Jabil, Inc.JBL has gained 36.2% year to date compared with the Electronic Manufacturing Services industry's growth of 23.6%. It has outperformed the Zacks Computer & Technology sector and the S&P 500's growth during this period.

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Among its competitors, the company has underperformed Flex Ltd.FLEX but outperformed  Celestica, Inc.CLS. Celestica has increased 5.7%, while Flex has gained 81.2%.

JBL Rides Solid AI Traction, Diverse Portfolio

AI is driving a structural transformation across the technology sector. This is not a short-term change. Companies across industries are accelerating AI adoption to streamline workflows, improve productivity and strengthen their competitive positioning. This surge in AI deployment is prompting hyperscalers like Amazon, Microsoft and Google to significantly ramp up investments in data-center capacity. Jabil's strongest growth opportunity is its expanding exposure to AI infrastructure. The company expects AI-related revenues of approximately $13.6 billion in fiscal 2026, up from $9 billion in fiscal 2025.

The company has developed capabilities spanning compute, storage, networking, optics, power, cooling and system integration. This is allowing customers to source more components from a single partner, reducing complexity for them. The company's AI-related revenue base is expanding through steady customer additions. Jabil is expanding manufacturing capacity in locations including North Carolina, Memphis and India to support a surge in this AI-related demand.

The company's growth is not only reliant on AI infrastructure investments. It is also benefiting from the increase in equipment spending needed to support evolution in semiconductor technology. Healthcare remains another major growth vertical. Jabil sees opportunities across areas such as drug delivery, medical devices, continuous glucose monitors, chronic disease management and pharma-related capabilities. The company is also witnessing improving conditions within renewable and energy infrastructure. Increasing power requirements associated with AI and data centers, and a shift in demand from residential toward commercial projects are driving demand in this vertical.

The company's Connected Living and Digital Commerce operations are also witnessing improved customer additions. Growing opportunities in automation, robotics, retail and warehouse technology are a positive factor.

Supply Chain Issues, Competition and Volatility are Concerns

One of Jabil's key challenges is ensuring adequate availability of critical components to support the rapid surge in demand. Management highlighted component availability as one of the factors that could influence the company's fiscal 2027 performance. Jabil's heavy reliance on a limited number of suppliers makes it vulnerable to supply chain disruptions.

Despite its diversified end-market exposure, Jabil remains dependent on a relatively limited number of customers. Changes in the spending plans, production requirements or financial condition of major customers could materially affect revenues. The risk is more prevalent because Jabil faces strong competition in the industry from other players such as Celestica and Flex.

Demand volatility in certain verticals such as automotive continues to impede top-line growth to some extent. The cyclical nature of the semiconductor market can also impact revenue growth.