Fabrinet's FN strategic push into manufacturing markets beyond optical communications is yielding substantial results, with the company's automotive and industrial laser segments establishing themselves as significant growth drivers. Non-optical communications revenues reached $221 million in the fourth quarter of fiscal 2025, representing a substantial 41% year-over-year increase that demonstrates the effectiveness of this diversification strategy.
Automotive remained the largest contributor, delivering $128 million on robust demand for electric vehicle charging infrastructure and advanced sensors. By concentrating on EV charging components rather than traditional auto parts, Fabrinet is positioned to capitalise on the accelerating electrification trend while leveraging its precision electro-mechanical expertise. Industrial lasers added $40 million, providing steady contributions from automation and processing equipment. Together with medical and metrology applications, these markets broaden Fabrinet’s exposure to secular growth themes that are less cyclical than communications.
The 41% non-optical growth outpaced overall revenue expansion, suggesting the company’s ability to capture market share in adjacent verticals. The Zacks Consensus Estimate for the first-quarter fiscal 2026 non-optical revenues is pegged at $231 million, indicating a year-over-year increase of 29.8%. With strength across automotive, lasers and medical markets, Fabrinet’s diversification beyond optics looks well-positioned to fuel further upside.
Fabrinet Faces Stiff Competition
Fabrinet faces competition from Jabil JBL and Coherent COHR, both of which are also expanding in adjacent markets. Jabil has been strengthening its presence in automotive and industrial solutions, leveraging its large-scale manufacturing capabilities to capture demand from the electrification and automation trends. Coherent, meanwhile, remains a key player in industrial lasers and optics, benefiting from rising adoption in advanced manufacturing and healthcare. Compared with Jabil and Coherent, Fabrinet’s focus on precision electro-mechanical components and EV charging infrastructure provides a differentiated positioning that could support sustained growth momentum.
Fabrinet’s Share Price Performance, Valuation and Estimates
Fabrinet’s shares have jumped 66.8% in the year-to-date (YTD) period, outperforming the Zacks Electronics-Miscellaneous Components industry and the Zacks Computer and Technology sector’s increase of 40% and 22.6%, respectively.
Fabrinet’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, Fabrinet stock is currently trading at a forward 12-month Price/Sales ratio of 3.06X compared with the industry’s 2.08X. Fabrinet has a Value Score of D.
Fabrinet's Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Fabrinet’s first-quarter fiscal 2026 earnings is pegged at $2.83 per share, unchanged over the past 30 days. The estimate indicates 18.41% year-over-year growth.
Fabrinet Price and Consensus
Fabrinet price-consensus-chart | Fabrinet Quote
Fabrinet currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
