Fabrinet Set to Report Q2 Earnings: What's in the Cards for the Stock?

Fabrinet FN is slated to release second-quarter fiscal 2026 results on Feb. 2.

For the fiscal second quarter, revenues are expected in the range of $1.05-$1.10 billion. Non-GAAP earnings per share are anticipated to be between $3.15 and $3.30.

The Zacks Consensus Estimate for fiscal second-quarter revenues is pegged at $1.08 billion, indicating 29.39% growth from the figure reported in the year-ago quarter.

The consensus mark for earnings is pegged at $3.26 per share, unchanged over the past 30 days, suggesting 24.9% growth from the figure reported in the year-ago quarter.

Fabrinet’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 2.39%.

Fabrinet Price and EPS Surprise

Fabrinet price-eps-surprise | Fabrinet Quote

Let us see how things are shaping up for the upcoming announcement.

Key Factors to Note Ahead of FN’s Q2 Results

FN’s performance in the second quarter of fiscal 2026 is expected to have benefited from strong momentum in the Telecom and Data Center Interconnect (DCI) business, driven by a 59% year-over-year surge in telecom revenues in the fiscal first quarter and nearly doubling DCI sales, with management indicating sustained demand for DCI modules in the second quarter of fiscal 2026.

The company’s expanding High-Performance Computing (HPC) business, marked by double-digit revenue contribution in the first quarter of fiscal 2026 and rising customer adoption, has strengthened its growth profile. These factors are expected to have benefited the company, driving improved performance in the fiscal second quarter of 2026.

Automotive remains the only major end market where Fabrinet does not expect sequential growth in the fiscal second quarter of 2026. Management indicated that automotive revenues declined slightly in the fiscal first quarter of 2026 and are projected to be flat to marginally lower in the quarter under review. While the company expects sequential growth across telecom, datacom and high-performance computing, automotive remains the sole area of weakness. This divergence is likely to have constrained overall performance in the to-be-reported quarter.

Fabrinet experienced margin pressure in the first quarter of fiscal 2026, with gross margin declining sequentially by 30 basis points due to foreign exchange headwinds and the seasonal impact of annual merit increases. While the company expects revenue-driven operating leverage to help support margins in the fiscal second quarter, such benefits may be offset by continued FX pressures. These factors are expected to have negatively impacted Fabrinet, limiting margin expansion in the fiscal second quarter of 2026.

What Our Model Says About FN Stock

Our proven model does not conclusively predict an earnings beat for Fabrinet this time around. Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, this is not the case here, as you can see below.

Fabrinet currently has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat earnings in their upcoming releases:

Cirrus Logic CRUS currently has an Earnings ESP of +5.89% and sports a Zacks Rank #1. CRUS shares have gained 31.6% in the in the trailing 12 months. It is set to report its third-quarter fiscal 2026 results on Feb. 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Advanced Micro Devices AMD has an Earnings ESP of +2.01% and a Zacks Rank #2 at present. AMD shares have surged 112.6% in the trailing 12 months. AMD is set to report its fourth-quarter 2025 results on Feb. 3.

Rockwell Automation ROK presently has an Earnings ESP of +1.03% and a Zacks Rank #2. ROK shares have soared 48.7% in the trailing 12 months. ROK is set to report its first-quarter fiscal 2026 results on Feb. 5.

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This article originally published on Zacks Investment Research (zacks.com).

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