Step 1 :
To factor $ x^{3}-2x^{2}-16x+32 $ we can use factoring by grouping:
Group $ \color{blue}{ x^{3} }$ with $ \color{blue}{ -2x^{2} }$ and $ \color{red}{ -16x }$ with $ \color{red}{ 32 }$ then factor each group.
$$ \begin{aligned} x^{3}-2x^{2}-16x+32 = ( \color{blue}{ x^{3}-2x^{2} } ) + ( \color{red}{ -16x+32 }) &= \\ &= \color{blue}{ x^{2}( x-2 )} + \color{red}{ -16( x-2 ) } = \\ &= (x^{2}-16)(x-2) \end{aligned} $$Step 2 :
Rewrite $ x^{2}-16 $ as:
$$ x^{2}-16 = (x)^2 - (4)^2 $$Now we can apply the difference of squares formula.
$$ I^2 - II^2 = (I - II)(I + II) $$After putting $ I = x $ and $ II = 4 $ , we have:
$$ x^{2}-16 = (x)^2 - (4)^2 = ( x-4 ) ( x+4 ) $$