Fabrinet (FN) Nokia Oyj Optical Fiber Communication Conference 2026 summary

Growth drivers and sustainability

• Achieved 36% year-over-year growth last quarter, with a 10-year CAGR of 16% and FY2025 growth at 19%.

• Telecom business grew 59% year-over-year, driven by strong DCI and systems business performance.

• High-performance compute (HPC) is a new, rapidly growing category, expanding from $15M in Q1 to $86M in Q2, mainly with AWS.

• Datacom business was flat due to supply constraints, but underlying demand remains robust.

• Customers are providing multi-year demand visibility, supporting capacity planning and growth confidence.

Technology and manufacturing capabilities

• Focused on being a pure-play contract manufacturer, not entering the ODM or product business.

• Invests in process technologies years ahead of mainstream adoption, especially for OCS and CPO.

• 70% of manufacturing space is clean room, enabling advanced wafer and die-level packaging.

• Produces 60%-70% of BOM content in-house, enhancing value and customer stickiness.

• Offers flexibility and IP protection by physically separating customer operations.

Capacity expansion and financial discipline

• Current run rate is $4.6B-$4.8B with $5.5B capacity; Building 10 will add $3B, raising total to $8.5B by year-end.

• Additional land allows for further expansion up to $11.5B capacity.

• CapEx for Building 10 is $130M, with low downside risk due to strong balance sheet and self-funded growth.

• Maintains low OpEx (1.5% of revenue) and fixed costs (5% of revenue), ensuring financial resilience.