Key Highlights

  • FN reported record first quarter fiscal 2027 Revenue of $1,474.5 million, up from $978.1 million a year earlier.
  • Non-GAAP Net Income per diluted share reached $4.34, compared with $2.92 in the prior-year quarter.
  • Data center revenue climbed 78% from a year ago to $777 million, or 53% of total revenue.
  • Second quarter revenue guidance is $1.6 billion to $1.65 billion, with non-GAAP EPS of $4.77 to $4.92.
  • The board added $103.0 million to the share repurchase program, lifting total authorization to $637.3 million.

Data Center Demand Drives Record Revenue and Accelerating Growth

Fabrinet (NYSE:FN) reported record revenue of $1,474.5 million for the first quarter of fiscal 2027, which ended Sep 25, 2026, up 51% from $978.1 million a year earlier. The results, released on Nov 2, 2026, beat the company's own guidance range. Management called it the fastest growth in a decade and the 14th consecutive quarter of growth.

Fabrinet provides advanced optical packaging and precision optical, electro-mechanical and electronic Manufacturing services to makers of complex products such as optical communication components, automotive parts, medical devices and industrial lasers. Data Center products grew 78% from a year ago to $777 million, driven by data center interconnect, transceivers and high-performance computing.

Communications infrastructure revenue rose 35% to $444 million, while automotive, industrial and other revenue increased 20% to $253 million.

GAAP Profit Rises Modestly as Pillar Two Tax and Investment Loss Weigh

GAAP net income was $103.5 million, or $2.86 per diluted share, compared with $95.9 million, or $2.66, a year earlier. Non-GAAP net income was $157.4 million, or $4.34 per diluted share, up from $105.3 million, or $2.92. The gap reflects a $19.9 million tax provision tied to the global minimum tax framework and a $21.5 million non-cash Revaluation loss on a minority investment.

GAAP gross Margin was 11.8% against 11.9% a year earlier, and non-GAAP gross margin was 12.1% versus 12.3%, which management tied mainly to currency headwinds. Non-GAAP Operating Margin improved to 10.8% from 10.6%.

Operating cash flow was $21.3 million, down from $102.6 million. Calculated Capital spending rose to $158.7 million from $45.3 million, including a $77 million purchase of a second Santa Clara campus, leaving free cash flow negative $137.4 million.

Building 11 and a $10 Billion Capacity Target Back Second Quarter Guidance

For the second quarter ending Dec 25, 2026, Fabrinet expects revenue of $1.6 billion to $1.65 billion. GAAP net income per diluted share is guided to $3.81 to $3.96, and non-GAAP to $4.77 to $4.92, on about 36.2 million diluted shares.

Management said revenue capacity stood near $5.8 billion at the end of fiscal 2026 and should reach roughly $10 billion in January, mainly as Building 10 in Chonburi, Thailand, is completed. Building 11 will follow, adding about 1.5 million square feet and roughly $3 billion of revenue capacity.

During the quarter Fabrinet repurchased about 77,000 shares for $29.1 million. The board then approved an additional $103.0 million, bringing aggregate authorization under the program to $637.3 million.

Capacity Build-Out and Second Quarter Ramps Set the Next Test

Fabrinet delivered record revenue and non-GAAP Earnings while heavy factory spending pushed free cash flow negative. The next checkpoints are the second quarter result against the guided $1.6 billion to $1.65 billion range, the January completion of Building 10, and the start of Building 11 construction.