Q1 2026 Fabrinet Earnings Call Transcript
Key Points
- Fabrinet (FN) reported record revenue of $978 million for Q1 FY2026, marking a 22% increase year-over-year and an 8% increase from Q4.
- Non-GAAP earnings per share were $2.92, exceeding guidance and reflecting strong financial performance.
- Telecom revenue surged 59% year-over-year, driven by data center interconnect (DCI) products, which nearly doubled to 14% of company revenue.
- The company introduced a new revenue category for high-performance computing (HPC) products, contributing $15 million to Q1 revenue, with expectations for significant growth.
- Fabrinet (FN) is optimistic about continued growth in Q2, with revenue projected to be between $1.05 billion and $1.1 billion, representing a 29% year-over-year increase at the midpoint.
- Datacom revenue declined by 17% year-over-year and 1% from Q4, although the decline was smaller than anticipated.
- First quarter gross margin decreased by 30 basis points from Q4, impacted by foreign exchange headwinds and seasonal cost increases.
- Operating margin declined by 10 basis points from Q4, reflecting increased operating expenses.
- Component constraints, particularly in datacom, are expected to persist into the second quarter, potentially impacting growth.
- Automotive revenue decreased by 5% from Q4, and industrial laser revenue remained flat sequentially.
Good afternoon. Welcome to Fabrinet's Financial Results Conference Call for the First Quarter of Fiscal Year 2026. (Operator Instructions) As a reminder, today's call is being recorded.
I would now like to turn the call over to your host, Garo Toomajanian, VP of Investor Relations.
Thank you, operator, and good afternoon, everyone. Thank you for joining us on today's conference call to discuss Fabrinet's financial and operating results for the first quarter of fiscal year 2026, which ended September 26, 2025. With me on the call today are Seamus Grady, Chairman and Chief Executive Officer; and Csaba Sverha, Chief Financial Officer.
This call is being webcast, and a replay will be available on the Investors section of our website located at investor.fabrinet.com.
During this call, we will present both GAAP and non-GAAP financial measures. Please refer to the Investors section of our website for important information, including our earnings press release and investor presentation, which
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