Jabil (JBL) closed fiscal 2026 with a decisive beat. Core EPS of $4.40 topped the $4.07 consensus by 7.3% and cleared the $4.10 Earnings Whisper number. Revenue of $10.616 billion beat the $9.61 billion consensus by 10.5% and landed more than $1 billion above the midpoint of management's June guidance of $9.2-$10.0 billion. Earnings grew 35.4% year over year and revenue grew 28.6%, faster than the 21% full-year revenue pace, so growth accelerated into year-end rather than fading. The more important news is the forward view. The fiscal 2027 outlook calls for core EPS of $17.55, up 34%, and a core operating margin of 6.1%. AI-related revenue is guided to roughly $22.1 billion, up 54%. That AI growth rate is faster than the 'similar to FY26' growth management indicated in June, which suggests the AI business is still accelerating.
The quality of the beat holds up, with a few qualifications. Intelligent Infrastructure generated $5.8 billion, up 56% and about $900 million above the June outlook, with segment margin up 60 basis points to 6.5%. On a GAAP basis, operating margin jumped from 4.1% to 5.7% and diluted EPS rose from $1.99 to $3.76. Much of that GAAP improvement, however, came from lapping the prior year's $98 million divestiture loss and heavier restructuring charges. On the core measure, Q4 operating margin improved only 10 basis points, to 6.4% from 6.3%. The full-year core margin expanded 40 basis points to 5.8%, but the fourth quarter itself was driven by volume more than by operating leverage. The balance sheet also deserves scrutiny. Receivables, inventories, and prepaid assets together rose by roughly $7.6 billion during the year. That buildup was funded by an $8 billion increase in payables and accrued liabilities. Adjusted free cash flow of $1.53 billion beat each prior target, but it relies on supplier financing of a rapidly growing working-capital base. That dependence carries some risk if the growth cycle turns. Net inventory days of 64 remain above the 55-60 target.
The call supported a credible and broadening growth story. Jabil raised its FY26 AI revenue estimate each quarter, from $12.1 billion in December to $13.1 billion, then $13.6 billion, before finishing at $14.4 billion. Management expects a second hyperscaler to become a 10%+ customer in FY27. Six Intelligent Infrastructure customers now exceed $1 billion, compared with one two years ago. Capital equipment is guided up 40% to about $4.2 billion on a wafer fab equipment (WFE) recovery. Regulated industries are guided up 7% to roughly $13.6 billion, led by automotive at about $5 billion. Networking outside of communications is growing 45%-50%. Management was noticeably more confident than on prior calls. It stressed that demand exceeds supply and that about 4 million square feet of new capacity is tied to booked programs. It also argued that inference-driven demand is less exposed to swings in frontier-AI spending.
The weak spots are real but contained. Connected Living is guided down 15% to about $2.3 billion. The renamed Intelligent Devices and Robotics segment is expected to decline 10% year over year in Q1. Healthcare and packaging missed in Q4 on automation-equipment delays. Memory and component shortages were a bigger topic than on earlier calls, as supply shifts toward hyperscale customers. Margins are also back-end loaded. The Q1 guide of $3.80-$4.20 in core EPS, with a $4.00 midpoint, is a step down from Q4's $4.40, and implied core operating income falls sequentially even as revenue rises. The source figures for FY27 revenue also conflict. The release states $44.5 billion, up 24%, while the call summary cites roughly $42.7 billion or more. The release figure matches the more than $8.5 billion of added revenue described on the call and should be treated as the formal guidance.
The market setup is more complicated than the beat implies. Shares entered the report at $318.84, down 22.7% from the $412.36 opening after the June report. The stock peaked at a 52-week high of $428.93 on that first trading day in June, then slid to $285.80 by late July. It now sits about 11.6% above that low and 25.7% below the high, still 6.2% above its 200-day moving average of $300.24. Investor sentiment was essentially unchanged at a mildly positive 0.24. The market was not bracing for disaster, but it was not positioned for a large upside surprise either. Sequential growth and momentum trend readings are positive, while AVWAP remains negative, consistent with a stock that has been repriced lower since June.
The bottom line is that Jabil delivered what bulls needed: a large revenue beat, a fourth consecutive round of raised expectations, and an FY27 AI outlook that is accelerating. The main offsets are a soft Q1 margin setup, a working-capital balance sheet financed by suppliers, and pockets of consumer and component weakness. Those issues give bears legitimate talking points, but they do not overturn a fundamental story that clearly improved this quarter.