Flex Pitches AI Data Center Spin-Off as Power and Cooling Growth Accelerates

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Sat, May 23, 2026 astatine 3:02 PM CDT 7 min read

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Flex plans to rotation disconnected its CPI segment into a caller institution focused connected information halfway power, cooling and electrical infrastructure. Management says the concern is ample capable and increasing accelerated capable to merit a antithetic superior structure, akin to Flex’s anterior Nextracker spin-off.
The institution outlined very beardown maturation targets for CPI, forecasting gross maturation of 65% to 75% successful fiscal 2027 and 80%+ successful fiscal 2028, with overmuch of that gross already tied to awarded programs and lawsuit request visibility.
Flex says the remaining concern volition inactive beryllium a $22 billion+ diversified platform, portion the spin-off operation is meant to support indebtedness debased and enactment growth, adjacent arsenic superior spending peaks astatine $1.4 cardinal to $1.6 cardinal successful fiscal 2027.

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Flex (NASDAQ:FLEX) executives utilized a J.P. Morgan fireside chat to outline the rationale for the company’s latest planned spin-off, picture the maturation expectations for the concern being separated and framework the remaining Flex arsenic a large, diversified manufacturing and services platform.

Revathi Advaithi, Flex’s main enforcement officer, said the company’s portfolio strategy implicit the past 7 years has focused connected improving concern mix, productivity and fiscal returns. She pointed to Flex’s exit from respective user extremity markets, the earlier spin-off of Nextracker and reinvestment successful areas tied to compute, powerfulness and information halfway infrastructure.

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Advaithi said the latest spin-off reflects the standard and maturation illustration of the company’s CPI segment, which she described arsenic requiring a antithetic superior model than the remainder of Flex.

“We cognize however to bash spins. We’ve done it well,” Advaithi said, noting that Nextracker has reached a marketplace capitalization of astir $17 billion.

SpinCo to Focus connected Data Center Power, Cooling and Electrical Infrastructure

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Advaithi said the caller company, referred to during the treatment arsenic SpinCo, volition beryllium positioned arsenic an concern institution with a absorption connected information halfway thermal architecture, electrical infrastructure and cooling infrastructure. She said Flex began investing successful the country earlier the caller surge successful artificial quality demand, gathering from a powerfulness concern acquired from Ericsson and combining it with compute integration capabilities.

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