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Concentration of Risk and Segment Data
 9 Months Ended
May 31, 2024
Segment Reporting [Abstract]  
Concentration of Risk and Segment Data Concentration of Risk and Segment Data
Concentration of Risk
Sales of the Company’s products are concentrated among specific customers. During the nine months ended May 31, 2024, the Company’s five largest customers accounted for approximately 37% of its net revenue and 86 customers accounted for approximately 90% of its net revenue. Sales to these customers were reported in the Electronics Manufacturing Services (“EMS”) and Diversified Manufacturing Services (“DMS”) operating segments. The DMS segment included the results of the Company’s mobility business prior to the closing of its sale on December 29, 2023.
The Company procures components from a broad group of suppliers. Some of the products manufactured by the Company require one or more components that are available from only a single source.
Segment Data
Net revenue for the operating segments is attributed to the segment in which the service is performed. An operating segment’s performance is evaluated based on its pre-tax operating contribution, or segment income. Segment income is defined as net revenue less cost of revenue, segment selling, general and administrative expenses, segment research and development expenses and an allocation of corporate manufacturing expenses and selling, general and administrative expenses. Certain items are excluded from the calculation of segment income. Transactions between operating segments are generally recorded at amounts that approximate those at which we would transact with third parties.
The following table sets forth operating segment information (in millions):
 Three months endedNine months ended
 May 31, 2024May 31, 2023May 31, 2024May 31, 2023
Segment income and reconciliation of income before income tax
EMS$195 $226 $505 $629 
DMS155 178 682 627 
Total segment income$350 $404 $1,187 $1,256 
Reconciling items:
Amortization of intangibles(12)(7)(27)(24)
Stock-based compensation expense and related charges(3)(18)(72)(80)
Restructuring, severance and related charges(1)
(55)— (252)(45)
Business interruption and impairment charges, net(2)
(14)— (14)— 
Gain from the divestiture of businesses(3)
— — 944 — 
Acquisition and divestiture related charges(3)
(3)— (64)— 
Other expense (net of periodic benefit cost)(24)(22)(72)(61)
Interest expense, net(38)(51)(132)(154)
Income before income tax$201 $306 $1,498 $892 
(1)Charges recorded during the three months and nine months ended May 31, 2024, related to the 2024 Restructuring Plan. Charges recorded during the nine months ended May 31, 2023, related to headcount reduction to further optimize the Company’s business activities.
(2)Charges recorded during the three months and nine months ended May 31, 2024, related to costs associated with product quality liabilities, which is classified as a component of cost of revenue and selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.
(3)The Company completed the divestiture of its mobility business and recorded a pre-tax gain of $944 million, subject to certain post-closing adjustments that are still being finalized. The Company incurred transaction and disposal costs in connection with the sale of approximately $64 million during the nine months ended May 31, 2024.
The following table presents the Company’s revenues disaggregated by segment (in millions):
Three months ended
May 31, 2024May 31, 2023
EMSDMSTotalEMSDMSTotal
Timing of transfer
Point in time$1,172 $559 $1,731 $1,120 $1,351 $2,471 
Over time2,225 2,809 5,034 3,010 2,994 6,004 
Total$3,397 $3,368 $6,765 $4,130 $4,345 $8,475 
Nine months ended
May 31, 2024May 31, 2023
EMSDMSTotalEMSDMSTotal
Timing of transfer
Point in time$3,473 $3,346 $6,819 $3,925 $5,047 $8,972 
Over time6,847 8,253 15,100 8,802 8,470 17,272 
Total$10,320 $11,599 $21,919 $12,727 $13,517 $26,244 
The Company operates in more than 30 countries worldwide. Sales to unaffiliated customers are based on the Company location that maintains the customer relationship and transacts the external sale. The following table sets forth, for the periods indicated, foreign source revenue expressed as a percentage of net revenue:
Three months endedNine months ended
 
May 31, 2024(1)
May 31, 2023
May 31, 2024(1)
May 31, 2023
Foreign source revenue80.5 %86.9 %83.4 %85.6 %
(1)Decrease from prior periods is driven by the divestiture of the mobility business during the three months ended February 29, 2024.