Fabrinet (FN)
Optical + EMS (Fabrinet) — manufactures optical transceivers/modules for the optics leaders
AI exposure 46% — derived from reported segment revenue, not asserted.
Where it sits
Connectivity → EMS / ODM · figures rebased to Q4 FY2026, reported 2026-08-17
Contract manufacturing of datacom + telecom optical components/modules… leads 2 businesses in this sub-tier that together are 100% of revenue, so EMS / ODM is effectively the whole company rather than one leg of it.
Reported segments
- Data centers — 47.9% of revenue
- Communications infrastructure — 33.3% of revenue
- Automotive / industrial / other — 18.7% of revenue
Fabrinet ($1,315.8M Q4 FY2026, +45% YoY from $909.7M; FY2026 $4.6B, +36%). RESTRUCTURED: Fabrinet retired the Optical Communications / Non-Optical split and now reports three END MARKETS — Data centers 51% ($669M, +68%, with DCI products past a $1B annualised run rate) = primary B3 EMS / ODM; Communications infrastructure 31% ($413M, +40%); Automotive, industrial and other 18% ($234M, +8%). The new basis is more honest about AI content than the old one: the AI-linked half is data centre at 51%, where the optical aggregate had been 73%. Contract manufacturer — it builds its customers' designs…
How the 46% is built
- Data centers — 47.9% of revenue × 80% AI-driven (disclosed). Datacom transceivers, DCI and HPC assemblies for AI clusters; a minority serves non-AI cloud
- Communications infrastructure — 33.3% of revenue × 20% AI-driven (disclosed). Telecom and carrier optical systems — largely independent of AI build-out
- Automotive / industrial / other — 18.7% of revenue × 8% AI-driven (disclosed). Lasers, sensors and precision manufacturing outside the data centre
Investment read
Moat. Scale and yield in advanced optical packaging, on a campus footprint customers have qualified and are slow to re-qualify elsewhere. That is a switching-cost moat rather than a technology one: Fabrinet builds to its customers' designs, and the DCI line passing a $1B annualised run rate reflects their success rather than its own IP.
Bottleneck / pricing power. Very little pricing power, and Q4 FY2026 proved it: revenue grew 45% while adjusted gross margin fell to 12.2% from 12.5%. Volume converts at a fixed rate. The constraint Fabrinet does own is capacity and qualification time, which is why customers stay — not price.
Role in the AI stack. The outsourced optical-manufacturing layer behind AI transceivers.
Connected companies
- Lumentum Holdings (LITE) — FN supplies: photonics contract mfg
- MACOM Technology (MTSI) — FN is supplied by: laser drivers / TIAs / lasers — component supplier into optical-module maker
- NVIDIA (NVDA) — FN supplies: builds optical modules/components for NVIDIA networking (optical EMS)
- Ciena (CIEN) — FN supplies: builds optical systems for Ciena
- Marvell Technology (MRVL) — FN supplies: builds optical (electro-optics) for Marvell
- Flex (FLEX) — FN competes with: contract manufacturing — Fabrinet vs Flex
- Jabil (JBL) — FN competes with: EMS — Fabrinet vs Jabil
- Meta Platforms (META) — FN supplies: contract-manufactures optical transceivers reaching Meta via optics vendors; new direct hyperscaler programs unnamed
- Alphabet (GOOGL) — FN supplies: optical modules for GOOGL AI data centers
- Amazon (AMZN) — FN supplies: contract-manufactured optical modules reaching AMZN AI data centers via OEM customers
- Oracle (ORCL) — FN supplies: contract-manufactures the optical modules deployed in ORCL AI data centers (sold via optics OEMs)
- CoreWeave (CRWV) — FN supplies: contract-manufactured optical modules reaching CRWV via NVIDIA/OEM channels
- Coherent (COHR) — FN supplies: Named as a customer in FN's value chain: Outsourced optical component and transceiver assembly to Fabrinet
- Viavi Solutions (VIAV) — FN supplies: Named as a customer in FN's value chain: Fabrinet manufactures optical components for Viavi product lines
Others in EMS / ODM
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