BANGKOK, Thailand – February 2, 2026 – Fabrinet (NYSE: FN), a leading provider of advanced optical packaging and precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers of complex products, today announced its financial results for its second fiscal quarter ended December 26, 2025. Seamus Grady, Chairman and Chief Executive Officer of Fabrinet, said, "We delivered an exceptional second quarter with record revenue and earnings that significantly exceede ...

Core Insights - Fabrinet reported record revenue and earnings for the second quarter of fiscal year 2026, significantly exceeding guidance ranges [2][6] - The company attributes its strong performance to multiple large strategic programs and excellent execution, which are expected to continue into the third quarter [2][4] Financial Highlights - Revenue for Q2 FY2026 was $1,132.9 million, up from $833.6 million in Q2 FY2025, representing a year-over-year increase of approximately 36% [6] - GAAP net income for Q2 FY2026 was $112.6 million, compared to $86.6 million in Q2 FY2025, marking a 30% increase [6] - GAAP net income per diluted share for Q2 FY2026 was $3.11, up from $2.38 in Q2 FY2025, reflecting a 30% increase [6] - Non-GAAP net income for Q2 FY2026 was $121.6 million, compared to $95.1 million in Q2 FY2025, a 28% increase [6] - Non-GAAP net income per diluted share for Q2 FY2026 was $3.36, compared to $2.61 in Q2 FY2025, a 29% increase [6] Business Outlook - For Q3 FY2026, Fabrinet expects revenue to be in the range of $1.15 billion to $1.20 billion [6] - GAAP net income per diluted share is projected to be between $3.22 and $3.37, while non-GAAP net income per diluted share is expected to be between $3.45 and $3.60 [6][29]

Core Viewpoint - Three global leaders, Fabrinet (FN), LivaNova (LIVN), and nVent Electric (NVT), are nearing buy points as they approach their earnings reports, indicating potential investment opportunities in the stock market [1]. Group 1: Company Earnings - Fabrinet is set to release its fiscal second-quarter earnings report on Monday after the market closes [1]. - LivaNova is highlighted as a stock of interest, forming a unique base and potentially driving new opportunities [1]. Group 2: Market Context - The stock market is experiencing mixed futures, with tech stocks facing significant declines, particularly impacting the Nasdaq index [1]. - The S&P 500 has reached an all-time high and is eyeing the 7,000 level as the market anticipates an earnings avalanche [1].

Key Takeaways FN will report fiscal Q2 results with revenues expected between $1.05-$1.10 billion and EPS of $3.15-$3.30.FN's telecom and DCI businesses are driving growth, supported by strong demand and rising HPC adoption.FN's results may be constrained by flat automotive revenue and margin pressure from FX headwinds.Fabrinet (FN) is slated to release second-quarter fiscal 2026 results on Feb. 2.For the fiscal second quarter, revenues are expected in the range of $1.05-$1.10 billion. Non-GAAP earnings per ...

Core Viewpoint - Fabrinet is set to release its financial results for the second quarter of fiscal year 2026 on February 2, 2026, after market close, followed by a conference call to discuss the results [1][2]. Group 1: Financial Results Announcement - Fabrinet will announce its financial results for the second quarter of fiscal year 2026, which ended on December 26, 2025 [1]. - The financial results will be released after market close on February 2, 2026 [1]. - A conference call and webcast will be held at 5:00 p.m. EST on the same day to review and discuss the results [1][2]. Group 2: Company Overview - Fabrinet is a leading provider of advanced optical packaging and precision manufacturing services for original equipment manufacturers of complex products [3]. - The company specializes in products such as optical communication components, automotive components, medical devices, and industrial lasers [3]. - Fabrinet offers a comprehensive range of manufacturing capabilities, including process design, supply chain management, advanced packaging, and testing [3]. - The company operates engineering and manufacturing facilities in Thailand, the USA, China, and Israel [3].

Summary of Key Points from Conference Call Records Industry Overview - **Technology and AI Sector**: The records highlight significant developments in the technology sector, particularly around AI and semiconductor industries, with a focus on companies like Nvidia and TSMC. The demand for AI-related technologies is driving capital expenditures and revenue growth expectations. Company-Specific Insights AppLovin (APP) - **Rating and Price Target**: ISI initiated coverage with an "Outperform" rating and a price target of $835, indicating a potential upside of approximately 25% [7][8] - **Growth Projections**: Expected sustained revenue and EBITDA CAGRs of over 30% from 2025 to 2028, with mobile gaming spend projected to grow at a ~23% CAGR through 2028 [7][8] Flex (FLEX) - **Upgrade and Price Target**: Raymond James upgraded Flex to "Outperform" with a price target of $75, citing strong growth in cloud and AI datacenter infrastructure [10] - **Revenue Expectations**: Anticipated FY26 datacenter revenue of $6.5 billion, representing a 35% year-over-year increase [10] TSMC (TSM) - **Capital Expenditure**: Morgan Stanley raised TSMC's capex forecast to $54 billion for 2027, noting it is still below market speculation of $60 billion but likely to increase due to strong AI demand [11] Infosys (INFY) - **Revenue Outlook**: Infosys raised its full-year revenue growth forecast to 3%-3.5% in constant currency, up from a previous estimate of 2%-3% [20] Nvidia (NVDA) - **Customs Restrictions**: Reports indicate that Chinese customs have prohibited Nvidia's H200 AI chips from entering China, impacting the company's market access [13][14] Okta (OKTA) - **Rating Upgrade**: Stephens upgraded Okta to "Overweight" with a price target increase to $120, citing improved growth outlook for 2026 [16] DoorDash (DASH) - **Operational Momentum**: BNP Paribas initiated coverage with an "Outperform" rating and a price target of $280, highlighting strong operational momentum and rising order frequency [17][18] Microsoft (MSFT) - **CIO Survey Insights**: Morgan Stanley reiterated an "Overweight" rating with a price target of $650, based on a CIO survey indicating modest acceleration in software spending growth to +3.8% in 2026 [36][38] Amazon (AMZN) - **Supplier Negotiations**: Amazon is reportedly pressuring suppliers for price cuts ahead of a Supreme Court ruling on tariffs, seeking discounts of up to 30% [39][40] Additional Insights - **Market Sentiment**: The overall market sentiment appears cautious, with investors showing little appetite for application software currently, despite some positive indicators from CIO surveys regarding software spending [4][36] - **AI and Semiconductor Demand**: The records emphasize the ongoing strength in AI semiconductor demand, which is expected to drive significant capital expenditures and revenue growth across the sector [2][11] Conclusion The conference call records provide a comprehensive overview of the current state of the technology sector, highlighting key companies and their growth prospects, as well as challenges posed by geopolitical factors and market dynamics. The emphasis on AI and cloud infrastructure indicates a strong growth trajectory for companies positioned in these areas.

Core Viewpoint - The article compiles significant research calls from Wall Street, highlighting upgrades for various companies that indicate potential growth and positive market sentiment [1] Group 1: Upgrades - Stephens upgraded Okta (OKTA) to Overweight from Equal Weight with a price target of $120, increased from $97, due to an increasing probability of growth acceleration in 2026 and an attractive risk/reward setup [2] - Seaport Research upgraded Global Payments (GPN) to Buy from Neutral with a price target of $109, anticipating a rebound in Fintech after a volatile 2025, noting reasonable forward valuation multiples and a constructive fundamental outlook for most companies in the sector [2] - Scotiabank upgraded Prologis (PLD) to Outperform from Sector Perform with a price target of $146, up from $133, as the firm becomes more positive on the Industrial subsector ahead of Q4 earnings, raising 2026/2027 earnings estimates due to better occupancy expectations [2] - Barclays upgraded Fabrinet (FN) to Overweight from Equal Weight with a price target of $537, increased from $499, identifying it as having the most upside to revenue numbers in 2026 within the distributor space [2] - Wells Fargo upgraded Cintas (CTAS) to Overweight from Equal Weight with a price target of $245, up from $205, citing strong fundamentals in 2026 due to pricing power despite multiple compression in 2025 [2]

Core Insights - In 2026, investors are expected to prioritize companies with consistent earnings growth, as this indicates profitability, but earnings acceleration is even more critical for driving stock prices higher [1][8] - Research shows that top-performing stocks often experience earnings acceleration before their share prices rise [1] Earnings Acceleration - Earnings acceleration refers to the incremental growth in a company's earnings per share (EPS), specifically when the quarter-over-quarter earnings growth rate increases over time [2] - This metric helps identify stocks that have not yet attracted investor attention, which can lead to a price rally once they are recognized [3] Earnings Growth Trends - An increasing percentage of earnings growth suggests a company is fundamentally sound, while a stagnant or decelerating growth percentage may indicate consolidation or a slowdown, potentially dragging prices down [4] Screening Parameters - Stocks should be screened based on the last two quarter-over-quarter EPS growth rates exceeding previous periods' growth rates, with projected EPS growth rates for the upcoming quarter expected to surpass prior periods [5][6] - Additional criteria include a current price of at least $5 and an average 20-day trading volume of 50,000 or more to ensure adequate liquidity [7] Top Stocks Identified - Screening for accelerating EPS growth narrowed the universe of approximately 7,735 stocks to just 11, with Silicon Laboratories Inc. (SLAB), Patria Investments Limited (PAX), and Fabrinet (FN) leading the list [8] - Expected earnings growth rates for 2026 are 197.8% for SLAB, 22.8% for PAX, and 16.1% for FN [8][9][10][11]

Core Viewpoint - Fabrinet (NYSE:FN) is highlighted as a promising investment in the AI sector, with a "Positive" rating and a price target of $550 set by Susquehanna, indicating strong potential in the optical networking market driven by infrastructure and AI trends [1][3]. Group 1: Company Positioning - Fabrinet is well-positioned in the optical networking market, benefiting from the growth in transceivers, Data Center Interconnect (DCI), and Co-Packaged Optics (CPO) technologies [2][3]. - The company has significantly benefited from the increasing demand for transceivers in data centers and is expected to capitalize on further opportunities in optical networking and high-performance computing (HPC) contract manufacturing for AI servers [3]. Group 2: Market Outlook - The firm anticipates that Fabrinet will leverage expanding opportunities in optical networking, which includes various technologies that are critical for the growth of AI infrastructure [2][3].

Core Thesis - Fabrinet (FN) is positioned as a leading outsourced semiconductor assembly and test (OSAT) provider, focusing on photonic modules for AI data centers, indicating strong growth potential in the AI hardware supply chain [2][3] Financial Performance - As of December 16th, FN's share price was $451.16, with a trailing P/E of 48.46 [1] - The company is projected to achieve a revenue growth of 27.9% and EBITDA growth of 30.9% in FY26, driven by the increasing adoption of photonic transceivers [2] - FN's net income margin stands at 10.7%, reflecting the profitability of its specialized operations [3] Market Valuation - FN's stock trades at a forward EV/Sales of 3.8x, EV/EBITDA of 30.5x, and a forward P/E of 36.7x, suggesting that the market valuation may not fully reflect its strategic position in the AI infrastructure ecosystem [3] Competitive Advantage - The company's focus on high-reliability modules provides a competitive moat, as few competitors possess the necessary technical expertise or scale to serve hyperscale AI clients [3] Growth Catalysts - Potential catalysts for FN's upside include growth in high-margin photonic modules, deeper penetration into AI data center supply chains, and operational leverage that could enhance profitability [4] - The company is well-positioned to benefit from revenue and margin expansion as AI adoption accelerates and demand for photonic interconnects increases [3][4] Historical Context - FN's stock has appreciated approximately 126.71% since a previous bullish thesis in April 2025, which highlighted a strategic issuance of warrants to Amazon, indicating growing market confidence in AI and data center demand [5]