Fabrinet

Good afternoon. Welcome to Sabrinet's Financial Results Conference call for the first quarter of fiscal year 2026. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and 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, Gero Tumajinian, VP of 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 2026, which ended September 26, 2025. With me on the call today are Seamus Grady, Chairman and Chief Executive Officer, and Chavez Ferra, 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, as well as additional details of our revenue breakdown. 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 19, 2025. 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 Fabrinet's Chairman and CEO, Seamus Grady. Seamus?

SEAMUS GRADY Thank you, Garo. Good afternoon, everyone, and thanks for joining our call today. We had an exceptional start to fiscal 2026, with record revenue and earnings that exceeded our guidance ranges and demonstrated our continued business momentum. First quarter revenue was $978 million, an impressive increase of 22% from a year ago and an increase of 8% from Q4. Non-GAAP earnings were also outstanding at $2.92 per share, with our revenue upside flowing directly to the bottom line. In addition to these terrific first quarter results, we're very optimistic that this strong momentum will extend into the second quarter with numerous revenue drivers contributing to our growth. Now let's look at the quarter in more detail. Starting with optical communications, telecom revenue hit a new record, increasing 59% from a year ago and 15% from Q4, driven primarily by data center interconnect products. Within telecom, DCI revenue nearly doubled from a year ago to 14% of company revenue. Datacom revenue declined sequentially as predicted, but by a smaller amount than we anticipated. This was the result of a smaller sequential decline than expected at our biggest Datacom customer, as well as larger contributions from other Datacom customers where we are gaining traction. While we believe certain component constraints will persist into the second quarter, we remain optimistic about overall demand trends in Datacom. Within non-optical communications, we are excited to introduce a new revenue category for high-performance computing products. In Q1, we qualified and started to ramp our first HPC program, which contributed $15 million to revenue. We believe this program will scale considerably over the coming quarters and become a significant driver to our overall growth. Automotive revenue was down slightly from Q4, as anticipated, and industrial laser revenue was flat. With numerous growth drivers supporting our confidence, construction of Building 10, which will total 2 million square feet, remains on track for completion by the end of calendar 2026. We have accelerated the construction of a portion of Building 10, which we expect to be completed in mid-2026, in order to help ensure that we will have ample capacity to support our rapid growth. As we look to the second quarter, we are very optimistic that we can deliver another outstanding quarter with continued growth in telecom driven by DCI expansion, strong datacom demand, and the rapid scaling of our HPC program. In summary, we are off to an excellent start in fiscal year 2026 with record first quarter results that exceeded our guidance ranges. With multiple growth drivers across our business producing increased business momentum we are well positioned to deliver an outstanding second quarter. Now I'd like to turn the call over to Csaba for more financial details on our first quarter results and our outlook for the second quarter. Csaba.