Flex Ltd (FLEX) shares tumbled 5.30% in pre-market trading on Thursday, despite reporting better-than-expected first-quarter fiscal 2026 results. The stark contrast between the positive earnings report and the negative stock reaction has left investors puzzled and raised questions about the company's future outlook.

The electronics manufacturing services provider announced Q1 adjusted earnings per share of $0.72, surpassing the IBES estimate of $0.63. Revenue for the quarter came in at $6.575 billion, also beating the expected $6.263 billion. Flex's net income reached $192 million, with a gross profit of $572 million and operating income of $311 million.

Despite these strong results, investors appear to be focusing on the company's forward guidance. Flex provided a revenue outlook of $6.5 billion to $6.8 billion for Q2, and adjusted EPS guidance of $0.70 to $0.78. For the full fiscal year 2026, the company expects revenue between $25.9 billion and $27.1 billion, with adjusted EPS ranging from $2.86 to $3.06. While these figures are generally in line with or slightly above current market expectations, they may not have been sufficiently ambitious to justify the stock's recent performance. The pre-market plunge suggests that investors were likely anticipating even stronger guidance, particularly in light of the company's Q1 outperformance and its strategic focus on high-growth end-markets such as data centers and power.