Key Highlights

  • Shares rose 11.52% pre-market to $350.96 from a $314.70 close.
  • Fiscal Q1 Revenue of $1.474 billion rose 51%, with non-GAAP EPS of $4.34.
  • Q2 revenue guidance of $1.6 billion to $1.65 billion beat the $1.48 billion consensus.

Fabrinet (NYSE:FN) shares rose 11.52% in pre-market trading on Tuesday to $350.96, from a Monday close of $314.70. The stock had fallen 3.85% in the prior session in a tech-led selloff.

Fabrinet is a Cayman Islands-incorporated contract manufacturer of optical packaging and precision optical, electro-mechanical and electronic products, with production concentrated in Thailand. Its largest customers include NVIDIA (NASDAQ:NVDA) and Cisco (NASDAQ:CSCO).

Data Center Interconnect Drives a Record Quarter

Fiscal first quarter revenue was $1.474 billion, up 51% year over year and 12% sequentially, above an estimate near $1.40 billion. Non-GAAP EPS was a record $4.34, against $4.19 expected and $2.86 a year ago.

Data center revenue rose 78% to $777 million, 53% of the total. Communications infrastructure rose 35% to $444 million, and automotive, industrial and other rose 20% to $253 million.

Capacity Build-Out Reaches About $16 Billion

Revenue capacity was about $5.8 billion at the end of fiscal 2026 and is expected to reach about $10 billion in January. Total planned capacity was raised to about $16 billion from $14 billion, with Building 11 expected online by the end of fiscal 2028.

Cash, Capex and Valuation After the Gap

Second quarter guidance calls for revenue of $1.6 billion to $1.65 billion and non-GAAP EPS of $4.77 to $4.92, against consensus of about $1.48 billion and $4.43. Gross Margin was 12.1% and Operating Margin was 10.8%.

Cash and short-term investments were $757 million, and free Cash Flow was an outflow of $137 million on $159 million of capex. The board added $103 million to the buyback, bringing the remaining authorization to $200 million.

At $350.96, the shares sit about 53% below the 52-week high of $748.89 and about 15% above the 52-week low of $305.63. Market Capitalization is about $11.28 billion.

Q2 Guidance and Margin Trends to Follow

Management expects incremental margin improvement, with growth led by Data Center interconnect and transceivers. Component Supply remains tight, and investors will track capex against the guide.