10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark one)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 3, 2021

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to                 .

Commission File Number 0-21272

Sanmina Corporation

(Exact name of registrant as specified in its charter)

DE			77-0228183
(State or other jurisdiction of			(I.R.S. Employer
incorporation or organization)			Identification Number)
2700 N. First St.,	San Jose,	CA	95134
(Address of principal executive offices)			(Zip Code)
	(408)	964-3500
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [x]    No [ ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [x]    No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer	[X]	Accelerated filer [ ]	Non-accelerated filer [  ]	Smaller reporting company	☐
				Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐  No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock	SANM	NASDAQ Global Select Market

As of April 27, 2021, there were 65,095,728 shares outstanding of the issuer's common stock, $0.01 par value per share.

SANMINA CORPORATION

INDEX

		Page
	PART I. FINANCIAL INFORMATION
Item 1.	Interim Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Income	4
	Condensed Consolidated Statements of Comprehensive Income (Loss)	5
	Condensed Consolidated Statements of Stockholders' Equity	6
	Condensed Consolidated Statements of Cash Flows	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	33
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	35
Item 6.	Exhibits	47
Signatures		48

2

SANMINA CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

	As of
	April 3, 2021		October 3, 2020
	(Unaudited)
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	575,176	$	480,526
Accounts receivable, net of allowances of $8,148 and $8,570 as of April 3, 2021 and October 3, 2020, respectively	1,122,962		1,043,334
Contract assets	334,957		396,583
Inventories	785,406		861,281
Prepaid expenses and other current assets	38,584		37,718
Total current assets	2,857,085		2,819,442
Property, plant and equipment, net	529,651		559,242
Deferred tax assets	259,943		273,470
Other	123,550		120,502
Total assets	$	3,770,229	$	3,772,656
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	1,108,994	$	1,210,049
Accrued liabilities	176,148		171,761
Accrued payroll and related benefits	114,704		122,029
Short-term debt, including current portion of long-term debt	18,750		18,750
Total current liabilities	1,418,596		1,522,589
Long-term liabilities:
Long-term debt	320,405		329,249
Other	296,121		290,902
Total long-term liabilities	616,526		620,151
Contingencies (Note 7)
Stockholders' equity	1,735,107		1,629,916
Total liabilities and stockholders' equity	$	3,770,229	$	3,772,656

See accompanying notes to condensed consolidated financial statements.

3

SANMINA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(Unaudited)
	(In thousands, except per share data)
Net sales	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
Cost of sales	1,556,579		1,483,129		3,170,593		3,188,418
Gross profit	143,098		107,421		284,333		242,303
Operating expenses:
Selling, general and administrative	61,142		62,257		120,109		125,408
Research and development	5,353		5,767		10,158		10,967
Restructuring and other	11,880		15,028		13,784		24,378
Total operating expenses	78,375		83,052		144,051		160,753
Operating income	64,723		24,369		140,282		81,550
Interest income	244		418		474		728
Interest expense	(4,880)		(6,040)		(9,834)		(11,917)
Other income (expense), net	6,143		(7,660)		8,010		(6,342)
Interest and other, net	1,507		(13,282)		(1,350)		(17,531)
Income before income taxes	66,230		11,087		138,932		64,019
Provision for income taxes	19,193		6,205		43,874		20,792
Net income	$	47,037	$	4,882	$	95,058	$	43,227
Net income per share:
Basic	$	0.72	$	0.07	$	1.46	$	0.61
Diluted	$	0.70	$	0.07	$	1.42	$	0.60
Weighted average shares used in computing per share amounts:
Basic	65,249		70,584		65,244		70,377
Diluted	66,957		72,245		66,887		72,429

See accompanying notes to condensed consolidated financial statements.

4

SANMINA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(Unaudited)
	(In thousands)
Net income	$	47,037	$	4,882	$	95,058	$	43,227
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustments	(1,561)		(2,887)		78		(2,170)
Derivative financial instruments:
Change in net unrealized amount	291		(8,306)		3,647		(4,926)
Amount reclassified into net income	2,530		538		1,029		343
Defined benefit plans:
Changes in unrecognized net actuarial losses and unrecognized transition costs	680		415		(45)		228
Amortization of actuarial losses and transition costs	460		102		966		646
Total other comprehensive income (loss)	2,400		(10,138)		5,675		(5,879)
Comprehensive income (loss)	$	49,437	$	(5,256)	$	100,733	$	37,348

See accompanying notes to condensed consolidated financial statements.

5

SANMINA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(Unaudited)
	(In thousands)
Common Stock and Additional Paid-in Capital
Balance, beginning of period	$	6,310,795	$	6,279,267	$	6,301,537	$	6,267,509
Issuances under stock plans	1,023		320		2,073		5,172
Stock-based compensation expense	9,224		7,783		17,432		14,689
Balance, end of period	6,321,042		6,287,370		6,321,042		6,287,370
Treasury Stock
Balance, beginning of period	(995,665)		(821,668)		(983,143)		(804,118)
Repurchases of treasury stock	(2,525)		(64,483)		(15,047)		(82,033)
Balance, end of period	(998,190)		(886,151)		(998,190)		(886,151)
Accumulated Other Comprehensive Income
Balance, beginning of period	38,161		46,518		34,886		42,259
Other comprehensive income (loss)	2,400		(10,138)		5,675		(5,879)
Balance, end of period	40,561		36,380		40,561		36,380
Accumulated Deficit
Balance, beginning of period	(3,675,343)		(3,824,732)		(3,723,364)		(3,863,077)
Net income	47,037		4,882		95,058		43,227
Balance, end of period	(3,628,306)		(3,819,850)		(3,628,306)		(3,819,850)
Total stockholders' equity	$	1,735,107	$	1,617,749	$	1,735,107	$	1,617,749
Common Stock Shares Outstanding
Number of shares, beginning of period	107,998		106,841		107,629		105,551
Issuances under stock plans	283		285		652		1,575
Number of shares, end of period	108,281		107,126		108,281		107,126
Treasury Shares
Number of shares, beginning of period	(43,112)		(36,384)		(42,630)		(35,831)
Repurchases of treasury stock	(80)		(2,540)		(562)		(3,093)
Number of shares, end of period	(43,192)		(38,924)		(43,192)		(38,924)

See accompanying notes to condensed consolidated financial statements.

6

SANMINA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Six Months Ended
	April 3, 2021		March 28, 2020
	(Unaudited)
	(In thousands)
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net income	$	95,058	$	43,227
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Depreciation and amortization	54,831		56,777
Stock-based compensation expense	17,432		14,689
Deferred income taxes	13,641		1,952
Goodwill and other asset impairments	—		8,409
Other, net	(19)		568
Changes in operating assets and liabilities:
Accounts receivable	(79,166)		207,994
Contract assets	61,626		(10,984)
Inventories	75,303		15,333
Prepaid expenses and other assets	1,359		11,687
Accounts payable	(99,525)		(185,175)
Accrued liabilities	2,360		(7,578)
Cash provided by operating activities	142,900		156,899
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
Purchases of property, plant and equipment, net of proceeds	(25,540)		(44,456)
Cash used in investing activities	(25,540)		(44,456)
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
Repayments of long-term debt	(9,376)		(24,986)
Proceeds from revolving credit facility borrowings	399,600		1,909,000
Repayments of revolving credit facility borrowings	(399,600)		(1,259,000)
Net proceeds from stock issuances	2,073		5,172
Repurchases of common stock	(15,047)		(82,033)
Cash provided by (used in) financing activities	(22,350)		548,153
Effect of exchange rate changes	(360)		(752)
Increase in cash and cash equivalents	94,650		659,844
Cash and cash equivalents at beginning of period	480,526		454,741
Cash and cash equivalents at end of period	$	575,176	$	1,114,585
Cash paid during the period for:
Interest, net of capitalized interest	$	3,082	$	8,407
Income taxes, net of refunds	$	18,675	$	13,371
Unpaid purchases of property, plant and equipment at the end of period	$	10,693	$	9,377

See accompanying notes to condensed consolidated financial statements.

7

SANMINA CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Sanmina Corporation (the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been omitted pursuant to those rules or regulations. The interim condensed consolidated financial statements are unaudited, but reflect all adjustments, consisting primarily of normal recurring adjustments, that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended October 3, 2020, included in the Company's 2020 Annual Report on Form 10-K.

The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Due to the COVID-19 pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic. The Company has considered information available to it as of the date of issuance of these financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates.

Results of operations for the second quarter of 2021 are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year.

The Company operates on a 52 or 53 week year ending on the Saturday nearest September 30. Fiscal 2021 will be a 52-week year and fiscal 2020 was a 53-week year, with the extra week included in the fourth quarter of fiscal 2020. All references to years relate to fiscal years unless otherwise noted.

Recent Accounting Pronouncements Adopted

In August 2018, the FASB issued ASU 2018-15, "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." The new guidance aligns the requirements for capitalizing implementation costs incurred in a cloud-based hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. There was no impact upon adoption of this ASU.

In June 2016, the FASB issued ASU 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which replaces the existing incurred loss impairment methodology with an expected credit loss methodology and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. The impact of adoption of this ASU was not material.

Recent Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)", which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. The Company has not yet applied any of the expedients and exceptions and is currently evaluating the impact of the provisions of this ASU.

8

Note 2. Revenue Recognition

The Company is a leading global provider of integrated manufacturing solutions, components, products and repair, logistics and after-market services. For purposes of determining when to recognize revenue, and in what amount, the Company applies a 5-step model: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the Company satisfies a performance obligation. Each of these steps involves the use of significant judgments, as discussed below.

Step 1 - Identify the contract with a customer

A contract is defined as an agreement between two parties that creates enforceable rights and obligations. The Company generally enters into a master supply agreement (“MSA”) with its customers that provides the framework under which business will be conducted, and pursuant to which a customer will issue purchase orders or other binding documents to specify the quantity, price and delivery requirements for products or services the customer wishes to purchase. The Company generally considers its contract with a customer to be a firm commitment, consisting of the combination of an MSA and a purchase order or any other similar binding document.

Step 2 - Identify the performance obligations in the contract

A performance obligation is a promised good or service that is material in the context of the contract and is both capable of being distinct (customer can benefit from the good or service on its own or together with other readily available resources) and distinct within the context of the contract (separately identifiable from other promises). The Company reviews its contracts to identify promised goods or services and then evaluates such items to determine which of those items are performance obligations. The majority of the Company’s contracts have a single performance obligation since the promise to transfer an individual good or service is not separately identifiable from other promises in the contract. The Company’s performance obligations generally have an expected duration of one year or less.

Step 3 - Determine the transaction price

The Company’s contracts with its customers may include certain forms of variable consideration such as early payment discounts, volume discounts and shared cost savings. The Company includes an estimate of variable consideration when determining the transaction price and the appropriate amount of revenue to be recognized. This estimate is limited to an amount which will not result in a significant reversal of revenue in a future period. Factors considered in the Company’s estimate of variable consideration are the potential amount subject to these contract provisions, historical experience and other relevant facts and circumstances.

Step 4 - Allocate the transaction price to the performance obligations in the contract

A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. In the event that more than one performance obligation is identified in a contract, the Company is required to allocate a portion of the transaction price to each performance obligation. This allocation would generally be based on the relative standalone price of each performance obligation, which most often would represent the price at which the Company would sell similar goods or services separately.

Step 5 - Recognize revenue when (or as) a performance obligation is satisfied

The Company is required to assess whether control of a product or services promised under a contract is transferred to the customer at a point-in-time or over time as the product is being manufactured or the services are being provided. If the criteria in ASC 606 for recognizing revenue on an over time basis are not met, revenue must be recognized at the point-in-time determined by the Company at which its customer obtains control of a product or service.

The Company has determined that revenue for the majority of its contracts is required to be recognized on an over time basis. This determination is based on the fact that 1) the Company does not have an alternative use for the end products it manufactures for its customers and has an enforceable right to payment, including a reasonable profit, for work-in-progress upon a customer’s cancellation of a contract for convenience or 2) the Company’s customer simultaneously receives and consumes the benefits provided by the Company’s services. For these contracts, revenue is recognized on an over time basis using the cost-to-cost method (ratio of costs incurred to date to total estimated costs at completion) which the Company believes best depicts the transfer of control to the customer. At least 95% of the Company's revenue is recognized on an over time basis, which is as products are manufactured or services are performed. Because of this, and the fact that there is no work-in-process or finished goods inventory associated with contracts for which revenue is recognized on an over-time basis, 99% or more of the Company’s inventory at the end of a given period is in the form of raw materials. For contracts for which revenue is required to be recognized at a point-in-time, the Company recognizes revenue when it has transferred control of the related goods, which generally occurs upon shipment or delivery of the goods to the customer.

9

Application of the cost-to-cost method for government contracts in the Company’s Defense and Aerospace division requires the use of significant judgments with respect to estimated materials, labor and subcontractor costs. This division is an operating segment whose results are aggregated with nine other operating segments and reported under Components, Products and Services ("CPS") for segment reporting purposes. During the first half of 2021, CPS revenue and gross profit was $638 million and $91 million, respectively.

The Company updates its estimates of materials, labor and subcontractor costs on a quarterly basis. These updated estimates are reviewed each quarter by a group of employees that includes representatives from numerous functions such as engineering, materials, contracts, manufacturing, program management, finance and senior management. If a change in estimate is deemed necessary, the impact of the change is recognized in the period of change.

Contract Assets

A contract asset is recognized when the Company has recognized revenue, but has not issued an invoice to its customer for payment. Contract assets are classified separately on the condensed consolidated balance sheets and transferred to accounts receivable when rights to payment become unconditional. Because of the Company’s short manufacturing cycle times, the transfer from contract assets to accounts receivable generally occurs within the next fiscal quarter.

Other

Taxes assessed by governmental authorities that are both imposed on and concurrent with a specific revenue-producing transaction, and are collected by the Company from a customer, are excluded from revenue.

Shipping and handling costs associated with outbound freight after control of a product has transferred to a customer are accounted for as fulfillment costs and are included in cost of sales.

The Company applies the following practical expedients or policy elections under ASC 606:

•The promised amount of consideration under a contract is not adjusted for the effects of a significant financing component because, at inception of a contract, the Company expects the period between when a good or service is transferred to a customer and when the customer pays for that good or service will generally be one year or less.

•The Company has elected to not disclose information about remaining performance obligations that have original expected durations of one year or less, which is substantially all of the Company’s remaining performance obligations.

•Incremental costs of obtaining a contract are not capitalized if the period over which such costs would be amortized to expense is less than one year.

10

Disaggregation of revenue

In the following table, revenue is disaggregated by segment, market sector and geography.

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Segments:
IMS	$	1,361,013	$	1,294,520	$	2,817,181	$	2,834,966
CPS	338,664		296,030		637,745		595,755
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
End Markets:
Industrial, Medical, Automotive and Defense	$	980,794	$	966,642	$	2,013,312	$	2,074,189
Communications Networks and Cloud Infrastructure	718,883		623,908		1,441,614		1,356,532
Total	1,699,677		$	1,590,550	$	3,454,926	$	3,430,721
Geography:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1) Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

Note 3. Financial Instruments

Fair Value Measurements    

Fair Value of Financial Instruments

The fair values of cash equivalents (generally 10% or less of cash and cash equivalents), accounts receivable, accounts payable and short-term debt approximate carrying value due to the short-term duration of these instruments. Additionally, the fair value of variable rate long-term debt approximates carrying value as of April 3, 2021.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company's primary financial assets and financial liabilities measured at fair value on a recurring basis are deferred compensation plan assets and defined benefit plan assets, which are both measured using Level 1 inputs. Deferred compensation plan assets were $46 million and $40 million as of April 3, 2021 and October 3, 2020, respectively. Defined benefit plan assets were $39 million as of October 3, 2020 and are measured at fair value only in the fourth quarter of each year. Other financial assets and financial liabilities measured at fair value on a recurring basis include foreign exchange contracts and interest rate swaps, which are both measured using Level 2 inputs. Foreign exchange contracts were not material as of April 3, 2021 or October 3, 2020. Interest rate swaps had a negative value of $22 million and $29 million as of April 3, 2021 and October 3, 2020, respectively.

Offsetting Derivative Assets and Liabilities

The Company has entered into master netting arrangements with each of its derivative counterparties that allows net settlement of derivative assets and liabilities under certain conditions, such as multiple transactions with the same currency maturing on the same date. The Company presents its derivative assets and derivative liabilities on a gross basis on the unaudited condensed consolidated balance sheets. The amount that the Company had the right to offset under these netting arrangements was not material as of  April 3, 2021 or October 3, 2020.

Non-Financial Assets Measured at Fair Value on a Nonrecurring Basis

11

Other non-financial assets, such as goodwill and other long-lived assets are measured at fair value as of the date such assets are acquired or in the period an impairment is recorded. During the second quarter of 2020, commodity prices in the oil and gas market experienced a sharp decline due to a combination of an oversaturated supply and a decrease in demand caused by the COVID-19 global pandemic. This commodity price decline resulted in a negative impact to the projected cash flows of the Company’s oil and gas reporting unit that is part of the Company's Components, Products and Services ("CPS") operating segment and therefore the Company performed a goodwill impairment test for this particular reporting unit. The Company concluded that the fair value of the reporting unit was below its carrying value, resulting in a goodwill impairment charge of $7 million. The fair value of the reporting unit was estimated based on the present value of future discounted cash flows. The Company also recorded an impairment charge of $2 million in the second quarter of 2020 for certain long-lived assets. These impairment charges are included in "Restructuring and Other" on the condensed consolidated statements of income.

Derivative Instruments

Foreign Exchange Rate Risk

The Company is exposed to certain risks related to its ongoing business operations. The primary risk managed by using derivative instruments is foreign currency exchange risk.

Forward contracts on various foreign currencies are used to manage foreign currency risk associated with forecasted foreign currency transactions and certain monetary assets and liabilities denominated in non-functional currencies. The Company's primary foreign currency cash flows are in certain Asian and European countries, Brazil, Israel and Mexico.

The Company had the following outstanding foreign currency forward contracts that were entered into to hedge foreign currency exposures:

	As of
	April 3, 2021		October 3, 2020
Derivatives Designated as Accounting Hedges:
Notional amount (in thousands)	$	110,056	$	113,300
Number of contracts	48		48
Derivatives Not Designated as Accounting Hedges:
Notional amount (in thousands)	$	398,864	$	352,062
Number of contracts	47		45

The Company utilizes foreign currency forward contracts to hedge certain operational (“cash flow”) exposures resulting from changes in foreign currency exchange rates. Such exposures generally result from (1) forecasted non-functional currency sales and (2) forecasted non-functional currency materials, labor, overhead and other expenses. These contracts are designated as cash flow hedges for accounting purposes and are generally one to two months in duration but, by policy, may be up to twelve months in duration.

For derivative instruments that are designated and qualify as cash flow hedges, the Company excludes time value from its assessment of hedge effectiveness and recognizes the amount of time value in earnings over the life of the derivative instrument. Gains or losses on the derivative not caused by changes in time value are recorded in Accumulated Other Comprehensive Income ("AOCI"), a component of equity, and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The amount of gain or loss recognized in Other Comprehensive Income on derivative instruments and the amount of gain or loss reclassified from AOCI into income were not material for any period presented herein.

The Company enters into short-term foreign currency forward contracts to hedge currency exposures associated with certain monetary assets and liabilities denominated in non-functional currencies. These contracts have maturities of up to two months and are not designated as accounting hedges. Accordingly, these contracts are marked-to-market at the end of each period with unrealized gains and losses recorded in other income, net, in the condensed consolidated statements of income. The amount of gains or losses associated with these forward contracts was not material for any period presented herein. From an economic perspective, the objective of the Company's hedging program is for gains and losses on forward contracts to substantially offset gains and losses on the underlying hedged items. In addition to the contracts disclosed in the table above, the Company has numerous contracts that have been closed from an economic and financial accounting perspective and will

12

settle early in the first month of the following quarter. Since these offsetting contracts do not expose the Company to risk of fluctuations in exchange rates, these contracts have been excluded from the above table.

Interest Rate Risk

The Company enters into forward interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the benchmark interest rate (LIBOR) associated with anticipated variable rate borrowings. These interest rate swaps have a maturity date of December 1, 2023 and effectively convert the Company's variable interest rate obligations to fixed interest rate obligations. These swaps are accounted for as cash flow hedges under ASC Topic 815, Derivatives and Hedging. Interest rate swaps with an aggregate notional amount of $350 million were outstanding as of April 3, 2021 and October 3, 2020. The aggregate effective interest rate of these swaps as of April 3, 2021 was approximately 4.3%. Due to a decline in interest rates since the time the swaps were put in place, these interest rate swaps had a negative value of $22 million as of April 3, 2021, of which $9 million is included in accrued liabilities and the remaining amount is included in other long-term liabilities on the condensed consolidated balance sheets.

Note 4. Debt

Long-term debt consisted of the following:

	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Term loan due 2023 ("Term Loan"), net of issuance costs	$	339,155	$	347,999
Current portion of Term Loan	18,750		18,750
Long-term debt	$	320,405	$	329,249

Term Loan maturities as of April 3, 2021 by fiscal year are as follows:

	(In Thousands)
Remainder of 2021	$	9,375
2022	18,750
2023	14,062
2024	300,000
	$	342,187

As of April 3, 2021, there were no borrowings and $8 million of letters of credit outstanding under the Fourth Amended and Restated Credit Agreement (the "Amended Cash Flow Revolver").

As of April 3, 2021, certain foreign subsidiaries of the Company had a total of $69 million of short-term borrowing facilities available, under which no borrowings were outstanding.

Debt covenants

The Company's Amended Cash Flow Revolver requires the Company to comply with certain financial covenants, namely a maximum leverage ratio and a minimum interest coverage ratio, in both cases measured on the basis of a trailing 12 month look-back period. In addition, the Company's debt agreements contain a number of restrictive covenants, including restrictions on incurring additional debt, making investments and other restricted payments, selling assets and paying dividends, subject to certain exceptions. The Company was in compliance with these covenants as of April 3, 2021.

Note 5. Leases

The Company's leases consist primarily of operating leases for buildings and land. These leases have initial lease terms of up to 44 years and, upon adoption of ASC 842, are recorded on the Company's balance sheet as lease liabilities and corresponding right-of-use ("ROU") assets. Certain of these leases contain an option to extend the lease term for additional periods or to terminate the lease after an initial non-cancelable term. Renewal options are considered in the measurement of the

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Company's initial lease liability and corresponding ROU asset only if it is reasonably certain that the Company will exercise such options. Leases with lease terms of twelve months or less are not recorded on the Company's balance sheet.

ROU assets and lease liabilities recorded in the condensed consolidated balance sheet are as follows:

	As of
	April 3, 2021			October 3, 2020
	(In thousands)
Other assets (1)	$	49,988		$	52,552
Accrued liabilities	16,780			16,659
Other long-term liabilities	35,101			37,015
Total lease liabilities	$	51,881		$	53,674
Weighted average remaining lease term (in years)	6.67			6.88
Weighted average discount rate	2.98		%	3.13		%

(1)    Net of accumulated amortization of $21 million and $16 million as of April 3, 2021 and October 3, 2020, respectively.

Cash paid for operating lease liabilities was $10 million and $9 million for the six months ended April 3, 2021 and March 28, 2020, respectively. Operating lease expense, which includes an immaterial amount for short-term leases, variable lease costs and sublease income, was $5 million and $11 million for the three and six months ended April 3, 2021, respectively and $4 million and $8 million for the three and six months ended March 28, 2020, respectively.

Future lease payments under non-cancelable operating leases as of April 3, 2021, by fiscal year, are as follows:

	Operating Leases
	(In thousands)
Remainder of 2021	$	9,433
2022	15,934
2023	9,265
2024	5,554
2025	4,106
2026	2,375
Thereafter	10,963
Total lease payments	57,630
Less: imputed interest	5,749
Total	$	51,881

Note 6. Accounts Receivable Sale Program

The Company has entered into a Receivable Purchase Agreement (the “RPA”) with certain third-party banking institutions for the sale of trade receivables generated from sales to certain customers, subject to acceptance by, and a funding commitment from, the banks that are party to the RPA. Trade receivables sold pursuant to the RPA are serviced by the Company.

In addition to the RPA, the Company has the option to participate in trade receivables sales programs that have been implemented by certain of the Company's customers, as in effect from time to time. The Company does not service trade receivables sold under these other programs.

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Under each of the programs noted above, the Company sells its entire interest in a trade receivable for 100% of face value, less a discount. During the six months ended April 3, 2021 and March 28, 2020, the Company sold approximately $371 million and $1.1 billion, respectively, of accounts receivable under these programs. Upon sale, these receivables are removed from the condensed consolidated balance sheets and cash received is presented as cash provided by operating activities in the condensed consolidated statements of cash flows. Discounts on sold receivables were not material for any period presented. As of April 3, 2021 and October 3, 2020, $27 million and $97 million, respectively, of accounts receivable sold under the RPA and subject to servicing by the Company remained outstanding and had not yet been collected. The Company's sole risk with respect to receivables it services is with respect to commercial disputes regarding such receivables. Commercial disputes include billing errors, returns and similar matters. To date, the Company has not been required to repurchase any receivable it has sold due to a commercial dispute. Additionally, the Company is required to remit amounts collected as servicer under the RPA on a weekly basis to the financial institutions that purchased the receivables. As of April 3, 2021 and October 3, 2020, $22 million and $39 million, respectively, had been collected but not yet remitted. This amount is classified in accrued liabilities on the condensed consolidated balance sheets.

Note 7. Contingencies

From time to time, the Company is a party to litigation, claims and other contingencies, including environmental, regulatory and employee matters and examinations and investigations by governmental agencies, which arise in the ordinary course of business. The Company records a contingent liability when it is probable that a loss has been incurred and the amount of loss is reasonably estimable in accordance with ASC Topic 450, Contingencies, or other applicable accounting standards. As of April 3, 2021 and October 3, 2020, the Company had reserves of $38 million and $37 million, respectively, for environmental matters, warranty, litigation and other contingencies (excluding reserves for uncertain tax positions), which the Company believes are adequate. However, there can be no assurance that the Company's reserves will be sufficient to settle these contingencies. Such reserves are included in accrued liabilities and other long-term liabilities on the unaudited condensed consolidated balance sheets.

Legal Proceedings

Environmental Matters

The Company is subject to various federal, state, local and foreign laws and regulations and administrative orders concerning environmental protection, including those addressing the discharge of pollutants into the environment, the management and disposal of hazardous substances, the cleanup of contaminated sites, the materials used in products, and the recycling, treatment and disposal of hazardous waste. As of April 3, 2021, the Company had been named in a lawsuit and several administrative orders alleging certain of its current and former sites contributed to groundwater contamination. One such order demands that the Company and other alleged defendants remediate groundwater contamination at four landfills located in Northern California to which the Company may have sent wastewater in the past. The Company is participating in a working group of other alleged defendants to better understand its potential exposure in this action and has reserved its estimated exposure for this matter as of April 3, 2021. However, there can be no assurance that the Company's reserve will ultimately be sufficient.

In June 2008, the Company was named by the Orange County Water District in a suit alleging that its actions contributed to polluted groundwater managed by the plaintiff. The complaint seeks recovery of compensatory and other damages, as well as declaratory relief, for the payment of costs necessary to investigate, monitor, remediate, abate and contain contamination of groundwater within the plaintiff’s control. In April 2013, all claims against the Company were dismissed. The plaintiff appealed this dismissal and the appellate court reversed the judgment in August 2017. In November 2017, the California Supreme Court denied the Company’s petition to review this decision and, in December 2017, the Court of Appeal remanded the case back to the Superior Court for further proceedings. The first part of a multi-phase trial commenced on April 12, 2021. The Company is contesting the plaintiff’s claims vigorously.

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Other Matters

In October 2018, a contractor who had been retained by the Company through a third party temporary staffing agency from November 2015 to March 2016 filed a lawsuit against the Company in the Santa Clara County Superior Court on behalf of himself and all other similarly situated Company contractors and employees in California, alleging violations of California Labor Code provisions governing overtime, meal and rest periods, wages, wage statements and reimbursement of business expenses. The complaint seeks certification of a class of all non-exempt employees, whether employed directly or through a temporary staffing agency, employed from four years before the filing of the initial complaint to the time of trial. Additionally, on November 1, 2019, another contractor retained through a temporary staffing agency filed a lawsuit against the Company in the Santa Clara County Superior Court. The complaint, which includes a single cause of action under California’s Private Attorneys General Act of 2004 ("PAGA"), alleges Labor Code violations substantially similar to those alleged in the October 2018 class action lawsuit and seeks penalties on behalf of the State of California and other “aggrieved employees” (defined to be current and former hourly, non-exempt employees employed by the Company between August 22, 2018 and the present). Although the Company continues to deny any wrongdoing, on November 19, 2020, the Company reached an agreement in principle to resolve all claims (the “Settlement”). Under the Settlement, which remains subject to court approval, the Company’s total payout will depend on the number and value of claims submitted by members of the settlement class to the claims administrator, and cannot exceed $5 million (but could be as low as approximately $3.5 million), inclusive of plaintiffs’ attorneys’ fees, costs, and certain other items. On December 3, 2020, in connection with and in order to effect the Settlement, plaintiffs dismissed the PAGA complaint pending in Santa Clara County Superior Court and refiled it as a class and PAGA action in Kern County Superior Court. Similarly, on April 3, 2021, the class action complaint originally filed in the Santa Clara County Superior Court was dismissed without prejudice.

In December 2019, the Company sued a former customer, Dialight plc (“Dialight”), in the United States District Court for the Southern District of New York to collect approximately $10 million in unpaid accounts receivable and net obsolete inventory obligations. Later the same day, Dialight commenced its own action in the same court. Dialight’s complaint, which asserts claims for fraudulent inducement, breach of contract, and gross negligence/willful misconduct, alleges that the Company fraudulently misrepresented its capabilities to induce Dialight to enter into a Manufacturing Services Agreement (the “Dialight MSA”), and then breached its obligations contained in the Dialight MSA relating to quality, on-time delivery and supply chain management. Dialight seeks an unspecified amount of compensatory and punitive damages. The Company intends to vigorously prosecute its claim against Dialight. Further, the Company strongly disagrees with Dialight’s allegations and intends to defend against them vigorously.

For each of the matters noted above, with the exception of the alleged violations of the California Labor Code described above, the Company is unable to reasonably estimate a range of possible loss at this time.

Note 8. Restructuring

The following table is a summary of restructuring costs:

	Restructuring Expense
	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Severance costs (approximately 790 and 830 employees for the three and six months ended April 3, 2021 and 300 and 1,750 employees for the three and six months ended March 28, 2020, respectively)	$	10,656	$	4,725	$	11,492	$	11,453
Other exit costs (recognized as incurred)	9		44		9		52
Total - Q1 FY20 Plan	10,665		4,769		11,501		11,505
Costs incurred for other plans	1,215		3,587		2,283		6,011
Total - all plans	$	11,880	$	8,356	$	13,784	$	17,516

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Q1 FY20 Plan

On October 28, 2019, the Company adopted a Company-wide restructuring plan ("Q1 FY20 Plan"). Under the Q1 FY20 Plan, the Company expects to incur restructuring charges of up to $35 million, consisting primarily of cash severance costs. As of April 3, 2021, the Company had incurred restructuring charges of approximately $29 million, consisting primarily of severance costs, under the Q1 FY20 Plan. Headcount reductions are expected to occur through the fourth quarter of 2021 and cash payments of severance are expected to occur through the end of calendar 2021.

Other Plans

Other plans include a number of plans for which costs are not expected to be material individually or in the aggregate.

All Plans

The Company’s Integrated Manufacturing Solutions ("IMS") segment incurred costs of $9 million for each of the six months ended April 3, 2021 and March 28, 2020. The Company’s CPS segment incurred costs of $4 million and $6 million for the six months ended April 3, 2021 and March 28, 2020, respectively. In addition, $0.6 million and $3 million of costs were incurred during the six months ended April 3, 2021 and March 28, 2020, respectively, for corporate headcount reductions that were not allocated to the Company's IMS and CPS segments. The Company had accrued liabilities of $16 million and $9 million as of April 3, 2021 and October 3, 2020, respectively, for restructuring costs (exclusive of long-term environmental remediation liabilities).

In addition to costs expected to be incurred under the Q1 FY20 Plan, the Company expects to incur restructuring costs in future periods primarily for vacant facilities and former sites for which the Company is or may be responsible for environmental remediation.

Note 9. Income Tax

The Company estimates its annual effective income tax rate at the end of each quarterly period. The estimate takes into account the geographic mix of expected pre-tax income (loss), expected total annual pre-tax income (loss), enacted changes in tax laws, implementation of tax planning strategies and possible outcomes of audits and other uncertain tax positions. To the extent there are fluctuations in any of these variables during a period, the provision for income taxes may vary.

The Company's provision for income taxes for the three months ended April 3, 2021 and March 28, 2020 was $19 million (29% of income before taxes) and $6 million (56% of income before taxes), respectively, and $44 million (32% of income before taxes) and $21 million (32% of income before taxes) for the six months ended April 3, 2021 and March 28, 2020, respectively. Income tax expense for the three and six months ended April 3, 2021 increased, primarily as a result of an increase in income before tax and a change in the geographic mix of income before tax. The effective tax rate for the three months ended March 28, 2020 was negatively impacted by the COVID-19 global pandemic, resulting in reduced income and unfavorable jurisdictional mix.

It is reasonably possible that the Company's liability for uncertain tax positions could decrease materially during the quarter ending July 3, 2021 based upon the resolution of audits and expiration of statutes of limitations, which would result in a decrease in income tax expense at that time.

Note 10. Stockholder's Equity

Accumulated Other Comprehensive Income

Accumulated other comprehensive income, net of tax as applicable, consisted of the following:

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	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Foreign currency translation adjustments	$	85,421	$	85,343
Unrealized holding losses on derivative financial instruments	(17,526)		(22,202)
Unrecognized net actuarial losses and transition costs for benefit plans	(27,334)		(28,255)
Total	$	40,561	$	34,886

Unrealized holding losses on derivative financial instruments includes losses from interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the benchmark interest rate (LIBOR) associated with anticipated variable rate borrowings. These swaps are accounted for as cash flow hedges under ASC Topic 815, Derivatives and Hedging. Interest rate swaps with an aggregate notional amount of $350 million were outstanding as of April 3, 2021 and October 3, 2020. The aggregate effective interest rate of these swaps as of April 3, 2021 was approximately 4.3%. Due to a decline in interest rates since the time the swaps were put in place, these interest rate swaps had a negative value of $22 million as of April 3, 2021, of which $9 million is included in accrued liabilities and the remaining amount is included in other long-term liabilities on the condensed consolidated balance sheets.

Stock Repurchase Program

During the six months ended April 3, 2021 and March 28, 2020, the Company repurchased 0.4 million and 2.7 million shares of its common stock for $9 million and $70 million, respectively, under a stock repurchase program authorized by the Board of Directors. There were no repurchases during the three months ended April 3, 2021. As of April 3, 2021, an aggregate of $125 million remains available under such repurchase program, which has no expiration date.

In addition to the repurchases discussed above, the Company withheld 0.2 million and 0.4 million shares of its common stock during the six months ended April 3, 2021 and March 28, 2020, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock units. The Company paid $6 million and $12 million, respectively, to applicable tax authorities in connection with these repurchases.

Note 11. Business Segment, Geographic and Customer Information

ASC Topic 280, Segment Reporting, establishes standards for reporting information about operating segments, products and services, geographic areas of operations and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker or decision making group in deciding how to allocate resources and in assessing performance.

The Company's operations are managed as two businesses: IMS and CPS. The Company's CPS business consists of multiple operating segments which do not meet the quantitative threshold for being presented individually as reportable segments. Therefore, financial information for these operating segments is presented in a single category entitled "CPS" and the Company has only one reportable segment - IMS.

During the first quarter of 2021, the Company began including Viking Technology, an operating segment previously aggregated and reported under CPS, in its IMS reportable segment. Accordingly, the data presented in the table below reflects this change in segment reporting for all periods presented. The change in segment reporting does not affect the Company’s previously reported consolidated financial statements.

The following table presents revenue and a measure of segment gross profit used by management to allocate resources and assess performance of operating segments:

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	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Gross sales:
IMS	$	1,369,937	$	1,305,887	$	2,832,037	$	2,854,780
CPS	361,072		321,509		680,488		652,684
Intersegment revenue	(31,332)		(36,846)		(57,599)		(76,743)
Net sales	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
Gross profit:
IMS	$	95,030	$	75,421	$	201,596	$	176,627
CPS	51,401		34,582		91,039		71,170
Total	146,431		110,003		292,635		247,797
Unallocated items (1)	(3,333)		(2,582)		(8,302)		(5,494)
Total	$	143,098	$	107,421	$	284,333	$	242,303

(1)    For purposes of evaluating segment performance, management excludes certain items from its measure of gross profit. These items consist of stock-based compensation expense, charges or credits resulting from distressed customers and litigation settlements.

Net sales by geographic segment, determined based on the country in which a product is manufactured, were as

follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Net sales:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1)    Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

Percentage of net sales represented by ten largest customers	54	%	55	%	56	%	55	%
Number of customers representing 10% or more of net sales	1		1		1		1

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Note 12. Earnings Per Share

Basic and diluted per share amounts are calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period, as follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands, except per share data)
Numerator:
Net income	$	47,037	$	4,882	$	95,058	$	43,227
Denominator:
Weighted average common shares outstanding	65,249		70,584		65,244		70,377
Effect of dilutive stock options and restricted stock units	1,708		1,661		1,643		2,052
Denominator for diluted earnings per share	66,957		72,245		66,887		72,429
Net income per share:
Basic	$	0.72	$	0.07	$	1.46	$	0.61
Diluted	$	0.70	$	0.07	$	1.42	$	0.60

Note 13. Stock-Based Compensation

Stock-based compensation expense was attributable to:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Stock options	$	—	$	—	$	—	$	(1,145)
Restricted stock units, including performance based awards	9,224		7,783		17,432		15,834
Total	$	9,224	$	7,783	$	17,432	$	14,689

Stock-based compensation expense was recognized as follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Cost of sales	$	3,629	$	2,582	$	7,050	$	5,494
Selling, general and administrative	5,479		5,127		10,196		9,052
Research and development	116		74		186		143
Total	$	9,224	$	7,783	$	17,432	$	14,689

During the second quarter of 2021, the Company's stockholders approved the reservation of an additional 1.4 million shares of common stock for future issuance under the Company's 2019 Incentive Plan. As of April 3, 2021, an aggregate of 8.0 million shares were authorized for future issuance under the Company's stock plans, of which 4.2 million of such shares were issuable upon exercise of outstanding options and delivery of shares upon vesting of restricted stock units and 3.8 million shares of common stock were available for future grant.

Restricted and Performance Stock Units

The Company grants restricted stock units and restricted stock units with performance conditions ("PSUs") to executive officers, directors and certain other employees. These units vest over periods ranging from one year to four years and/or upon achievement of specified performance criteria and are automatically exchanged for shares of common stock at the

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vesting date. If performance metrics are not met within specified time limits, the award will be canceled. Compensation expense associated with restricted stock units and PSUs is recognized ratably over the vesting period, subject to probability of achievement for PSUs.

During 2021 and 2020, the Company granted 373,000 and 304,500 PSU shares, respectively, for which vesting is contingent on cumulative non-GAAP earnings per share measured over three fiscal years. If a minimum threshold is not achieved, no shares will vest. If the minimum threshold is achieved or exceeded, the number of shares of common stock that will be issued will range from 80% to 120% of the number of PSUs granted, depending on the extent of performance. Additionally, the number of shares that vest may be adjusted up or down by up to 15% based on the Company's total shareholder return relative to that of its peer group over this same period. These PSUs will be cancelled if such performance conditions have not been met during the measurement period.

Activity with respect to the Company's restricted stock awards was as follows:

	Number of Shares	Weighted- Average Grant Date Fair Value ($)	Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($)
	(In thousands)			(In thousands)
Outstanding as of October 3, 2020	2,568	29.67	1.23	71,571
Granted	1,444	33.92
Vested/Forfeited/Cancelled	(698)	29.31
Outstanding as of April 3, 2021	3,314	31.61	1.56	135,998
Expected to vest as of April 3, 2021	2,870	31.46	1.51	117,798

As of April 3, 2021, unrecognized compensation expense of $63 million is expected to be recognized over a weighted average period of 1.5 years. Additionally, as of April 3, 2021, unrecognized compensation expense related to performance-based restricted stock units for which achievement of the performance criteria was not currently considered probable is $3 million.

Note 14. Acquisition

On April 6, 2021, subsequent to the end of the second quarter of 2021, the Company purchased all outstanding stock of a European subsidiary of a multinational customer. The Company expects the net purchase price of this acquisition to be in the range of $30 million to $35 million. The acquisition is expected to increase the Company's IMS capabilities in Europe. The Company is in the process of determining the fair value of the assets and liabilities acquired and does not expect the acquisition to have a material effect on the Company's financial position or results of operations.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements relate to our expectations for future events and time periods. All statements other than statements of historical fact are statements that could be deemed to be forward-looking statements, including any statements regarding trends in future revenue or results of operations, gross margin, operating margin, expenses, earnings or losses from operations, or cash flow; any statements of the plans, strategies and objectives of management for future operations and the anticipated benefits of such plans, strategies and objectives; any statements regarding future economic conditions or performance; any statements regarding litigation or pending investigations, claims or disputes; any statements regarding the timing of closing of, future cash outlays for, and benefits of acquisitions; any statements regarding expected restructuring costs and benefits; any statements concerning the adequacy of our current liquidity and the availability of additional sources of liquidity; any statements regarding the potential or expected impact of the COVID-19 pandemic on our business, results of operations and financial condition; any statements regarding the potential impact of supply chain shortages on our business; any statements regarding the future impact of tariffs on our business; any statements regarding potential changes in our tax liabilities; any statements relating to the expected impact of accounting pronouncements not yet adopted; any statements regarding future repurchases of our common stock; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Generally, the words “anticipate,” “believe,” “plan,” “expect,” “future,” “intend,” “may,” “will,” “should,” “estimate,” “predict,” “potential,” “continue” and similar expressions identify forward-looking statements. Our forward-looking statements are based on current expectations, forecasts and assumptions and are subject to risks and uncertainties, including those contained in Part II, Item 1A of this report. As a result, actual results could vary materially from those suggested by the forward-looking statements. We undertake no obligation to publicly disclose any revisions to these forward-looking statements to reflect events or circumstances occurring subsequent to filing this report with the Securities and Exchange Commission. Investors and others should note that the Company announces material financial information to its investors using its investor relations website (http://ir.sanmina.com/investor-relations/overview/default.aspx), SEC filings, press releases, public conference calls and webcasts. The Company uses these channels to communicate with its investors and the public about the Company, its products and services and other issues. It is possible that the information the Company posts on its investor relations website could be deemed to be material information. Therefore, the Company encourages investors, the media, and others interested in the Company to review the information it posts on its investor relations website. The contents of our investor relations website are not incorporated by reference into this quarterly report on Form 10-Q or in any other report or document we file with the SEC.

Sanmina Corporation and its subsidiaries (the “Company”, “we” or “us”) operate on a 52 or 53 week year ending on the Saturday nearest September 30. Fiscal 2021 will be a 52-week year and fiscal 2020 was a 53-week year, with the extra week included in the fourth quarter of fiscal 2020. All references to years relate to fiscal years unless otherwise noted.

Overview

We are a leading global provider of integrated manufacturing solutions, components, products and repair, logistics and after-market services. Our revenue is generated from sales of our products and services primarily to original equipment manufacturers (OEMs) that serve the industrial, medical, defense and aerospace, automotive, communications networks and cloud infrastructure solutions industries.

Our operations are managed as two businesses:

1.Integrated Manufacturing Solutions ("IMS"). Our IMS segment consists of printed circuit board assembly and test, high-level assembly and test, direct-order-fulfillment and memory from our Viking Technology division.

2.Components, Products and Services ("CPS"). Components include interconnect systems (printed circuit board fabrication, backplane, cable assemblies and plastic injection molding) and mechanical systems (enclosures and precision machining). Products include enterprise solutions from our Viking Enterprise Solutions division; RF, optical and microelectronic; defense and aerospace products from SCI Technology; and cloud-based manufacturing execution software from our 42Q division. Services include design, engineering, logistics and repair services.

Our only reportable segment for financial reporting purposes is IMS, which represented approximately 80% of our total revenue in the first half of 2021. Our CPS business consists of multiple operating segments, which do not individually meet the quantitative thresholds for being presented as reportable segments under the accounting rules for segment reporting. Therefore, financial information for these operating segments is aggregated and presented in a single category entitled “Components, Products and Services”.

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Our strategy is to leverage our comprehensive product and service offerings, advanced technologies and global capabilities to further penetrate diverse end markets that we believe offer significant growth opportunities and have complex products that require higher value-added services. We believe this strategy differentiates us from our competitors and will help drive more sustainable revenue growth and provide opportunities for us to ultimately achieve operating margins that exceed industry standards.

There are many challenges to successfully executing our strategy. For example, we compete with a number of companies in each of our key end markets. This includes companies that are much larger than we are and smaller companies that focus on a particular niche. Although we believe we are well-positioned in each of our key end markets and seek to differentiate ourselves from our competitors, competition remains intense and profitably growing our revenues has been challenging.

We are dependent on certain suppliers, including limited and sole source suppliers, to provide key components we incorporate into our products. Recently, and due in part to increased worldwide demand for electronic products and components across a number of end markets, we are experiencing delays in delivery and shortages of certain components, particularly certain types of capacitors, resistors and discrete semiconductors needed for many of the products we manufacture. We expect these delays and shortages to persist at least through the end of calendar 2021 and that such shortages could result in delays in shipments to our customers during the period of such shortages. Any such delays would reduce our revenue, gross profit and net income for the periods affected, and would also result in an increase in our inventory of other components, which would reduce our operating cash flow.

In March 2020, the World Health Organization declared COVID-19 to be a pandemic. Our results of operations have been negatively impacted by rapidly changing market and economic conditions caused by the COVID-19 pandemic, as well as by numerous measures imposed by government authorities to try to contain the virus. These conditions and measures disrupted our operations and those of our customers, interrupted the supply of components, temporarily limited the types of products we could manufacture and the capacity of our logistics providers to deliver those products, and resulted in temporary closures of manufacturing sites and reduced staffing as mandated by government orders. Although employee infections have not yet had a significant impact on our operations, these conditions and measures require us to perform contact tracing, exclude potentially infected employees from the workplace and clean work areas used by infected employees. Recently, there has been increased COVID-19 infections in countries in which we have operations. Should employee infections become widespread, our ability to sustain production at desired levels would be significantly and negatively impacted. We are unable to accurately predict the full impact that the COVID-19 pandemic will have on us due to a number of uncertainties, including the impact of the pandemic on our customers' businesses, the number of employees who may become infected or exposed to infected persons whom we would then be required to exclude from our plants, the imposition of government restrictions on staffing, the need for temporary plant closures, supply chain shortages and other interruptions, the capacity of our logistic providers, the duration of the outbreak, the distribution and availability of COVID-19 vaccines, the geographic locations of any future outbreaks, and actions that government authorities may take. However, it is likely that the pandemic will continue to have a negative impact on our business, results of operations and financial condition for the foreseeable future.

Separately, we incurred restructuring charges of approximately $29 million, consisting of severance costs, under our company-wide restructuring plan adopted in October 2019 ("Q1 FY20 Plan"). Additionally, actions under the Q1 FY20 Plan are expected to be implemented through the fourth quarter of 2021 and cash payments of severance are expected to occur through the end of calendar 2021.

A small number of customers have historically generated a significant portion of our net sales. Sales to our ten largest customers have typically represented approximately 55% of our net sales. One customer represented 10% or more of our net sales for all periods presented.

We typically generate about 80% of our net sales from products manufactured in our foreign operations. The concentration of foreign operations has resulted primarily from a desire on the part of many of our customers to manufacture in lower cost regions such as Asia, Latin America and Eastern Europe.

Historically, we have had substantial recurring sales to existing customers. We typically enter into supply agreements with our major OEM customers. These agreements generally have terms ranging from three to five years and can cover the manufacture of a range of products. Under these agreements, a customer typically purchases its requirements for specific products in particular geographic areas from us. However, these agreements generally do not obligate the customer to purchase minimum quantities of products, which can have the effect of reducing revenue and profitability. In addition, some customer contracts contain cost reduction objectives, which can also have the effect of reducing revenue from such customers.

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Critical Accounting Policies and Estimates

Management's discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). We review the accounting policies used in reporting our financial results on a regular basis. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, net sales and expenses and related disclosure of contingent liabilities. On an ongoing basis, we evaluate the process used to develop estimates related to accounts receivable, inventories, income taxes, environmental matters, litigation and other contingencies. We base our estimates on historical experience and on various other assumptions that we believe are reasonable for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Due to the COVID-19 pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic. We have considered information available to us as of the date of issuance of these financial statements and are not aware of any specific events or circumstances that would require an update to our estimates or judgments, or a revision to the carrying value of our assets or liabilities. Our estimates may change as new events occur and additional information becomes available. Our actual results may differ materially from these estimates.

A complete description of our critical accounting policies and estimates is contained in our Annual Report on Form 10-K for the fiscal year ended October 3, 2020 filed with the Securities and Exchange Commission.

Results of Operations

Key Operating Results

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Net sales	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
Gross profit	$	143,098	$	107,421	$	284,333	$	242,303
Operating income	$	64,723	$	24,369	$	140,282	$	81,550
Net income	$	47,037	$	4,882	$	95,058	$	43,227

Net Sales

Sales by end market were as follows (dollars in thousands):

	Three Months Ended								Six Months Ended
	April 3, 2021		March 28, 2020		Increase/(Decrease)				April 3, 2021		March 28, 2020		Increase/(Decrease)
Industrial, Medical, Defense and Automotive	$	980,794	$	966,642	$	14,152	1.5	%	$	2,013,312	$	2,074,189	$	(60,877)	(2.9)	%
Communications Networks and Cloud Infrastructure	718,883		623,908		94,975		15.2	%	1,441,614		1,356,532		85,082		6.3	%
Total	$	1,699,677	$	1,590,550	$	109,127	6.9	%	$	3,454,926	$	3,430,721	$	24,205	0.7	%

Net sales increased from $1.6 billion in the second quarter of 2020 to $1.7 billion in the second quarter of 2021, an increase of 6.9% and from $3.4 billion in the six months ended March 28, 2020 to $3.5 billion in the six months ended April 3, 2021, an increase of 0.7%. These increases were primarily due to a more significant impact from the Covid-19 pandemic in the second quarter of 2020 than in the second quarter of 2021.

Gross Margin

Gross margin increased to 8.4% for the second quarter of 2021 from 6.8% for the second quarter of 2020. IMS gross margin increased to 6.9% for the second quarter of 2021, from 5.8% for the second quarter of 2020 primarily due to increased operational efficiencies and cost reduction and containment efforts implemented in 2020, some of which were in response to the COVID-19 pandemic. There was a greater impact on operational efficiencies and additional costs in the second quarter of 2020 due to the COVID-19 pandemic. CPS gross margin increased to 14.2% for the second quarter of 2021, from 10.8% for the

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second quarter of 2020, primarily due to increased volume, operational efficiencies, favorable product mix and the factors impacting IMS gross margin as described above.

Gross margin increased to 8.2% for the six months ended April 3, 2021 from 7.1% for the six months ended March 28, 2020. IMS gross margin increased to 6.9% for the six months ended April 3, 2021, from 5.8% for the six months ended March 28, 2020 primarily due to increased operational efficiencies and the cost reduction and containment efforts described above. CPS gross margin increased to 14.2% for the six months ended April 3, 2021, from 10.8% for the six months ended March 28, 2020, primarily due to the continued benefits of certain plant closures and the factors described with respect to IMS gross margin.

We have experienced fluctuations in gross margin in the past and may continue to do so in the future. Fluctuations in our gross margins may also be caused by a number of other factors, including:

•the ongoing impacts of the COVID-19 pandemic on our operations, the operations of our suppliers and on our customers' businesses;

•capacity utilization which, if lower, results in lower margins due to fixed costs being absorbed by lower volumes;

•changes in the mix of high and low margin products demanded by our customers;

•competition in the EMS industry and pricing pressures from OEMs due to greater focus on cost reduction;

•the amount of our provisions for excess and obsolete inventory, including those associated with distressed customers;

•levels of operational efficiency and production yields;

•customer design changes that may increase our costs and delay or reduce our production of products; and

•our ability to transition the location of and ramp manufacturing and assembly operations when requested by a customer in a timely and cost-effective manner.

Selling, General and Administrative

Selling, General and Administrative expenses decreased $1.1 million, from $62.3 million, or 3.9% of net sales, in the second quarter of 2020 to $61.1 million, or 3.6% of net sales, in the second quarter of 2021. The decrease in dollars was primarily due to reduced travel and certain other expenses in response to the COVID-19 pandemic.

Selling, General and Administrative expenses decreased $5.3 million, from $125.4 million, or 3.7% of net sales, in the six months ended March 28, 2020 to $120.1 million, or 3.5% of net sales, in the six months ended April 3, 2021. The decrease in dollars was primarily due to reduced headcount as a result of actions under our Q1 FY20 restructuring plan and reduced travel and certain other expenses in response to the COVID-19 pandemic.

Research and Development

Research and Development expenses decreased $0.4 million, from $5.8 million, or 0.4% of net sales, in the second quarter of 2020 to $5.4 million, or 0.3% of net sales, in the second quarter of 2021.

Research and Development expenses decreased $0.8 million, from $11.0 million, or 0.3% of net sales, in the six months ended March 28, 2020 to $10.2 million, or 0.3% of net sales, in the six months ended April 3, 2021.

Restructuring and Other

Restructuring

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The following table provides a summary of restructuring costs:

	Restructuring Expense
	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Severance costs (approximately 790 and 830 employees for the three and six months ended April 3, 2021, respectively and 300 and 1,750 employees for the three and six months ended March 28, 2020, respectively)	$	10,656	$	4,725	$	11,492	$	11,453
Other exit costs	9		44		9		52
Total - Q1 FY20 Plan	10,665		4,769		11,501		11,505
Costs incurred for other plans	1,215		3,587		2,283		6,011
Total - all plans	$	11,880	$	8,356	$	13,784	$	17,516

Q1 FY20 Plan

On October 28, 2019, we adopted a Company-wide restructuring plan ("Q1 FY20 Plan"). Under the Q1 FY20 Plan, we expect to incur restructuring charges of up to $35 million, consisting primarily of cash severance costs. As of April 3, 2021, we incurred restructuring charges of approximately $29 million, consisting of severance costs, under the Q1 FY20 Plan. Additional actions under the Q1 FY20 Plan are expected to be implemented through the fourth quarter of 2021 and cash payments of severance are expected to occur through the end of calendar year 2021.

Other Plans

Other plans include a number of plans for which costs are not expected to be material individually or in the aggregate.

All Plans

Our IMS segment incurred costs of $9 million for each of the six months ended April 3, 2021 and March 28, 2020. Our CPS segment incurred costs of $4 million and $6 million for the six months ended April 3, 2021 and March 28, 2020, respectively. In addition, $0.6 million and $3 million of costs were incurred during the three months ended April 3, 2021 and March 28, 2020, respectively, for corporate headcount reductions that were not allocated to our IMS and CPS segments. We had accrued liabilities of $16 million and $9 million as of April 3, 2021 and October 3, 2020, respectively, for restructuring costs (exclusive of long-term environmental remediation liabilities).

In addition to costs expected to be incurred under the Q1 FY20 Plan, we expect to incur restructuring costs in future periods primarily for vacant facilities and former sites for which we are or may be responsible for environmental remediation.

Other

During the second quarter of 2020, commodity prices in the oil and gas market experienced a sharp decline due to a combination of an oversaturated supply and a decrease in demand caused by the COVID-19 pandemic. This commodity price decline negatively impacted the projected cash flows of our oil and gas reporting unit, which is part of our CPS operating segment. Therefore, we performed a goodwill impairment test for this particular reporting unit and concluded that the fair value of the reporting unit was below its carrying value, resulting in an impairment charge of $7 million. The fair value of the reporting unit was estimated based on the present value of future discounted cash flows.

Other Income (Expense), Net

Other income (expense), net for the three and six months ended April 3, 2021, was an income of $6 million and $8 million, respectively. Other income (expense), net for the three and six months ended March 28, 2020, was an expense of $8 million and $6 million, respectively. The changes in the above comparative periods were primarily due to a significant decline in the market value of participant investment accounts in our deferred compensation plan in the second quarter of 2020 that was caused by the COVID-19 pandemic. In addition, the Company received settlement payments in connection with certain anti-trust class action matters during the second quarter of 2021 of approximately $5 million.

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Provision for Income Taxes

Our provision for income taxes for the three months ended April 3, 2021 and March 28, 2020 was $19 million (29% of income before taxes) and $6 million (56% of income before taxes), respectively and $44 million (32% of income before taxes) and $21 million (32% of income before taxes) for the six months ended April 3, 2021 and March 28, 2020, respectively. Income tax expense for the three and six months ended April 3, 2021 increased, primarily as a result of an increase in income before tax and a change in the geographic mix of income before tax. The effective tax rate for the three months ended March 28, 2020 was negatively impacted by the COVID-19 global pandemic, resulting in reduced income and unfavorable jurisdictional mix.

It is reasonably possible that our liability for uncertain tax positions could decrease materially during the quarter ending July 3, 2021 based upon the resolution of audits and expiration of statutes of limitations, which would result in a decrease in income tax expense at that time.

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Liquidity and Capital Resources

	Six Months Ended
	April 3, 2021		March 28, 2020
	(In thousands)
Net cash provided by (used in):
Operating activities	$	142,900	$	156,899
Investing activities	(25,540)		(44,456)
Financing activities	(22,350)		548,153
Effect of exchange rate changes on cash and cash equivalents	(360)		(752)
Increase (Decrease) in cash and cash equivalents	$	94,650	$	659,844

Key Working Capital Management Measures

	As of
	April 3, 2021	October 3, 2020
Days sales outstanding (1)	59	54
Contract asset days (2)	18	20
Inventory turns (3)	7.8	7.3
Days inventory on hand (4)	47	50
Accounts payable days (5)	66	70
Cash cycle days (6)	58	54

(1)    Days sales outstanding (a measure of how quickly we collect our accounts receivable), or "DSO", is calculated as the ratio of average accounts receivable, net, to average daily net sales for the quarter.

(2)    Contract asset days (a measure of how quickly we transfer contract assets to accounts receivable) are calculated as the ratio of average contract assets to average daily net sales for the quarter.

(3)    Inventory turns (annualized) (a measure of how quickly we sell inventory) are calculated as the ratio of four times our cost of sales for the quarter to average inventory.

(4)    Days inventory on hand (a measure of how quickly we turn inventory into sales) is calculated as the ratio of average inventory for the quarter to average daily cost of sales for the quarter.

(5)    Accounts payable days (a measure of how quickly we pay our suppliers), or "DPO", is calculated as the ratio of 365 days divided by accounts payable turns, in which accounts payable turns is calculated as the ratio of four times our cost of sales for the quarter to average accounts payable.

(6)    Cash cycle days (a measure of how quickly we convert investments in inventory to cash) is calculated as days inventory on hand plus days sales outstanding and contract assets days minus accounts payable days.

Cash and cash equivalents were $575 million at April 3, 2021 and $481 million at October 3, 2020. Our cash levels vary during any given quarter depending on the timing of collections from customers and payments to suppliers, borrowings under our credit facilities, sales of accounts receivable under numerous programs we utilize, repurchases of capital stock and other factors. Our working capital was $1.4 billion and $1.3 billion as of April 3, 2021 and October 3, 2020, respectively.

Net cash provided by operating activities was $143 million and $157 million for the six months ended April 3, 2021 and March 28, 2020, respectively. Cash flows from operating activities consist of: (1) net income adjusted to exclude non-cash items such as depreciation and amortization, deferred income taxes, impairments and stock-based compensation expense and (2) changes in net operating assets, which are comprised of accounts receivable, contract assets, inventories, prepaid expenses and other assets, accounts payable, accrued liabilities and other long-term liabilities. Our working capital metrics tend to fluctuate from quarter-to-quarter based on factors such as the linearity of our shipments to customers and purchases from suppliers, customer and supplier mix, the extent to which we factor customer receivables and the negotiation of payment terms with customers and suppliers. These fluctuations can significantly affect our cash flows from operating activities.

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During the six months ended April 3, 2021, we generated $181 million of cash primarily from earnings, excluding non-cash items, and consumed $38 million of cash due primarily to a decrease in accounts payable and an increase in accounts receivable, partially offset by decreases in contract assets and inventories. Individual components of operating assets and liabilities fluctuate for a number of reasons, including linearity of purchases and sales, the mix of customer and supplier payment terms within our accounts receivable and accounts payable, and the amount and timing of sales of accounts receivable. The decreases noted above were primarily due to decreased business volume and, in the case of inventories, continued focus on inventory reduction initiatives. The decrease in accounts payable was attributable to reduced business volume and a decrease in DPO from 70 days as of October 3, 2020 to 66 days as of April 3, 2021 resulting from an unfavorable shift in the linearity of material receipts and an unfavorable supplier payment terms mix. The increase in accounts receivable is primarily attributable to less factoring of accounts receivable and an unfavorable shift in the linearity of shipments, both of which caused DSO to increase from 54 days as of October 3, 2020 to 59 days as of April 3, 2021.

Net cash used in investing activities was $26 million and $44 million for the six months ended April 3, 2021 and March 28, 2020, respectively. During the six months ended April 3, 2021 and March 28, 2020, we used $26 million and $44 million, respectively, of cash for capital expenditures.

Net cash (used in) and provided by financing activities was $(22) million and $548 million for the six months ended April 3, 2021 and March 28, 2020, respectively. During the six months ended April 3, 2021, we used $15 million of cash to repurchase common stock (including $6 million related to employee tax withholding on vested restricted stock units), repaid an aggregate of $9 million of long-term debt and received $2 million of net proceeds from issuances of common stock pursuant to stock option exercises. During the six months ended March 28, 2020, we borrowed $650 million of cash under our Fourth Amended and Restated Credit Agreement (the "Amended Cash Flow Revolver"), used $82 million of cash to repurchase common stock (including $12 million related to employee tax withholdings on vested restricted stock units), repaid an aggregate of $25 million of long-term debt and received $5 million of net proceeds from issuances of common stock pursuant to stock option exercises.

Other Liquidity Matters

Our Board of Directors has authorized us to repurchase shares of our common stock, subject to a dollar limitation. The timing of repurchases depends upon capital needs to support the growth of our business, market conditions and other factors. We repurchased 0.4 million and 2.7 million shares of our common stock for $9 million and $70 million during the six months ended April 3, 2021 and March 28, 2020, respectively. There were no repurchases during the three months ended April 3, 2021. As of April 3, 2021, $125 million remains available under the stock repurchase program authorized by the Board of Directors, which does not have an expiration date. Although stock repurchases are intended to increase stockholder value and to offset the dilution that results from the issuance of shares under our equity plans, repurchases of shares also reduce our liquidity. As a result, the timing of future repurchases depends upon our future capital needs, market conditions and other factors.

We entered into a Receivable Purchase Agreement (the “RPA”) with certain third-party banking institutions for the sale of trade receivables generated from sales to certain customers, subject to acceptance by, and a funding commitment from, the banks that are party to the RPA. As of April 3, 2021, a maximum of $554 million of sold receivables can be outstanding at any point in time under this program, as amended, subject to limitations under our Amended Cash Flow Revolver. Additionally, the amount available under the RPA is uncommitted and, as such, is available at the discretion of our third-party banking institutions. On January 16, 2019, we entered into an amendment to our Amended Cash Flow Revolver which increased the percentage of our total accounts receivable that can be sold and outstanding at any time from 30% to 40%. Trade receivables sold pursuant to the RPA are serviced by us.

In addition to the RPA, we have the option to participate in trade receivables sales programs that have been implemented by certain of our customers, as in effect from time to time. We do not service trade receivables sold under these other programs.

The sale of receivables under all of these programs is subject to the approval of the banks or customers involved and there can be no assurance that we will be able to sell the maximum amount of receivables permitted by these programs when desired.

Under each of the programs noted above, we sell our entire interest in a trade receivable for 100% of face value, less a discount. During the six months ended April 3, 2021 and March 28, 2020, we sold approximately $371 million and $1.1 billion, respectively, of accounts receivable under these programs. Upon sale, these receivables are removed from the condensed consolidated balance sheets and cash received is presented as cash provided by operating activities in the condensed consolidated statements of cash flows. Discounts on sold receivables were not material for any period presented. As of April 3,

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2021 and October 3, 2020, $27 million and $97 million, respectively, of accounts receivable sold under the RPA and subject to servicing by us remained outstanding and had not yet been collected. Our sole risk with respect to receivables we service is with respect to commercial disputes regarding such receivables. Commercial disputes include billing errors, returns and similar matters. To date, we have not been required to repurchase any receivable we have sold due to a commercial dispute. Additionally, we are required to remit amounts collected as servicer on a weekly basis to the financial institutions that purchased the receivables. As of April 3, 2021 and October 3, 2020, $22 million and $39 million, respectively, had been collected but not yet remitted. This amount is classified in accrued liabilities on the condensed consolidated balance sheets.

We enter into forward interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the benchmark interest rate (LIBOR) associated with anticipated variable rate borrowings. These interest rate swaps have a maturity date of December 1, 2023, and effectively convert our variable interest rate obligations to fixed interest rate obligations. These swaps are accounted for as cash flow hedges under ASC Topic 815, Derivatives and Hedging. Interest rate swaps with an aggregate notional amount of $350 million were outstanding as of April 3, 2021 and October 3, 2020. The aggregate effective interest rate under these swaps as of April 3, 2021 was approximately 4.3%. As of April 3, 2021, due to a decline in interest rates since the time the swaps were put in place, these interest rate swaps had a negative value of $22 million as of April 3, 2021, of which $9 million is included in accrued liabilities and the remaining amount is included in other long-term liabilities on the condensed consolidated balance sheets.

In the ordinary course of business, we are or may become party to legal proceedings, claims and other contingencies, including environmental, regulatory, warranty and employee matters and examinations by government agencies. As of April 3, 2021, we had accrued liabilities of $38 million related to such matters. We cannot accurately predict the outcome of these matters or the amount or timing of cash flows that may be required to defend ourselves or to settle such matters or that these reserves will be sufficient to fully satisfy our contingent liabilities.

As of April 3, 2021, we had a liability of $122 million for uncertain tax positions. Our estimate of liabilities for uncertain tax positions is based on a number of subjective assessments, including the likelihood of a tax obligation being assessed, the amount of taxes (including interest and penalties) that would ultimately be payable, and our ability to settle any such obligations on favorable terms. Therefore, the amount of future cash flows associated with uncertain tax positions may be significantly higher or lower than our recorded liability and we are unable to reliably estimate when cash settlement may occur. It is reasonably possible that our liability for uncertain tax positions could decrease materially during the quarter ending July 3, 2021 based upon the resolution of audits and expiration of statutes of limitations.

Our liquidity needs are largely dependent on changes in our working capital, including sales of accounts receivable under our receivables sales programs and the extension of trade credit by our suppliers, investments in manufacturing inventory, facilities and equipment, repayments of obligations under outstanding indebtedness and repurchases of common stock. We generated $143 million of cash from operations in the second quarter of 2021. Our primary sources of liquidity as of April 3, 2021 consisted of (1) cash and cash equivalents of $575 million; (2) our Amended Cash Flow Revolver, under which $692 million, net of outstanding borrowings and letters of credit, was available; (3) our foreign short-term borrowing facilities of $69 million, all of which was available; (4) proceeds from the sale of accounts receivable under our receivables sales programs, if accepted by the counterparties to such programs; and (5) cash generated from operations. Subject to satisfaction of certain conditions, including obtaining additional commitments from existing and/or new lenders, we may increase the revolver commitments under the Amended Cash Flow Revolver by an additional $200 million.

We believe our existing cash resources and other sources of liquidity, together with cash generated from operations, will be sufficient to meet our working capital requirements through at least the next 12 months. However, should demand for our services decrease significantly over the next 12 months or should we experience significant increases in delinquent or uncollectible accounts receivable for any reason, including in particular continued or worsening economic conditions caused by the COVID-19 pandemic, our cash provided by operations could decrease significantly and we could be required to seek additional sources of liquidity to continue our operations at their current level.

We distribute our cash among a number of financial institutions that we believe to be of high quality. However, there can be no assurance that one or more of such institutions will not become insolvent in the future, in which case all or a portion of our uninsured funds on deposit with such institutions could be lost.

As of April 3, 2021, 45% of our cash balance was held in the United States. Should we choose or need to remit cash to the United States from our foreign locations, we may incur tax obligations which would reduce the amount of cash ultimately available to the United States. We believe that cash held in the United States, together with liquidity available under our Amended Cash Flow Revolver and cash from foreign subsidiaries that could be remitted to the United States without tax consequences, will be sufficient to meet our United States liquidity needs for at least the next twelve months.

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Off-Balance Sheet Arrangements

As of April 3, 2021, we did not have any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated by the SEC, that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues, or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

Our primary exposure to market risk for changes in interest rates relates to our Term Loan of $342 million under our Amended Cash Flow Revolver for which the interest rate we pay is determined at the time of borrowing based on a floating index. As of April 3, 2021, we had interest rate swaps with an aggregate notional amount of $350 million that effectively convert $350 million of our outstanding floating rate debt to fixed rate debt. An immediate 10 percent change in interest rates would not have a significant impact on our results of operations.

Foreign Currency Exchange Risk

We transact business in foreign currencies. Our foreign exchange policy requires that we take certain steps to limit our foreign exchange exposures resulting from certain assets and liabilities and forecasted cash flows. However, our policy does not require us to hedge all foreign exchange exposures. Furthermore, our foreign currency hedges are based on forecasted transactions and estimated balances, the amount of which may differ from that actually incurred. As a result, we can experience foreign exchange gains and losses in our results of operations.

Our primary foreign currency cash flows are in certain Asian and European countries, Israel, Brazil and Mexico. We enter into short-term foreign currency forward contracts to hedge currency exposures associated with certain monetary assets and liabilities denominated in non-functional currencies. These contracts generally have maturities of up to two months. Accordingly, these forward contracts are not designated as part of a hedging relationship for accounting purposes. All outstanding foreign currency forward contracts are marked-to-market at the end of the period with unrealized gains and losses included in other income, net, in the condensed consolidated statements of income. From an economic perspective, the objective of our hedging program is for gains or losses on forward contracts to substantially offset gains and losses on the underlying hedged items. As of April 3, 2021, we had outstanding foreign currency forward contracts to exchange various foreign currencies for U.S. dollars in an aggregate notional amount of $399 million.

We also utilize foreign currency forward contracts to hedge certain operational (“cash flow”) exposures resulting from changes in foreign currency exchange rates. Such exposures result from (1) forecasted non-functional currency sales and (2) forecasted non-functional currency materials, labor, overhead and other expenses. These contracts may be up to twelve months in duration and are designated as cash flow hedges for accounting purposes. The effective portion of changes in the fair value of the contracts is recorded in stockholders' equity as a separate component of accumulated other comprehensive income and recognized in earnings when the hedged item affects earnings. We had forward contracts related to cash flow hedges in various foreign currencies in the aggregate notional amount of $110 million as of April 3, 2021.

The net impact of an immediate 10 percent change in exchange rates would not be material to our unaudited condensed consolidated financial statements, provided we accurately forecast and estimate our foreign currency exposure. If such forecasts are materially inaccurate, we could incur significant gains or losses.

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Item 4. Controls and Procedures

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended, (the "Exchange Act") that occurred during the quarter ended April 3, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures will prevent all error and all fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that their objectives are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits of disclosure controls and procedures must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of disclosure controls and procedures can provide absolute assurance that all disclosure control issues and instances of fraud, if any, have been detected. Nonetheless, our Chief Executive Officer and Chief Financial Officer have concluded that, as of April 3, 2021, (1) our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives, and (2) our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

In June 2008, the Company was named by the Orange County Water District in a suit alleging that its actions contributed to polluted groundwater managed by the plaintiff. The complaint seeks recovery of compensatory and other damages, as well as declaratory relief, for the payment of costs necessary to investigate, monitor, remediate, abate and contain contamination of groundwater within the plaintiff’s control. In April 2013, all claims against the Company were dismissed. The plaintiff appealed this dismissal and the appellate court reversed the judgment in August 2017. In November 2017, the California Supreme Court denied the Company’s petition to review this decision and, in December 2017, the Court of Appeals remanded the case back to the Superior Court for further proceedings. The first part of a multi-phase trial commenced on April 12, 2021. The Company is contesting the plaintiff’s claims vigorously.

In October 2018, a contractor who had been retained by the Company through a third party temporary staffing agency from November 2015 to March 2016 filed a lawsuit against the Company in the Santa Clara County Superior Court on behalf of himself and all other similarly situated Company contractors and employees in California, alleging violations of California Labor Code provisions governing overtime, meal and rest periods, wages, wage statements and reimbursement of business expenses. The complaint seeks certification of a class of all non-exempt employees, whether employed directly or through a temporary staffing agency, employed from four years before the filing of the initial complaint to the time of trial. Additionally, on November 1, 2019, another contractor retained through a temporary staffing agency filed a lawsuit against the Company in the Santa Clara County Superior Court. The complaint, which includes a single cause of action under California’s Private Attorneys General Act of 2004 (“PAGA”), alleges Labor Code violations substantially similar to those alleged in the October 2018 class action lawsuit and seeks penalties on behalf of the State of California and other “aggrieved employees” (defined to be current and former hourly, non-exempt employees employed by the Company between August 22, 2018 and the present). Although the Company continues to deny any wrongdoing, on November 19, 2020, the Company reached an agreement in principle to resolve all claims (the “Settlement”). Under the Settlement, which remains subject to court approval, the Company’s total payout will depend on the number and value of claims submitted by members of the settlement class to the claims administrator, and cannot exceed $5 million (but could be as low as approximately $3.5 million), inclusive of plaintiffs’ attorneys’ fees, costs, and certain other items. On December 3, 2020, in connection with and in order to effect the Settlement, plaintiffs dismissed the PAGA complaint pending in Santa Clara County Superior Court and refiled it as a class and PAGA action in Kern County Superior Court. Similarly, on April 3, 2021, the class action complaint originally filed in the Santa Clara County Superior Court was dismissed without prejudice.

On December 20, 2019, the Company sued its former customer, Dialight plc (“Dialight”), in the United States District Court for the Southern District of New York to collect approximately $10 million in unpaid accounts receivable and net obsolete inventory obligations. Later the same day, Dialight commenced its own action in the same court. Dialight’s complaint, which asserts claims for fraudulent inducement, breach of contract and gross negligence/willful misconduct, alleges that Sanmina fraudulently misrepresented its capabilities to induce Dialight to enter into a Manufacturing Services Agreement (“Dialight MSA”), and then breached its obligations under the Dialight MSA relating to quality, on-time delivery and supply chain management. Dialight seeks an unspecified amount of compensatory and punitive damages. The Company intends to vigorously prosecute its claim against Dialight. Further, the Company strongly disagrees with Dialight’s allegations and intends to defend against them vigorously.

In addition, from time to time, we may become involved in routine legal proceedings, demands, claims, threatened litigation and regulatory inquiries and investigations, that arise in the normal course of our business. We record liabilities for such matters when a loss becomes probable and the amount of loss can be reasonably estimated. The ultimate outcome of any litigation is uncertain and unfavorable outcomes could have a negative impact on our results of operations and financial condition. Regardless of outcome, litigation can have an adverse impact on us as a result of incurrence of litigation costs, diversion of management resources, and other factors.

Refer also to Note 7 to Condensed Consolidated Financial Statements.

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Item 1A. Risk Factors

End Market and Operational Risks

The COVID-19 pandemic has had, and will likely continue to have, a significant impact on our results of operations and financial condition by reducing demand from our customers, interrupting the flow of components needed for our customers’ products, limiting the operations or productivity of our manufacturing facilities, restricting the types of products we can build for our customers and creating health risks to our employees.

Our global operations expose us to the effects of the COVID-19 pandemic, which has impacted economic activity worldwide for over one year. In particular, the pandemic:

•Resulted in the temporary closure of certain of our facilities;

•Reduced the amount of staffing we are permitted to maintain at certain of our plants;

•Required us in some cases to pay staff who are not able to work due to government orders or illness;

•Limited the capacity of logistics providers to deliver components for and the products we manufacture;

•Reduced demand for certain of our customers’ products;

•Temporarily prevented us from building certain products not deemed as essential under certain local, state and national public health orders; and

•Resulted in interruptions of supply of components, either because our suppliers have themselves been prevented from operating or because major distribution channels (e.g., sea transport) have been disrupted by the pandemic.

Collectively, these conditions reduced our revenue during the last 12 months and it is unclear when these impacts will be fully resolved.

Further, although we have implemented infection control measures recommended or required by the applicable public health authorities, and have not to date experienced a significant number of COVID-19 infections among our employees, should infections among our employees increase significantly, our operations could be impacted if we become required to temporarily exclude significant numbers of employees from our plants due to either infection or exposure to an infected person and/or close impacted plants in order to clean them or as a result of government orders. Furthermore, as a result of government orders, a large number of our employees have been working remotely since the end of the second quarter of fiscal 2020. Although these restrictions have been relaxed in some geographies, and we have not experienced any significant disruptions to date as a result of remote work arrangements, should a substantial number of our employees supporting general and administrative functions, particularly at our California headquarters location, continue to be required to work remotely for an extended period of time, we could experience disruptions and reduced efficiencies. Furthermore, various local, state and national governments and agencies have recently enacted safety regulations intended to help prevent the transmission of COVID-19 in the workplace. These regulations are complex, costly to implement, subject to frequent change and to audit and investigation by governmental authorities, including the Occupational Health and Safety Administration (OSHA), their state counterparts and local health departments. Any failure by the Company to materially comply with COVID-19-related safety rules and regulations in any of its facilities could result in sanctions, fines, as well as negative publicity for the Company.

More generally, the COVID-19 pandemic raises the possibility of an extended global economic downturn and has caused volatility in financial markets, which has affected and could continue to affect demand for our products and services and impact our results and financial condition even after the pandemic is contained. In particular, the pandemic also resulted in certain of our customers and suppliers experiencing financial difficulties, which could impact their ability or willingness to satisfy their payment or delivery obligations to us in the future. Although we have not experienced any significant increase in customer defaults as a result of the pandemic to date, the risk of such defaults will increase if pandemic conditions continue indefinitely or if commercial and social restrictions originally put in place in response to them by local, state and national governments increase or are reinstated. Recently, there have been increased COVID-19 infections in countries in which we have operations. For example, a resurgence of infections in India has resulted in new restrictions on activities in a number of regions of such country.

We are unable to accurately predict the full impact that the COVID-19 pandemic will have on us due to a number of uncertainties, including the impact of the pandemic on our customers’ businesses, the number of our employees who may become infected or exposed to infected persons whom we would then be required to temporarily exclude from our plants, the

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imposition of government restrictions on staffing and the types of products we are permitted to build, the need for temporary plant closures, supply chain shortages and other interruptions, the capacity of our logistics providers, the duration of the outbreak, the distribution and availability of COVID-19 vaccines, the geographic locations of any future outbreaks, and actions that government authorities may take. However, we believe it is likely that the pandemic will continue to have a negative impact on our business, results of operations and financial condition for the foreseeable future.

Adverse changes in the key end markets we target could harm our business by reducing our sales.

We provide products and services to companies that serve the industrial, medical, defense and aerospace, automotive, communications networks and cloud infrastructure industries. Adverse changes in any of these end markets could reduce demand for our customers' products or make these customers more sensitive to the cost of our products and services, either of which could reduce our sales, gross margins and net income. A number of factors could affect these industries in general and our customers in particular, leading to reductions in net sales. These factors include:

•intense competition among our customers and their competitors, leading to reductions in prices for their products and increases in pricing pressure placed on us;

•failure of our customers' products to gain widespread commercial acceptance, which could decrease the volume of orders customers place with us. For example, our sales and margins have been negatively impacted in the past by the slower than expected ramp of 5G programs by our communications customers;

•changes in regulatory requirements affecting the products we build for our customers, leading to product redesigns or obsolescence and potentially causing us to lose business; and

•recessionary periods in our customers' markets, which decrease orders from affected customers, such as the currently depressed conditions due to the COVID-19 pandemic.

We realize a substantial portion of our revenues from communications equipment customers. This market is highly competitive, particularly in the area of price. Should any of our larger customers in this market fail to effectively compete with their competitors, they could reduce their orders to us or experience liquidity difficulties, either of which could have the effect of substantially reducing our revenue and net income. There can be no assurance that we will not experience declines in demand in this or in other end markets in the future.

Our operating results are subject to significant uncertainties, which can cause our future sales, net income and cash generated from operations to be variable.

Our operating results can vary due to a number of significant uncertainties, including:

•our ability to replace declining sales from end-of-life programs and customer disengagements with new business wins;

•conditions in the economy as a whole and in the industries we serve, which are being significantly impacted by the current COVID-19 pandemic;

•fluctuations in component prices, component shortages and extended component lead times caused by high demand, natural disasters, epidemics or pandemics, such as the COVID-19 pandemic, or otherwise;

•timing and success of new product developments and ramps by our customers, which create demand for our services, but which can also require us to incur start-up costs relating to new tooling and processes;

•levels of demand in the end markets served by our customers;

•timing of orders from customers and the accuracy of their forecasts;

•inventory levels of customers, which if high relative to their normal sales volume, could cause them to reduce their orders to us;

•customer payment terms and the extent to which we factor customer receivables during the quarter;

•increasing labor costs in the regions in which we operate;

•mix of products ordered by and shipped to major customers, as high volume and low complexity manufacturing services typically have lower gross margins than more complex and lower volume services;

•our ability to pass tariffs through to our customers;

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•resolution of claims with our customers;

•the degree to which we are able to fully utilize our available manufacturing capacity, including due to restrictions under local, state and national public health orders covering the locations of our plants as a result of the COVD-19 pandemic;

•customer insolvencies resulting in bad debt or inventory exposures that are in excess of our reserves;

•our ability to efficiently move manufacturing operations to lower cost regions when required;

•changes in our tax provision due to changes in our estimates of pre-tax income in the jurisdictions in which we operate, uncertain tax positions, and our ability to utilize our deferred tax assets; and

•political and economic developments in countries in which we have operations, which could restrict our operations or those of our suppliers and/or customers or increase our costs.

Variability in our operating results may also lead to variability in cash generated by operations, which can adversely affect our ability to make capital expenditures, engage in strategic transactions and repurchase stock.

We are subject to risks arising from our international operations.

The substantial majority of our net sales are generated through our non-U.S. operations. As a result, we are affected by economic, political and other conditions in the foreign countries in which we do business, including:

•changes in trade and tax laws that may result in us or our customers being subjected to increased taxes, duties and tariffs, which could increase our costs and/or reduce our customers’ willingness to use our services in countries in which we are currently manufacturing their products;

•rising labor costs;

•compliance with foreign laws, including labor laws which generally provide for increased notice, severance and consultation requirements compared to U.S. laws;

•labor unrest, including strikes;

•difficulties in staffing due to immigration or travel restrictions imposed by national governments, including the U.S.;

•security concerns;

•political instability and/or regional military tension or hostilities;

•fluctuations in currency exchange rates, which may either increase or decrease our operating costs and for which we have significant exposure;

•the imposition of currency controls;

•exposure to heightened corruption risks;

•aggressive, selective or lax enforcement of laws and regulations by national governmental authorities;

•potentially increased risk of misappropriation of intellectual property; and

•an outbreak of a contagious disease, such as COVID-19, which may cause us or our suppliers and/or customers to temporarily suspend our operations in the affected city or country.

We operate in countries that have experienced labor unrest, political instability or conflict and strife, including China, India, Israel, Malaysia, Mexico and Thailand, and we have experienced work stoppages and similar disruptions at our plants in these countries. To the extent such developments prevent us from adequately staffing our plants and manufacturing and shipping products in those jurisdictions, our margins and net income could be reduced and our reputation as a reliable supplier could be negatively impacted.

Certain of our foreign manufacturing facilities are leased from third parties. To the extent we are unable to renew the leases covering such facilities as they expire on reasonable terms, or are forced to move our operations at those facilities to other locations as a result of a failure to agree upon renewal terms, production for our customers may be interrupted, we may breach our customer agreements, we could incur significant start-up costs at new facilities and our lease expense may increase, potentially significantly.

Our business is currently being impacted by supply chain shortages and our supply chain is subject to a number of economic, regulatory and environmental risks that could increase our costs or cause us to delay shipments to customers, reducing our revenue and margins and increasing our inventory.

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Our supply chain is subject to a number of risks and uncertainties. For example, we are dependent on certain suppliers, including limited and sole source suppliers, to provide key components we incorporate into our products. Recently, and due in part to increased worldwide demand for electronic products and components across a number of end markets, we are experiencing delays in delivery and shortages of certain components, particularly certain types of capacitors, resistors and discrete semiconductors needed for many of the products we manufacture. We expect these delays and shortages to persist at least through the end of calendar 2021 and that such shortages could result in delays in shipments to our customers during the period of such shortages. Any such delays would reduce our revenue and margins for the periods affected and would also result in an increase in our inventory of other components, which would reduce our operating cash flow. These delays and shortages could be further exacerbated by shipping delays resulting from a general improvement in worldwide economic conditions that is driving increased demand for shipping and logistics services generally.

Our components are manufactured using a number of commodities, including petroleum, gold, copper and other metals that are subject to frequent and unpredictable changes in price due to worldwide demand, investor interest and economic conditions. We do not hedge against the risk of these fluctuations, but rather attempt to adjust our product pricing to reflect such changes. Recently, significant increases in commodities prices have occurred and, should we not be able to increase our product prices enough to offset these increased costs, our gross margins and profitability could decrease, perhaps significantly.

Concern over climate change has led to state, federal and international legislative and regulatory initiatives aimed at reducing carbon dioxide and other greenhouse gas emissions and there is increased stockholder interest in corporate sustainability initiatives. Collectively, such initiatives could lead to an increase in the price of energy over time. A sustained increase in energy prices for any reason could increase our raw material, components, operations and transportation costs, which we may not be able to pass on to our customers and which would therefore reduce our profitability. We could also suffer reputational damage if our sustainability practices are not perceived to be adequate. Finally, government regulations, such as the Dodd-Frank Act disclosure requirements relating to conflict minerals, and customer interest in responsible sourcing could decrease the availability and increase the prices of components used in our customers' products. We may not be able to increase our product prices enough to offset these increased costs, in which case our profitability would be reduced.

We rely on a variety of common carriers to transport our raw materials and components from our suppliers to us, and to transport our products to our customers. The use of common carriers is subject to a number of risks, including increased costs due to rising energy prices and labor, vehicle and insurance costs, and hijacking and theft resulting in losses of shipments, delivery delays resulting from labor disturbances and strikes and other factors beyond our control. Although we attempt to mitigate our liability for any losses resulting from these risks through contracts with our customers, suppliers and insurance carriers, any costs or losses that cannot be mitigated could reduce our profitability, require us to manufacture replacement product or damage our relationships with our customers.

We rely on a relatively small number of customers for a substantial portion of our sales, and declines in sales to these customers could reduce our net sales and net income.

Sales to our ten largest customers have historically represented approximately half of our net sales. We expect to continue to depend upon a relatively small number of customers for a significant percentage of our sales for the foreseeable future. The loss of, or a significant reduction in sales or pricing to, our largest customers could substantially reduce our revenue and margins.

Current U.S. trade policy could increase the cost of using both our onshore and offshore manufacturing services for our U.S. customers, leading them to reduce their orders to us.

Although we maintain significant manufacturing capacity in the U.S., the substantial majority of our manufacturing operations are located outside the U.S. As a result of continuing trade disputes, the U.S., China, the E.U. and several other countries have imposed tariffs on certain imported products. In particular, the U.S. has imposed tariffs impacting certain components and products imported from China by us into the U.S. These tariffs apply to both components imported into the U.S. from China for use in the manufacture of products at our U.S. plants and to certain of our customers’ products that we manufacture for them in China and that are then imported into the U.S. Any decision by a large number of our customers to cease using our manufacturing services due to the continued application of tariffs would materially reduce our revenue and net income. In addition, our gross margins would be reduced in the event we are for any reason unable to pass on any tariffs that we incurred to our customers. Although our customers are generally liable for tariffs we pay on their behalf on importation of components used in the manufacture of their products, our gross margins would be reduced in the event we

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were for any reason unable to recover tariffs or duties from our customers. Further, although we are required to pay tariffs upon importation of the components, we may not be able to recover these amounts from customers until sometime later, if at all, which would adversely impact our operating cash flow in a given period.

Cancellations, reductions in production quantities, delays in production by our customers and changes in customer requirements could reduce our sales and net income.

We generally do not obtain firm, long-term purchase commitments from our customers and our bookings may generally be canceled prior to the scheduled shipment date. Although a customer is generally liable for raw materials we procure on their behalf, finished goods and work-in-process at the time of cancellation, the customer may fail to honor this commitment or we may be unable or, for other business reasons, choose not to enforce our contractual rights. Cancellations, reductions or delays of orders by customers could increase our inventory levels, lead to write-offs of inventory that we are not able to resell to the customer, reduce our sales and net income, delay or eliminate recovery of our expenditures for inventory purchased in preparation for customer orders and lower our asset utilization, all of which could result in lower gross margins and lower net income.

Our strategy to pursue higher margin business depends in part on the success of our CPS businesses, which, if not successful, could cause our future gross margins and operating results to be lower.

A key part of our strategy to capitalize on our end-to-end solutions is to grow our CPS business, which includes printed circuit boards, backplane and cable assemblies and plastic injection molding, mechanical systems, memory, RF, optical and microelectronic solutions, and data storage solutions and design, engineering, logistics and repair services and our SCI defense and aerospace products business. A decrease in orders for these components, products and services can have a disproportionately adverse impact on our profitability since these components, products and services generally carry higher than average contribution margins than our core IMS business. In addition, in order to grow this portion of our business profitably, we must continue to make substantial investments in the development of our product development capabilities, research and development activities, test and tooling equipment and skilled personnel, all of which reduce our operating results in the short term. The success of our CPS business also depends on our ability to increase sales of our proprietary products, convince our customers to agree to purchase our components for use in the manufacture of their products, rather than directing us to buy them from third parties, and expand the number of our customers who contract for our design, engineering, logistics and repair services. We may face challenges in achieving commercially viable yields and difficulties in manufacturing components in the quantities and to the specifications and quality standards required by our customers, as well as in qualifying our components for use in our customers' designs. Our proprietary products and design, engineering, logistics and repair services must compete with products and services offered by established vendors which focus solely on development of similar technologies or the provision of similar services. Any of these factors could cause our CPS business revenue and margin to be less than expected, which would have an adverse and potentially disproportionate effect on our overall revenues and profitability.

Customer requirements to transfer business may increase our costs.

Our customers sometimes require that we transfer the manufacturing of their products from one of our facilities to another to achieve cost reductions, tariff reductions and other objectives. These transfers have resulted in increased costs to us due to facility downtime, less than optimal utilization of our manufacturing capacity and delays and complications related to the transition of manufacturing programs to new locations. These transfers, and any decision by a significant customer to terminate manufacturing services in a particular facility, could require us to close or reduce operations at certain facilities and, as a result, we may incur in the future significant costs for the closure of facilities, employee severance and related matters. We may be required to relocate additional manufacturing operations in the future and, accordingly, we may incur additional costs that decrease our net income. Any of these factors could reduce our revenues, increase our expenses and reduce our net income.

Regulatory, Compliance and Litigation Risks

We are subject to a number of U.S. export control and other regulatory requirements, the failure to comply with which could result in damages or reduction of future revenue.

We are subject to a number of laws and regulations relating to the export of U.S. technology, anti-corruption and the award, administration and performance of U.S. government contracts and subcontracts. In particular, our activities must

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comply with the restrictions relating to the export of controlled technology and sales to denied or sanctioned parties contained in the International Traffic in Arms Regulations (ITAR), the U.S. Export Administration Regulations and sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (OFAC). We must also comply with the regulations relating to the award, administration and performance of U.S. government contracts and subcontracts with respect to our defense business, including regulations that govern price negotiations, cost accounting standards, procurement practices, termination at the election of the government and many other aspects of performance under government contracts and subcontracts. These laws and regulations are complex, require extensive compliance efforts and expenditures in the form of additional personnel, systems and personnel and, in some cases, require us to ensure that our suppliers adhere to such regulations. Furthermore, our compliance with such regulations is subject to audit or investigation by governmental authorities and, from time to time, we receive formal and informal inquiries from government agencies and regulators regarding our compliance. Should Sanmina be found to have violated one or more of such laws or regulations, we could become subject to civil damages (which in some cases could be trebled) or criminal penalties and administrative sanctions, including appointment of government monitors, termination of our government contracts and, ultimately, debarment from doing further business with the U.S. government. Any of such results would increase our expenses, reduce our revenue and damage our reputation as both a commercial and government supplier.

If we manufacture or design defective products, if there are manufacturing defects in the components we incorporate into customer products or if our manufacturing processes do not comply with applicable statutory and regulatory requirements and standards, we could be subject to claims, damages and fines and lose customers.

We manufacture products to our customers' specifications, and in some cases our manufacturing processes and facilities need to comply with various statutory and regulatory requirements and standards. For example, many of the medical products that we manufacture, as well as the facilities and manufacturing processes that we use to produce them, must comply with standards established by the U.S. Food and Drug Administration and products we manufacture for the automotive end market are generally subject to the IATF 16949:2016 standard. In addition, our customers' products and the manufacturing processes that we use to produce them often are highly complex. As a result, products that we design or manufacture may at times contain design or manufacturing defects, and our manufacturing processes may be subject to errors or may not be in compliance with applicable statutory and regulatory requirements and standards. Finally, customer products can experience quality problems or failures as a result of defects in the components they specify to be included in the products we manufacture for them. Defects in the products we design or manufacture, even if caused by components specified by the customer, may result in product recalls, warranty claims by customers, including liability for repair costs, delayed shipments to customers or reduced or canceled customer orders. The failure of the products that we design or manufacture or of our manufacturing processes and facilities to comply with applicable statutory and regulatory requirements and standards may subject us to legal fines or penalties, cause us to lose business and, in some cases, require us to shut down or incur considerable expense to correct a manufacturing program or facility. In addition, these defects may result in product liability claims against us. The magnitude of such claims may increase as we continue to expand our presence in the medical and automotive end markets since defects in these types of products can result in death or significant injury to end users of these products. Even when our customers are contractually responsible for defects in the design of a product and defects in components used in the manufacture of such products, there is no guarantee that these customers will have the financial resources to indemnify us for such liabilities and we could nonetheless be required to expend significant resources to defend ourselves if named in a product liability suit over such defects. Additionally, insolvency of our customers may result in us being held ultimately liable for our customers’ design defects, which could significantly reduce our net income.

If we are unable to protect our intellectual property or if we infringe, or are alleged to infringe, upon the intellectual property of others, we could be required to pay significant amounts in costs or damages.

We rely on a combination of copyright, patent, trademark and trade secret laws and contractual restrictions to protect our intellectual property rights. However, a number of our patents covering certain aspects of our manufacturing processes or products have expired and will continue to expire in the future. Such expirations reduce our ability to assert claims against competitors or others who use or sell similar technology. Any inability to protect our intellectual property rights could diminish or eliminate the competitive advantages that we derive from our proprietary technology.

We are also subject to the risk that current or former employees violate the terms of their proprietary information agreements with us. Should a current or former employee use or disclose any of our or our customers' proprietary information, we could become subject to legal action by our customers or others, our key technologies could become compromised and our ability to compete could be adversely impacted.

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In addition, we may become involved in administrative proceedings, lawsuits or other proceedings if others allege that the products we manufacture for our customers or our own manufacturing processes and products infringe on their intellectual property rights. If successful, such claims could force our customers and us to stop importing or producing products or components of products that use the challenged intellectual property, to pay up to treble damages and to obtain a license to the relevant technology or to redesign those products or services so as not to use the infringed technology. The costs of defense and potential damages and/or impact on production of patent litigation could be significant and have a materially adverse impact on our financial results. In addition, although our customers typically indemnify us against claims that the products we manufacture for them infringe others’ intellectual property rights, there is no guaranty that these customers will have the financial resources to stand behind such indemnities should the need arise, nor is there any guarantee that any such indemnity could be fully enforced. We sometimes design products on a contract basis or jointly with our customers. In such situations, we may become subject to claims that products we design infringe third party intellectual property rights and may also be required to indemnify our customer against liability caused by such claims.

Any of these events could reduce our revenue, increase our costs and damage our reputation with our customers.

Allegations of failures to comply with domestic or international employment and related laws could result in the payment of significant damages, which would reduce our net income.

We are subject to a variety of domestic and foreign employment laws, including those related to safety, wages and overtime, discrimination, organizing, whistle-blowing, classification of employees, privacy and severance payments. We may be required to defend against allegations that we have violated such laws. Allegations that we have violated labor laws could lead to damages being awarded to employees or fines from or settlements with plaintiffs or federal, state or foreign regulatory authorities, the amounts of which could be substantial, and which would reduce our net income.

Cyberattacks and other disruptions of our information technology ("IT") network and systems could interrupt our operations, lead to loss of our customer and employee data and subject us to damages.

We rely on internal and cloud-based networks and systems furnished by third parties for worldwide financial reporting, inventory management, procurement, invoicing, employee payroll and benefits administration and email communications, among other functions. In addition, our 42Q manufacturing execution solutions software used by us and certain of our customers operates in the cloud. Despite our business continuity planning, including redundant data sites and network availability, both our internal and cloud-based infrastructure may be susceptible to outages due to fire, floods, power loss, telecommunications failures, terrorist attacks and similar events. In addition, despite the implementation of numerous network security measures, both our internal and our cloud-based infrastructure may also be vulnerable to hacking, computer viruses, the installation of malware and similar disruptions either by third parties or employees with access to key IT infrastructure. Cybersecurity attacks can come in many forms, including distributed denial of service attacks, advanced persistent threat, phishing and business email compromise efforts. Recently, a cyberattack involving malware delivered through network monitoring software sold by SolarWinds resulted in the penetration of the systems of a multitude of governmental and commercial entities. While we were not affected by this cyberattack, there can be no assurance that a future malware attack will not be successful in breaching our systems. Hacking, malware and other cybersecurity attacks, if not prevented, could lead to the collection and disclosure of sensitive personal or confidential information relating to our customers, employees or others, exposing us to legal liability and causing us to suffer reputational damage. In addition, our SCI defense and aerospace businesses are subject to U.S. government regulations requiring the safeguarding of certain unclassified government information and to report to the U.S. government certain cyber incidents that affect such information. The increasing sophistication of cyberattacks requires us to continually evaluate new technologies and processes intended to detect and prevent these attacks. Our insurance coverage for cyber-attacks is limited. There can be no assurance that the security measures we choose to implement will be sufficient to protect the data we manage. If we and our cloud infrastructure vendors are not successful in preventing such outages and cyberattacks, our operations could be disrupted, we could incur losses, including losses relating to claims by our customers, employees or privacy regulators relating to loss of personal or confidential business information, the willingness of customers to do business with us may be damaged and, in the case of our defense business, we could be debarred from future participation in U.S. government programs.

Any failure to comply with applicable environmental laws could adversely affect our business by causing us to pay significant amounts for cleanup of hazardous materials or for damages or fines.

We are subject to various federal, state, local and foreign environmental laws and regulations, including those governing the use, generation, storage, discharge and disposal of hazardous substances and waste in the ordinary course of our manufacturing operations. If we violate environmental laws or if we own or operate, or owned or operated in the past, a

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site at which we or a predecessor company caused contamination, we may be held liable for damages and the costs of remedial actions. Although we estimate and regularly reassess our potential liability with respect to violations or alleged violations and accrue for such liability, our accruals may not be sufficient. Any increase in existing reserves or establishment of new reserves for environmental liability would reduce our net income. Our failure or inability to comply with applicable environmental laws and regulations could also limit our ability to expand facilities or could require us to acquire costly equipment or to incur other significant expenses to comply with these laws and regulations.

Partly as a result of certain of our acquisitions, we have incurred liabilities associated with environmental contamination. These liabilities include ongoing investigation and remediation activities at a number of current and former sites. The time required to perform environmental remediation can be lengthy and there can be no assurance that the scope, and therefore cost, of these activities will not increase as a result of the discovery of new contamination or contamination on adjoining landowner's properties or the adoption of more stringent regulatory standards covering sites at which we are currently performing remediation activities.

We cannot assure that past disposal activities will not result in liability that will materially affect us in the future, nor can we provide assurance that we do not have environmental exposures of which we are unaware and which could adversely affect our future operating results. Changes in or restrictions on discharge limits, emissions levels, permitting requirements and material storage or handling could require a higher than anticipated level of remediation activities, operating expenses and capital investment or, depending on the severity of the impact of the foregoing factors, costly plant relocation, any of which would reduce our net income.

Changes in financial accounting standards or policies have affected, and in the future may affect, our reported financial condition or results of operations; there are inherent limitations to our system of internal controls; changes in corporate governance policies and practices may impact our business.

We prepare our consolidated financial statements in conformity with GAAP. Our preparation of financial statements in accordance with GAAP requires that we make estimates and assumptions that affect the recorded amounts of assets, liabilities and net income during the reporting period. A change in the facts and circumstances surrounding those estimates could result in a change to our estimates and could impact our future operating results.

These principles are subject to interpretation by the Financial Accounting Standards Board ("FASB"), the SEC and various bodies formed to interpret and create accounting policies. A change in those policies can have a significant effect on our reported results and may affect our reporting of transactions which are completed before a change is announced. For example, in fiscal 2019, we implemented the new revenue recognition standard, which is complex and requires significant management judgment. Although we believe the judgments we applied in implementation of the new revenue recognition standard are appropriate, there can be no assurance that we will not be required to change our judgments relating to implementation of such standard in the future, whether as a result of new guidance or otherwise. A significant change in our accounting judgments could have a significant impact on our reported revenue, gross profits or balance sheets. In general, changes to accounting rules or challenges to our interpretation or application of the rules by regulators may have a material adverse effect on our reported financial results or on the way we conduct business.

Our system of internal and disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives. However, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been or will be detected. As a result, there can be no assurance that our system of internal and disclosure controls and procedures will be successful in preventing all errors, theft and fraud, or in informing management of all material information in a timely manner. Furthermore, due to the health risks caused by the COVID-19 pandemic to employees who operate and monitor our internal controls and due to the requirement that a large number of employees work remotely, the COVID-19 pandemic impact on staffing could cause challenges for the effective operation of our internal controls.

Finally, corporate governance, public disclosure and compliance practices continue to evolve based upon continuing legislative action, SEC rulemaking and policy positions taken by large institutional stockholders and proxy advisors. As a result, the number of rules, regulations and standards applicable to us may become more burdensome to comply with, could increase scrutiny of our practices and policies by these or other groups and increase our legal and financial compliance costs and the amount of time management must devote to governance and compliance activities. Increasing regulatory burdens and corporate governance requirements could also make it more difficult for us to attract and retain qualified members of our Board of Directors, particularly to serve on our Audit Committee, and qualified executive officers.

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Liquidity and Credit Risks

Our customers could experience credit problems, which could reduce our future revenues and net income.

Some companies in the industries for which we provide products have previously experienced significant financial difficulty, with a few filing for bankruptcy in the past. Such financial difficulty, if experienced by one or more of our customers, may negatively affect our business due to the decreased demand from these financially distressed customers, the lengthening of customer payment terms, the potential inability of these companies to make full payment on amounts owed to us or to purchase inventory we acquired to support their businesses. Customer bankruptcies also entail the risk of potential recovery by the bankruptcy estate of amounts previously paid to us that are deemed a preference under bankruptcy laws. There can be no assurance that additional customers will not declare bankruptcy, including as result of the COVID-19 pandemic.

We may be unable to generate sufficient liquidity to maintain or expand our operations, which may reduce the business our customers and vendors are able to do with us and impact our ability to continue operations at current levels without seeking additional funding; we could experience losses if one or more financial institutions holding our cash or other financial counterparties were to fail; repatriation of foreign cash could increase our taxes.

Our liquidity is dependent on a number of factors, including profitability, business volume, inventory requirements, the extension of trade credit by our suppliers, the degree of alignment of payment terms from our suppliers with payment terms granted to our customers, investments in facilities and equipment, acquisitions, repayments of our outstanding indebtedness, stock repurchase activity, the amount available under our accounts receivable sales programs and availability under our revolving credit facility. In the event we need or desire additional liquidity to maintain or expand our business, make acquisitions or repurchase stock, there can be no assurance that such additional liquidity will be available on acceptable terms or at all. A failure to maintain adequate liquidity would prevent us from purchasing components and satisfying customer demand, which would reduce both our revenue and profitability.

Although we believe our existing cash resources and sources of liquidity, together with cash generated from operations, will be sufficient to meet our working capital requirements for at least the next 12 months, should demand for our services change significantly over the next 12 months or should we experience significant increases in delinquent or uncollectible accounts receivable for any reason, including in particular continued or worsening economic conditions caused by the COVID-19 pandemic, our cash provided by operations could decrease significantly and we could be required to seek additional sources of liquidity to continue our operations at their current level. In such a case, there can be no assurance that such additional sources of financing would be available.

A principal source of our liquidity is our cash and cash equivalents, which are held with various financial institutions. Although we distribute such funds among a number of financial institutions that we believe to be of high quality, there can be no assurance that one or more of such institutions will not become insolvent in the future, in which case all or a portion of our uninsured funds on deposit with such institutions could be lost. Finally, if one or more counterparties to our interest rate or foreign currency hedging instruments were to fail, we could suffer losses and our hedging of risk could become less effective.

Additionally, a majority of our worldwide cash reserves are generated by, and therefore held in, foreign jurisdictions. Some of these jurisdictions restrict the amount of cash that can be transferred to the U.S. or impose taxes and penalties on such transfers of cash. To the extent we have excess cash in foreign locations that could be used in, or is needed by, our U.S. operations, we may incur significant foreign taxes to repatriate these funds which would reduce the net amount ultimately available for such purposes.

Our Amended Cash Flow Revolver contains covenants that may adversely impact our business; the failure to comply with such covenants or the occurrence of an event of default could cause us to be unable to borrow additional funds and cause our outstanding debt to become immediately payable.

Our Amended Cash Flow Revolver contains a maximum leverage and minimum interest coverage ratio, in both cases measured on the basis of a trailing 12 month look-back period, and a number of restrictive covenants, including restrictions on incurring additional debt, making investments and other restricted payments, selling assets and paying dividends, subject to certain exceptions, with which we must comply. Collectively, these covenants could constrain our ability to grow our business through acquisition or engage in other transactions. Such facility also contains customary events

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of default, including that a material business interruption or cessation has not occurred. Finally, such facility includes covenants requiring, among other things, that we file quarterly and annual financial statements with the SEC, comply with all laws, pay all taxes and maintain casualty insurance. If we are not able to comply with these covenants or if an event of default were to occur and not be cured, all of our outstanding debt would become immediately due and payable and the incurrence of additional debt under our revolving credit facility would not be allowed, either of which would have a material adverse effect on our liquidity and ability to continue to conduct our business.

General Risk Factors

We are subject to intense competition in the EMS industry, which could cause us to lose sales and, therefore, harm our financial performance.

The EMS industry is highly competitive and the industry has experienced a surplus of manufacturing capacity. Our competitors include major global EMS providers, including Benchmark Electronics, Inc., Celestica, Inc., Flex Ltd., Hon Hai Precision Industry Co., Ltd. (Foxconn), Jabil Circuit, Inc. and Plexus Corp., as well as other companies that have a regional, product, service or industry-specific focus. We also face competition from current and potential OEM customers who may elect to manufacture their own products internally rather than outsourcing to EMS providers.

Competition is based on a number of factors, including end markets served, price and quality. We may not be able to offer prices as low as some of our competitors for any number of reasons, including the willingness of competitors to provide EMS services at prices we are unable or unwilling to offer. There can be no assurance that we will win new business or maintain existing business due to competitive factors, which could decrease our sales and net income. In addition, due to the extremely price sensitive nature of our industry, business that we do win or maintain may have lower margins than our historical or target margins. As a result, competition may cause our gross and operating margins to fall.

Consolidation in the electronics industry may adversely affect our business by increasing customer buying power and increasing prices we pay for components.

Consolidation in the electronics industry among our customers, our suppliers and/or our competitors may increase, which could result in a small number of very large electronics companies offering products in multiple sectors of the electronics industry. If one of our customers is acquired by another company that does not rely on us to provide EMS services, we may lose that customer's business. Similarly, consolidation among our suppliers could result in a sole or limited source for certain components used in our customers' products. Any such consolidation could cause us to be required to pay increased prices for such components, which could reduce our gross margin and profitability.

Unanticipated changes in our income tax rates or exposure to additional tax liabilities could increase our taxes and decrease our net income; our projections of future taxable income that drove the release of our valuation allowance in prior years could prove to be incorrect, which could cause a charge to earnings.

We are or may become subject to income, sales, value-added, goods and services, withholding and other taxes in the United States and various foreign jurisdictions. Significant judgment is required in determining our worldwide provision for taxes and, in the ordinary course of business, there are many transactions and calculations for which the ultimate tax determination is uncertain. Our effective income tax rates and liability for other taxes could increase as a result of changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in enacted tax laws, the effectiveness of our cash and tax management strategies, our ability to negotiate advance pricing agreements with foreign tax authorities, compliance with local trade laws and other factors. Recent international initiatives require multinational enterprises, like ours, to report profitability on a country-by-country basis, which could increase scrutiny by foreign tax authorities. In addition, our tax determinations are regularly subject to audit by tax authorities. For example, we are currently undergoing audits of our tax returns for certain recent tax years in a number of jurisdictions, including the United States. Developments in these or future audits could adversely affect our tax provisions, including through the disallowance or reduction of deferred tax assets or the assessment of back taxes, interest and penalties, any of which could result in an increase to income tax expense and therefore a decrease in our net income.

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We can experience losses due to foreign exchange rate fluctuations and currency controls, which could reduce our net income and impact our ability to repatriate funds.

Because we manufacture and sell the majority of our products abroad, our operating results can be negatively impacted due to fluctuations in foreign currency exchange rates, particularly in volatile currencies to which we are exposed, such as the Euro, Mexican peso, Malaysian ringgit, Chinese renminbi and Brazilian real. We use financial instruments, primarily short-term foreign currency forward contracts, to hedge our exposure to exchange rate fluctuations. However, the success of our foreign currency hedging activities in preventing foreign exchange losses depends largely upon the accuracy of our forecasts of future sales, expenses, capital expenditures and monetary assets and liabilities. As such, our foreign currency hedging program may not fully cover all of our exposure to exchange rate fluctuations. If our hedging activities are not successful, our net income may be reduced. In addition, certain countries in which we operate have adopted currency controls requiring that local transactions be settled only in local currency rather than in our functional currency, which is generally different than the local currency. Such controls could require us to hedge larger amounts of local currency than we otherwise would and/or prevent us from repatriating cash generated by our operations in such countries.

We may not have sufficient insurance coverage for potential claims and losses, which could leave us responsible for certain costs and damages.

We carry various forms of business and liability insurance in types and amounts we believe are reasonable and customary for similarly situated companies in our industry. However, our insurance program does not generally cover losses due to failure to comply with typical customer warranties for workmanship, product and medical device liability, intellectual property infringement, product recall claims, or environmental contamination. In particular, our insurance coverage with respect to damages to or closure of our facilities, or damages to our customers' products caused by certain natural disasters, such as earthquakes, epidemics and pandemics (such as the COVID-19 pandemic), is limited and is subject to policy deductibles, coverage limits, and exclusions, and as a result, may not be sufficient to cover all of our losses. For example, our policies have very limited coverage for damages due to earthquakes or losses caused by business disruptions. In addition, such coverage may not continue to be available at commercially reasonable rates and terms. In addition, our policies generally have deductibles and/or limits or may be limited to certain lines or business or customer engagements that reduce the amount of our potential recoveries from insurance. As a result, not all of our potential business losses are covered under our insurance policies. Should we sustain a significant uncovered loss, our net income will be reduced. Additionally, if one or more counterparties to our insurance coverage were to fail, we would bear the entire amount of an otherwise insured loss.

Recruiting and retaining our key personnel is critical to the continued growth of our business.

Our success depends upon the continued service of our key personnel, particularly our highly skilled sales and operations executives, managers and engineers with many years of experience in electronics and contracts manufacturing. Such individuals can be difficult to identify, recruit and retain and are heavily recruited by our competitors. As our key employees choose to retire or terminate their employment with us, we will be required to replace them with new employees with the required experience. Should we be unable to recruit new employees to fill key positions with us, our operations, financial controls and growth prospects could be negatively impacted.

We may not be successful in implementing and integrating strategic transactions or in divesting assets or businesses, which could harm our operating results; we could become required to book a charge to earnings should we determine that goodwill and other acquired assets are impaired.

From time to time, we may undertake strategic transactions that give us the opportunity to access new customers and new end markets, increase our proprietary product offerings, obtain new manufacturing and service capabilities and technologies, enter new geographic manufacturing locations, lower our manufacturing costs, increase our margins or further develop existing customer relationships. Strategic transactions involve a number of risks, uncertainties and costs, including integrating acquired operations and workforce, businesses and products, resolving quality issues involving acquired products, incurring severance and other restructuring costs, diverting management attention, maintaining customer, supplier or other favorable business relationships of acquired operations, terminating unfavorable commercial arrangements, losing key employees, integrating the systems of acquired operations into our management information systems and satisfying the liabilities of acquired businesses, including liability for past violations of law and material environmental liabilities. Any of these risks could cause our strategic transactions not to be ultimately profitable. Divestitures reduce revenue and, potentially, margins and can involve the risk of retained liabilities from the operations divested, including environmental liabilities.

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In addition, we have in the past recorded, and may be required to record in the future, goodwill and other intangible assets in connection with our acquisitions. We evaluate, at least on an annual basis, whether events or circumstances have occurred that indicate all, or a portion, of the carrying amount of our goodwill and other intangible assets may no longer be recoverable. Should we determine in the future that our goodwill or other intangible assets have become impaired, an impairment charge to earnings would become necessary, which could be significant. For example, during our fiscal 2018 annual goodwill impairment analysis, we fully impaired goodwill of $31 million associated with the acquisition of a storage software business we purchased in 2016.

We are subject to risks associated with natural disasters and global events.

We conduct a significant portion of our activities, including manufacturing, administration and information technology management in areas that have experienced natural disasters, such as major earthquakes, hurricanes, floods, tsunamis and epidemics or pandemics, such as the COVID-19 pandemic. In the event of a major earthquake or other disaster affecting one or more of our facilities, our operations and management information systems, which control our worldwide procurement, inventory management, shipping and billing activities, could be significantly disrupted. Such events could delay or prevent product manufacturing for an extended period of time. Any extended inability to continue our operations at affected facilities following such an event could reduce our revenue.

Risks Of Investing In Our Stock

The market price of our common stock is volatile and is impacted by factors other than our financial performance.

The stock market in recent years has experienced significant price and volume fluctuations that have affected our stock price. Recent stock market fluctuations related to the current COVID-19 pandemic have been particularly significant. These fluctuations have often been unrelated to our operating performance. Factors that can cause such fluctuations include announcements by our customers, suppliers, competitors or other events affecting companies in the electronics industry, such as component shortages, currency fluctuations, the impact of natural disasters and global events, such as the current COVID-19 pandemic, general market fluctuations and macroeconomic conditions, any of which may cause the market price of our common stock to fluctuate widely.

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Item 6. Exhibits

Exhibit Number	Description
10.29*	2019 Equity Incentive Plan, as amended (filed herewith).
31.1	Certification of the Principal Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
31.2	Certification of the Principal Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.1 (1)	Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2 (1)	Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

________________________

*     Compensatory plan or arrangement in which an executive officer or director participates.

(1)    This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

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SIGNATURES

Pursuant to the Requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		SANMINA CORPORATION
		(Registrant)
		By:	/s/ JURE SOLA
			Jure Sola
			Chief Executive Officer (Principal Executive Officer)
Date:	May 5, 2021
		By:	/s/ KURT ADZEMA
			Kurt Adzema
			Executive Vice President and
			Chief Financial Officer (Principal Financial Officer)
Date:	May 5, 2021

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EX-10.29

Exhibit 10.29

SANMINA CORPORATION
2019 EQUITY INCENTIVE PLAN

(As amended on March 15, 2021)

1.Purposes of the Plan. The purposes of this Plan are:

•to attract and retain the best available personnel for positions of substantial responsibility,

•to provide additional incentive to Employees, Directors, and Consultants, and

•to promote the success of the Company’s business.

The Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units, Performance Shares and other stock or cash awards as the Administrator may determine.

2.Definitions. As used herein, the following definitions will apply:

(a) “Administrator” means the Board or any of its Committees as will be administering the Plan, in accordance with Section 4 of the Plan.

(b) “Affiliate” means any corporation or any other entity (including, but not limited to, partnerships and joint ventures) controlling, controlled by, or under common control with the Company, including any Parent or Subsidiary of the Company.

(c) “Applicable Laws” means the legal and regulatory requirements relating to the administration of equity-based awards and the related issuance of Shares thereunder, including but not limited to U.S. federal and state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any non-U.S. country or jurisdiction where Awards are, or will be, granted under the Plan.

(d) “Award” means, individually or collectively, a grant under the Plan of Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units (including Performance Units payable in cash), Performance Shares and other stock or cash awards as the Administrator may determine.

(e) “Award Agreement” means the written or electronic agreement setting forth the terms and provisions applicable to each Award granted under the Plan. The Award Agreement is subject to the terms and conditions of the Plan.

(f) “Board” means the Board of Directors of the Company.

(g) “Change in Control” means the occurrence of any of the following events:

A change in the ownership of the Company which occurs on the date that any one person, or more than one person acting as a group (“Person”), acquires ownership of the stock of the Company that, together with the stock held by such Person, constitutes more than fifty percent (50%) of the total voting power of the stock of the Company; provided, however, that for purposes of this subsection, (A) the acquisition of additional stock by any one Person, who is considered to own more than fifty percent (50%) of the total voting power of the stock of the Company will not be considered a Change in Control, and (B) if the stockholders of the Company immediately before such change in ownership continue to retain immediately after the change in ownership, in substantially the same proportions as their ownership of shares of the Company’s voting stock immediately prior to the change in ownership, the direct or indirect beneficial ownership of fifty percent (50%) or more of the total voting power of the stock of the Company or of the ultimate parent entity of the Company, such event will not be considered a Change in Control under this subsection (i). For this purpose, indirect beneficial ownership will include, without limitation, an interest resulting from ownership of the voting securities of one or more corporations or other business entities which own the Company, as the case may be, either directly or through one or more subsidiary corporations or other business entities; or

A change in the effective control of the Company which occurs on the date that a majority of members of the Board is replaced during any twelve (12)-month period by Directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election. For purposes

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of this subsection (ii), if any Person is considered to be in effective control of the Company, the acquisition of additional control of the Company by the same Person will not be considered a Change in Control; or

A change in the ownership of a substantial portion of the Company’s assets which occurs on the date that any Person acquires (or has acquired during the twelve (12)-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than fifty percent (50%) of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions; provided, however, that for purposes of this subsection (iii), the following will not constitute a change in the ownership of a substantial portion of the Company’s assets: (A) a transfer to an entity that is controlled by the Company’s stockholders immediately after the transfer, or (B) a transfer of assets by the Company to: (1) a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect to the Company’s stock, (2) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by the Company, (3) a Person, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power of all the outstanding stock of the Company, or (4) an entity, at least fifty percent (50%) of the total value or voting power of which is owned, directly or indirectly, by a Person described in this subsection (iii)(B)(3). For purposes of this subsection (iii), gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

For purposes of this definition, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the Company.

Notwithstanding the foregoing, a transaction will not be deemed a Change in Control unless the transaction qualifies as a change in control event within the meaning of Section 409A.

Further and for the avoidance of doubt, a transaction will not constitute a Change in Control if: (i) its sole purpose is to change the state of the Company’s incorporation, or (ii) its sole purpose is to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.

(h) “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or regulation thereunder will include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.

(i) “Committee” means a committee of Directors or of one or more other individuals satisfying Applicable Laws appointed by the Board, or a duly authorized committee of the Board, in accordance with Section 4 hereof.

(j) “Common Stock” means the common stock of the Company.

(k) “Company” means Sanmina Corporation, a Delaware corporation, or any successor thereto.

(l) “Consultant” means any natural person, including an advisor, engaged by the Company or an Affiliate to render bona fide services to such entity, provided the services (i) are not in connection with the offer or sale of securities in a capital raising transaction, and (ii) do not directly promote or maintain a market for the Company’s securities, in each case, within the meaning of Form S-8 promulgated under the Securities Act, and provided, further, that a Consultant will include only those persons to whom the issuance of Shares may be registered under Form S-8 promulgated under the Securities Act.

(m) “Director” means a member of the Board.

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(n) “Disability” means total and permanent disability as defined in Code Section 22(e)(3), provided that in the case of Awards other than Incentive Stock Options, the Administrator in its discretion may determine whether a permanent and total disability exists in accordance with uniform and non-discriminatory standards adopted by the Administrator from time to time.

(o) “Employee” means any person, including Officers and Directors, employed by the Company or its Affiliates. Neither service as a Director nor payment of a director’s fee by the Company will be sufficient to constitute “employment” by the Company.

(p) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

(q) “Exchange Program” means a program under which (i) outstanding Awards are surrendered or cancelled in exchange for awards of the same type (which may have higher or lower exercise prices and different terms), awards of a different type, and/or cash, (ii) Participants would have the opportunity to transfer any outstanding Awards to a financial institution or other person or entity selected by the Administrator, and/or (iii) the exercise price of an outstanding Award is increased or reduced. For the avoidance of doubt, as set forth in Section 6(a), the Administrator may not implement an Exchange Program.

(r) “Fair Market Value” means, as of any date the value of Common Stock determined as follows: The Fair Market Value will be the closing sales price for Common Stock as quoted on any established stock exchange or national market system (including without limitation the New York Stock Exchange, the Nasdaq Global Select Market, the Nasdaq Global Market or the Nasdaq Capital Market of The Nasdaq Stock Market) on which the Common Stock is listed on the date of determination (or the closing bid, if no sales were reported), as reported in The Wall Street Journal or such other source as the Administrator deems reliable. If the determination date for the Fair Market Value occurs on a non-trading day (i.e., a weekend or holiday), the Fair Market Value will be such price on the immediately preceding trading day, unless otherwise determined by the Administrator. In the absence of an established market for the Common Stock, the Fair Market Value thereof will be determined in good faith by the Administrator.

The determination of fair market value for purposes of tax withholding may be made in the Administrator’s discretion subject to Applicable Laws and is not required to be consistent with the determination of Fair Market Value for other purposes.

(s) “Fiscal Year” means the fiscal year of the Company.

(t) “Incentive Stock Option” means an Option that by its terms qualifies and is otherwise intended to qualify as an incentive stock option within the meaning of Code Section 422 and the regulations promulgated thereunder.

(u) “Nonstatutory Stock Option” means an Option that by its terms does not qualify or is not intended to qualify as an Incentive Stock Option.

(v) “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(w) “Option” means a stock option granted pursuant to Section 7 of the Plan.

(x) “Outside Director” means a Director who is not an Employee.

(y) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Code Section 424(e).

(z) “Participant” means the holder of an outstanding Award.

(aa) “Performance Share” means an Award denominated in Shares which may be earned in whole or in part upon attainment of performance goals or other vesting criteria as the Administrator may determine pursuant to Section 11.

(bb) “Performance Unit” means an Award which may be earned in whole or in part upon attainment of performance goals or other vesting criteria as the Administrator may determine and which, in the Administrator’s sole discretion, may be settled for cash, Shares or other securities or a combination of the foregoing pursuant to Section 11, in the Administrator’s sole discretion.

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(cc) “Period of Restriction” means the period during which the transfer of Shares of Restricted Stock are subject to restrictions and therefore, the Shares are subject to a substantial risk of forfeiture. Such restrictions may be based on the passage of time, the achievement of target levels of performance, or the occurrence of other events as determined by the Administrator.

(dd) “Plan” means this 2019 Equity Incentive Plan.

(ee) “Restricted Stock” means Shares issued pursuant to an Award of Restricted Stock under Section 9 of the Plan, or issued pursuant to the early exercise of an Option.

(ff) “Restricted Stock Unit” means a bookkeeping entry representing an amount equal to the Fair Market Value of one Share, granted pursuant to Section 10. Each Restricted Stock Unit represents an unfunded and unsecured obligation of the Company.

(gg) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in effect when discretion is being exercised with respect to the Plan.

(hh) “Section 16(b)” means Section 16(b) of the Exchange Act.

(ii) “Section 409A” means Code Section 409A, as it has been and may be amended from time to time, and any proposed or final Treasury Regulations and Internal Revenue Service guidance that has been promulgated or may be promulgated thereunder from time to time.

(jj) “Securities Act” means the Securities Act of 1933, as amended.

(kk) “Service Provider” means an Employee, Director or Consultant.

(ll) “Share” means a share of the Common Stock, as adjusted in accordance with Section 15 of the Plan.

(mm) “Stock Appreciation Right” means an Award, granted alone or in connection with an Option, that pursuant to Section 8 is designated as a Stock Appreciation Right.

(nn) “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Code Section 424(f).

3.    Stock Subject to the Plan.

(a) Stock Subject to the Plan. Subject to the provisions of Section 15 of the Plan, the maximum aggregate number of Shares that may be awarded and sold under the Plan is 6,993,000 Shares, plus any Shares subject to stock options or similar awards granted under the Sanmina Corporation 2009 Stock Incentive Plan (the “2009 Plan”) that, after the date of stockholder approval of this Plan, expire or otherwise terminate without having been exercised in full and Shares issued pursuant to awards granted under the 2009 Plan that, after the date of stockholder approval of this Plan, are forfeited to or repurchased by the Company, with the maximum number of Shares to be added to the Plan pursuant to the 2009 Plan equal to 6,436,840 Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.

(b) Full Value Awards. Any Shares subject to Awards other than Options or Stock Appreciation Rights will be counted against the numerical limits of this Section 3 as 1.36 Shares for every one Share subject thereto. Further, if Shares acquired pursuant to any such Award are forfeited or repurchased by the Company and would otherwise return to the Plan pursuant to Section 3(c), 1.36 times the number of Shares so forfeited or repurchased will return to the Plan and will again become available for issuance.

(c) Lapsed Awards. If an Award expires or becomes unexercisable without having been exercised in full, or, with respect to Restricted Stock, Restricted Stock Units, Performance Shares or Performance Units which are to be settled in Shares, is forfeited to or repurchased by the Company, the unpurchased Shares (or for Awards other than Options and Stock Appreciation Rights, the forfeited or repurchased Shares) which were subject thereto will become available for future grant or sale under the Plan (unless the Plan has terminated). Upon exercise of a Stock Appreciation Right settled in Shares, the gross number of Shares covered by the portion of the Award so exercisedwill cease to be available under the Plan. If unvested Shares of Restricted Stock, or unvested Shares issued pursuant to Awards of Restricted Stock Units, Performance Shares or Performance Units are repurchased by or forfeited to the Company, such Shares will become available for future grant under the Plan. Shares used to pay the tax and exercise price of an Award will not become available for future grant or sale under the Plan. To the extent an Award under the Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the number of Shares available for issuance under the Plan. Notwithstanding the foregoing and, subject to adjustment provided in Section 15, the maximum number of Shares that may be issued upon the exercise of Incentive Stock Options will

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equal the aggregate Share number stated in Section 3(a), plus, to the extent allowable under Code Section 422, any Shares that become available for issuance under the Plan under this Section 3(c).

(d) Share Reserve. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as will be sufficient to satisfy the requirements of the Plan.

4.    Administration of the Plan.

(a) Procedure.

(i) Multiple Administrative Bodies. Different Committees with respect to different groups of Service Providers may administer the Plan.

(ii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder will be structured to satisfy the requirements for exemption under Rule 16b-3.

(iii) Delegation to an Officer. The Board may delegate to one or more Officers of the Company the authority to do one or both of the following (i) designate Employees or Consultants of the Company or any of its Subsidiaries who are not Officers to be recipients of Options, Restricted Stock and Restricted Stock Units and the terms thereof, and (ii) determine the number of shares of Common Stock to be subject to such Awards granted to such Employees and Consultants; provided, however, that the Board resolutions regarding such delegation shall specify the total number of shares of Common Stock that may be subject to the Awards granted by such Officer. Notwithstanding anything to the contrary in this Section 4(a), the Board may not delegate to an Officer authority to determine the Fair Market Value of the Common Stock pursuant to Section 4(b) below.

(iv) Other Administration. Other than as provided above, the Plan will be administered by (A) the Board or (B) a Committee, which committee will be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator will have the authority, in its discretion:

(i) to determine the Fair Market Value;

(ii) to select the Service Providers to whom Awards may be granted hereunder;

(iii) to determine the number of Shares to be covered by each Award granted hereunder;

(iv) to approve forms of Award Agreements for use under the Plan;

(v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Award granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Awards may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Award or the Shares relating thereto, based in each case on such factors as the Administrator will determine;

(vi) to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan;

(vii) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of satisfying applicable non-U.S. laws or for qualifying for favorable tax treatment under applicable non-U.S. laws;

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(viii) to modify or amend each Award (subject to 6(b) and Section 20(c) of the Plan) including but not limited to the discretionary authority to extend the post-termination exercisability period of Awards. Notwithstanding the previous sentence, the Administrator may not modify or amend an Option or Stock Appreciation Right to reduce the exercise price of such Option or Stock Appreciation Right after it has been granted (except for adjustments made pursuant to Section 15), and neither may the Administrator cancel any outstanding Option or Stock Appreciation Right in exchange for cash, other awards or an Option or Stock Appreciation Right with an exercise price that is less than the exercise price of the original Option or Stock Appreciation Right, or implement any other type of Exchange Program, unless such action is approved by stockholders prior to such action being taken;

(ix) to allow Participants to satisfy tax withholding obligations in such manner as prescribed in Section 16 of the Plan;

(x) to authorize any person to execute on behalf of the Company any instrument required to effect the grant of an Award previously granted by the Administrator;

(xi) to allow a Participant to defer the receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant under an Award pursuant to such procedures as the Administrator may determine; and

(xii) to make all other determinations deemed necessary or advisable for administering the Plan.

(c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations and interpretations will be final and binding on all Participants and any other holders of Awards

5. Eligibility. Nonstatutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units, Performance Shares and such other cash or stock awards as the Administrator determines may be granted to Service Providers. Incentive Stock Options may be granted only to employees of the Company or any Parent or Subsidiary of the Company.

6.    Limits.

(a) No Exchange Program or Repricing. The Administrator may not implement an Exchange Program.

(b) One-Year Vesting Requirement. Awards granted under the Plan shall vest no earlier than the one (1) year anniversary of the Award’s date of grant, provided that the Administrator, in its sole discretion, may provide an Award may accelerate vesting, including, without limitation, by reason of the Participant’s death, Disability or retirement, or a termination of the Participant’s service, and provided further, that, notwithstanding the foregoing one-year vesting requirement, Awards that result in the issuance of an aggregate of up to five percent (5%) of the Shares reserved for issuance under Section 3(a) may be granted to Service Providers without regard to such minimum vesting provisions.

(c) Dividends and Other Distributions. The Administrator will not be permitted to provide that dividends or other distributions with respect to Shares to be paid or issued to a Participant with respect to an Award, unless and until the underlying Award has vested. Further, in no event may dividend equivalents be paid with respect to Awards of Stock Options or Stock Appreciation Rights.

(d) Outside Director Limitations. No Outside Director may be granted, in any Fiscal Year, Awards with a grant date fair value (determined in accordance with U.S. generally accepted accounting principles) of greater than $900,000. Any Awards granted to an individual for his or her services as an Employee, or for his or her services as a Consultant (other than as an Outside Director), will not count for purposes of the limitation under this Section 6(d).

(e) Chief Executive Officer Holding Requirement. Any Shares received by the Chief Executive Officer of the Company pursuant to the exercise, issuance or settlement of an Award granted to him or her while serving in the capacity of Chief Executive Officer, after satisfaction of any applicable tax obligations, may not be sold or otherwise transferred (other than for estate planning purposes) by the Chief Executive Officer prior to the one (1) year anniversary of the date the Chief Executive Officer received such Shares, or, if earlier, the termination of the Chief Executive Officer’s status as a Service Provider.

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7.    Stock Options.

(a) Limitations. Each Option will be designated in the Award Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options will be treated as Nonstatutory Stock Options. For purposes of this Section 7(a), Incentive Stock Options will be taken into account in the order in which they were granted. The Fair Market Value of the Shares will be determined as of the time the Option with respect to such Shares is granted.

(b) Number of Shares. The Administrator will have complete discretion to determine the number of Shares subject to an Option granted to any Participant.

(c) Term of Option. The Administrator will determine the term of each Option in its sole discretion; provided, however, that the term will be no more than ten (10) years from the date of grant thereof. Moreover, in the case of an Incentive Stock Option granted to a Participant who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option will be five (5) years from the date of grant or such shorter term as may be provided in the Award Agreement.

(d) Option Exercise Price and Consideration.

(i) Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise of an Option will be determined by the Administrator, but will be no less than 100% of the Fair Market Value per Share on the date of grant. In addition, in the case of an Incentive Stock Option granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price will be no less than 110% of the Fair Market Value per Share on the date of grant. Notwithstanding the foregoing provisions of this Section 7(d), Options may be granted with a per Share exercise price of less than 100% of the Fair Market Value per Share on the date of grant pursuant to a transaction described in, and in a manner consistent with, Code Section 424(a).

(ii) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator will fix the period within which the Option may be exercised and will determine any conditions that must be satisfied before the Option may be exercised.

(iii) Form of Consideration. The Administrator will determine the acceptable form(s) of consideration for exercising an Option, including the method of payment, to the extent permitted by Applicable Laws, which forms of consideration shall be set forth in the Award Agreement at the time of grant.

(e) Exercise of Option.

(i) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder will be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Award Agreement. An Option may not be exercised for a fraction of a Share. An Option will be deemed exercised when the Company receives: (i) notice of exercise (in such form as the Administrator specifies from time to time) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised (together with any applicable withholding taxes). No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 15 of the Plan.

(ii) Termination of Relationship as a Service Provider. If a Participant ceases to be a Service Provider, other than upon the Participant’s termination as the result of the Participant’s death or Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for ninety (90) days following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date of termination the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan. If after termination the Participant does not exercise his or her Option within the time specified by the Administrator, the Option will terminate, and the Shares covered by such Option will revert to the Plan.

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(iii) Disability of Participant. If a Participant ceases to be a Service Provider as a result of the Participant’s Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for five (5) years following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date of termination the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan. If after termination the Participant does not exercise his or her Option within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to the Plan.

(iv) Death of Participant. If a Participant dies while a Service Provider, the Option may be exercised following the Participant’s death within such period of time as is specified in the Award Agreement to the extent of all of the shares subject to the Option, including Shares that had not yet vested on the date of death (but in no event may the option be exercised later than the expiration of the term of such Option as set forth in the Award Agreement), by the Participant’s designated beneficiary, provided such beneficiary has been designated prior to Participant’s death in a form acceptable to the Administrator. If no such beneficiary has been designated by the Participant, then such Option may be exercised by the personal representative of the Participant’s estate or by the person(s) to whom the Option is transferred pursuant to the Participant’s will or in accordance with the laws of descent and distribution. In the absence of a specified time in the Award Agreement, the Option will remain exercisable for five (5) years following Participant’s death. If the Option is not so exercised within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to the Plan.

(v) Tolling Expiration. A Participant’s Award Agreement may also provide that:

(1) if the exercise of the Option following the termination of Participant’s status as a Service Provider (other than upon the Participant’s death or Disability) would result in liability under Section 16(b), then the Option will terminate on the earlier of (A) the expiration of the term of the Option set forth in the Award Agreement, or (B) the tenth (10th) day after the last date on which such exercise would result in such liability under Section 16(b); or

(2) if the exercise of the Option following the termination of the Participant’s status as a Service Provider (other than upon the Participant’s death or Disability) would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities Act, then the Option will terminate on the earlier of (A) the expiration of the term of the Option, or (B) the expiration of a period of ninety (90) days after the termination of the Participant’s status as a Service Provider during which the exercise of the Option would not be in violation of such registration requirements.

8.    Stock Appreciation Rights.

(a) Grant of Stock Appreciation Rights. Subject to the terms and conditions of the Plan, a Stock Appreciation Right may be granted to Service Providers at any time and from time to time as will be determined by the Administrator, in its sole discretion.

(b) Number of Shares. The Administrator will have complete discretion to determine the number of Stock Appreciation Rights granted to any Participant.

(c) Exercise Price and Other Terms. The Administrator, subject to the provisions of the Plan, will have complete discretion to determine the terms and conditions of Stock Appreciation Rights granted under the Plan, provided, however, that the exercise price will be not less than 100% of the Fair Market Value of a Share on the date of grant. Notwithstanding the foregoing, any outstanding Stock Appreciation Rights held by a Participant who dies while a Service Provider will accelerate and fully vest upon the Participant’s death.

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(d) Stock Appreciation Right Agreement. Each Stock Appreciation Right grant will be evidenced by an Award Agreement that will specify the exercise price, the term of the Stock Appreciation Right, the conditions of exercise, and such other terms and conditions as the Administrator, in its sole discretion, will determine.

(e) Expiration of Stock Appreciation Rights. A Stock Appreciation Right granted under the Plan will expire upon the date determined by the Administrator, in its sole discretion, and set forth in the Award Agreement; provided, however, that the term will be no more than ten (10) years from the date of grant thereof. Notwithstanding the foregoing, the rules of Section 7(c) also will apply to Stock Appreciation Rights.

(f) Payment of Stock Appreciation Right Amount. Upon exercise of a Stock Appreciation Right, a Participant will be entitled to receive payment from the Company in an amount determined by multiplying:

(i) The difference between the Fair Market Value of a Share on the date of exercise over the exercise price; by

(ii) The number of Shares with respect to which the Stock Appreciation Right is exercised. At the discretion of the Administrator, the payment upon the exercise of a Stock Appreciation Right may be in cash, in Shares of equivalent value, or in some combination thereof.

9.    Restricted Stock.

(a) Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the Administrator, at any time and from time to time, may grant Shares of Restricted Stock to Service Providers in such amounts as the Administrator, in its sole discretion, will determine.

(b) Restricted Stock Agreement. Each Award of Restricted Stock will be evidenced by an Award Agreement that will specify the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Administrator, in its sole discretion, determines. Unless the Administrator determines otherwise, Shares of Restricted Stock will be held by the Company as escrow agent until the restrictions on such Shares have lapsed.

(c) Transferability. Except as provided in Section 14, Shares of Restricted Stock may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end of the applicable Period of Restriction.

(d) Other Restrictions. The Administrator, in its sole discretion, may impose such other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate and contained in the Award Agreement on the date of grant.

(e) Removal of Restrictions. Except as otherwise provided in this Section 9, Shares of Restricted Stock covered by each Restricted Stock grant made under the Plan will be released from escrow as soon as practicable after the last day of the Period of Restriction. Subject to the vesting limitations under Section 6(b), the Administrator, in its discretion, may accelerate the time at which any restrictions will lapse or be removed. Notwithstanding the foregoing, any outstanding Shares of Restricted Stock held by a Participant who dies while a Service Provider will accelerate and fully vest upon the Participant’s death.

(f) Voting Rights. During the Period of Restriction, Service Providers holding Shares of Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares, unless the Administrator determines otherwise.

(g) Dividends and Other Distributions. During the Period of Restriction, Service Providers holding Shares of Restricted Stock will not be entitled to receive dividends or any other distributions paid with respect to such Shares.

(h) Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which restrictions have not lapsed will revert to the Company and become available for grant under the Plan.

10.    Restricted Stock Units.

(a) Grant. Restricted Stock Units may be granted at any time and from time to time as determined by the Administrator. Each Restricted Stock Unit grant will be evidenced by an Award Agreement that will specify such other terms and conditions as the Administrator, in its sole discretion, determines, including all terms, conditions, and restrictions related to the grant, the number of Restricted Stock Units and the form of payout, which, subject to Section 10(d), may be left to the discretion of the Administrator.

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(b) Vesting Criteria and Other Terms. Subject to Section 6(b), the Administrator will set vesting criteria in its discretion, which, depending on the extent to which the criteria are met, will determine the number of Restricted Stock Units that will be paid out to the Participant. Subject to Section 6(b), after the grant of Restricted Stock Units, the Administrator, in its sole discretion, may reduce or waive any restrictions for such Restricted Stock Units. Each Award of Restricted Stock Units will be evidenced by an Award Agreement that will specify the vesting criteria, and such other terms and conditions as the Administrator, in its sole discretion, determines. The Administrator may set vesting criteria based upon the achievement of Company-wide, divisional, business unit, or individual goals (including, but not limited to, continued employment or service), applicable federal or state securities laws or any other basis determined by the Administrator in its discretion. Notwithstanding the foregoing, any outstanding Restricted Stock Units held by a Participant who dies while a Service Provider will accelerate and fully vest upon the Participant’s death.

(c) Earning Restricted Stock Units. Upon meeting the applicable vesting criteria, the Participant will be entitled to receive a payout as determined by the Administrator. Notwithstanding the foregoing, subject to the vesting limitations under Section 6(b), at any time after the grant of Restricted Stock Units, the Administrator, in its sole discretion, may reduce or waive any vesting criteria that must be met to receive a payout.

(d) Form and Timing of Payment. Payment of earned Restricted Stock Units will be made as soon as practicable after the date(s) determined by the Administrator and set forth in the Award Agreement. The Administrator, in its sole discretion, may only settle earned Restricted Stock Units in cash, Shares, or a combination of both.

(e) Cancellation. On the date set forth in the Award Agreement, all unearned Restricted Stock Units will be forfeited to the Company and become available for grant under the Plan.

11.    Performance Units and Performance Shares.

(a) Grant of Performance Units/Shares. Performance Units and Performance Shares may be granted to Service Providers at any time and from time to time, as determined by the Administrator, in its sole discretion. The Administrator will have complete discretion in determining the number of Performance Units and Performance Shares granted to each Participant.

(b) Value of Performance Units/Shares. Each Performance Unit will have an initial value that is established by the Administrator on or before the date of grant. Each Performance Share will have an initial value equal to the Fair Market Value of a Share on the date of grant.

(c) Performance Objectives and Other Terms. Subject to Section 6(b), the Administrator will set Performance Goals or other vesting provisions (including, without limitation, continued status as a Service Provider) in its discretion which, depending on the extent to which they are met, will determine the number or value of Performance Units/Shares that will be paid out to the Participant. The Administrator may set performance objectives based upon the achievement of Company-wide, divisional, or individual goals (including, but not limited to, continued employment or service), or any other basis determined by the Administrator in its discretion. The time period during which the performance objectives or other vesting provisions must be met will be called the “Performance Period.” Each Award of Performance Units/Shares will be evidenced by an Award Agreement that will specify the Performance Period and such other terms and conditions as the Administrator, in its sole discretion, determines.

(d) Earning of Performance Units/Shares. After the applicable Performance Period has ended, the holder of Performance Units/Shares will be entitled to receive a payout of the number of Performance Units/Shares earned by the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding performance objectives or other vesting provisions have been achieved. After the grant of a Performance Unit/Share, subject to the vesting limitations under Section 6(b), the Administrator, in its sole discretion, may reduce or waive any performance objectives or other vesting provisions for such Performance Unit/Share. Notwithstanding the foregoing, any outstanding Performance Units/Shares held by a Participant who dies while a Service Provider will accelerate upon the Participant’s death, with such acceleration assuming that all performance goals and other vesting criteria are deemed achieved at target performance levels and any additional service conditions satisfied.

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(e) Form and Timing of Payment of Performance Units/Shares. Payment of earned Performance Units/Shares will be made as soon as practicable after the expiration of the applicable Performance Period and achievement of the performance criteria and other vesting provisions. The Administrator, in its sole discretion, may pay earned Performance Units/Shares in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the value of the earned Performance Units/Shares at the close of the applicable Performance Period) or in a combination thereof.

(f) Cancellation of Performance Units/Shares. On the date set forth in the Award Agreement, all unearned or unvested Performance Units/Shares will be forfeited to the Company, and become available for grant under the Plan.

12. Compliance With Code Section 409A. Awards will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the requirements of Section 409A such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Section 409A, except as otherwise determined in the sole discretion of the Administrator. The Plan and each Award Agreement under the Plan is intended to meet the requirements of Section 409A and will be construed and interpreted in accordance with such intent, except as otherwise determined in the sole discretion of the Administrator. To the extent that an Award or payment, or the settlement or deferral thereof, is subject to Section 409A the Award will be granted, paid, settled or deferred in a manner that will meet the requirements of Section 409A, such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Section 409A. In no event will the Company (or any Parent or Subsidiary of the Company, as applicable) reimburse a Participant for any taxes imposed or other costs incurred as a result of Section 409A.

13. Leaves of Absence/Transfer Between Locations. Unless the Administrator provides otherwise or as provided by written Company policies, vesting of Awards granted hereunder will be suspended during any unpaid leave of absence or as provided by written Company policies. A Service Provider will not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company and its Affiliates. For purposes of Incentive Stock Options, no such leave may exceed three (3) months, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, then six (6) months and one day following the commencement of such leave any Incentive Stock Option held by the Participant will cease to be treated as an Incentive Stock Option and will be treated for tax purposes as a Nonstatutory Stock Option.

14. Transferability of Awards. Unless determined otherwise by the Administrator, an Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant. With the approval of the Administrator, a Participant may, in a manner specified by the Administrator, (a) transfer an Award to a Participant’s spouse or former spouse pursuant to a court-approved domestic relations order which relates to the provision of child support, alimony payments or marital property rights, and (b) transfer an Option by bona fide gift and not for any consideration, to (i) a member or members of the Participant’s immediate family, (ii) a trust established for the exclusive benefit of the Participant and/or member(s) of the Participant’s immediate family, (iii) a partnership, limited liability company of other entity whose only partners or members are the Participant and/or member(s) of the Participant’s immediate family, or (iv) a foundation in which the Participant and/or member(s) of the Participant’s immediate family control the management of the foundation’s assets. For purposes of this Section 14, “immediate family” will mean the Participant’s spouse, former spouse, children, grandchildren, parents, grandparents, siblings, nieces, nephews, parents-in-law, sons-in-law, daughters-in-law, brothers-in-law, sisters-in-law, including adoptive or step relationships and any person sharing the Participant’s household (other than as a tenant or employee).

15. Adjustments; Dissolution or Liquidation; Merger or Change in Control.

(a) Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split up, spin off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under the Plan, will adjust the number and class of Shares that may be delivered under the Plan and/or the number, class, and price of Shares covered by each outstanding Award, and the numerical Share or value limits, as applicable, set forth in Sections 3 and 6.

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(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Administrator will notify each Participant as soon as practicable prior to the effective date of such proposed transaction. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed action.

(c) Change in Control. In the event of a merger of the Company with or into another corporation or other entity or a Change in Control, each outstanding Award will be treated as the Administrator determines subject to the restriction in the following paragraph, including, without limitation, that each Award be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation (the “Successor Corporation”). The Administrator will not be required to treat all Awards or Participants similarly in the transaction.

In the event that the Successor Corporation does not assume or substitute for the Award (and for the avoidance of doubt, notwithstanding the vesting limitations under Section 6(b)), the Participant will fully vest in and have the right to exercise all of his or her outstanding Options and Stock Appreciation Rights, including Shares as to which such Awards would not otherwise be vested or exercisable, all restrictions on Restricted Stock and Restricted Stock Units will lapse, and, with respect to such Award with performance-based vesting, all performance goals or other vesting criteria will be deemed achieved based on actual performance measured through the last date that the Award remains outstanding (or such earlier date, as determined by the Administrator, in its sole discretion), with any performance period shortened proportionately and applicable performance goals or other vesting criteria adjusted proportionately to reflect the shortened performance period (or to the extent applicable, the value of the consideration to be received by the Company’s stockholders in connection with the merger or Change in Control), as determined by the Administrator, in its sole discretion. In addition, if an Option or Stock Appreciation Right is not assumed or substituted in the event of a Change in Control, the Administrator will notify the Participant in writing or electronically that the Option or Stock Appreciation Right will be exercisable for a period of time determined by the Administrator in its sole discretion, and the Option or Stock Appreciation Right will terminate upon the expiration of such period.

For the purposes of this subsection (c), an Award will be considered assumed if, following the Change in Control, the Award confers the right to purchase or receive, for each Share subject to the Award immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) received in the Change in Control by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the Successor Corporation or its Parent, the Administrator may, with the consent of the Successor Corporation, provide for the consideration to be received upon the exercise of an Option or Stock Appreciation Right or upon the payout of a Restricted Stock Unit, Performance Unit or Performance Share, for each Share subject to such Award, to be solely common stock of the Successor Corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the Change in Control.

Notwithstanding anything in this Section 15(c) to the contrary, an Award that vests, is earned or paid-out upon the satisfaction of one or more performance goals will not be considered assumed if the Company or its successor modifies any of such performance goals without the Participant’s consent; provided, however, a modification to such performance goals only to reflect the Successor Corporation’s post-Change in Control corporate structure will not be deemed to invalidate an otherwise valid Award assumption.

(d) Outside Director Awards. With respect to Awards granted to an Outside Director, in the event of a Change in Control in which such Awards are assumed or substituted for, if on the date of or following such assumption or substitution the Participant’s status as a Director or a director of the Successor Corporation, as applicable, is terminated other than upon a voluntary resignation by the Participant (unless such resignation is at the request of the acquirer), then the Participant will fully vest in and have the right to exercise Options and/or Stock Appreciation Rights as to all of the Shares underlying such Award, including those Shares which would not otherwise be vested or exercisable, all restrictions on Restricted Stock and Restricted Stock Units will lapse, and, with respect to Awards with performance-based vesting, unless specifically provided otherwise under the applicable Award Agreement, a Company policy applicable to the Participant, or other written agreement between the Participant and the Company, all performance goals or other vesting criteria will be deemed achieved at one hundred percent (100%) of target levels and all other terms and conditions met.

12

16. Tax.

(a) Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof) or such earlier time as any tax withholding obligations are due, the Company will have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy U.S. federal, state, or local taxes, non-U.S. taxes, or other taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award (or exercise thereof).

(b) Withholding Arrangements. The Administrator, in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (without limitation) (i) paying cash, (ii) electing to have the Company withhold otherwise deliverable Shares having a fair market value equal to the minimum statutory amount required to be withheld or such greater amount as the Administrator may determine if such amount would not have adverse accounting consequences, as the Administrator determines in its sole discretion, (iii) delivering to the Company already-owned Shares having a fair market value equal to the statutory amount required to be withheld or such greater amount as the Administrator may determine, in each case, provided the delivery of such Shares will not result in any adverse accounting consequences, as the Administrator determines in its sole discretion, (iv) selling a sufficient number of Shares otherwise deliverable to the Participant through such means as the Administrator may determine in its sole discretion (whether through a broker or otherwise) equal to the amount required to be withheld, or (v) any combination of the foregoing methods of payment. The amount of the withholding requirement will be deemed to include any amount which the Administrator agrees may be withheld at the time the election is made, not to exceed the amount determined by using the maximum federal, state or local marginal income tax rates applicable to the Participant with respect to the Award on the date that the amount of tax to be withheld is to be determined. The fair market value of the Shares to be withheld or delivered will be determined as of the date that the taxes are required to be withheld.

17. No Effect on Employment or Service. Neither the Plan nor any Award will confer upon a Participant any right with respect to continuing the Participant’s relationship as a Service Provider, nor will they interfere in any way with the Participant’s right or the right of the Company (or any Affiliate) to terminate such relationship at any time, with or without cause, to the extent permitted by Applicable Laws.

18. Date of Grant. The date of grant of an Award will be, for all purposes, the date on which the Administrator makes the determination granting such Award, or such other later date as is determined by the Administrator. Notice of the determination will be provided to each Participant within a reasonable time after the date of such grant.

19. Term of Plan. Subject to Section 24 of the Plan, the Plan will become effective upon its adoption by the Board. It will continue in effect for a term of ten (10) years from the date adopted by the Board, unless terminated earlier under Section 20 of the Plan.

20. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Administrator may at any time amend, alter, suspend or terminate the Plan.

(b) Stockholder Approval. The Company will obtain stockholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.

(c) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan will materially impair the rights of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. Termination of the Plan will not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination.

21. Conditions Upon Issuance of Shares.

(a) Legal Compliance. Shares will not be issued pursuant to the exercise of an Award unless the exercise of such Award and the issuance and delivery of such Shares will comply with Applicable Laws and will be further subject to the approval of counsel for the Company with respect to such compliance.

13

(b) Investment Representations. As a condition to the exercise of an Award, the Company may require the person exercising such Award to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required.

22. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction or to complete or comply with the requirements of any registration or other qualification of the Shares under any U.S. federal or state law, any non-U.S. law, or the rules and regulations of the Securities and Exchange Commission, the stock exchange on which Shares of the same class are then listed, or any other governmental or regulatory body, which authority, registration, qualification or rule compliance is deemed by the Company’s counsel to be necessary or advisable for the issuance and sale of any Shares hereunder, will relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority, registration, qualification or rule compliance will not have been obtained.

23. Clawback. The Administrator may specify in an Award Agreement that the Participant’s rights, payments, and/or benefits with respect to an Award will be subject to reduction, cancellation, forfeiture, and/or recoupment upon the occurrence of certain specified events, in addition to any applicable vesting, performance or other conditions and restrictions of an Award. Notwithstanding any provisions to the contrary under this Plan, an Award granted under the Plan shall be subject to the Company’s clawback policy as may be established and/or amended from time to time. The Board may require a Participant to forfeit or return to and/or reimburse the Company all or a portion of the Award and/or Shares issued under the Award, any amounts paid under the Award, and any payments or proceeds paid or provided upon disposition of the Shares issued under the Award, pursuant to the terms of such Company policy or as necessary or appropriate to comply with Applicable Laws.

24. Stockholder Approval. The Plan will be subject to approval by the stockholders of the Company within twelve (12) months after the date the Plan is adopted by the Board. Such stockholder approval will be obtained in the manner and to the degree required under Applicable Laws.

14

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 302(A) OF

THE SARBANES - OXLEY ACT OF 2002

I, Jure Sola, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Sanmina Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.    The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5.    The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's Board of Directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

Date:	May 5, 2021
/s/ JURE SOLA
Jure Sola
Chief Executive Officer (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302(A) OF

THE SARBANES - OXLEY ACT OF 2002

I, Kurt Adzema, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Sanmina Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.    The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5.    The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's Board of Directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

Date:	May 5, 2021
/s/ KURT ADZEMA
Kurt Adzema
Chief Financial Officer (Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States of America Code (18 U.S.C. §1350), Jure Sola, Chief Executive Officer of Sanmina Corporation (the “Company”), hereby certifies that, to the best of his knowledge:

1.    The Company's Quarterly Report on Form 10-Q for the period ended April 3, 2021, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and

2.    The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

IN WITNESS WHEREOF, the undersigned has set his hand hereto as of May 5, 2021.

/s/ JURE SOLA

Jure Sola

Chief Executive Officer (Principal Executive Officer)

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Sanmina Corporation under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing).

EX-32.2

EXHIBIT 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to the requirement set forth in Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 1350 of Chapter 63 of Title 18 of the United States of America Code (18 U.S.C. §1350), Kurt Adzema, Chief Financial Officer of Sanmina Corporation (the “Company”), hereby certifies that, to the best of his knowledge:

1.    The Company's Quarterly Report on Form 10-Q for the period ended April 3, 2021, to which this Certification is attached as Exhibit 32.2 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and

2.    The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

IN WITNESS WHEREOF, the undersigned has set his hand hereto as of May 5, 2021.

/s/ Kurt Adzema

Kurt Adzema

Chief Financial Officer (Principal Financial Officer)

This certification accompanies the Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Sanmina Corporation under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing).

XML

Document and Entity Information Document - $ / shares	6 Months Ended
	Apr. 03, 2021	Apr. 27, 2021
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 03, 2021
Document Transition Report	false
Entity File Number	0-21272
Entity Registrant Name	Sanmina Corporation
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	77-0228183
Entity Address, Address Line One	2700 N. First St.,
Entity Address, City or Town	San Jose,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95134
City Area Code	(408)
Local Phone Number	964-3500
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Shell Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	SANM
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		65,095,728
Entity Listing, Par Value Per Share	$ 0.01
Entity Central Index Key	0000897723
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--10-02
Entity Emerging Growth Company	false
Entity Small Business	false

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 03, 2021	Oct. 03, 2020
Current assets:
Cash and cash equivalents	$ 575,176	$ 480,526
Accounts receivable, net of allowances of $8,148 and $8,570 as of April 3, 2021 and October 3, 2020, respectively	1,122,962	1,043,334
Contract assets	334,957	396,583
Inventories	785,406	861,281
Prepaid expenses and other current assets	38,584	37,718
Total current assets	2,857,085	2,819,442
Property, plant and equipment, net	529,651	559,242
Deferred tax assets	259,943	273,470
Other	123,550	120,502
Total assets	3,770,229	3,772,656
Current liabilities:
Accounts payable	1,108,994	1,210,049
Accrued liabilities	176,148	171,761
Accrued payroll and related benefits	114,704	122,029
Short-term debt, including current portion of long-term debt	18,750	18,750
Total current liabilities	1,418,596	1,522,589
Long-term liabilities:
Long-term debt	320,405	329,249
Other	296,121	290,902
Total long-term liabilities	616,526	620,151
Contingencies (Note 7)
Stockholders' equity	1,735,107	1,629,916
Total liabilities and stockholders' equity	$ 3,770,229	$ 3,772,656

XML

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Net sales	$ 1,699,677	$ 1,590,550	$ 3,454,926	$ 3,430,721
Cost of sales	1,556,579	1,483,129	3,170,593	3,188,418
Gross profit	143,098	107,421	284,333	242,303
Operating expenses:
Selling, general and administrative	61,142	62,257	120,109	125,408
Research and development	5,353	5,767	10,158	10,967
Restructuring and other	11,880	15,028	13,784	24,378
Total operating expenses	78,375	83,052	144,051	160,753
Operating income	64,723	24,369	140,282	81,550
Interest income	244	418	474	728
Interest expense	(4,880)	(6,040)	(9,834)	(11,917)
Other income (expense), net	6,143	(7,660)	8,010	(6,342)
Interest and other, net	1,507	(13,282)	(1,350)	(17,531)
Income before income taxes	66,230	11,087	138,932	64,019
Provision for income taxes	19,193	6,205	43,874	20,792
Net income	$ 47,037	$ 4,882	$ 95,058	$ 43,227
Net income per share:
Basic	$ 0.72	$ 0.07	$ 1.46	$ 0.61
Diluted	$ 0.70	$ 0.07	$ 1.42	$ 0.60
Weighted average shares used in computing per share amounts:
Basic	65,249	70,584	65,244	70,377
Diluted	66,957	72,245	66,887	72,429

XML

Condensed Consolidated Statement of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Net income	$ 47,037	$ 4,882	$ 95,058	$ 43,227
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustments	(1,561)	(2,887)	78	(2,170)
Derivative financial instruments:
Change in net unrealized amount	291	(8,306)	3,647	(4,926)
Amount reclassified into net income	2,530	538	1,029	343
Defined benefit plans:
Changes in unrecognized net actuarial losses and unrecognized transition costs	680	415	(45)	228
Amortization of actuarial losses and transition costs	460	102	966	646
Total other comprehensive income (loss)	2,400	(10,138)	5,675	(5,879)
Comprehensive income (loss)	$ 49,437	$ (5,256)	$ 100,733	$ 37,348

XML

Condensed Consolidated Statements of Stockholder's Equity Statement - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock and Additional Paid in Capital	Treasury Stock	Accumulated Other Comprehensive Income	Accumulated Deficit	Number of Common Shares
Balance at Sep. 28, 2019		$ 6,267,509	$ (804,118)	$ 42,259	$ (3,863,077)
Common Stock, Shares, Issued at Sep. 28, 2019						105,551
Treasury Stock, Shares at Sep. 28, 2019			(35,831)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuances under stock plans, shares						1,575
Issuances under stock plans, Value		5,172
Stock-based compensation expense		14,689
Repurchases of treasury stock			(3,093)
Repurchases of Treasury Stock, Value			$ 82,033
Other comprehensive income (loss)	$ (5,879)			(5,879)
Net income	43,227				43,227
Common Stock, Shares, Issued at Mar. 28, 2020						107,126
Treasury Stock, Shares at Mar. 28, 2020			(38,924)
Balance at Mar. 28, 2020	1,617,749	6,287,370	$ (886,151)	36,380	(3,819,850)
Balance at Dec. 28, 2019		6,279,267	$ (821,668)	46,518	(3,824,732)
Common Stock, Shares, Issued at Dec. 28, 2019						106,841
Treasury Stock, Shares at Dec. 28, 2019			(36,384)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuances under stock plans, shares						285
Issuances under stock plans, Value		320
Stock-based compensation expense		7,783
Repurchases of treasury stock			(2,540)
Repurchases of Treasury Stock, Value			$ 64,483
Other comprehensive income (loss)	(10,138)			(10,138)
Net income	4,882				4,882
Common Stock, Shares, Issued at Mar. 28, 2020						107,126
Treasury Stock, Shares at Mar. 28, 2020			(38,924)
Balance at Mar. 28, 2020	1,617,749	6,287,370	$ (886,151)	36,380	(3,819,850)
Balance at Oct. 03, 2020	1,629,916	6,301,537	$ (983,143)	34,886	(3,723,364)
Common Stock, Shares, Issued at Oct. 03, 2020						107,629
Treasury Stock, Shares at Oct. 03, 2020			(42,630)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuances under stock plans, shares						652
Issuances under stock plans, Value		2,073
Stock-based compensation expense		17,432
Repurchases of treasury stock			(562)
Repurchases of Treasury Stock, Value			$ 15,047
Other comprehensive income (loss)	5,675			5,675
Net income	95,058				95,058
Common Stock, Shares, Issued at Apr. 03, 2021						108,281
Treasury Stock, Shares at Apr. 03, 2021			(43,192)
Balance at Apr. 03, 2021	1,735,107	6,321,042	$ (998,190)	40,561	(3,628,306)
Balance at Jan. 02, 2021		6,310,795	$ (995,665)	38,161	(3,675,343)
Common Stock, Shares, Issued at Jan. 02, 2021						107,998
Treasury Stock, Shares at Jan. 02, 2021			(43,112)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuances under stock plans, shares						283
Issuances under stock plans, Value		1,023
Stock-based compensation expense		9,224
Repurchases of treasury stock			(80)
Repurchases of Treasury Stock, Value			$ 2,525
Other comprehensive income (loss)	2,400			2,400
Net income	47,037				47,037
Common Stock, Shares, Issued at Apr. 03, 2021						108,281
Treasury Stock, Shares at Apr. 03, 2021			(43,192)
Balance at Apr. 03, 2021	$ 1,735,107	$ 6,321,042	$ (998,190)	$ 40,561	$ (3,628,306)

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES:
Net income	$ 95,058	$ 43,227
Adjustments to reconcile net income to cash provided by (used in) operating activities:
Depreciation and amortization	54,831	56,777
Stock-based compensation expense	17,432	14,689
Deferred income taxes	13,641	1,952
Goodwill and other asset impairments	0	8,409
Other, net	(19)	568
Changes in operating assets and liabilities:
Accounts receivable	(79,166)	207,994
Contract assets	61,626	(10,984)
Inventories	75,303	15,333
Prepaid expenses and other assets	1,359	11,687
Accounts payable	(99,525)	(185,175)
Accrued liabilities	2,360	(7,578)
Cash provided by operating activities	142,900	156,899
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES:
Purchases of property, plant and equipment, net of proceeds	(25,540)	(44,456)
Cash used in investing activities	(25,540)	(44,456)
CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES:
Repayment of Long-term Debt, Long-term Lease Obligation, and Capital Security	(9,376)	(24,986)
Proceeds from revolving credit facility borrowings	399,600	1,909,000
Repayments of revolving credit facility borrowings	(399,600)	(1,259,000)
Net proceeds from stock issuances	2,073	5,172
Repurchases of common stock	(15,047)	(82,033)
Cash provided by (used in) financing activities	(22,350)	548,153
Effect of exchange rate changes	(360)	(752)
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect	94,650	659,844
Cash and cash equivalents at beginning of period	480,526	454,741
Cash and cash equivalents at end of period	575,176	1,114,585
Cash paid during the period for:
Interest, net of capitalized interest	3,082	8,407
Income taxes, net of refunds	18,675	13,371
Unpaid purchases of property, plant and equipment at the end of period	$ 10,693	$ 9,377

XML

Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Apr. 03, 2021	Oct. 03, 2020
Accounts Receivable, Allowance for Credit Loss, Current	$ 8,148	$ 8,570

XML

Note 1 Basis of Presentation

6 Months Ended

Apr. 03, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Sanmina Corporation (the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been omitted pursuant to those rules or regulations. The interim condensed consolidated financial statements are unaudited, but reflect all adjustments, consisting primarily of normal recurring adjustments, that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended October 3, 2020, included in the Company's 2020 Annual Report on Form 10-K.

The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Due to the COVID-19 pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic. The Company has considered information available to it as of the date of issuance of these financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates.

Results of operations for the second quarter of 2021 are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year.

The Company operates on a 52 or 53 week year ending on the Saturday nearest September 30. Fiscal 2021 will be a 52-week year and fiscal 2020 was a 53-week year, with the extra week included in the fourth quarter of fiscal 2020. All references to years relate to fiscal years unless otherwise noted.

Recent Accounting Pronouncements Adopted

In August 2018, the FASB issued ASU 2018-15, "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." The new guidance aligns the requirements for capitalizing implementation costs incurred in a cloud-based hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. There was no impact upon adoption of this ASU.

In June 2016, the FASB issued ASU 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which replaces the existing incurred loss impairment methodology with an expected credit loss methodology and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. The impact of adoption of this ASU was not material.

Recent Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)", which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. The Company has not yet applied any of the expedients and exceptions and is currently evaluating the impact of the provisions of this ASU.

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Note 2 Revenue Recognition

6 Months Ended

Apr. 03, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

Revenue Recognition

The Company is a leading global provider of integrated manufacturing solutions, components, products and repair, logistics and after-market services. For purposes of determining when to recognize revenue, and in what amount, the Company applies a 5-step model: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the Company satisfies a performance obligation. Each of these steps involves the use of significant judgments, as discussed below.

Step 1 - Identify the contract with a customer

A contract is defined as an agreement between two parties that creates enforceable rights and obligations. The Company generally enters into a master supply agreement (“MSA”) with its customers that provides the framework under which business will be conducted, and pursuant to which a customer will issue purchase orders or other binding documents to specify the quantity, price and delivery requirements for products or services the customer wishes to purchase. The Company generally considers its contract with a customer to be a firm commitment, consisting of the combination of an MSA and a purchase order or any other similar binding document.

Step 2 - Identify the performance obligations in the contract

A performance obligation is a promised good or service that is material in the context of the contract and is both capable of being distinct (customer can benefit from the good or service on its own or together with other readily available resources) and distinct within the context of the contract (separately identifiable from other promises). The Company reviews its contracts to identify promised goods or services and then evaluates such items to determine which of those items are performance obligations. The majority of the Company’s contracts have a single performance obligation since the promise to transfer an individual good or service is not separately identifiable from other promises in the contract. The Company’s performance obligations generally have an expected duration of one year or less.

Step 3 - Determine the transaction price

The Company’s contracts with its customers may include certain forms of variable consideration such as early payment discounts, volume discounts and shared cost savings. The Company includes an estimate of variable consideration when determining the transaction price and the appropriate amount of revenue to be recognized. This estimate is limited to an amount which will not result in a significant reversal of revenue in a future period. Factors considered in the Company’s estimate of variable consideration are the potential amount subject to these contract provisions, historical experience and other relevant facts and circumstances.

Step 4 - Allocate the transaction price to the performance obligations in the contract

A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. In the event that more than one performance obligation is identified in a contract, the Company is required to allocate a portion of the transaction price to each performance obligation. This allocation would generally be based on the relative standalone price of each performance obligation, which most often would represent the price at which the Company would sell similar goods or services separately.

Step 5 - Recognize revenue when (or as) a performance obligation is satisfied

The Company is required to assess whether control of a product or services promised under a contract is transferred to the customer at a point-in-time or over time as the product is being manufactured or the services are being provided. If the criteria in ASC 606 for recognizing revenue on an over time basis are not met, revenue must be recognized at the point-in-time determined by the Company at which its customer obtains control of a product or service.

The Company has determined that revenue for the majority of its contracts is required to be recognized on an over time basis. This determination is based on the fact that 1) the Company does not have an alternative use for the end products it manufactures for its customers and has an enforceable right to payment, including a reasonable profit, for work-in-progress upon a customer’s cancellation of a contract for convenience or 2) the Company’s customer simultaneously receives and consumes the benefits provided by the Company’s services. For these contracts, revenue is recognized on an over time basis using the cost-to-cost method (ratio of costs incurred to date to total estimated costs at completion) which the Company believes best depicts the transfer of control to the customer. At least 95% of the Company's revenue is recognized on an over time basis, which is as products are manufactured or services are performed. Because of this, and the fact that there is no work-in-process or finished goods inventory associated with contracts for which revenue is recognized on an over-time basis, 99% or more of the Company’s inventory at the end of a given period is in the form of raw materials. For contracts for which revenue is required to be recognized at a point-in-time, the Company recognizes revenue when it has transferred control of the related goods, which generally occurs upon shipment or delivery of the goods to the customer.

Application of the cost-to-cost method for government contracts in the Company’s Defense and Aerospace division requires the use of significant judgments with respect to estimated materials, labor and subcontractor costs. This division is an operating segment whose results are aggregated with nine other operating segments and reported under Components, Products and Services ("CPS") for segment reporting purposes. During the first half of 2021, CPS revenue and gross profit was $638 million and $91 million, respectively.

The Company updates its estimates of materials, labor and subcontractor costs on a quarterly basis. These updated estimates are reviewed each quarter by a group of employees that includes representatives from numerous functions such as engineering, materials, contracts, manufacturing, program management, finance and senior management. If a change in estimate is deemed necessary, the impact of the change is recognized in the period of change.

Contract Assets

A contract asset is recognized when the Company has recognized revenue, but has not issued an invoice to its customer for payment. Contract assets are classified separately on the condensed consolidated balance sheets and transferred to accounts receivable when rights to payment become unconditional. Because of the Company’s short manufacturing cycle times, the transfer from contract assets to accounts receivable generally occurs within the next fiscal quarter.

Other

Taxes assessed by governmental authorities that are both imposed on and concurrent with a specific revenue-producing transaction, and are collected by the Company from a customer, are excluded from revenue.

Shipping and handling costs associated with outbound freight after control of a product has transferred to a customer are accounted for as fulfillment costs and are included in cost of sales.

The Company applies the following practical expedients or policy elections under ASC 606:

•The promised amount of consideration under a contract is not adjusted for the effects of a significant financing component because, at inception of a contract, the Company expects the period between when a good or service is transferred to a customer and when the customer pays for that good or service will generally be one year or less.

•The Company has elected to not disclose information about remaining performance obligations that have original expected durations of one year or less, which is substantially all of the Company’s remaining performance obligations.

•Incremental costs of obtaining a contract are not capitalized if the period over which such costs would be amortized to expense is less than one year.

Disaggregation of revenue

In the following table, revenue is disaggregated by segment, market sector and geography.

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Segments:
IMS	$	1,361,013	$	1,294,520	$	2,817,181	$	2,834,966
CPS	338,664		296,030		637,745		595,755
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
End Markets:
Industrial, Medical, Automotive and Defense	$	980,794	$	966,642	$	2,013,312	$	2,074,189
Communications Networks and Cloud Infrastructure	718,883		623,908		1,441,614		1,356,532
Total	1,699,677		$	1,590,550	$	3,454,926	$	3,430,721
Geography:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1) Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

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Note 3 Financial Instruments

6 Months Ended

Apr. 03, 2021

Financial Instruments [Abstract]

Derivatives and Fair Value [Text Block]

Financial Instruments

Fair Value Measurements    

Fair Value of Financial Instruments

The fair values of cash equivalents (generally 10% or less of cash and cash equivalents), accounts receivable, accounts payable and short-term debt approximate carrying value due to the short-term duration of these instruments. Additionally, the fair value of variable rate long-term debt approximates carrying value as of April 3, 2021.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company's primary financial assets and financial liabilities measured at fair value on a recurring basis are deferred compensation plan assets and defined benefit plan assets, which are both measured using Level 1 inputs. Deferred compensation plan assets were $46 million and $40 million as of April 3, 2021 and October 3, 2020, respectively. Defined benefit plan assets were $39 million as of October 3, 2020 and are measured at fair value only in the fourth quarter of each year. Other financial assets and financial liabilities measured at fair value on a recurring basis include foreign exchange contracts and interest rate swaps, which are both measured using Level 2 inputs. Foreign exchange contracts were not material as of April 3, 2021 or October 3, 2020. Interest rate swaps had a negative value of $22 million and $29 million as of April 3, 2021 and October 3, 2020, respectively.

Offsetting Derivative Assets and Liabilities

The Company has entered into master netting arrangements with each of its derivative counterparties that allows net settlement of derivative assets and liabilities under certain conditions, such as multiple transactions with the same currency maturing on the same date. The Company presents its derivative assets and derivative liabilities on a gross basis on the unaudited condensed consolidated balance sheets. The amount that the Company had the right to offset under these netting arrangements was not material as of  April 3, 2021 or October 3, 2020.

Non-Financial Assets Measured at Fair Value on a Nonrecurring Basis

Other non-financial assets, such as goodwill and other long-lived assets are measured at fair value as of the date such assets are acquired or in the period an impairment is recorded. During the second quarter of 2020, commodity prices in the oil and gas market experienced a sharp decline due to a combination of an oversaturated supply and a decrease in demand caused by the COVID-19 global pandemic. This commodity price decline resulted in a negative impact to the projected cash flows of the Company’s oil and gas reporting unit that is part of the Company's Components, Products and Services ("CPS") operating segment and therefore the Company performed a goodwill impairment test for this particular reporting unit. The Company concluded that the fair value of the reporting unit was below its carrying value, resulting in a goodwill impairment charge of $7 million. The fair value of the reporting unit was estimated based on the present value of future discounted cash flows. The Company also recorded an impairment charge of $2 million in the second quarter of 2020 for certain long-lived assets. These impairment charges are included in "Restructuring and Other" on the condensed consolidated statements of income.

Derivative Instruments

Foreign Exchange Rate Risk

The Company is exposed to certain risks related to its ongoing business operations. The primary risk managed by using derivative instruments is foreign currency exchange risk.

Forward contracts on various foreign currencies are used to manage foreign currency risk associated with forecasted foreign currency transactions and certain monetary assets and liabilities denominated in non-functional currencies. The Company's primary foreign currency cash flows are in certain Asian and European countries, Brazil, Israel and Mexico.

The Company had the following outstanding foreign currency forward contracts that were entered into to hedge foreign currency exposures:

	As of
	April 3, 2021		October 3, 2020
Derivatives Designated as Accounting Hedges:
Notional amount (in thousands)	$	110,056	$	113,300
Number of contracts	48		48
Derivatives Not Designated as Accounting Hedges:
Notional amount (in thousands)	$	398,864	$	352,062
Number of contracts	47		45

The Company utilizes foreign currency forward contracts to hedge certain operational (“cash flow”) exposures resulting from changes in foreign currency exchange rates. Such exposures generally result from (1) forecasted non-functional currency sales and (2) forecasted non-functional currency materials, labor, overhead and other expenses. These contracts are designated as cash flow hedges for accounting purposes and are generally one to two months in duration but, by policy, may be up to twelve months in duration.

For derivative instruments that are designated and qualify as cash flow hedges, the Company excludes time value from its assessment of hedge effectiveness and recognizes the amount of time value in earnings over the life of the derivative instrument. Gains or losses on the derivative not caused by changes in time value are recorded in Accumulated Other Comprehensive Income ("AOCI"), a component of equity, and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The amount of gain or loss recognized in Other Comprehensive Income on derivative instruments and the amount of gain or loss reclassified from AOCI into income were not material for any period presented herein.

The Company enters into short-term foreign currency forward contracts to hedge currency exposures associated with certain monetary assets and liabilities denominated in non-functional currencies. These contracts have maturities of up to two months and are not designated as accounting hedges. Accordingly, these contracts are marked-to-market at the end of each period with unrealized gains and losses recorded in other income, net, in the condensed consolidated statements of income. The amount of gains or losses associated with these forward contracts was not material for any period presented herein. From an economic perspective, the objective of the Company's hedging program is for gains and losses on forward contracts to substantially offset gains and losses on the underlying hedged items. In addition to the contracts disclosed in the table above, the Company has numerous contracts that have been closed from an economic and financial accounting perspective and will

settle early in the first month of the following quarter. Since these offsetting contracts do not expose the Company to risk of fluctuations in exchange rates, these contracts have been excluded from the above table.

Interest Rate Risk

The Company enters into forward interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the benchmark interest rate (LIBOR) associated with anticipated variable rate borrowings. These interest rate swaps have a maturity date of December 1, 2023 and effectively convert the Company's variable interest rate obligations to fixed interest rate obligations. These swaps are accounted for as cash flow hedges under ASC Topic 815, Derivatives and Hedging. Interest rate swaps with an aggregate notional amount of $350 million were outstanding as of April 3, 2021 and October 3, 2020. The aggregate effective interest rate of these swaps as of April 3, 2021 was approximately 4.3%. Due to a decline in interest rates since the time the swaps were put in place, these interest rate swaps had a negative value of $22 million as of April 3, 2021, of which $9 million is included in accrued liabilities and the remaining amount is included in other long-term liabilities on the condensed consolidated balance sheets.

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Note 4 Debt

6 Months Ended

Apr. 03, 2021

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Debt

Long-term debt consisted of the following:

	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Term loan due 2023 ("Term Loan"), net of issuance costs	$	339,155	$	347,999
Current portion of Term Loan	18,750		18,750
Long-term debt	$	320,405	$	329,249

Term Loan maturities as of April 3, 2021 by fiscal year are as follows:

	(In Thousands)
Remainder of 2021	$	9,375
2022	18,750
2023	14,062
2024	300,000
	$	342,187

As of April 3, 2021, there were no borrowings and $8 million of letters of credit outstanding under the Fourth Amended and Restated Credit Agreement (the "Amended Cash Flow Revolver").

As of April 3, 2021, certain foreign subsidiaries of the Company had a total of $69 million of short-term borrowing facilities available, under which no borrowings were outstanding.

Debt covenants

The Company's Amended Cash Flow Revolver requires the Company to comply with certain financial covenants, namely a maximum leverage ratio and a minimum interest coverage ratio, in both cases measured on the basis of a trailing 12 month look-back period. In addition, the Company's debt agreements contain a number of restrictive covenants, including restrictions on incurring additional debt, making investments and other restricted payments, selling assets and paying dividends, subject to certain exceptions. The Company was in compliance with these covenants as of April 3, 2021.

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Note 5 Leases

6 Months Ended

Apr. 03, 2021

Leases [Abstract]

Leases of Lessee Disclosure [Text Block]

LeasesThe Company's leases consist primarily of operating leases for buildings and land. These leases have initial lease terms of up to 44 years and, upon adoption of ASC 842, are recorded on the Company's balance sheet as lease liabilities and corresponding right-of-use ("ROU") assets. Certain of these leases contain an option to extend the lease term for additional periods or to terminate the lease after an initial non-cancelable term. Renewal options are considered in the measurement of the

Company's initial lease liability and corresponding ROU asset only if it is reasonably certain that the Company will exercise such options. Leases with lease terms of twelve months or less are not recorded on the Company's balance sheet.

ROU assets and lease liabilities recorded in the condensed consolidated balance sheet are as follows:

	As of
	April 3, 2021			October 3, 2020
	(In thousands)
Other assets (1)	$	49,988		$	52,552
Accrued liabilities	16,780			16,659
Other long-term liabilities	35,101			37,015
Total lease liabilities	$	51,881		$	53,674
Weighted average remaining lease term (in years)	6.67			6.88
Weighted average discount rate	2.98		%	3.13		%

(1)    Net of accumulated amortization of $21 million and $16 million as of April 3, 2021 and October 3, 2020, respectively.

Cash paid for operating lease liabilities was $10 million and $9 million for the six months ended April 3, 2021 and March 28, 2020, respectively. Operating lease expense, which includes an immaterial amount for short-term leases, variable lease costs and sublease income, was $5 million and $11 million for the three and six months ended April 3, 2021, respectively and $4 million and $8 million for the three and six months ended March 28, 2020, respectively.

Future lease payments under non-cancelable operating leases as of April 3, 2021, by fiscal year, are as follows:

	Operating Leases
	(In thousands)
Remainder of 2021	$	9,433
2022	15,934
2023	9,265
2024	5,554
2025	4,106
2026	2,375
Thereafter	10,963
Total lease payments	57,630
Less: imputed interest	5,749
Total	$	51,881

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Note 6 Accounts Receivable Sale Program

6 Months Ended

Apr. 03, 2021

Transfers and Servicing [Abstract]

Transfers and Servicing of Financial Assets [Text Block]

Accounts Receivable Sale Program

The Company has entered into a Receivable Purchase Agreement (the “RPA”) with certain third-party banking institutions for the sale of trade receivables generated from sales to certain customers, subject to acceptance by, and a funding commitment from, the banks that are party to the RPA. Trade receivables sold pursuant to the RPA are serviced by the Company.

In addition to the RPA, the Company has the option to participate in trade receivables sales programs that have been implemented by certain of the Company's customers, as in effect from time to time. The Company does not service trade receivables sold under these other programs.

Under each of the programs noted above, the Company sells its entire interest in a trade receivable for 100% of face value, less a discount. During the six months ended April 3, 2021 and March 28, 2020, the Company sold approximately $371 million and $1.1 billion, respectively, of accounts receivable under these programs. Upon sale, these receivables are removed from the condensed consolidated balance sheets and cash received is presented as cash provided by operating activities in the condensed consolidated statements of cash flows. Discounts on sold receivables were not material for any period presented. As of April 3, 2021 and October 3, 2020, $27 million and $97 million, respectively, of accounts receivable sold under the RPA and subject to servicing by the Company remained outstanding and had not yet been collected. The Company's sole risk with respect to receivables it services is with respect to commercial disputes regarding such receivables. Commercial disputes include billing errors, returns and similar matters. To date, the Company has not been required to repurchase any receivable it has sold due to a commercial dispute. Additionally, the Company is required to remit amounts collected as servicer under the RPA on a weekly basis to the financial institutions that purchased the receivables. As of April 3, 2021 and October 3, 2020, $22 million and $39 million, respectively, had been collected but not yet remitted. This amount is classified in accrued liabilities on the condensed consolidated balance sheets.

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Note 7 Commitments and Contingencies

6 Months Ended

Apr. 03, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

Contingencies

From time to time, the Company is a party to litigation, claims and other contingencies, including environmental, regulatory and employee matters and examinations and investigations by governmental agencies, which arise in the ordinary course of business. The Company records a contingent liability when it is probable that a loss has been incurred and the amount of loss is reasonably estimable in accordance with ASC Topic 450, Contingencies, or other applicable accounting standards. As of April 3, 2021 and October 3, 2020, the Company had reserves of $38 million and $37 million, respectively, for environmental matters, warranty, litigation and other contingencies (excluding reserves for uncertain tax positions), which the Company believes are adequate. However, there can be no assurance that the Company's reserves will be sufficient to settle these contingencies. Such reserves are included in accrued liabilities and other long-term liabilities on the unaudited condensed consolidated balance sheets.

Legal Proceedings

Environmental Matters

The Company is subject to various federal, state, local and foreign laws and regulations and administrative orders concerning environmental protection, including those addressing the discharge of pollutants into the environment, the management and disposal of hazardous substances, the cleanup of contaminated sites, the materials used in products, and the recycling, treatment and disposal of hazardous waste. As of April 3, 2021, the Company had been named in a lawsuit and several administrative orders alleging certain of its current and former sites contributed to groundwater contamination. One such order demands that the Company and other alleged defendants remediate groundwater contamination at four landfills located in Northern California to which the Company may have sent wastewater in the past. The Company is participating in a working group of other alleged defendants to better understand its potential exposure in this action and has reserved its estimated exposure for this matter as of April 3, 2021. However, there can be no assurance that the Company's reserve will ultimately be sufficient.

In June 2008, the Company was named by the Orange County Water District in a suit alleging that its actions contributed to polluted groundwater managed by the plaintiff. The complaint seeks recovery of compensatory and other damages, as well as declaratory relief, for the payment of costs necessary to investigate, monitor, remediate, abate and contain contamination of groundwater within the plaintiff’s control. In April 2013, all claims against the Company were dismissed. The plaintiff appealed this dismissal and the appellate court reversed the judgment in August 2017. In November 2017, the California Supreme Court denied the Company’s petition to review this decision and, in December 2017, the Court of Appeal remanded the case back to the Superior Court for further proceedings. The first part of a multi-phase trial commenced on April 12, 2021. The Company is contesting the plaintiff’s claims vigorously.

Other Matters

In October 2018, a contractor who had been retained by the Company through a third party temporary staffing agency from November 2015 to March 2016 filed a lawsuit against the Company in the Santa Clara County Superior Court on behalf of himself and all other similarly situated Company contractors and employees in California, alleging violations of California Labor Code provisions governing overtime, meal and rest periods, wages, wage statements and reimbursement of business expenses. The complaint seeks certification of a class of all non-exempt employees, whether employed directly or through a temporary staffing agency, employed from four years before the filing of the initial complaint to the time of trial. Additionally, on November 1, 2019, another contractor retained through a temporary staffing agency filed a lawsuit against the Company in the Santa Clara County Superior Court. The complaint, which includes a single cause of action under California’s Private Attorneys General Act of 2004 ("PAGA"), alleges Labor Code violations substantially similar to those alleged in the October 2018 class action lawsuit and seeks penalties on behalf of the State of California and other “aggrieved employees” (defined to be current and former hourly, non-exempt employees employed by the Company between August 22, 2018 and the present). Although the Company continues to deny any wrongdoing, on November 19, 2020, the Company reached an agreement in principle to resolve all claims (the “Settlement”). Under the Settlement, which remains subject to court approval, the Company’s total payout will depend on the number and value of claims submitted by members of the settlement class to the claims administrator, and cannot exceed $5 million (but could be as low as approximately $3.5 million), inclusive of plaintiffs’ attorneys’ fees, costs, and certain other items. On December 3, 2020, in connection with and in order to effect the Settlement, plaintiffs dismissed the PAGA complaint pending in Santa Clara County Superior Court and refiled it as a class and PAGA action in Kern County Superior Court. Similarly, on April 3, 2021, the class action complaint originally filed in the Santa Clara County Superior Court was dismissed without prejudice.

In December 2019, the Company sued a former customer, Dialight plc (“Dialight”), in the United States District Court for the Southern District of New York to collect approximately $10 million in unpaid accounts receivable and net obsolete inventory obligations. Later the same day, Dialight commenced its own action in the same court. Dialight’s complaint, which asserts claims for fraudulent inducement, breach of contract, and gross negligence/willful misconduct, alleges that the Company fraudulently misrepresented its capabilities to induce Dialight to enter into a Manufacturing Services Agreement (the “Dialight MSA”), and then breached its obligations contained in the Dialight MSA relating to quality, on-time delivery and supply chain management. Dialight seeks an unspecified amount of compensatory and punitive damages. The Company intends to vigorously prosecute its claim against Dialight. Further, the Company strongly disagrees with Dialight’s allegations and intends to defend against them vigorously.

For each of the matters noted above, with the exception of the alleged violations of the California Labor Code described above, the Company is unable to reasonably estimate a range of possible loss at this time.

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Note 8 Restructuring

6 Months Ended

Apr. 03, 2021

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

Restructuring

The following table is a summary of restructuring costs:

	Restructuring Expense
	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Severance costs (approximately 790 and 830 employees for the three and six months ended April 3, 2021 and 300 and 1,750 employees for the three and six months ended March 28, 2020, respectively)	$	10,656	$	4,725	$	11,492	$	11,453
Other exit costs (recognized as incurred)	9		44		9		52
Total - Q1 FY20 Plan	10,665		4,769		11,501		11,505
Costs incurred for other plans	1,215		3,587		2,283		6,011
Total - all plans	$	11,880	$	8,356	$	13,784	$	17,516

Q1 FY20 Plan

On October 28, 2019, the Company adopted a Company-wide restructuring plan ("Q1 FY20 Plan"). Under the Q1 FY20 Plan, the Company expects to incur restructuring charges of up to $35 million, consisting primarily of cash severance costs. As of April 3, 2021, the Company had incurred restructuring charges of approximately $29 million, consisting primarily of severance costs, under the Q1 FY20 Plan. Headcount reductions are expected to occur through the fourth quarter of 2021 and cash payments of severance are expected to occur through the end of calendar 2021.

Other Plans

Other plans include a number of plans for which costs are not expected to be material individually or in the aggregate.

All Plans

The Company’s Integrated Manufacturing Solutions ("IMS") segment incurred costs of $9 million for each of the six months ended April 3, 2021 and March 28, 2020. The Company’s CPS segment incurred costs of $4 million and $6 million for the six months ended April 3, 2021 and March 28, 2020, respectively. In addition, $0.6 million and $3 million of costs were incurred during the six months ended April 3, 2021 and March 28, 2020, respectively, for corporate headcount reductions that were not allocated to the Company's IMS and CPS segments. The Company had accrued liabilities of $16 million and $9 million as of April 3, 2021 and October 3, 2020, respectively, for restructuring costs (exclusive of long-term environmental remediation liabilities).

In addition to costs expected to be incurred under the Q1 FY20 Plan, the Company expects to incur restructuring costs in future periods primarily for vacant facilities and former sites for which the Company is or may be responsible for environmental remediation.

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Note 9 Income Tax

6 Months Ended

Apr. 03, 2021

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

Income Tax

The Company estimates its annual effective income tax rate at the end of each quarterly period. The estimate takes into account the geographic mix of expected pre-tax income (loss), expected total annual pre-tax income (loss), enacted changes in tax laws, implementation of tax planning strategies and possible outcomes of audits and other uncertain tax positions. To the extent there are fluctuations in any of these variables during a period, the provision for income taxes may vary.

The Company's provision for income taxes for the three months ended April 3, 2021 and March 28, 2020 was $19 million (29% of income before taxes) and $6 million (56% of income before taxes), respectively, and $44 million (32% of income before taxes) and $21 million (32% of income before taxes) for the six months ended April 3, 2021 and March 28, 2020, respectively. Income tax expense for the three and six months ended April 3, 2021 increased, primarily as a result of an increase in income before tax and a change in the geographic mix of income before tax. The effective tax rate for the three months ended March 28, 2020 was negatively impacted by the COVID-19 global pandemic, resulting in reduced income and unfavorable jurisdictional mix.

It is reasonably possible that the Company's liability for uncertain tax positions could decrease materially during the quarter ending July 3, 2021 based upon the resolution of audits and expiration of statutes of limitations, which would result in a decrease in income tax expense at that time.

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Note 10 Stockholders' Equity

6 Months Ended

Apr. 03, 2021

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Stockholder's Equity

Accumulated Other Comprehensive Income

Accumulated other comprehensive income, net of tax as applicable, consisted of the following:

	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Foreign currency translation adjustments	$	85,421	$	85,343
Unrealized holding losses on derivative financial instruments	(17,526)		(22,202)
Unrecognized net actuarial losses and transition costs for benefit plans	(27,334)		(28,255)
Total	$	40,561	$	34,886

Unrealized holding losses on derivative financial instruments includes losses from interest rate swap agreements with independent counterparties to partially hedge the variability in cash flows due to changes in the benchmark interest rate (LIBOR) associated with anticipated variable rate borrowings. These swaps are accounted for as cash flow hedges under ASC Topic 815, Derivatives and Hedging. Interest rate swaps with an aggregate notional amount of $350 million were outstanding as of April 3, 2021 and October 3, 2020. The aggregate effective interest rate of these swaps as of April 3, 2021 was approximately 4.3%. Due to a decline in interest rates since the time the swaps were put in place, these interest rate swaps had a negative value of $22 million as of April 3, 2021, of which $9 million is included in accrued liabilities and the remaining amount is included in other long-term liabilities on the condensed consolidated balance sheets.

Stock Repurchase Program

During the six months ended April 3, 2021 and March 28, 2020, the Company repurchased 0.4 million and 2.7 million shares of its common stock for $9 million and $70 million, respectively, under a stock repurchase program authorized by the Board of Directors. There were no repurchases during the three months ended April 3, 2021. As of April 3, 2021, an aggregate of $125 million remains available under such repurchase program, which has no expiration date.

In addition to the repurchases discussed above, the Company withheld 0.2 million and 0.4 million shares of its common stock during the six months ended April 3, 2021 and March 28, 2020, respectively, in settlement of employee tax withholding obligations due upon the vesting of restricted stock units. The Company paid $6 million and $12 million, respectively, to applicable tax authorities in connection with these repurchases.

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Note 11 Business Segment, Geographic and Customer Information

6 Months Ended

Apr. 03, 2021

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

Business Segment, Geographic and Customer Information

ASC Topic 280, Segment Reporting, establishes standards for reporting information about operating segments, products and services, geographic areas of operations and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker or decision making group in deciding how to allocate resources and in assessing performance.

The Company's operations are managed as two businesses: IMS and CPS. The Company's CPS business consists of multiple operating segments which do not meet the quantitative threshold for being presented individually as reportable segments. Therefore, financial information for these operating segments is presented in a single category entitled "CPS" and the Company has only one reportable segment - IMS.

During the first quarter of 2021, the Company began including Viking Technology, an operating segment previously aggregated and reported under CPS, in its IMS reportable segment. Accordingly, the data presented in the table below reflects this change in segment reporting for all periods presented. The change in segment reporting does not affect the Company’s previously reported consolidated financial statements.

The following table presents revenue and a measure of segment gross profit used by management to allocate resources and assess performance of operating segments:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Gross sales:
IMS	$	1,369,937	$	1,305,887	$	2,832,037	$	2,854,780
CPS	361,072		321,509		680,488		652,684
Intersegment revenue	(31,332)		(36,846)		(57,599)		(76,743)
Net sales	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
Gross profit:
IMS	$	95,030	$	75,421	$	201,596	$	176,627
CPS	51,401		34,582		91,039		71,170
Total	146,431		110,003		292,635		247,797
Unallocated items (1)	(3,333)		(2,582)		(8,302)		(5,494)
Total	$	143,098	$	107,421	$	284,333	$	242,303

(1)    For purposes of evaluating segment performance, management excludes certain items from its measure of gross profit. These items consist of stock-based compensation expense, charges or credits resulting from distressed customers and litigation settlements.

Net sales by geographic segment, determined based on the country in which a product is manufactured, were as

follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Net sales:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1)    Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

Percentage of net sales represented by ten largest customers	54	%	55	%	56	%	55	%
Number of customers representing 10% or more of net sales	1		1		1		1

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Note 12 Earnings Per Share

6 Months Ended

Apr. 03, 2021

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

Earnings Per Share

Basic and diluted per share amounts are calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period, as follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands, except per share data)
Numerator:
Net income	$	47,037	$	4,882	$	95,058	$	43,227
Denominator:
Weighted average common shares outstanding	65,249		70,584		65,244		70,377
Effect of dilutive stock options and restricted stock units	1,708		1,661		1,643		2,052
Denominator for diluted earnings per share	66,957		72,245		66,887		72,429
Net income per share:
Basic	$	0.72	$	0.07	$	1.46	$	0.61
Diluted	$	0.70	$	0.07	$	1.42	$	0.60

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Note 13 Stock-Based Compensation

6 Months Ended

Apr. 03, 2021

Share-based Payment Arrangement, Noncash Expense [Abstract]

Share-based Payment Arrangement [Text Block]

Stock-Based Compensation

Stock-based compensation expense was attributable to:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Stock options	$	—	$	—	$	—	$	(1,145)
Restricted stock units, including performance based awards	9,224		7,783		17,432		15,834
Total	$	9,224	$	7,783	$	17,432	$	14,689

Stock-based compensation expense was recognized as follows:

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Cost of sales	$	3,629	$	2,582	$	7,050	$	5,494
Selling, general and administrative	5,479		5,127		10,196		9,052
Research and development	116		74		186		143
Total	$	9,224	$	7,783	$	17,432	$	14,689

During the second quarter of 2021, the Company's stockholders approved the reservation of an additional 1.4 million shares of common stock for future issuance under the Company's 2019 Incentive Plan. As of April 3, 2021, an aggregate of 8.0 million shares were authorized for future issuance under the Company's stock plans, of which 4.2 million of such shares were issuable upon exercise of outstanding options and delivery of shares upon vesting of restricted stock units and 3.8 million shares of common stock were available for future grant.

Restricted and Performance Stock Units

The Company grants restricted stock units and restricted stock units with performance conditions ("PSUs") to executive officers, directors and certain other employees. These units vest over periods ranging from one year to four years and/or upon achievement of specified performance criteria and are automatically exchanged for shares of common stock at the

vesting date. If performance metrics are not met within specified time limits, the award will be canceled. Compensation expense associated with restricted stock units and PSUs is recognized ratably over the vesting period, subject to probability of achievement for PSUs.

During 2021 and 2020, the Company granted 373,000 and 304,500 PSU shares, respectively, for which vesting is contingent on cumulative non-GAAP earnings per share measured over three fiscal years. If a minimum threshold is not achieved, no shares will vest. If the minimum threshold is achieved or exceeded, the number of shares of common stock that will be issued will range from 80% to 120% of the number of PSUs granted, depending on the extent of performance. Additionally, the number of shares that vest may be adjusted up or down by up to 15% based on the Company's total shareholder return relative to that of its peer group over this same period. These PSUs will be cancelled if such performance conditions have not been met during the measurement period.

Activity with respect to the Company's restricted stock awards was as follows:

	Number of Shares	Weighted- Average Grant Date Fair Value ($)	Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($)
	(In thousands)			(In thousands)
Outstanding as of October 3, 2020	2,568	29.67	1.23	71,571
Granted	1,444	33.92
Vested/Forfeited/Cancelled	(698)	29.31
Outstanding as of April 3, 2021	3,314	31.61	1.56	135,998
Expected to vest as of April 3, 2021	2,870	31.46	1.51	117,798

As of April 3, 2021, unrecognized compensation expense of $63 million is expected to be recognized over a weighted average period of 1.5 years. Additionally, as of April 3, 2021, unrecognized compensation expense related to performance-based restricted stock units for which achievement of the performance criteria was not currently considered probable is $3 million.

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Note 14 Business Combinations	6 Months Ended
	Apr. 03, 2021
Business Combinations [Abstract]
Business Combination Disclosure	AcquisitionOn April 6, 2021, subsequent to the end of the second quarter of 2021, the Company purchased all outstanding stock of a European subsidiary of a multinational customer. The Company expects the net purchase price of this acquisition to be in the range of $30 million to $35 million. The acquisition is expected to increase the Company's IMS capabilities in Europe. The Company is in the process of determining the fair value of the assets and liabilities acquired and does not expect the acquisition to have a material effect on the Company's financial position or results of operations.

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Accounting Policies (Policies)

6 Months Ended

Apr. 03, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Accounting [Text Block]

The accompanying unaudited condensed consolidated financial statements of Sanmina Corporation (the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been omitted pursuant to those rules or regulations. The interim condensed consolidated financial statements are unaudited, but reflect all adjustments, consisting primarily of normal recurring adjustments, that are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended October 3, 2020, included in the Company's 2020 Annual Report on Form 10-K.

Use of Estimates, Policy [Policy Text Block]

The preparation of financial statements requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Due to the COVID-19 pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic. The Company has considered information available to it as of the date of issuance of these financial statements and is not aware of any specific events or circumstances that would require an update to its estimates or judgments, or a revision to the carrying value of its assets or liabilities. These estimates may change as new events occur and additional information becomes available. Actual results could differ materially from these estimates.

Results of operations for the second quarter of 2021 are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year.

Fiscal Period, Policy [Policy Text Block]

The Company operates on a 52 or 53 week year ending on the Saturday nearest September 30. Fiscal 2021 will be a 52-week year and fiscal 2020 was a 53-week year, with the extra week included in the fourth quarter of fiscal 2020. All references to years relate to fiscal years unless otherwise noted.

New Accounting Pronouncements, Policy [Text Block]

Recent Accounting Pronouncements Adopted

In August 2018, the FASB issued ASU 2018-15, "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." The new guidance aligns the requirements for capitalizing implementation costs incurred in a cloud-based hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. There was no impact upon adoption of this ASU.

In June 2016, the FASB issued ASU 2016-13 "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which replaces the existing incurred loss impairment methodology with an expected credit loss methodology and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU was effective for the Company at the beginning of fiscal 2021, including interim periods within that reporting period. The impact of adoption of this ASU was not material.

Recent Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)", which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. The Company has not yet applied any of the expedients and exceptions and is currently evaluating the impact of the provisions of this ASU.

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Note 2 Revenue Recognition (Tables)

6 Months Ended

Apr. 03, 2021

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Segments:
IMS	$	1,361,013	$	1,294,520	$	2,817,181	$	2,834,966
CPS	338,664		296,030		637,745		595,755
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
End Markets:
Industrial, Medical, Automotive and Defense	$	980,794	$	966,642	$	2,013,312	$	2,074,189
Communications Networks and Cloud Infrastructure	718,883		623,908		1,441,614		1,356,532
Total	1,699,677		$	1,590,550	$	3,454,926	$	3,430,721
Geography:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1) Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

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Note 3 Derivative Financial Instruments (Tables)

6 Months Ended

Apr. 03, 2021

Financial Instruments [Abstract]

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block]

	As of
	April 3, 2021		October 3, 2020
Derivatives Designated as Accounting Hedges:
Notional amount (in thousands)	$	110,056	$	113,300
Number of contracts	48		48
Derivatives Not Designated as Accounting Hedges:
Notional amount (in thousands)	$	398,864	$	352,062
Number of contracts	47		45

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Note 4 Debt (Tables)

6 Months Ended

Apr. 03, 2021

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments [Table Text Block]

	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Term loan due 2023 ("Term Loan"), net of issuance costs	$	339,155	$	347,999
Current portion of Term Loan	18,750		18,750
Long-term debt	$	320,405	$	329,249

Schedule of Maturities of Long-Term Debt [Table Text Block]

	(In Thousands)
Remainder of 2021	$	9,375
2022	18,750
2023	14,062
2024	300,000
	$	342,187

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Note 5 Leases (Tables)

6 Months Ended

Apr. 03, 2021

Leases [Abstract]

Asset and Liabilities, Lessee [Table Text Block]

	As of
	April 3, 2021			October 3, 2020
	(In thousands)
Other assets (1)	$	49,988		$	52,552
Accrued liabilities	16,780			16,659
Other long-term liabilities	35,101			37,015
Total lease liabilities	$	51,881		$	53,674
Weighted average remaining lease term (in years)	6.67			6.88
Weighted average discount rate	2.98		%	3.13		%

(1)    Net of accumulated amortization of $21 million and $16 million as of April 3, 2021 and October 3, 2020, respectively.

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

	Operating Leases
	(In thousands)
Remainder of 2021	$	9,433
2022	15,934
2023	9,265
2024	5,554
2025	4,106
2026	2,375
Thereafter	10,963
Total lease payments	57,630
Less: imputed interest	5,749
Total	$	51,881

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Note 8 Restructuring and Related Activities (Tables)

6 Months Ended

Apr. 03, 2021

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs [Table Text Block]

	Restructuring Expense
	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Severance costs (approximately 790 and 830 employees for the three and six months ended April 3, 2021 and 300 and 1,750 employees for the three and six months ended March 28, 2020, respectively)	$	10,656	$	4,725	$	11,492	$	11,453
Other exit costs (recognized as incurred)	9		44		9		52
Total - Q1 FY20 Plan	10,665		4,769		11,501		11,505
Costs incurred for other plans	1,215		3,587		2,283		6,011
Total - all plans	$	11,880	$	8,356	$	13,784	$	17,516

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Note 10 Stockholders' Equity (Tables)

6 Months Ended

Apr. 03, 2021

Stockholders' Equity Note [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

	As of
	April 3, 2021		October 3, 2020
	(In thousands)
Foreign currency translation adjustments	$	85,421	$	85,343
Unrealized holding losses on derivative financial instruments	(17,526)		(22,202)
Unrecognized net actuarial losses and transition costs for benefit plans	(27,334)		(28,255)
Total	$	40,561	$	34,886

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Note 11 Business Segment, Geographic and Customer Information (Tables)

6 Months Ended

Apr. 03, 2021

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Gross sales:
IMS	$	1,369,937	$	1,305,887	$	2,832,037	$	2,854,780
CPS	361,072		321,509		680,488		652,684
Intersegment revenue	(31,332)		(36,846)		(57,599)		(76,743)
Net sales	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721
Gross profit:
IMS	$	95,030	$	75,421	$	201,596	$	176,627
CPS	51,401		34,582		91,039		71,170
Total	146,431		110,003		292,635		247,797
Unallocated items (1)	(3,333)		(2,582)		(8,302)		(5,494)
Total	$	143,098	$	107,421	$	284,333	$	242,303

(1)    For purposes of evaluating segment performance, management excludes certain items from its measure of gross profit. These items consist of stock-based compensation expense, charges or credits resulting from distressed customers and litigation settlements.

Schedule of Revenue from External Customers by Geographic Area [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Net sales:
Americas (1)	$	803,642	$	817,061	$	1,635,464	$	1,723,629
EMEA	272,167		256,724		531,459		517,755
APAC	623,868		516,765		1,288,003		1,189,337
Total	$	1,699,677	$	1,590,550	$	3,454,926	$	3,430,721

(1)    Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

Percentage of net sales represented by ten largest customers	54	%	55	%	56	%	55	%
Number of customers representing 10% or more of net sales	1		1		1		1

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Note 12 Earnings Per Share (Tables)

6 Months Ended

Apr. 03, 2021

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands, except per share data)
Numerator:
Net income	$	47,037	$	4,882	$	95,058	$	43,227
Denominator:
Weighted average common shares outstanding	65,249		70,584		65,244		70,377
Effect of dilutive stock options and restricted stock units	1,708		1,661		1,643		2,052
Denominator for diluted earnings per share	66,957		72,245		66,887		72,429
Net income per share:
Basic	$	0.72	$	0.07	$	1.46	$	0.61
Diluted	$	0.70	$	0.07	$	1.42	$	0.60

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Note 13 Stock-Based Compensation (Tables)

6 Months Ended

Apr. 03, 2021

Share-based Payment Arrangement, Noncash Expense [Abstract]

Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Stock options	$	—	$	—	$	—	$	(1,145)
Restricted stock units, including performance based awards	9,224		7,783		17,432		15,834
Total	$	9,224	$	7,783	$	17,432	$	14,689

Share-based Payment Arrangement, Expensed and Capitalized, Amount [Table Text Block]

	Three Months Ended				Six Months Ended
	April 3, 2021		March 28, 2020		April 3, 2021		March 28, 2020
	(In thousands)
Cost of sales	$	3,629	$	2,582	$	7,050	$	5,494
Selling, general and administrative	5,479		5,127		10,196		9,052
Research and development	116		74		186		143
Total	$	9,224	$	7,783	$	17,432	$	14,689

Schedule of Restricted Stock Units Award Activity [Table Text Block]

	Number of Shares	Weighted- Average Grant Date Fair Value ($)	Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($)
	(In thousands)			(In thousands)
Outstanding as of October 3, 2020	2,568	29.67	1.23	71,571
Granted	1,444	33.92
Vested/Forfeited/Cancelled	(698)	29.31
Outstanding as of April 3, 2021	3,314	31.61	1.56	135,998
Expected to vest as of April 3, 2021	2,870	31.46	1.51	117,798

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Note 2 Disagregation of Revenue (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Disaggregation of Revenue [Line Items]
Percent of Net Sales Transferred Over Time				95.00%
Raw Materials, net of reserves, as a percentage of total Inventory		99.00%		99.00%
Number of Other Operating Segment Excluding DAS				9
Net sales		$ 1,699,677	$ 1,590,550	$ 3,454,926	$ 3,430,721
Gross profit		143,098	107,421	284,333	242,303
Operating Segments
Disaggregation of Revenue [Line Items]
Gross profit		146,431	110,003	292,635	247,797
Americas
Disaggregation of Revenue [Line Items]
Net sales	[1]	803,642	817,061	1,635,464	1,723,629
EMEA
Disaggregation of Revenue [Line Items]
Net sales		272,167	256,724	531,459	517,755
Asia Pacific
Disaggregation of Revenue [Line Items]
Net sales		$ 623,868	516,765	$ 1,288,003	1,189,337
Mexico
Disaggregation of Revenue [Line Items]
Percentage of Net Sales to Americas Net Sales		60.00%		60.00%
United States
Disaggregation of Revenue [Line Items]
Percentage of Net Sales to Americas Net Sales		35.00%		35.00%
Industrial, Medical, Automotive and Defense
Disaggregation of Revenue [Line Items]
Net sales		$ 980,794	966,642	$ 2,013,312	2,074,189
Communications Networks and Cloud Infrastructure
Disaggregation of Revenue [Line Items]
Net sales		718,883	623,908	1,441,614	1,356,532
IMS Third Party Revenue
Disaggregation of Revenue [Line Items]
Net sales		1,361,013	1,294,520	2,817,181	2,834,966
CPS Third Party Revenue
Disaggregation of Revenue [Line Items]
Net sales		338,664	296,030	637,745	595,755
CPS | Operating Segments
Disaggregation of Revenue [Line Items]
Net sales		361,072	321,509	680,488	652,684
Gross profit		$ 51,401	$ 34,582	$ 91,039	$ 71,170

[1] Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

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Note 3 Fair Value (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Mar. 28, 2020	Apr. 03, 2021	Oct. 03, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents		10.00%
Fair Value, Nonrecurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Goodwill impairment	$ 7,000
Tangible Asset Impairment Charges	$ 2,000
Fair Value, Inputs, Level 1 [Member] | Fair Value, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets for Plan Benefits, Defined Benefit Plan			$ 39,000
Deferred Compensation Plan Assets		$ 46,000	40,000
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member] | Derivatives Designated as Accounting Hedges: | Interest Rate Swap [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest Rate Cash Flow Hedge Liability at Fair Value		$ 22,000	$ 29,000

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Note 3 Derivatives (Details) $ in Thousands	6 Months Ended
	Apr. 03, 2021 USD ($)	Oct. 03, 2020 USD ($)
Derivatives Designated as Accounting Hedges: | Foreign Exchange Forward [Member]
Derivative [Line Items]
Derivative, Notional Amount	$ 110,056	$ 113,300
Number of contracts	48	48
Maximum Length of Time Hedged	12 months
Derivatives Designated as Accounting Hedges: | Interest Rate Swap [Member]
Derivative [Line Items]
Derivative, Notional Amount	$ 350,000	$ 350,000
Maturity Date	Dec. 01, 2023
Effective Interest Rate	4.30%
Derivatives Not Designated as Accounting Hedges: | Foreign Exchange Forward [Member]
Derivative [Line Items]
Derivative, Notional Amount	$ 398,864	$ 352,062
Number of contracts	47	45
Maximum Remaining Maturity	2 months
Fair Value, Inputs, Level 2 [Member] | Derivatives Designated as Accounting Hedges: | Interest Rate Swap [Member] | Fair Value, Recurring [Member]
Derivative [Line Items]
Interest Rate Cash Flow Hedge Liability at Fair Value	$ 22,000	$ 29,000
Fair Value, Inputs, Level 2 [Member] | Other Current Liabilities | Derivatives Designated as Accounting Hedges: | Interest Rate Swap [Member] | Fair Value, Recurring [Member]
Derivative [Line Items]
Interest Rate Cash Flow Hedge Liability at Fair Value	$ 9,000

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Note 4 Debt Schedule (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Oct. 03, 2020
Debt Instrument [Line Items]
Long-term debt	$ 320,405	$ 329,249
Delayed Draw Term Loan [Member]
Debt Instrument [Line Items]
Term loan due 2023 ("Term Loan"), net of issuance costs	339,155	347,999
Current portion of Term Loan	18,750	$ 18,750
Long-term Debt, Fiscal Year Maturity [Abstract]
Remainder of Fiscal Year	9,375
Long-Term Debt, Maturity, Year One	18,750
Long-Term Debt, Maturity, Year Two	14,062
Long-Term Debt, Maturty, Year Three	300,000
Long-term Debt, Gross	$ 342,187

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Note 4 Line of Credit Facility (Details) $ in Millions	Apr. 03, 2021 USD ($)
Line of Credit Facility [Line Items]
Long-term Line of Credit	$ 0.0
Letters of Credit Outstanding, Amount	8.0
Foreign Line of Credit
Line of Credit Facility [Line Items]
Maximum Borrowing Capacity	69.0
Long-term Line of Credit	$ 0.0

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Note 5 Lessee Lease Description (Details)	Apr. 03, 2021
Maximum [Member]
Lessee, Lease, Description [Line Items]
Term of Contract	44 years

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Note 5 Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Leases [Abstract]
Operating Leases, Rent Expense, Net	$ 5,000	$ 4,000	$ 11,000	$ 8,000

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Note 5 Leases Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Cash Flow, Operating Activities, Lessee [Abstract]
Operating Lease, Payments	$ 10,000	$ 9,000

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Note 5 Leases (Detail) - USD ($) $ in Thousands		Apr. 03, 2021	Oct. 03, 2020
Asset and Liabilities, Lessee [Line Items]
Operating Lease, Right Of Use Asset, Accumulated Amortization		$ 21,000	$ 16,000
Operating Lease, Liability		$ 51,881
Operating Lease, Weighted Average Remaining Lease Term		6 years 8 months 1 day	6 years 10 months 17 days
Operating Lease, Weighted Average Discount Rate, Percent		2.98%	3.13%
Other Assets [Member]
Asset and Liabilities, Lessee [Line Items]
Operating Lease, Right-of-Use Asset	[1]	$ 49,988	$ 52,552
Accrued Liabilities [Member]
Asset and Liabilities, Lessee [Line Items]
Operating Lease, Liability, Current		16,780	16,659
Other Noncurrent Liabilities [Member]
Asset and Liabilities, Lessee [Line Items]
Operating Lease, Liability, Noncurrent		35,101	37,015
Liabilities, Total [Member]
Asset and Liabilities, Lessee [Line Items]
Operating Lease, Liability		$ 51,881	$ 53,674

[1] Net of accumulated amortization of $21 million and $16 million as of April 3, 2021 and October 3, 2020, respectively.

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Note 5 Future Lease Liability (Details) $ in Thousands	Apr. 03, 2021 USD ($)
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Lessee, Operating Lease, Liability, to be Paid, Remainder of Fiscal Year	$ 9,433
Lessee, Operating Lease, Liability, to be Paid, Year One	15,934
Lessee, Operating Lease, Liability, to be Paid, Year Two	9,265
Lessee, Operating Lease, Liability, to be Paid, Year Three	5,554
Lessee, Operating Lease, Liability, to be Paid, Year Four	4,106
Lessee, Operating Lease, Liability, to be Paid, Year Five	2,375
Lessee, Operating Lease, Liability, to be Paid, after Year Five	10,963
Lessee, Operating Lease, Liability, to be Paid	57,630
Lessee, Operating Lease, Liability, Undiscounted Excess Amount	5,749
Operating Lease, Liability	$ 51,881

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Note 6 Accounts Receivable Sale Program (Details) - USD ($) $ in Millions	6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Oct. 03, 2020
Transfer of Financial Assets Accounted for as Sales [Line Items]
Face Value of Receivable Sold, Percentage	100.00%
Accounts Receivable Sold During The Period	$ 371	$ 1,100
RPA [Member]
Transfer of Financial Assets Accounted for as Sales [Line Items]
Accounts Receivable Sold and Outstanding	27		$ 97
Amount Collected But Not Remitted to Financial Institutions	$ 22		$ 39

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Note 7 Contingencies (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Oct. 03, 2020
Loss Contingencies [Line Items]
Loss Contingency Accrual	$ 38,000	$ 37,000
Collectibility of Receivable and Excess and Obsolete Inventory [Member]
Loss Contingencies [Line Items]
Loss Contingency Accrual	10,000
Violation of Labor Code [Member] | Maximum [Member]
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	5,000
Violation of Labor Code [Member] | Minimum [Member]
Loss Contingencies [Line Items]
Loss Contingency, Estimate of Possible Loss	$ 3,500

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Note 8 Restructuring (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021 USD ($) people	Mar. 28, 2020 USD ($) people	Apr. 03, 2021 USD ($) people	Mar. 28, 2020 USD ($) people	Oct. 03, 2020 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	$ 11,880	$ 8,356	$ 13,784	$ 17,516
Restructuring Reserve	$ 16,000		16,000		$ 9,000
Corporate, Non-Segment [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges			600	3,000
IMS
Restructuring Cost and Reserve [Line Items]
Restructuring Charges			9,000	9,000
CPS
Restructuring Cost and Reserve [Line Items]
Restructuring Charges			$ 4,000	$ 6,000
Q1 FY20 Plan [Member]
Restructuring Cost and Reserve [Line Items]
Number of Positions Eliminated | people	790	300	830	1,750
Restructuring Charges	$ 10,665	$ 4,769	$ 11,501	$ 11,505
Expected Cost	35,000		35,000
Cost Incurred to Date	29,000		29,000
Q1 FY20 Plan [Member] | Employee Severance [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	10,656	4,725	11,492	11,453
Q1 FY20 Plan [Member] | Other Restructuring [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	9	44	9	52
Other plans [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	$ 1,215	$ 3,587	$ 2,283	$ 6,011

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Note 9 Income Tax (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 19,193	$ 6,205	$ 43,874	$ 20,792
Effective Income Tax Rate	29.00%	56.00%	32.00%	32.00%

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Note 10 Stockholders' Equity (Details) - USD ($) $ in Thousands	Apr. 03, 2021	Oct. 03, 2020
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign currency translation adjustments	$ 85,421	$ 85,343
Unrealized holding losses on derivative financial instruments	(17,526)	(22,202)
Unrecognized net actuarial losses and transition costs for benefit plans	(27,334)	(28,255)
Total	$ 40,561	$ 34,886

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Note 10 Derivatives (Details) - Derivatives Designated as Accounting Hedges: - Interest Rate Swap [Member] - USD ($) $ in Millions	Apr. 03, 2021	Oct. 03, 2020
Derivative [Line Items]
Derivative, Notional Amount	$ 350	$ 350
Effective Interest Rate	4.30%
Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member]
Derivative [Line Items]
Interest Rate Cash Flow Hedge Liability at Fair Value	$ 22	$ 29
Other Current Liabilities | Fair Value, Inputs, Level 2 [Member] | Fair Value, Recurring [Member]
Derivative [Line Items]
Interest Rate Cash Flow Hedge Liability at Fair Value	$ 9

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Note 10 Stock Repurchase (Details) - USD ($) shares in Millions, $ in Millions	6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020
Stockholders' Equity Note [Abstract]
Shares Repurchased	0.4	2.7
Cash Paid for Share Repurchases	$ 9	$ 70
Stock Repurchase Program, Remaining Authorized Repurchase Amount	$ 125
Share-based Payment Arrangement, Shares Withheld for Tax Withholding Obligation	0.2	0.4
Amount of Tax Withholding for Share-based Compensation	$ 6	$ 12

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Note 11 Revenue and Gross Profit by Segment (Details) $ in Thousands		3 Months Ended		6 Months Ended
		Apr. 03, 2021 USD ($)	Mar. 28, 2020 USD ($)	Apr. 03, 2021 USD ($)	Mar. 28, 2020 USD ($)
Segment Reporting Information [Line Items]
Net sales		$ 1,699,677	$ 1,590,550	$ 3,454,926	$ 3,430,721
Gross profit		143,098	107,421	$ 284,333	242,303
Number of Reportable Segments				1
Operating Segments
Segment Reporting Information [Line Items]
Gross profit		146,431	110,003	$ 292,635	247,797
Operating Segments | IMS
Segment Reporting Information [Line Items]
Net sales		1,369,937	1,305,887	2,832,037	2,854,780
Gross profit		95,030	75,421	201,596	176,627
Operating Segments | CPS
Segment Reporting Information [Line Items]
Net sales		361,072	321,509	680,488	652,684
Gross profit		51,401	34,582	91,039	71,170
Intersegment revenue
Segment Reporting Information [Line Items]
Net sales		(31,332)	(36,846)	(57,599)	(76,743)
Unallocated items
Segment Reporting Information [Line Items]
Gross profit	[1]	$ (3,333)	$ (2,582)	$ (8,302)	$ (5,494)

[1] For purposes of evaluating segment performance, management excludes certain items from its measure of gross profit. These items consist of stock-based compensation expense, charges or credits resulting from distressed customers and litigation settlements.

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Note 11 Segment Reporting by Geographic Segment (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Revenue from External Customer [Line Items]
Net sales		$ 1,699,677	$ 1,590,550	$ 3,454,926	$ 3,430,721
Percentage of net sales represented by ten largest customers		54.00%	55.00%	56.00%	55.00%
Number of customers representing 10% or more of net sales		1	1	1	1
Americas
Revenue from External Customer [Line Items]
Net sales	[1]	$ 803,642	$ 817,061	$ 1,635,464	$ 1,723,629
EMEA
Revenue from External Customer [Line Items]
Net sales		272,167	256,724	531,459	517,755
Asia Pacific
Revenue from External Customer [Line Items]
Net sales		$ 623,868	$ 516,765	$ 1,288,003	$ 1,189,337
Mexico
Revenue from External Customer [Line Items]
Percentage of Net Sales to Americas Net Sales		60.00%		60.00%
United States
Revenue from External Customer [Line Items]
Percentage of Net Sales to Americas Net Sales		35.00%		35.00%

[1] Mexico represents approximately 60% of Americas revenue and the U.S. represents approximately 35%.

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Note 12 Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Weighted average shares used in computing per share amount:
Net income	$ 47,037	$ 4,882	$ 95,058	$ 43,227
Weighted average common shares outstanding	65,249	70,584	65,244	70,377
Effect of dilutive stock options and restricted stock units	1,708	1,661	1,643	2,052
Denominator for diluted earnings per share	66,957	72,245	66,887	72,429
Net income per share:
Basic	$ 0.72	$ 0.07	$ 1.46	$ 0.61
Diluted	$ 0.70	$ 0.07	$ 1.42	$ 0.60

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Note 13 Share-Based Compensation Arrangements (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Apr. 03, 2021	Mar. 28, 2020	Apr. 03, 2021	Mar. 28, 2020
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Noncash Expense	$ 9,224	$ 7,783	$ 17,432	$ 14,689
Share-based Payment Arrangement, Option [Member]
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Noncash Expense	0	0	0	(1,145)
Restricted stock units, including performance based awards
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Noncash Expense	9,224	7,783	17,432	15,834
Cost of sales
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Expense	3,629	2,582	7,050	5,494
Selling, general and administrative
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Expense	5,479	5,127	10,196	9,052
Research and development
Allocation of Recognized Period Costs [Line Items]
Share-based Payment Arrangement, Expense	$ 116	$ 74	$ 186	$ 143

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Note 13 Shares Authorized for Future Issuance and Available for Grant (Details) shares in Millions	3 Months Ended
	Apr. 03, 2021 shares
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Common Stock, Capital Shares Reserved for Future Issuance	8.0
Stock options and unvested restricted stock units outstanding	4.2
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant	3.8
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized	1.4

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Note 13 Additional Information (Details) - shares	3 Months Ended	6 Months Ended
	Dec. 28, 2019	Apr. 03, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted		1,444,000
Performance Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted	304,500	373,000
Performance Shares | Q1 FY20 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Potential adjustment to PSUs		15.00%
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting Period		1 year
Minimum [Member] | Performance Shares | Q1 FY20 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Potential Payout Percentage		80.00%
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting Period		4 years
Maximum [Member] | Performance Shares | Q1 FY20 Grants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Potential Payout Percentage		120.00%

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Note 13 Restricted Stock Rollforward (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended	12 Months Ended
	Apr. 03, 2021	Oct. 03, 2020
Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Outstanding, beginning	2,568
Granted	1,444
Vested/Forfeited/Cancelled	(698)
Outstanding, ending	3,314	2,568
Expected to vest	2,870
Weighted Average Grant Date Fair Value Restricted Stock [Abstract]
Outstanding, beginning	$ 29.67
Granted	33.92
Vested/Forfeited/Cancelled	29.31
Outstanding, ending	31.61	$ 29.67
Expected to vest	$ 31.46
Weighted Average Remaining Contractual Term [Abstract]
Outstanding	1 year 6 months 21 days	1 year 2 months 23 days
Expected to vest	1 year 6 months 3 days
Restricted Stock Non vested Aggregate Intrinsic Value [Abstract]
Outstanding	$ 135,998	$ 71,571
Expected to vest	$ 117,798

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Note 13 Unrecognized Stock Based Compensation Expense (Details) $ in Millions	6 Months Ended
	Apr. 03, 2021 USD ($)
Restricted stock units
Unrecognized Compensation Cost and Weighted Average Period [Line Items]
Unrecognized compensation expense	$ 63
Weighted average period of recognition (years)	1 year 6 months
Performance Shares
Unrecognized Compensation Cost and Weighted Average Period [Line Items]
Unrecognized compensation expense	$ 3

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Note 14 Business Combinations (Details) - Subsequent Event $ in Millions	Apr. 06, 2021 USD ($)
Business Acquisition [Line Items]
Effective Date of Acquisition	Apr. 06, 2021
Minimum [Member]
Business Acquisition [Line Items]
Payments to Acquire Businesses, Gross	$ 30
Maximum [Member]
Business Acquisition [Line Items]
Payments to Acquire Businesses, Gross	$ 35