Sanmina Corporation (SANM) is entering 2026 with a fundamentally altered financial and operational profile following its $2.05 billion acquisition of ZT Systems’ data center infrastructure business. While the stock’s 52-week rally reflects optimism, the transaction marks a shift from the company’s historically conservative balance sheet and specialized components focus toward high-volume system integration.
The acquisition was financed through approximately $2.5 billion in committed debt, a move that increases Sanmina’s interest expense and financial leverage. Historically, Sanmina maintained a debt-to-equity ratio below 0.15x; however, the new capital structure must now support a massive production ramp-up for AMD-based AI rack builds. Management has stated they intend to double Sanmina’s annual revenue to $16 billion within the next two years, a significant acceleration from previous three-year targets.
Industry analysts note that this transition involves a steep “learning curve” for manufacturing yields and supply chain coordination. The company must now manage higher working capital requirements and navigate the “lumpy” capital expenditure cycles typical of hyperscale cloud providers. While the acquisition bolsters Sanmina’s position in the AI stack, the reliance on a concentrated group of semiconductor partners creates a “perfection” scenario where any delay in product qualification could pressure margins that currently sit at 5.7% for the full year.