Flextronics’ announced new priorities aimed to re-align Company focus and grow top-line revenues. Improved focus is being driven by moving P&Ls from geographies to eight distinct end-markets. Customer retention and acceptance of the changes are reported to be exceeding Company expectations.
Benchmark continues to perform. The Company anticipates continued growth from non-traditional end-market sectors including auto, medical, avionics, security, and defense and indicated it also plans to improve upon its operating margins which are already among the best in industry.
Solectron recently reported an industry-low operating margin of 1.3%. The company also released figures reflecting an inventory increase of more than $200 million from last quarter. While the company did not indicate additional restructuring would take place near-term, VO has reason to believe through discussions with customers and industry observation, there is still more low-hanging fruit and, that financial and operational metrics improvements could likely be held hostage as a result. The revenue upside was driven by Nortel and Cisco business.
BenQ’s recent quarter operating loss was higher than expected. Executives anticipate the Company’s return to profit will likely be in the fourth quarter of ’06 and driven primarily by lowering internal costs; improving transition pricing, and consolidating resources.
VentureOutsource.com, April 2006
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