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Fabrinet Rides AI Wave: Data Centers Fuel Record Growth
11 Sep
Summary
- Data center business is now Fabrinet's largest revenue source.
- Company forecasts visibility for demand through end of 2027.
- Manufacturing expansion aims to add $3-$3.5 billion in revenue capacity.
Fabrinet is experiencing accelerated demand for high-speed optical connectivity, largely fueled by hyperscalers expanding artificial intelligence (AI) and cloud data center infrastructure. The company, a manufacturer of optical and interconnect products for data centers, HPC, and AI applications, sees its data center business becoming its largest revenue segment. In the fourth quarter of fiscal 2026, this segment grew by 68% year-over-year to $669 million, representing 51% of total revenues.
With annualized revenue for data center interconnects exceeding $1 billion, Fabrinet benefits from strong demand across DCI, transceivers, and HPC. Customer forecasts provide visibility through the end of 2027 and beyond, indicating sustained growth opportunities. Fabrinet has achieved 12 consecutive quarters of record revenues and forecasts potential for another year of accelerating growth in fiscal 2027.
To meet this demand, Fabrinet is undertaking significant manufacturing expansions. Building 10 in Chonburi, slated for completion in Q1 FY27, is expected to add $3-$3.5 billion in revenue capacity. Further expansions could eventually increase total potential revenue capacity to $12.5-$14 billion, positioning the company to capture the expanding AI infrastructure market. Optical cross-connects (OCS) represent an additional growth avenue, leveraging existing manufacturing expertise.
