TLDR
- Fabrinet delivered non-GAAP earnings per share of $4.10 for Q4, surpassing analyst expectations of $3.81 by 7.6%
- Quarterly revenue reached $1.316 billion, representing a 45% year-over-year increase and exceeding the $1.27 billion consensus
- Shares climbed 5% during regular hours to $598.58, before plummeting 7% in after-hours trading to approximately $556
- Data center operations now represent 51% of total sales, establishing it as the firm’s dominant business segment
- First quarter fiscal 2027 revenue guidance ranges from $1.375 billion to $1.425 billion
Fabrinet delivered an impressive fiscal fourth-quarter performance that exceeded analyst projections across key metrics, yet shares experienced a significant decline in after-hours trading.
The optical components manufacturer announced non-GAAP earnings of $4.10 per share, comfortably beating the Street’s $3.81 expectation by 7.6%. Total revenue landed at $1.316 billion, approximately $46 million above what analysts had forecasted.
During Monday’s regular session, FN shares surged 4.97% to close at $598.58. However, in extended trading, the stock tumbled roughly 7% to around $556, falling beneath the previous session’s close of $570.22.
The quarterly revenue figure represents a 45% jump compared to the same period last year. This achievement extends the company’s record revenue streak to 12 consecutive quarters, while also marking the sixth straight quarter of accelerating annual growth.
For the first time in company history, data center operations surpassed the 50% threshold, representing 51% of the quarter’s $1.316 billion in total sales.
Diversified Revenue Streams
Four major technology companiesāCisco, Nvidia, Nokia, and Amazonāeach contributed at least 10% of total revenue during fiscal year 2026. This represents a more diversified customer portfolio compared to previous fiscal periods.
Chief Executive Seamus Grady emphasized the broad-based nature of the quarter’s success. “What is most noticeable to us is that this performance did not come from any one product category or customer,” he stated.
Grady also noted that multiple new data center transceiver initiatives with additional customers are scheduled to scale up throughout the current fiscal year.
Annual revenue for fiscal 2026 totaled $4.64 billion, marking a 36% increase from the $3.42 billion recorded in fiscal 2025. Full-year non-GAAP earnings per share climbed to $14.09, representing a 39% year-over-year improvement.
GAAP net income for the quarter registered $139.3 million, translating to $3.83 per diluted share, versus $87.2 million, or $2.42 per share, in the comparable quarter from the prior year.
Operating margin expanded to 10.9%, marking the highest level achieved in three years. Gross margin came in at 12.2%, showing a modest sequential improvement but declining 30 basis points compared to the year-ago period.
Forward Guidance and Manufacturing Investment
Looking ahead to the first quarter of fiscal 2027, Fabrinet projects revenue between $1.375 billion and $1.425 billion, with non-GAAP earnings per share ranging from $4.10 to $4.25. The midpoint suggests approximately 43% revenue expansion year over year.
The company continues to make substantial investments in expanding its production capabilities. Building 10 in Thailand remains on schedule for early 2027 completion and is projected to deliver $3 billion to $3.5 billion in additional revenue capacity. A recently acquired facility in Navanakorn and an expansion in Santa Clara will each contribute another $200 million to $250 million in capacity.
Combined, these initiatives are expected to push total potential revenue capacity to between $12.5 billion and $14 billion over the long term.
Chief Financial Officer Csaba Sverha indicated the company is beginning fiscal 2027 with “strong momentum.” Leadership noted that customers are providing demand forecasts “well out into the end of 2027 and beyond.”
The company’s cash position and short-term investments totaled $876 million at quarter’s end. The stock has traded within a 52-week range of $272.49 to $748.89.
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