Fabrinet reported fourth-quarter fiscal 2026 earnings that exceeded analysts' expectations, though its guidance for the first quarter of fiscal 2027 fell short of market forecasts, prompting a decline in after-hours trading.
The contract manufacturer of optical interconnects and networking components said adjusted earnings per share came in at $1.75, surpassing the $1.62 consensus estimate compiled by Refinitiv. Revenue for the quarter totaled $642 million, slightly above the $638 million estimate.
Despite the beat on earnings and revenue, Fabrinet provided a cautious outlook for Q1 FY27. The company guided for adjusted EPS in the range of $1.25 to $1.45, below the $1.55 forecast from analysts. Revenue guidance for the quarter was set between $580 million and $610 million, also below the $620 million estimate.
Chief Executive Seamus Grady attributed the softer outlook to "persistent macroeconomic headwinds" and "slower-than-expected demand" across key end markets, including cloud and enterprise networking. Grady noted that while inventory levels at customers remain elevated, Fabrinet expects gradual normalization in the second half of FY27.
Shares of Fabrinet fell 4.5% in extended trading following the release. The stock had closed the regular session at $112.30, up 1.2% for the day.
