Fabrinet

Good afternoon. Welcome to the FRAB and NETS results conference call for the first quarter of fiscal year 2022. At this time, all participants are in listen-only mode. If you have any questions at this session, instructions on how to participate will be provided at that time. As a reminder, today's call is being recorded. I would now like to turn the call over to your host, Gara Tsema-Germanian, Investor Relations.

Thank you, Operator, and good afternoon, everyone. Thank you for joining us on today's conference call to discuss Fabrinet's financial and operating results for the first quarter of fiscal year 2022, which ended September 24, 2021. With me on the call today are Seamus Grady, Chief Executive Officer, and Chabas Farah, Chief Financial Officer. This call is being webcast and a replay will be available on the investor section of our website located at investor.fabrinet.com. During this call, we will present both GAAP and non-GAAP financial measures. Please refer to the investor section of our website for important information, including our earnings press release and investor presentation, which include our GAAP to non-GAAP reconciliation. In addition, today's discussion will contain forward-looking statements about the future financial performance of the company. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from management's current expectations. These statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise them in light of new information or future events, except as required by law. For a description of the risk factors that may affect our results, please refer to our recent SEC filings, in particular the section captioned Risk Factors in our Form 10-K, filed on August 17, 2021. We will begin the call with remarks from Seamus and Chaba, followed by time for questions. I would now like to turn the call over to Fabernet's CEO, Seamus Grady. Seamus?

SEAMUS GRADY Thank you, Gaurav. Good afternoon, everyone, and thank you for joining us on today's conference call. We had a strong start to fiscal 2022 with top and bottom line results for the first quarter that exceeded our expectations. Demand trends remain robust across our business, which contributed to revenue reaching $543.3 million, more than $13 million above the high end of our guidance. We continue to execute very effectively with revenue upside falling to the bottom line as reflected in our non-GAAP net income of $1.45 per share, which was also above our guidance range. From a revenue perspective, we had a particularly strong quarter for optical communications, which grew 10% from the fourth quarter and 24% from a year ago. As Chaba will detail in a moment, strong optical communications demand was evident in both telecom and Datacom. We continued to execute well despite the component supply constraints that we and many others continue to experience. During our last call, we estimated that we would see a $25 to $30 million revenue headwind in the first quarter from these constraints. We are pleased to report that the actual impact was at the lower end of that range. Our ability to overcome many of these component shortages was most evident in our record optical communications results. Component shortages in the automotive market's extremely lean supply chain resulted in a moderate decline in automotive revenue from the fourth quarter. As we look to the second quarter, we are optimistic about continued strong demand across our business and are anticipating healthy overall growth despite persisting supply chain headwinds. Operationally, I'm very happy to announce that our COVID-19 vaccination program for employees in Thailand has been a great success and that at this point, 99% or virtually all of our employees in Thailand are now fully vaccinated. I'm also pleased that we were successful in delivering first quarter margins within our target ranges, despite these additional COVID-19 related costs in the quarter. At our Chanbury campus, construction of our second building is progressing well. This building will add approximately 1 million square feet or 50% to our global footprint, substantially increasing our manufacturing capacity. We are on track for construction to be completed around the end of the fiscal year. This schedule is extremely timely since, based on continued customer demand, we now anticipate that our first building in Chanbury will be effectively fully occupied when our second Chanbury building opens for business. In summary, After a very strong first quarter, we are optimistic that Q2 will represent another strong quarter for revenue and profitability. Demand trends remain strong and we are excited that our second building in Chambury will be coming online just at the right time to enable us to continue meeting anticipated demand and extend our business momentum in the years ahead. Now I'd like to turn the call over to Chabba for additional financial details on our first quarter and our guidance for the second quarter of fiscal 2022. Chabba.