: Fabrinet stock rallies as new AI products lift results
Shares of Fabrinet FN jumped 13% after hours on Monday after the high-tech manufacturing services company forecast first-quarter results that were above Wall Street’s expectations, after new AI products and data-communications sales drove results for its fourth quarter. Fabrinet, which provides those services to makers of complex gear like optical communication components and industrial lasers, said it expected first-quarter sales of $650 million to $670 million, with the midpoint above the $657 million forecast by FactSet. The company said it expected to report adjusted first-quarter earnings per share of $1.83 to $1.90, compared to FactSet expectations for $1.86. For the fourth quarter, Fabrinet reported net income of $60.8 million, or $1.65 a share, compared with $56.2 million, or $1.51 a share, in the same quarter last year. Revenue rose to $655.9 million, compared with $587.9 million in the prior-year quarter. Adjusted earnings per share came in at $1.86. Analysts polled by FactSet expected Fabrinet to report adjusted earnings per share of $1.80 on sales of $641 million. “During the quarter we saw very strong growth in datacom revenue, driven by new AI products, which more than offset anticipated headwinds from inventory adjustments at some customers,” Chief Executive Seamus Grady said in a statement. He added: “As we look to the first quarter of fiscal 2024, we are optimistic that new datacom programs can continue to offset inventory absorption in the industry, and that we can extend our track record of strong execution.”
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