Earnings

Jabil Sets $22.1 Billion AI Revenue Target For Fiscal 2027 — '$7.7 Billion At A Higher Growth Rate' — As Shares Slide 6%

CEO Mike Dastoor told analysts on Wednesday's earnings call that inference workloads, not frontier-model training, are driving the company's AI demand.

Matteo Parrino Jonathan Ponciano

Matteo Parrino, Jonathan Ponciano

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Jabil Sets $22.1 Billion AI Revenue Target For Fiscal 2027 — '$7.7 Billion At A Higher Growth Rate' — As Shares Slide 6%

Jabil chief executive Michael Meheryar Dastoor told analysts on the company's fourth-quarter earnings call Wednesday that the company expects AI-related revenue to reach approximately $22.1 billion in fiscal 2027 — a 54% jump from the roughly $14.4 billion it delivered in fiscal 2026 — even as shares fell about 6% to $298.59 in Wednesday trading. The full-year fiscal 2027 revenue guidance of approximately $44.5 billion and adjusted earnings-per-share target of $17.55 both came in above analyst estimates, according to FactSet.

What The Call Said

Dastoor framed the scale of the fiscal 2027 AI target in blunt terms on the call. "That's another $7.7 billion at a higher growth rate on top of a much larger base, even from our expectations in June," he said, adding that the company now expects five customers to each generate more than $1 billion in AI-related revenue during the year.

The fiscal 2026 AI figure of roughly $14.4 billion was itself up $5.4 billion year-over-year, setting a high base for the 54% growth projection. Senior Vice President of Investor Relations Adam Berry told investors on the call that the company was anticipating adding in excess of $8.5 billion of revenue in fiscal 2027 after having added over $6 billion in fiscal 2026, calling it "an unprecedented amount of growth for Jabil."

The Intelligent Infrastructure segment — which covers cloud and data center infrastructure, capital equipment, and networking and communications — is expected to generate $25.6 billion in total revenue for fiscal 2027, up about 43% year-over-year, management said on the call. In fiscal 2026, the segment grew more than 40% and AI-related revenue within it rose 60% year-over-year, according to Matt Crowley, who heads the segment.

Crowley also said Jabil ended fiscal 2026 with four customers generating AI-related revenue above $1 billion annually, up from one such customer two years earlier, and added a third hyperscale customer during the third quarter of the year.

Dastoor's Defense Of The AI Trade

Dastoor pushed back directly on concerns that Jabil's AI exposure is hostage to the volatility of frontier-model training cycles. "Most of our business is not there," he said on the call, explaining that the bulk of demand comes from inference workloads running at scale for large cloud platforms — workloads that grow with usage rather than with any single model's training cycle.

That framing positions Jabil's revenue base as tied to deployed, everyday AI rather than to the capital spending decisions of a handful of frontier-model developers. Dastoor argued that makes the company's demand more durable and less susceptible to swings in any one customer's research budget.

When Goldman Sachs analyst Mark Delaney asked what the company was hearing from customers and government officials about how potential regulations could affect data center infrastructure and AI development, Crowley said the company does not "see any significant impact and/or disruption" to fiscal 2027 or fiscal 2028 from current policy. He flagged the midterm elections, however, as a potential inflection point for data-center policy that the company is monitoring closely.

Fiscal 2026 Results And The Margin Setup For 2027

Fourth-quarter revenue came in at approximately $10.6 billion, up 29% year-over-year and more than $1 billion above the midpoint of the company's June outlook, Chief Financial Officer Gregory Hebard said on the call. Core diluted earnings per share for the quarter were $4.40, up 34% year-over-year. Intelligent Infrastructure revenue for the quarter was approximately $5.8 billion, up 56% year-over-year and roughly $900 million above the June outlook.

For the first quarter of fiscal 2027, Jabil guided Intelligent Infrastructure revenue of approximately $6.3 billion, up about 63% year-over-year. Total company first-quarter revenue is expected in the range of $10.6 billion to $11.4 billion, with core diluted earnings per share estimated between $3.80 and $4.20.

Dastoor said fiscal 2027 margins are back-end loaded, with the first half absorbing ramp costs across four million square feet of new capacity. The full-year core operating margin target is 6.1%, and investors will be watching whether second-half utilization delivers on that figure. Adjusted free cash flow for fiscal 2026 exceeded $1.5 billion for the year, above the company's initial outlook of $1.3 billion or more, Hebard said.

The next test of whether Jabil's back-half margin thesis holds will come when the company reports its first-quarter fiscal 2027 results — the period in which it says ramp costs across four million square feet of new capacity will weigh most heavily on profitability.

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