Jabil (NYSE:JBL) Surprises With Strong Q3, Full-Year Outlook Slightly Exceeds Expectations

Electronics manufacturing services provider Jabil (NYSE:JBL) reported Q3 CY2025 results beating Wall Street’s revenue expectations, with sales up 18.5% year on year to $8.25 billion. On top of that, next quarter’s revenue guidance ($8 billion at the midpoint) was surprisingly good and 7.5% above what analysts were expecting. Its non-GAAP profit of $3.29 per share was 11.7% above analysts’ consensus estimates.

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Company Overview

With manufacturing facilities spanning the globe from China to Mexico to the United States, Jabil (NYSE:JBL) provides electronics design, manufacturing, and supply chain solutions to companies across various industries, from healthcare to automotive to cloud computing.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.

With $29.8 billion in revenue over the past 12 months, Jabil is a behemoth in the business services sector and benefits from economies of scale, giving it an edge in distribution. This also enables it to gain more leverage on its fixed costs than smaller competitors and the flexibility to offer lower prices. However, its scale is a double-edged sword because it’s harder to find incremental growth when you’ve penetrated most of the market. To accelerate sales, Jabil likely needs to optimize its pricing or lean into new offerings and international expansion.

As you can see below, Jabil grew its sales at a sluggish 1.8% compounded annual growth rate over the last five years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Jabil’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 7.3% annually.

This quarter, Jabil reported year-on-year revenue growth of 18.5%, and its $8.25 billion of revenue exceeded Wall Street’s estimates by 9.5%. Company management is currently guiding for a 14.4% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 3% over the next 12 months. While this projection suggests its newer products and services will catalyze better top-line performance, it is still below the sector average.

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Operating Margin

Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D.

Jabil’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 4.6% over the last five years. This profitability was lousy for a business services business and caused by its suboptimal cost structure.

Analyzing the trend in its profitability, Jabil’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

In Q3, Jabil generated an operating margin profit margin of 4.1%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Jabil’s EPS grew at an astounding 27.5% compounded annual growth rate over the last five years, higher than its 1.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Jabil, its two-year annual EPS growth of 6.5% was lower than its five-year trend. We hope its growth can accelerate in the future.

In Q3, Jabil reported adjusted EPS of $3.29, up from $2.30 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Jabil’s full-year EPS of $9.78 to grow 10.6%.

Key Takeaways from Jabil’s Q3 Results

We were impressed by how significantly Jabil blew past analysts’ EPS guidance for next quarter expectations this quarter. We were also excited its revenue outperformed Wall Street’s estimates by a wide margin. Zooming out, we think this quarter featured some important positives. Investors were likely hoping for more, and shares traded down 2.5% to $219.60 immediately following the results.

Is Jabil an attractive investment opportunity at the current price? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.