and Exchange Commission, including our current,

annual and quarterly reports.

If this presentation references non-GAAP financial measures, these measures are located on the “Investor

Relations” section of our website, www.flextronics.com along with the required reconciliation to the most

comparable GAAP financial measures.

Page 3: Flextronics Investor Presentation August 2015

2

Cash Flow & Capital

Structure

Differentiated

StrategyIntro

Business

Groups

Latest Financial

Update

Why Invest in FLEX?

Our Improving Execution

Avg. World GDP Per

Capita

Intelligence of Things

World is Changing

Expanding TAM

Flex Platform

Visibility Into Strategies &

Innovation in Every

Industry

Manufacturing

Technologies

Balanced Global

Manufacturing Footprint

3

4

5

6

7

8

9-12

13

14

15

Continued Portfolio

Evolution

Driving Operating Income

& Margin Expansion

Structured To Deliver

Earnings Growth

CTG Summary

INS Summary

IEI Summary

HRS Summary

17

18

19

20-24

25-29

30-35

36-42

Driving Future Revenue

Growth

Strong Strategic

Relationships

Automotive Offerings

Medical Technology

Wearable Technology

Connected Home

Open Innovation Platform

Strategy

Success With Disruptors

Is Evidenced In IPOs

Customer Innovation

Center (CIC)

Lab IX

Elementum

44

45

46

47

48

49

50

51

52

53

54-55

ROIC

Unwavering Shareholder

Return Commitment

Free Cash Flow

Generation

Balanced Capital

Structure

Selective M&A

Transactions

MCi Acquisition

57

58

59

60

61

62

Q1 FY16 Earnings

IR Contact Info

63-72

73

Page 4: Flextronics Investor Presentation August 2015

3

Evolving our portfolio to provide more predictable

earnings and higher margin

Committed to 5-10% annual net income growth

Strong sustainable free cash flow

Committed to return over 50% of free cash flow

1

2

3

4

Page 5: Flextronics Investor Presentation August 2015

4

Portfolio evolution

continues

HRS business grew

25% in the last 2 years

IEI business grew 19%

in the last 2 years

Revenue($ in Billions)

2 year adjusted

operating profit growth

of 23%

8 consecutive quarters

of operating margin

expansion

Adj. Operating Income($ in Millions)

Adjusted net Income

growth of 15% in FY15

Achieved record annual

adjusted EPS

Adj. EPS(per share)

Generated ~$2 billion of

free cash flow in the last

3 years

On track to achieve 5-

year target by FY17

Free Cash Flow

~$24B

~$26B

FY13 FY15

+11%

$611

$751

FY13 FY15

+23%

$0.84

$1.08

FY13 FY15

+29%

FY15FY13 FY17E

~$2B

5-Year Target

$3 - $4 Billion by FY17

Page 6: Flextronics Investor Presentation August 2015

5

100

1,000

10,000

Intelligence

Age™

152x every

years

Information

Age

252x every

years

Modern

Age

402x every

years

1750 1850 1970 2010Source: World Bank, Maddison Project, De Long- UC Berkeley

Industrial

Age

1002x every

years

Page 7: Flextronics Investor Presentation August 2015

6

By 2020, the Intelligence of Things™ will bring 50 billion

connected devices to market, creating a $7.1T in TAM.(versus an estimated 10 billion connected devices today)

Page 8: Flextronics Investor Presentation August 2015

7

The World is Changing

Increased

RegionalizationGrowth of

Asian OEMsFaster Product

Cycles

More Disruptive

Products

New Hardware

OEMsCorporate Social

Environmental

Responsibility

Internet of Things

Supply Chain

Complexity

Innovation

on the Rise

Page 9: Flextronics Investor Presentation August 2015

8

Contract Manufacturing

(CM)

Electronics Manufacturing Services

(EMS)

End-to-End Supply Chain Solutions – Sketch to

Scale

Revenue

$0 $5B $25B $30B $35B

TAM:

$524B

TAM:

$940BTAM:

$1T+

1993-2001 2001-2010 2010-Future

Operating Margin

Page 10: Flextronics Investor Presentation August 2015

9

Flex PlatformA Supply Chain Solutions Provider

Page 11: Flextronics Investor Presentation August 2015

10

Monitor the health of your supply

chain real-time

Simultaneously launch new products

across multiple continents

Time-to-market advantages from

regionalized solutions

Real-Time Information to Run a

Modern Supply Chain

Page 12: Flextronics Investor Presentation August 2015

11

Innovation that brings products to

market faster

2,500+ engineers enabling

technology innovation

Global network of forward, reverse

and spare parts logistics

Services That Enable a

Connected World

Page 13: Flextronics Investor Presentation August 2015

12

~26 billion in sales in FY15

Over 100 sites spanning 30 countries

with a workforce of ~200,000

~52M square feet of manufacturing

and services globally

6 Product Innovation Centers and

expanding

Visibility into Strategies and

Innovation in Every Industry

Page 14: Flextronics Investor Presentation August 2015

13

Healthcare

$2Billion

Automotive

$2Billion

Industrial

$1Billion

Home

Appliances

$1Billion

Capital

Equipment

$1Billion

Energy

$1Billion

Datacom

$3Billion

Telecom

$3Billion

Server/Storage

$3Billion

Wearables

$1Billion

Connected

Living

$1Billion

Smartphones

$3Billion

Page 15: Flextronics Investor Presentation August 2015

14

PowerFlexible & Rigid

CircuitsMachining

Precision Plastics EnclosuresAutomotive Technologies

Page 16: Flextronics Investor Presentation August 2015

15

>70 Locations | ~25M Square Feet | ~200K Employees

Power

PCBA, Box Build, SI

Mechanicals

Aguascalientes, MX ●●

Althofen, Austria●

Austin, TX ●●Dallas, TX ●

Fort Worth, TX ●Houston, TX ●

Batam, Indonesia ●

Cebu, Philippines ●●

Ashville, NC ●Charlotte, NC ●

Chengdu, China ●●

Chennai, India ●●●

Columbia, SC ●

Coopersville, MI ●

Cork, Ireland ●Limerick, Ireland

Dalingshan (Dongguan), China ●Qiaotou (Dongguan), China ●

Guadalajara, MX ●●

Huang Tian (Shenzhen), China ●●Gushu (Shenzhen), China ●Nanjing, China ●Shanghai, China ●Shenzhen, China ●Suzhou, China ●Wuzhong (Suzhou), China ●●●Zhuhai, China ●●

Ibaraki, Japan ●

Jaguariuna, Brazil ●

Juarez, MX ●●

Joo Koon Singapore ●●Kallang, Singapore ●

Manaus, Brazil ●●

Migdal Haemek, Israel ●Ofakim, Israel ●Yavne, Israel ●

Mukachevo, Ukraine ●

Northfield, MN ●

Penang, Malaysia ●●Port of Tanjong Pelepas (Johor), Malaysia ●Senai (Johor), Malaysia ●●Skudai (Johor), Malaysia ●

Ronneby, Sweden ●

Sarvar, Hungary ●●Tab, Hungary ●Zalaegerszeg, Hungary ●

Sorocaba, Brazil ●●

Taipei, Taiwan ●

Tczew, Poland ●●

Tianjin, China ●

Tijuana, MX ●●

Timisoara, Romania ●●

Toronto, Canada ●

Treviso, Italy ●

Valencia, CA ●

Zurich, Switzerland ●

Tempe, AZ ●

Buffalo Grove, IL ●

Manchester, CT ●

Sonderborg, Denmark ●

Page 17: Flextronics Investor Presentation August 2015

16

Page 18: Flextronics Investor Presentation August 2015

17

More predictable earnings and high margins

1. Fiscal 2020 target represents our targeted long-term model (double-digit HRS & IEI growth, INS stable, CTG growing in-line with GDP 2.5%)

Target1

FY20E

~20% ~20%

~30%~30%

~40%

FY10

6%13%

42% 39%

19%

FY15

17% 14%

34%35%

31%

HRS + IEI

$8.0BHRS + IEI

$4.5BHRS + IEI

~$13.0B

CTG INS HRS IEI

Page 19: Flextronics Investor Presentation August 2015

18

FY15 Adjusted

Operating Income

Target Adjusted

Operating Margin Range

FY15 Adjusted

Operating Income

$228M

$132M

$257M

$218M

Corporate

Services & Other1 ($84M)

Total $751M

HRS

IEI

CTG

INS

2% 3%

4%

5%

6%

7%

4%3%16%

27%

26%31%

CTG INS HRS IEI

43%

1. Corporate services and other related to unallocated cost

Page 20: Flextronics Investor Presentation August 2015

19

Target Model Features

Revenue

Growth

Operating

Margin

Double digit 5-7%

Double digit 4-6%

Stable 3-4%

Better mix 2-3%

HRS

IEI

CTG

INS

~30%~30%

~20% ~20%

~60%

CTG INS HRS IEI

Target Fiscal 2020 Potential

Operating Profit Contribution

Page 21: Flextronics Investor Presentation August 2015

20

More Diversified

Accelerated time to market

Co-innovation

Visibility into future trends

Revenue($ in millions)

Fiscal2010

Fiscal2015

CTG INS HRS IEI

19%

6%13%

42%

39%

31%

17% 14%

34% 35%

Mobile• Smart Phones

• Wireless Modules

• Headsets

• Portable Audio

Consumer • Game Consoles & Accessories

• Wearable Technology

• Smart Home Devices

• Home Entertainment Equipment

Computing• EMS Desktop / Notebook PCs

• Tablets

• Printers

$7,037

$9,358 $8,940

FY13 FY14 FY15

Page 22: Flextronics Investor Presentation August 2015

21

Operating

Profit

5+ %

2+ %

3-4 %

Customers

Added

33

3

6

STRATEGIC

CORE

ICE Aggressive

Moderate

Stable

Page 23: Flextronics Investor Presentation August 2015

22

Page 24: Flextronics Investor Presentation August 2015

23

We lead in the wearable movement

• 300%+ avg CAGR

We lead connected home growth

• 81%+ avg CAGR

We are leading the NEXT BIG THING

• New Vectors in Development

• Higher Margins and more diversification

• Driven by the Intelligence of Things™

Page 25: Flextronics Investor Presentation August 2015

1 A better mix of customers and products

2 Actively engaging new markets for richer opportunities

and new growth

3 Leveraging our innovation to bring the Intelligence of

Things™ to consumer products

4 Running a lean operation of highly talented individuals to

consistently achieve stated financial results

24

Run THE Best Consumer Business

Page 26: Flextronics Investor Presentation August 2015

25

Stable revenue

Strong operating cash flow

Broad, deep market

penetration

Revenue($ in millions)

Fiscal2010

Fiscal2015

CTG INS HRS IEI

19%

6%13%

42%

39%

31%

17% 14%

34% 35%

Communications 3G / 4G / LTE

Wireless

Wireline

Networking• Routing

• Switch

• SDN

• Optical

Server & Storage Converged: Compute/Storage &

Appliance/Security

Enterprise

Flash / Hybrid Storage

SSD

$9,935 $9,688 $9,191

FY13 FY14 FY15

Page 27: Flextronics Investor Presentation August 2015

26

- $9 billion business

- Server, Storage - Converged: Compute/Storage & Appliance/Security

- Communications: Wireless & Wireline

- Networking: Routing, Switch, SDN & Optical

• Innovation & Investment

• 10 New customer logos, solid bookings and business pipeline

• High Operating Cash FlowFA

ST

FA

CT

S

Page 28: Flextronics Investor Presentation August 2015

27

Communication

#1

Network

#1

Server & Storage

#2

Converged

#1

Converged

Infrastructure

Network Function

Virtualization

Software

Defined

Open Source

/Compute

Source: IDC Ems QTR revenue tracker

Page 29: Flextronics Investor Presentation August 2015

Flash

Storage

23% CAGR

Data

Analytics

$76Billion

28

Source: IDC Ems QTR revenue tracker

Digital Data

will exceed

40Zettabytes

Internet

Security

$43Billion100xincrease in

Wi-Fi Capacity

8xGrowth in Smart

Phone Traffic 10xvideo data

traffic on mobile

network

37%Growth in

SDN NFV

Applications

Converged

Infrastructure

Network Function

Virtualization

Software

Defined

Open Source

/Compute

Page 30: Flextronics Investor Presentation August 2015

Telecom - Wireless

29Source: UBS Estimates, Company Reports, Gartner, and Dell Oro

3G

Enterprise

Switching

GPON/FTTH

PBX & Unified

Communication

IP Core & Edge

Routing

Enterprise RoutingEnterprise Storage Enterprise Server

Optical

Networking

WLAN

(Networking) Converged Infrastructure 3.0 (Server Storage)

Small Cells

Broadcast/Video

Investing & Emerging Legacy HardwareMarket Leadership Position

DAS

RRH

Security Appliance

Em

erg

ing

Tech

no

log

y G

row

th

Leg

acy

Tech

no

log

y

Microwave

Backhaul

Flash/Hybrid

Storage

LTE – 4G

100G400G

SDN

Reference

Platforms

Converged

Platforms

Rack Solutions

5G

C-Ran

Page 31: Flextronics Investor Presentation August 2015

30

Double digit growth

Massive TAM

Expansion across new

industries

Technology convergence

Revenue($ in millions)

Fiscal2010

Fiscal2015

CTG INS HRS IEI

19%

6%13%

42%

39%

31%

17% 14%

34% 35%

$3,763 $3,788

$4,459

FY13 FY14 FY15

IndustrialAppliances

and Lifestyle

Self-Service/

Smart Retail

Capital

Equipment

Office

Solutions

Safety &

Security

Energy

and Metering

Page 32: Flextronics Investor Presentation August 2015

31

$4.46Brevenue in FY15 and

18% increase over

FY14

Increased from

7 to 13accounts with

>100M in revenue

23 accounts

with double digit growth

12 accounts

with triple digit growth

>$1.6Bof new

manufacturing business wins

44new accounts

185 new program

ramps

17%revenue

contribution to Flex

total business

On track for double digit growth in FY16

Page 33: Flextronics Investor Presentation August 2015

LightingTAM: $72B

AutomationTAM: $102B

Capital EquipmentTAM: $140B

AgricultureTAM: $36B

Connected Home and Lifestyle

TAM: $198B

EnergyTAM: $371B

2014 Flex TAM’s

32

Page 34: Flextronics Investor Presentation August 2015

Industrial

AutomationAppliances Lifestyles Self-service HVAC

Capital

Equipment

Measurement

Instrumentation

& Test

Building

Automation

Safety &

SecuritySmart Grid Oil & Gas

Water Transport

& Treatment

33

Page 35: Flextronics Investor Presentation August 2015

Approaching $1B in Industrial Home and Lifestyle Business in FY15

Window

Controls

Water

Heater

HVAC

Lighting &

Fan Controls

Door LocksHome

Appliances Pool

EquipmentSmart

Irrigation

34

Page 36: Flextronics Investor Presentation August 2015

35

Design, Engineering and Manufacturing Partner for

Leading Global Electric Meter Companies

Over 25% of North American Electric Meters Produced for

all Major OEM’s

Energy Management

Largest Manufacturer of Crystalline Silicon Solar Silicon Modules, Outside China, with

1.7 GW/Year Capacity

Largest Manufacturer of Micro-Inverters in the World with over

10 million Shipped To-Date

Renewable Energy

Full Spectrum Capabilities to Support Residential,

Commercial and Utility Scale Products

Design, value engineering, Manufacturing and Cost Optimization Through

Alternate Materials Systems

Energy Storage

Page 37: Flextronics Investor Presentation August 2015

36

Double digit growth

Longer product lifecycles

Significant barriers to entry

Focused M&A

Revenue($ in millions)

Fiscal2010

Fiscal2015

CTG INS HRS IEI

19%

6%13%

42%

39%

31%

17% 14%

34% 35%

Automotive• Vehicle Electronics

• Connectivity

• Energy Management

Defense & Aerospace• Defense

• Civil Aviation

• Homeland Security

Medical• Consumer Health

• Drug Delivery

• Disposable Devices

• Medical Equipment

$2,835$3,275 $3,557

FY13 FY14 FY15

Page 38: Flextronics Investor Presentation August 2015

37

FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18

~21%

10%+

Revenue Bookings

FY16 FY17 FY18

95%Booked

92%Booked

85%Booked

Page 39: Flextronics Investor Presentation August 2015

*Compared to traditional competitors

Automotive Medical Aero & Defense

#1Industry(Technology and

Revenue)

#1*Industry(Technology and

Revenue)

79%(Bookings increase

over FY14)

38

Page 40: Flextronics Investor Presentation August 2015

~$2 billionsegment

25+ locations

9,000employees

15countries

• Connectivity &

Infotainment

• Motion & Power

Controls

• Smart Actuators

• Smart Camera

• Electronic Module

Design/Manufacturing

• EMI/EMC Simulation

and Validation

• VA/VE Analysis

• Component Validation,

Re-Flash “Last to

Touch” Logistics

• Overhead Consoles &

Ambient Lighting

• LED Driver Modules

• Flexible LED Lighting

(Q-Prime®)

• Power & Signal

Distribution

• Electrohydraulic

Controls

• Power Conversion,

Storage & Charging

Manufacturing

& ServicesSmart Electronics Clean TechLighting

39

Page 41: Flextronics Investor Presentation August 2015

Extends Flextronics’ market

leadership in automotiveCustomer and Global Expansion

• #1 - Global market share leader in exterior

mirror motion controls

– Extends existing $100M motion control

business

• “Smart” mirror embedded

with electronics

– Complements Flextronics smart

camera activity

– Actuators are the single most value-add

of all smart components in the mirror

• Accelerates our position with strategic

OEM’s (VW, Audi, Toyota, Fiat and

several OEM’s in China)

• #1 market share leader in China

• Specified by the OEM’s

40

Page 42: Flextronics Investor Presentation August 2015

• #1 manufacturing solutions provider in

the medical market

• ~$1.6B in annual revenue

• 14 FDA registered sites

• We helped design more than 65 medical

products that are in the market today

• Over 60 manufacturing transfers have

been made with 100% success rate

• Excellent track record in FDA inspections

We help medical customers become more competitive by bringing innovative products to market faster and at lower

costs through world-class end-to-end supply chain solutions with a commitment to quality in everything we do.

Expertise & ExperienceStrength & Stability

41

Page 43: Flextronics Investor Presentation August 2015

42

Laboratory Diagnostics Equipment• Lab Blood Diagnostics

• Mass Spectrometry

• High Pressure Liquid Chromatography

• Dialysis

Consumer Diagnostics• Blood Glucose Meters

• Handheld Wireless Controllers

• Hearing Aids

• Aesthetic Care Devices

Imaging & Monitoring• Ultrasound

• CT, MRI, PET

• X-ray

• Patient Monitoring

Patient Mobility• Hospital Beds

• Patient Mobility Systems

Disposable Devices• Diagnostic Catheters

• Wound Management

• Infusion Sets

• Pressure Cuffs

• Drug Delivery Cassettes & Cartridges

Drug Delivery• Electro-Mechanical Drug Delivery Systems:

(Insulin, HGH, pain)

• Smart Patches

• Inhalers

Microelectronics for Implantable

Devices• Neuro-Stimulation

• Cochlear Implants

• Cardiac Rhythm Management

Orthopedics• Cases & Trays

• Instruments

• Power Tool Build & Repair

• Logistics

• Design (2015)

• Machining Expansion (2015)

Page 44: Flextronics Investor Presentation August 2015

43

Page 45: Flextronics Investor Presentation August 2015

44

Non-traditional businessSignificant opportunities to grow

our market leading position

Strategic relationshipsPartnered across leading

customers in varied industries

InnovationDistinctly positioned as a product

innovation enabler

Partnering with

tomorrow’s disruptorsPowerful differentiation to create

future demand

Page 46: Flextronics Investor Presentation August 2015

45

Intense customer focus builds trust

and long-standing relationships

30 years

15 years

10 years

10 years

0 years

Page 47: Flextronics Investor Presentation August 2015

Rear CompartmentRear Tail Lamp PCBAs

LED Tail Lamp Controllers

Power Deck Lid/Lift Gate Controllers

Smart Cameras

DoorsMotion Control Modules

Power Mirror Actuators

SeatsPower Seat Modules

Front LightingFront Lamp PCBAs

Light Control Modules

Engine & PowertrainRecuperation Modules

DC/DC Converters

High Precision Solenoids (Engine & Transmission)

Wiring Harnesses (Al & Cu)

Battery Cables

Specialized Harnesses (incl. FPC & AL)

Instrument PanelDigital LCD Gauges

LED/RGB Ambient Lighting

Overhead SystemsOverhead Consoles

Dome Lamps

Sunroof ControllersConnectivity/InfotainmentConnectivity & Media Modules

Media Device Interface Modules

Rear Seat Entertainment Modules

Vehicle System Interface Modules

Head Units

46

Page 48: Flextronics Investor Presentation August 2015

47

Diabetes Blood glucose meters

Insulin delivery systems and tubing

sets

Dialysis disposables and equipment

CardiacDiagnostic catheters

Implantable heart monitoring systems

Cardiac rhythm monitoring

RespiratoryInhalers & Nebulizers

C-Pap

BrainNeuro-stimulation

Transdermal patch for migraines

OrthopedicsBlades and cutters

DiagnosticsBlood analyzers

Imaging

DermatologyWound management systems

Aesthetic care devices

MobilityHospital beds

Mobility systems

HearingCochlear implants

DentalHigh speed headpiece

PodiatricFoot ulcer system

Gel cushions

Hospital SuppliesIV pumps and tubing sets

Syringes

Blood collection devices

General Surgery Insufflation sets

Gastic bands

Surgical packs

Page 49: Flextronics Investor Presentation August 2015

48

Micro-electronics

encapsulation

(flex circuits)

Sensor Integration

Optics (image capture)

Smart Watch Packaging

(computing/mechanics)

Bendable / Stretchable

Electronics

Waterproofing

Customization/Personalization

Tech.

Flex Capabilities

Sport & Fitness

Wellness

Image Capture

Lifestyle Computing

Entertainment

Apparel & Fashion

Apparel & Fashion

Personal Data Management

Sectors We Support

Smart Watches

Smart Glasses

Notification Sensors

Smart Fabrics

Smart Fitness Wristbands

Super Fitness Watches

Fitness Shoe Sensors

Smart Socks

Page 50: Flextronics Investor Presentation August 2015

49

Wearables /

Fitness Trackers

Energy Management /

Thermostats

Streaming

Video

and

IPTV

Smart

Home

Controllers

Streaming

Audio

Cloud

Analytics

Smart Sensors

and

Lighting Controls

Page 51: Flextronics Investor Presentation August 2015

50

Sensors & Actuators

Open Innovation Platform

Lab IX/ Startups

InternalOEMs University Research Institutes

Government & Public

Innovation Services

ComputingBattery & Power

Mechanicals & Plastics

Smart Software

Human Machine Interface

Wireless & Connectivity

Value Engineering

Semiconductors Flexible Technologies

Technology Partners

Centers of Excellence

Aerospace & Defense

Automotive EnergyIndustrial Automation

Fitness & Medical

Consumer Electronics

Communications & Networking

Server & Storage

Markets & Products

Page 52: Flextronics Investor Presentation August 2015

51

2010 2012 2013 2014

IPO Date: July 2012

Product: Security Appliances

Flex Exclusive

IPO Date: Sept 2013

Product: Security Appliances

Flex Exclusive

IPO Date: Dec 2013

Product: Converged Storage

Flex Exclusive

IPO Date: Nov 2009

Product: Security Appliances

IPO Date: May 2013

Product: Optical

Products & SDN

Flex Exclusive

IPO Date: April 2012

Product: Network Control

IPO Date: Sept 2013

Product: SSD Enterprise

Storage

IPO Date: Nov 2012

Product: Wireless

Networking

IPO Date: June 2014

Product: SDN Solutions

(Gigabit Ethernet Switches)

Page 53: Flextronics Investor Presentation August 2015

52

Silicon Valley’s Customer Innovation CenterProduct Concept > Design & Engineering > Rapid Prototyping > Volume Production > Repair & Refurbish

Manufacturing

• Scalable

Manufacturing

• Procurement &

Sourcing

Advanced

Engineering &

Robotics Labs

• Value Engineering

Services

• Manufacturing

Technology

Innovation

Interconnect

Technology Center

• Multek (PCBs,

Flexible & Rigid)

• Advanced Printed

Circuits

• Integrated Design

Capabilities

Failure Analysis

Labs & Mechanicals

• Materials

Characterization

• Sheet Metal

Manufacturing

System

Integration

• Configure to

Order

• Build to Order

New Product Introduction

• Prototype to Product

Launch

• 3D Printing (plastic)

Confidential

Center

• Private & Secure

Manufacturing

Room

Lab IX

• Startup hardware

Accelerator

• Business Scaling

Resources

Global Services

• Forward & Reverse

Logistics

• Vendor Managed

Inventory

Innovation Labs &

Design Center

• Technology Innovation &

Engineering

• Design for ‘X’ Services

• 3D Printing (metal)

WELCOME

CENTER

Page 54: Flextronics Investor Presentation August 2015

53

Page 55: Flextronics Investor Presentation August 2015

54

Lightspeed Venture Partners

Dave Duffield (co-founder & co-CEO,

Workday)

Aaron Levie (co-founder & CEO, Box)

Jerry Yang (co-founder, Yahoo & founding

partner, AME Cloud Ventures)

Mike Frandsen (VP of products,

Workday)

Jim Davidson (co-founder, Silver Lake

Partners)

Outside investors:

Mike McNamara (CEO, Flex),

Nader Mikhail (founder & CEO,

Elementum),

Chris Schaepe (founder & partner,

Lightspeed Venture Partners),

Jim Davidson (co-founder, Silver Lake

Partners),

Ray Bingham (Chairman of the Board,

Flex and former CEO, Cadence)

Board of Directors:

Dave Duffield (co-founder & co-CEO,

Workday)

David Dibble (former EVP, Service

Engineering & Operations, Yahoo)

David Henke (former SVP, Engineering &

Operations, LinkedIn)

Aneel Bhusri (co-founder, chairman and

co-CEO, Workday)

Advisory Board:

Flex began incubating Elementum in 2012

Elementum is a majority-owned subsidiary of Flex

– Flex owns a majority of the outstanding equity and controls the board of directors

– Consolidated financials with Flex

Elementum has over $60M in total funding

Page 56: Flextronics Investor Presentation August 2015

55

Poor visibility into the state of

operations.

Unclear which suppliers are at

risk and when

Don’t know which shipments

are late until they don’t arrive

It takes way too long to get

commitment on new or

changed orders from partners

The Problem

Perspective: Real-time

visibility

Exposure: Risk

management

Transport: Shipment

tracking & carrier management

Fulfillment: Order

collaboration

The Solution

Page 57: Flextronics Investor Presentation August 2015

56

Page 58: Flextronics Investor Presentation August 2015

57

Improving earnings efficiency

Disciplined capital deployment

Internal target threshold stands at 20%

ROIC well above WACC

Return on Invested Capital1

(ROIC %)

19.0%

22.1%

23.7%

FY13 FY14 FY15

19%

22%

24%

1. Return on Invested Capital (ROIC) is calculated by dividing the Company's last twelve months after-tax Non-GAAP operating income by the net invested capital asset base as of each date. After-

tax non-GAAP operating income excludes charges for stock-based compensation expense and restructuring charges. The net invested capital asset base is defined as the sum of shareholders'

equity and net debt averaged over the last five quarters.

Page 59: Flextronics Investor Presentation August 2015

58

Committed to returning over 50% of annual free cash flow to shareholders

Since FY11, we have repurchased…

Over $2 Billion in stock

Over 300 Million shares

~ 30% of net shares outstanding

75%

63%

75%

% of Free Cash Flow

Returned to Shareholders

1-YrFY15

3-YrFY13-15

5-YrFY11-15$400

$510

$322

$475$416

813757

684639

591 563 568

FY10 FY11 FY12 FY13 FY14 FY15 FY16 YTD

Repurchased ($ millions)

Shares Outstanding

Share Repurchase($ millions)

65Mshares

82Mshares

52Mshares

60Mshares

39Mshares

$400

$510

$322

$475$416

8Mshares

$100

Page 60: Flextronics Investor Presentation August 2015

59

Generating strong sustainable free cash flow to support growth

$715M

$855M

$622M

$463M$416M

$680M $701M

$554M

225M

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 YTD FY17E

$3 Billion Target

$3 - $4 Billion

$715M

$855M

$622M

$463M$416M

$680M $701M

$554M

$225M

Page 61: Flextronics Investor Presentation August 2015

60

Debt Maturities ($ millions)

(Calendar Year)

Solid liquidity

No near-term maturities

Low cost of debt ~3.5%

Strong credit metrics (Debt / EBITDA (LTM) : 2.1x)

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

$3.8B

$1.5B

Revolver

$2.3B

Cash

Total Liquidity

4.625%

Notes

5%

NotesTerm Loans

LIBOR + 125 to 137.5 bps

$593

$475$500 $500

Capital Structure as of Q1 FY2016 earnings announcement 7/23/2015

4.75%

Notes

$600

Page 62: Flextronics Investor Presentation August 2015

61

Primarily focused on investing to expand our HRS capabilities

Target capabilities

Strategic customers

Longer product lifecycles

Barriers to entry

Higher margins

EPS Accretive

Key Criteria$25-$100M

2 4

<$25M

Reflects M&A transactions completed from FY13 to FY16, excludes OEM asset acquisitions

>$100M

Purchase Price

2

Page 63: Flextronics Investor Presentation August 2015

62

Will not impact our shareholder return commitment

Hits our key M&A investment criteria

Compelling strategic rationale

Solid financial framework

• Strong growing revenue

• LTM €200M (USD$216M1), up 20%

• Positioned across all top 10 OEMs

• Over 90% of next 2 years of business booked

• Expand across FLEX business groups

• Accretive margin profile

• Well above HRS business margins

• Immediately accretive to EPS

• Greater than $0.01 per quarter

• Solid free cash flow generation

• Consideration of €457M (USD$494M1)

• Multiple attractive funding options

1. Based on exchange rate of Euro/USD $1.08

Page 64: Flextronics Investor Presentation August 2015

63

Page 65: Flextronics Investor Presentation August 2015

64

($ in millions, except per share amounts) June 27, 2014 March 31, 2015 June 26, 2015

Net sales $6,643 $5,952 $5,566

Adjusted operating income 183 178 159

Adjusted net income 148 157 134

Adjusted EPS $0.25 $0.27 $0.23

GAAP operating income 172 164 143

GAAP net income 174 135 111

GAAP EPS $0.29 $0.23 $0.19

Net sales of $5.6B vs. $5.6 - $6.2B

Adjusted operating income of $159M within guidance of $150 - $190M

Adjusted EPS of $0.23 at mid-point of $0.20 - $0.26

Please refer to the Investor Relations section of our website which contain the reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures

Page 66: Flextronics Investor Presentation August 2015

65 Please refer to the Investor Relations section of our website which contain the reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures

22.8%23.3%

24.1%23.7%

22.9%

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15

(ROIC %)

$0.25 $0.26

$0.30

$0.27

$0.23

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15

(EPS)

6,643 6,529 7,025

5,952 5,566

5.8% 5.8% 5.8%

6.4% 6.4%

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15

Adj. Gross Margin($ in millions)

183 183207

178159

2.8% 2.8%2.9%

3.0%2.9%

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15

% Revenue($ in millions)

Page 67: Flextronics Investor Presentation August 2015

$57 2.9%

$39 2.5%

$29 2.6%

$60 6.6%

Corporate

Services & Other1 ($26)

Total $159 2.9%

INS

CTG

HRS

66

($ in millions)

Please refer to the Investor Relations section of our website which contain the reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures

IEI

1. Corporate services and other related to unallocated cost

3%2%

5% 7%

3% 4%

4% 6%

• Challenging INS macro-environment

• Margins on target

• Sustaining healthy margins

• Program ramps and investments weigh on margins

Page 68: Flextronics Investor Presentation August 2015

67

• Q1 FY16 was $17M, better than guidance of ~$20M

• Outlook: quarterly estimate of ~$25M

• Q1 FY16 was 5.6%

• Outlook: 8-10% range

• Intangible amortization $8M

• Stock based compensation $16M

• Aggregate impact on EPS $0.04

Page 69: Flextronics Investor Presentation August 2015

68

Three Months

Ended

($ in millions) Jun-15

GAAP net income $111

Depreciation and amortization 110

Change in net working capital 131

Other operating cash flows, net 10

Net cash provided by operating activities 362

Purchases of property & equipment, net (137)

Free Cash Flow 225

Payments for share repurchases (100)

Proceeds from borrowings, net 588

Other investing and financing, net (10)

Net change in cash and cash equivalents $703

2,126 1,886 1,834 1,866

1,730

8.0%7.2%

6.5%

7.8% 7.8%

Jun-14 Sep-14 Dec-14 Mar-15 Jun-15

% Annualized Revenue($ in millions)

400

510

322

475 416

100

757 684 639

591 563 568

FY11 FY12 FY13 FY14 FY15 FY16 YTD

Shares Outstanding

($ in millions)

Page 70: Flextronics Investor Presentation August 2015

69

$2,331

$1,500

$593 $475 $500 $500 $600

Liquidity 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

($M) (Calendar Year)

Cash

Revolver

Total

Liquidity

$3,831

••••

Term Loans LIBOR + 125 to 137.5bps

4.625% Notes 5% Notes 4.75% Notes

Page 71: Flextronics Investor Presentation August 2015

70

• Disciplined SG&A expense management

• Well balanced capital expenditures

• ROIC above 20% target

• Strong Q1 Free Cash Flow of $225M

• New branding and website will drive a richer sales engagement

• Launch of Flex Pulse and Flex Customer Experience Center

provides us with more effective tools

• Capital return program remains on track as 7.7M shares

were repurchased for $100M in Q1

• Repurchased 305M shares, reducing our net shares

outstanding by ~30% since FY11

Page 72: Flextronics Investor Presentation August 2015

71

36%

20%

16%

28%

HRSIEI

CTG INS

Jun

2015

36%

($ in millions) Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15E

Business Group $ $ $ $ $ Q/Q % Y/Y % Outlook (Q/Q)

INS 2,440 2,341 2,358 2,052 1,966 -4% -19% Up high single digit

CTG 2,222 2,210 2,647 1,861 1,565 -16% -30% Up 15% - 25%

IEI 1,125 1,097 1,106 1,132 1,130 0% 1% Up mid to high single digit

HRS 856 881 914 907 905 0% 6% Up mid to high single digit

Total Revenue $6,643 $6,529 $7,025 $5,952 $5,566 -6% -16%

Certain prior quarter amounts have been recast to conform to current year presentation

Integrated Network

Solutions(Telecom, Datacom, Server & Storage,

Converged Infrastructure)

Consumer Technology

Group(Wearables, Digital Health, Gaming,

Connected Home, Mobile, PC/Printers)

Industrial & Emerging

Industries(Semiconductor & Capital Equipment, Office

Solutions & Industrial Automation, Test &

Measurement, Appliance & Lifestyle, Energy

& Metering, Lighting)

High Reliability

Solutions(Automotive, Medical, Aerospace &

Defense)

37%

17%13%

33% Jun

2014

30%

HRSIEI

CTG INS

Page 73: Flextronics Investor Presentation August 2015

72

Adjusted SG&A Expense ~$210 +/- $5 million

Interest & Other Expense ~$25 million

Adjusted Income Tax Rate 8-10% range

GAAP EPS $0.17 - $0.23

WASO 577 million shares

($ in millions, except per share amounts)

Adjusted operating income excludes approximately $16 million for stock based compensation, of which approximately $14 million is excluded from adjusted SG&A.

GAAP EPS reflects approximately $0.05 for intangible amortization and stock-based compensation expense.

$5,900 - $6,500

$165 - $205

$0.22 - $0.28

Page 74: Flextronics Investor Presentation August 2015

73

Kevin Kessel Mary Lee

VP, Investor Relations Sr. Manager, Investor Relations

[email protected] [email protected]

(408) 576 - 7985 (408) 576 - 5167

For more information contact:

investors.flextronics.com