HIGH VELOCITY SOLUTIONS executing at the speed of innovation

Transcription

1 HIGH VELOCITY SOLUTIONS executing at the speed of innovation Mike Dennison, President May, 2012

2 High Velocity Solutions A Refined Strategy to Win in a Major Market Segment HVS Business Plan Diversified customer mix Predictable financial results Sustainable profit growth Differentiated/comprehensive solutions 2

3 Balancing the Portfolio Takes Business Intelligence Ongoing Profit Decline Cheaper in China Standard solutions Many players, few winners Large scale, low profit Differentiated Value E2E Services Verticals Regional manufacturing Engineering services Flex Margin Growth 3

4 High Velocity (HVS) Key Facts Flextronics Business Group FY13E Integrated Network Solutions ~45% Industrial & Emerging ~15% High Reliability ~10% High Velocity ~30% Key Facts about HVS HVS Segments - FY13E Fiscal 2012 Revenue: $10B, excluding ODM PC Scale: Targeted solutions, backed by the whole Flex footprint Capabilities: Services that create value Customer Base: 50+ customers Industry Ranking: #4 Market share is not the objective Mobility ~50% ~23% ~27% Consumer Computing 4

5 Driving Positive Changes in Portfolio and Services FY07 FY12 FY13E 3%0% 7% 5% 10% 17% 15% 8% 50% 90% 70% 25% Assembly Mechanical Multek/Power Services Significant Improvement, Especially Between FY12 and FY13 5

6 High Velocity Solutions Highlights FY12 Revenue Outlook ($M) Highlights FY12 $9,518 $11,921 $11,564 (35)% (40)% FY11-FY12-3% yoy growth FY12 operating margins below expectations Multiple new customers Wins Efficient exit of ODM and reduction in RIM We ll grow 5-10% a year going forward FY10 FY11 FY12 FY13E 6

7 HVS: A Broad Product Portfolio Home Access Computing Consumer Gateway Equipment Fixed Ethernet Access Controller Cable Modem End Devices End Devices Gateways Connectivity Devices Mobile Hotspot Femtocell Set Top Box Wireless Router 7

8 The HVS Market is Expanding & Evolving Trends Driving HVS Outsourcing Emerging market growth Speed to market Pace of innovation Big brands enter hardware Product/market convergence Key Supplier Selection Criteria Product launch services Global management system Early engineering support After market services Total cost optimization 8

9 Going Beyond the Historical Customer Example- Wearable smart devices geared for growth Heart rate monitors to increase from 11M to 17.7M Sports technology to double from 3.5M to over 8+M Other smart devices increasing from 1.3M to 20M+ 9

10 Leveraging the Power of Flextronics Customer Full Service Offering Driving Speed to Market CONCEPT DESIGN MANUFACTURING Mechanical & Technology Services & Solutions Pre-Manufacturing Engineering Services Global Manufacturing Services DELIVERY & REPAIR SERVICES Unique Customized Service Solutions Flextronics HVS 10

11 We Become the Entire Supply Chain NPI Services FLEX HVS Margin Value Added Services/Components Customize to Unique Needs Technology Development Early Engagement Sustainable Capabilities Low Cost Assembly (High volume low mix) Engineering & Supply Chain Support Distribution & SMI Commodity Supplier Value 11

12 Innovative Mechanical and Technical Services Developing solutions as fast as they are necessary High Value Technical Support Integrated mechanical solutions Product design support Assembly process technology Addressing Critical Factors Innovation creates new requirements Early technology evaluation Supporting consumer success 12

13 Pre-Manufacturing Engineering Services Silicon Valley- Product Development and Launch Center Early Engagement Services World class engineering Optimizing NPI for manufacturing Supply chain development Addressing Critical Factors Life cycles are shortening Need for high secrecy Efficient transition to manufacturing 13

14 Product Completion Center- Example 2009 Project starts 2010 Excellent Serviceability Award received Zero defects in 18 months 2011 Expand service scope to include all Products in Europe 2012 Quality Award received for Best In Class Operations 14

15 Our Strategy to WIN Win with the winners focus on top tier and high potential customers Leverage Flextronics overall capabilities and vertical offerings to create sustainable & predictable growth Target customer opportunities with engineering support and service solutions which drive differentiated value Exit non productive business and grow competence and credibility in new product and market areas 15