Yahoo Finance FLEX Augments Portfolio With the Acquisition of FreeFlow
Flex Inc FLEX recently announced the buyout of FreeFlow, which is renowned for its services in global secondary markets, specializing in asset disposition, digital circular economy tracking and reporting capabilities.
The initiative is likely to augment FLEX’s service footprint across emerging markets, such as data center, enterprise and lifestyle, unlocking new sources of revenues and fostering sustainability through second life products.
With more than two decades of experience, FreeFlow has effectively revamped product lifecycle profitability by leveraging its profound understanding of circularity and offering a scalable, cloud-based B2B secondary marketplace for asset disposition. FreeFlow's B2B digital marketplace platform is the hub of its operations, empowering customers to efficiently sell surplus and returned inventory while safeguarding primary channel strategies.
By integrating FreeFlow's capabilities into its existing portfolio, FLEX enhances its product lifecycle services, comprising design, supply chain management, advanced manufacturing, vertical integration, post-production and post-sale support. Also, the acquisition strengthens its reverse logistics and circular economy capabilities (as part of its after-sale services), incorporating repair, refurbishment, asset recovery, sustainability analytics and recycling services.
By leveraging FreeFlow's platform, Flex aims to offer a comprehensive suite of services, catering to a broad spectrum of clients from cloud computing to lifestyle brands, enabling them to embrace second-life products and execute their environmental commitments, added FLEX.
Headquartered in Singapore, FLEX has a global presence spanning 30 countries. The company offers advanced manufacturing solutions and additional value to customers through a robust range of services, including design and engineering, component services, rapid prototyping, fulfillment and circular economy solutions.
FLEX’s acquisition strategies over time have been instrumental in expanding its manufacturing footprint as well as driving growth across multiple end markets. It has acquired many companies over the years, including Mirror Controls International (Apr 29, 2015), Olio Devices (Jun 01, 2017), AGM Automotive (Feb 21, 2017) and Nextracker (Sep 8, 2015). The latest acquisition was Anord Mardix (Dec 1, 2021).
Nextracker has been a key contributor to company’s financial performance. However, in order to unleash its true potential, Flex has separated its primary operations from Nextracker. In October, the company announced its plan to spin off roughly 51.47% interest in Nextracker to Flex shareholders on a pro-rata basis. Following the spin-off of Nextracker in fourth-quarter fiscal 2024, its historical financials are now reported under discontinued operations.
However, softness across the Agility and Reliability Solutions segments has impeded its revenue growth in the last reported quarter. Revenues (excluding Nextracker) declined 11.7% year over year to $6.2 billion, beating the Zacks Consensus mark by 1.1%.
Management expects macro headwinds to persist throughout 2024, negatively impacting various end markets. An increase in global tax rates remains an additional concern.
At present, FLEX has a Zacks Rank #4 (Sell). Shares of the company have gained 28.1% in the past year compared with the sub-industry’s growth of 33%.
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