Fabrinet (FN) 2024 Q1 法說會逐字稿

Good afternoon. Welcome to Fabrinet's Financial Results Conference Call for the First Quarter of Fiscal Year 2024. (Operator Instructions) As a reminder, today's call is being recorded. I would now like to turn the call over to your host, Garo Toomajanian, VP of Investor Relations. Please go ahead.

午安.歡迎參加 Fabrinet 2024 財年第一季財務業績電話會議。現在我想將電話轉給主持人投資者關係副總裁 Garo Toomajanian。請繼續。

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 2024, which ended September 29, 2023.

謝謝接線員，大家下午好。感謝您參加今天的電話會議，討論 Fabrinet 截至 2023 年 9 月 29 日的 2024 財年第一季度的財務和營運業績。

With me on the call today are Seamus Grady, Chief Executive Officer; and Csaba Sverha, Chief Financial Officer. This call is being webcast, and a replay will be available on the Investors section of our website located at investor.fabrinet.com.

今天與我一起參加電話會議的是執行長 Seamus Grady；和財務長 Csaba Sverha。本次電話會議正在進行網路直播，我們網站的投資者部分將提供重播，網址為investor.fabrinet.com。

During this call, we will present both GAAP and non-GAAP financial measures. Please refer to the Investors 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 detail of our revenue breakdown.

在本次電話會議中，我們將介紹 GAAP 和非 GAAP 財務指標。請參閱我們網站的投資者部分，以了解重要信息，包括我們的收益新聞稿和投資者介紹，其中包括我們的 GAAP 與非 GAAP 調節表以及我們收入細目的其他詳細資訊。

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 opinion 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.

此外，今天的討論將包含有關公司未來財務表現的前瞻性陳述。前瞻性陳述受到風險和不確定性的影響，可能導致實際結果與管理階層目前的預期有重大差異。這些陳述僅反映我們截至本簡報發布之日的意見，我們不承擔根據新資訊或未來事件對其進行修改的義務，除非法律要求。

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 22, 2023. We will begin the call with remarks from Seamus and Csaba, followed by time for questions. I would now like to turn the call over to Fabrinet's CEO, Seamus Grady. Seamus?

有關可能影響我們結果的風險因素的描述，請參閱我們最近向SEC 提交的文件，特別是我們於2023 年8 月22 日提交的10-K 表格中標題為「風險因素」的部分。電話會議開始時發表評論Seamus 和 Csaba，接下來是提問時間。我現在想將電話轉給 Fabrinet 的執行長 Seamus Grady。西莫？

Thank you, Garo. Good afternoon, everyone, and thank you for joining us on our call today. We set new quarterly records for revenue and EPS in our first quarter, both of which were above our guidance ranges. Free cash flow also reached a new quarterly record. We achieved triple-digit year-over-year growth in datacom revenue driven by next-generation optical interconnect for AI applications. This datacom growth more than made up for continued but diminishing sequential declines in telecom revenue as inventory absorption runs its course.

謝謝你，加羅。大家下午好，感謝您今天加入我們的電話會議。我們第一季的營收和每股盈餘創下了新的季度記錄，兩者都高於我們的指導範圍。自由現金流也創下了新的季度紀錄。在人工智慧應用的下一代光互連的推動下，我們的數據通訊收入實現了三位數的年增長。隨著庫存吸收的進行，數據通訊的成長足以彌補電信收入持續但逐漸減少的連續下降。

Overall revenue was $685.5 million, representing an increase of 5% from the fourth quarter as well as from a year ago. Recall that the first quarter of fiscal 2023 was a 14-week quarter, adding approximately $20 million to revenue a year ago. Excluding this impact, revenue would have grown 8% year-over-year. Our strong revenue growth contributed to a record bottom line with non-GAAP net income of $2 per share.

總營收為 6.855 億美元，比第四季和去年同期成長 5%。回想一下，2023 財年第一季是一個為期 14 週的季度，比一年前增加了約 2,000 萬美元的收入。排除此影響，營收將年增 8%。我們強勁的營收成長推動了創紀錄的淨利潤，非 GAAP 淨利潤達到每股 2 美元。

Looking at the first quarter in more detail. Optical communications revenue increased from both a year ago and the fourth quarter. Within optical communications, telecom revenue decreased sequentially, though by a smaller amount than anticipated. Datacom growth more than offset the telecom decline again with sequential growth of 26% from a very strong fourth quarter and year-over-year growth of over 160%. As in Q4, datacom growth was driven primarily by AI optical interconnect.

更詳細地看第一季。光通訊收入較去年同期和第四季均有所成長。在光通訊領域，電信收入季減，但降幅小於預期。數據通訊業務的成長再次抵銷了電信業務的下滑，第四季環比成長 26%，年增超過 160%。與第四季一樣，數據通訊的成長主要由人工智慧光互連推動。

In our nonoptical communications business, revenue was relatively flat as anticipated. A small sequential decline in automotive revenue was largely offset by growth in industrial lasers and other nonoptical communications revenue.

在我們的非光通訊業務中，營收與預期相對持平。汽車收入連續小幅下降在很大程度上被工業雷射和其他非光通訊收入的成長所抵消。

Looking to the second quarter, we expect the industry-wide inventory adjustments in telecom to continue. We believe that datacom growth, particularly in AI, will more than offset these headwinds again in the second quarter. In short, we are optimistic that the telecom inventory-related issues are temporary, whereas the demand strength in datacom is sustainable.

展望二季度，我們預期電信業的全產業庫存調整仍將持續。我們相信，數據通訊的成長，尤其是人工智慧領域的成長，將在第二季再次抵銷這些不利因素。簡而言之，我們樂觀地認為電信庫存相關問題是暫時的，而數據通訊的需求強勁是可持續的。

In summary, our record top and bottom line results represented a strong start to the fiscal year, and we are confident that we remain well positioned to continue delivering solid results as we look ahead. Now I'd like to turn the call over to Csaba for additional financial details on our first quarter of fiscal 2024 and our guidance for the second quarter. Csaba?

總而言之，我們創紀錄的營收和淨利潤代表了本財年的強勁開局，我們有信心在展望未來時繼續提供穩健的業績。現在，我想將電話轉接給 Csaba，以了解 2024 財年第一季的更多財務細節以及第二季的指導。恰巴？

Thank you, Seamus, and good afternoon, everyone. Revenue was above our guidance range at $685.5 million, up 5%, both sequentially and from a year ago. Keep in mind that the first quarter of the prior year benefited by approximately $20 million due to an additional week. Our strong revenue helped to produce record earnings. Non-GAAP net income was $2 per share, which was above our guidance range.

謝謝你，Seamus，大家下午好。營收達到 6.855 億美元，高於我們的指導範圍，環比和去年同期均成長 5%。請記住，由於增加了一周，去年第一季的收益約為 2000 萬美元。我們強勁的收入幫助創造了創紀錄的收益。非 GAAP 淨利潤為每股 2 美元，高於我們的指導範圍。

We have published additional details regarding our revenue breakdown in the investor presentation, which you can find on our website. So in looking more closely at revenue, I will focus my comments on the most notable changes.

我們在投資者介紹中發布了有關我們收入細分的更多詳細信息，您可以在我們的網站上找到這些信息。因此，在更仔細地觀察收入時，我將重點放在最顯著的變化。

Optical communications revenue of $533.3 million was a new quarterly record. Very strong sequential datacom growth of 26% more than made up for a smaller-than-anticipated decline in telecom revenue of 6%. Datacom growth is being driven primarily by 800-gig technology for AI applications. We believe there is still excess inventory in the supply chain. And in the second quarter, we expect datacom revenue to again more than offset telecom declines by a wide margin.

光通訊收入達 5.333 億美元，創下季度新紀錄。數據通訊連續 26% 的強勁成長彌補了電信收入 6% 低於預期的下降。數據通訊的成長主要由人工智慧應用的 800G 技術推動。我們認為供應鏈中仍存在過剩庫存。在第二季度，我們預期數據通訊收入將再次大幅抵銷電信收入的下降。

Looking at optical communications revenue by data rate. Growth in revenue from products rated 400-gig and faster was substantially greater than revenue declines from 100-gig programs. Nonoptical communications revenue was consistent with the fourth quarter at $152.2 million and represented 22% of total revenue. Automotive revenue declined 5% from the fourth quarter due to some inventory absorption. This was partially offset by a smaller sequential increase in industrial laser and other nonoptical communications revenue.

按數據速率查看光通訊收入。 400 億及以上產品的營收成長遠大於 100 億項目的營收下降。非光通訊收入與第四季持平，為 1.522 億美元，佔總營收的 22%。由於吸收了一些庫存，汽車收入較第四季下降了 5%。這被工業雷射和其他非光通訊收入較上季增幅較小所部分抵消。

As I discuss the details of our P&L, expense and profitability metrics will be on a non-GAAP basis, unless otherwise noted. Gross margin in the quarter was 12.6%. As anticipated, gross margin declined seasonally by about 20 basis points from Q4, primarily due to annual merit increases, which take effect in the first quarter. Operating expenses in the quarter were $14.9 million or 2.2% of revenue, an improvement of 10 basis points from the fourth quarter. We anticipate that operating expenses will continue to decline as a percentage of revenue as our business scales. Operating income was $71.7 million, representing an operating margin of 10.5%, consistent with the fourth quarter.

當我討論損益表的詳細資訊時，除非另有說明，費用和獲利指標將基於非公認會計原則（non-GAAP）。該季度毛利率為 12.6%。如預期，毛利率較第四季季節性下降約 20 個基點，主要是由於第一季生效的年度績效成長。本季營運費用為 1,490 萬美元，佔營收的 2.2%，比第四季提高了 10 個基點。我們預計，隨著業務規模的擴大，營運費用佔收入的比例將持續下降。營業收入為 7,170 萬美元，營業利潤率為 10.5%，與第四季持平。

Our strong balance sheet again benefited our interest income, which was $5.9 million in the quarter. Our gains from foreign currency asset and liability revaluations at the end of the quarter was relatively small at $0.4 million. Effective GAAP tax rate was 7.2% in the first quarter, which is above the mid-single-digit level we continue to expect for the fiscal year as a whole. Non-GAAP net income was a new quarterly record of $72.8 million or $2 per diluted share. On a GAAP basis, net income was $1.78 per diluted share.

我們強勁的資產負債表再次使我們的利息收入受益，本季利息收入為 590 萬美元。本季末我們從外幣資產和負債重估中獲得的收益相對較小，為 40 萬美元。第一季有效 GAAP 稅率為 7.2%，高於我們對整個財年的持續預期中個位數水準。非 GAAP 淨利潤創下新的季度記錄，達到 7,280 萬美元，即稀釋後每股收益 2 美元。以 GAAP 計算，攤薄後每股淨利為 1.78 美元。

Turning to the balance sheet and cash flow statement. At the end of the first quarter, cash and short-term investments were $670.8 million, up $120.3 million from the end of the fourth quarter. This increase was driven primarily by strong operating cash flow of $145 million. With CapEx of $11.4 million, free cash flow was a quarterly record at $133.6 million. Our share repurchase program was not active in the first quarter. As a result, $100 million remained in our share purchase authorization at the end of the quarter.

轉向資產負債表和現金流量表。第一季末，現金和短期投資為6.708億美元，比第四季末增加1.203億美元。這一成長主要是由 1.45 億美元的強勁營運現金流推動的。資本支出為 1,140 萬美元，自由現金流達到 1.336 億美元，創季度紀錄。我們的股票回購計劃在第一季並不活躍。因此，截至本季末，我們的股票購買授權中還剩 1 億美元。

Now I will turn to our guidance for the second quarter. As I mentioned, we expect inventory adjustment at our customers primarily in the telecom space to continue into the second quarter. We expect sequential revenue growth from high-data rate data from AI programs to, again, more than offset these telecom headwinds. We anticipate automotive revenue to decline sequentially and expect industrial laser revenue to be relatively flat.

現在我將談談我們對第二季的指導。正如我所提到的，我們預計主要是電信領域客戶的庫存調整將持續到第二季​​。我們預計人工智慧程式的高數據速率數據帶來的連續收入成長將再次足以抵消這些電信不利因素。我們預計汽車收入將連續下降，並預計工業雷射收入將相對持平。

In total, we expect revenue to be between $680 million to $700 million. From a profitability perspective, we anticipate non-GAAP net income to be in the range of $1.98 to $2.05 per diluted share.

總的來說，我們預計收入將在 6.8 億美元至 7 億美元之間。從獲利能力的角度來看，我們預計非 GAAP 攤薄後每股淨利潤將在 1.98 美元至 2.05 美元之間。

In summary, we are happy to have exceeded our first quarter guidance by producing record revenue, net income and free cash flow. We continue to balance consistent growth with improving profitability. We are optimistic that we can continue to execute well to deliver strong results as we look ahead. Operator, we are now ready to open the call for questions.

總而言之，我們很高興透過創造創紀錄的收入、淨利潤和自由現金流，超越了第一季的指導。我們持續在持續成長與提高獲利能力之間取得平衡。我們樂觀地認為，展望未來，我們能夠持續良好執行，並取得強勁成果。接線員，我們現在準備開始提問。

(Operator Instructions) Our first question is going to come from the line of Alex Henderson with Needham.

（操作員說明）我們的第一個問題將來自 Alex Henderson 和 Needham 的線路。

I've got a quick question for you on the news that came out of Jabil about the Jabil purchase of the silicon photonics business over at Intel. I know Intel silicon photonics has been historically a customer of yours. And I was wondering how you think that will impact you over time, particularly given the difficulty of moving an existing line.

關於捷普收購英特爾矽光子業務的消息，我有一個簡短的問題要問您。我知道英特爾矽光子技術一直是你們的客戶。我想知道您認為隨著時間的推移這會對您產生什麼影響，特別是考慮到移動現有線路的困難。

Alex, it looks like Intel wanted to exit that market for their own strategic reasons. They -- Intel has not been a 10% customer of ours. We have been one of 2 sources on the program that we -- programs that we're involved with. We remain focused on being a manufacturer serving customers in the market rather than selling our own products. So for us, we understand Intel have sold the business in its entirety to Jabil, including development of new products, supplier for products, et cetera. And that's just not a business that we're involved in.

亞歷克斯，看來英特爾出於自己的戰略原因想要退出該市場。他們——英特爾還不是我們 10% 的客戶。我們是我們參與的計劃的兩個來源之一。我們仍然專注於成為一家為市場客戶服務的製造商，而不是銷售我們自己的產品。因此，對我們來說，我們了解到英特爾已將整個業務出售給捷普，包括新產品開發、產品供應商等。這不是我們涉及的業務。

The immediate impact, it's really too early to say. The news only became official literally a few days ago, so we have to sit down with our customer and work out the transfer plan. And we're confident that in these situations, we provide a high level of service to our customers. And in general, we've become good at managing these type of transitions and usually find a way to come out on top.

至於直接影響，現在說還太早。這個消息幾天前才正式發布，所以我們必須與客戶坐下來製定轉移計劃。我們相信，在這些情況下，我們能夠為客戶提供高水準的服務。總的來說，我們已經變得擅長管理這些類型的轉變，並且通常會找到一種方法來脫穎而出。

Do you think that this represents an increase in Jabil trying to get into the optical market? Or do you -- what's your assessment of the competitive implications of it?

您認為這是否代表捷普加大了進軍光學市場的力道？或者您對它的競爭影響有何評價？

Well, it's a different business, I guess, to the business we're involved in. We manufacture other people's products. We have no interest in having our own products. So I would assume for Jabil, it's more of an -- I don't want to speak for Jabil, but it appears to be more of an ODM-type offering that they'll be providing. And that's just not something that we're involved in. So I would see it as a different market to the market that we're involved in. But we wish Jabil well.

嗯，我想，這與我們所從事的業務不同。我們對擁有自己的產品沒有興趣。所以我認為對於 Jabil 來說，它更像是——我不想代表 Jabil 說話，但它似乎更像是他們將提供的 ODM 類型的產品。這不是我們參與的事情。 所以我認為這是一個與我們參與的市場不同的市場。

I was hoping you could talk one more question, if I could, and then I'll cede the floor, about any potential pipeline activity or thoughts on how to get into the Ethernet side of the 800-gig AI opportunity.

如果可以的話，我希望您能再談一個問題，然後我就讓出發言權，討論任何潛在的管道活動或關於如何進入 800-g AI 機會的以太網方面的想法。

Well, we just really follow our customers leads, Alex, whichever protocol the customers deem to be the one that they want us to work, and we're happy. For us, we don't really mind whether the products are Ethernet or any other protocol. We don't really mind. So we work with our customers, and we're working with, I would say, a number of customers in this space to make sure we continue to provide the products that they need and the volumes that they need. But we really don't mind whether it's Ethernet or InfiniBand or anything else.

好吧，我們只是真正遵循我們的客戶線索，Alex，無論客戶認為他們希望我們使用哪種協議，我們都很高興。對我們來說，我們並不真正介意產品是乙太網路還是任何其他協定。我們並不介意。因此，我們與客戶合作，我想說，我們正在與這個領域的許多客戶合作，以確保我們繼續提供他們需要的產品和他們需要的數量。但我們真的不介意它是乙太網路、InfiniBand 還是其他任何東西。

Well, yes, but your current 800-gig customer is almost exclusively InfiniBand and then D-Link. And obviously, over time, the world will shift towards Ethernet. So the question is, do you have a hook into that stream?

嗯，是的，但是您目前的 800 GB 客戶幾乎都是 InfiniBand，然後是 D-Link。顯然，隨著時間的推移，世界將轉向乙太網路。所以問題是，你對這個流有興趣嗎？

We do indeed. We're working with, I would say, a number of opportunities that we're working on that will be both, again, InfiniBand but also Ethernet-based products.

我們確實這麼做了。我想說，我們正在利用許多機會，這些機會既包括 InfiniBand，也包括基於乙太網路的產品。

Our next question will come from the line of Samik Chatterjee with JPM.

我們的下一個問題將來自 Samik Chatterjee 與 JPM 的對話。

I guess to start off, maybe I can follow up on Alex's question here. How -- Seamus, as you move towards working with customers on the Ethernet side, what are you finding relative to the competitive landscape? Just from the outside in, from our perspective, it looks like more companies are in the manufacturing supply chain in relation to Ethernet. But can you share your thoughts about what you're seeing from a competitive aspect? And what's sort of the differentiation that you bring there into that ecosystem? And I have a follow-up.

我想首先，也許我可以在這裡跟進亞歷克斯的問題。如何－Seamus，當您開始與乙太網路的客戶合作時，您對競爭格局有何發現？從我們的角度來看，從外到內，似乎有更多的公司處於與乙太網路相關的製造供應鏈中。但您能分享一下您從競爭角度看到的情況嗎？您為該生態系帶來了什麼樣的差異化？我有一個後續行動。

I think, Samik, for newer products, whether it's 800-gig or higher speeds, we feel pretty confident that we're well positioned to support what the customers need. I think for the older-generation products, it's -- the competitive landscape is much more competitive. But for new-generation products, for these kind of specific short-reach, low-power, low-latency applications, there's really a handful of companies who are able to design these type of products, and we're well positioned, we think, to support them.

Samik，我認為，對於較新的產品，無論是 800 吉還是更高的速度，我們都非常有信心能夠滿足客戶的需求。我認為對於老一代產品來說，競爭格局更具競爭力。但對於新一代產品，對於這些特定的短距離、低功耗、低延遲應用，確實有少數公司能夠設計這類產品，我們認為我們處於有利地位，支持他們。

So again, whether it's InfiniBand or Ethernet, we just follow our customers' lead. Whatever they need from us, we're happy to help them with. And again, our focus is always on producing the current-generation products but also winning the next-generation products. So we're very focused on that with our customers in this space.

再說一遍，無論是 InfiniBand 還是以太網，我們只是遵循客戶的指導。無論他們需要我們什麼，我們都很樂意幫助他們。再說一遍，我們的重點始終是生產當前一代產品，同時贏得下一代產品。因此，我們非常關注這一領域的客戶。

Okay. Got it. If I can just ask as a follow-up on the guidance. Going from 4Q to 1Q, you had a sequential increase of about [$13 million] or so in revenue with datacom easily -- the increase in datacom easily offsetting the telecom decline. As you look forward, I mean, you're carrying forward the same theme where datacom does offset telecom. But the magnitude of it seems to be much lower just given the $5 million sequential increase at the midpoint that you're guiding to. So maybe if you can help us with the puts and takes there. Is telecom declining more than sort of what we've seen from 4Q to 1Q? Or is it the datacom in ramp is moderating, just given that you are maybe reaching more capacity with the customers that you're engaged with?

好的。知道了。如果我可以詢問作為指導的後續行動。從第四季到第一季度，數據通訊的收入輕鬆地連續成長了約[1300萬美元]左右——數據通訊的成長輕鬆抵銷了電信業務的下滑。我的意思是，當你展望未來時，你將繼續推進數據通訊確實抵消電信的相同主題。但考慮到您所指導的中點連續增加 500 萬美元，其幅度似乎要低得多。那麼也許您可以幫助我們進行看跌期權和看跌期權。電信業的下滑是否超出了我們從第四季到第一季所看到的水平？或者是數據通訊正在放緩，只是考慮到您可能會為您所接觸的客戶提供更多容量？

I would say, first of all, in Q1, our telecom declined probably less than we thought it would. It declined about 6%. We -- going into the quarter, I guess, we thought it might decline more than that. It declined about 6%, which was primarily driven by stronger demand than anticipated for certain telecom programs, especially DCI. So again, driven by the data center and the growth going on in the data center with DCI products, which we categorize as telecom. So that's the first thing.

我想說，首先，在第一季度，我們的電信業務下降幅度可能比我們想像的還要小。下降了約6%。我想，進入本季度，我們認為下降幅度可能會更大。下降了約 6%，這主要是由於某些電信項目（尤其是 DCI）的需求強於預期。同樣，受到資料中心以及資料中心 DCI 產品（我們將其歸類為電信）的成長的推動。這是第一件事。

And then as we go into Q2, yes, our -- we think our telecom business will decline further into Q2. As you know, we don't guide beyond one quarter at a time. But in a general sense, I think -- we think telecom will decline. Datacom will increase by more than that decline. And then as we look to the kind of future, again, based on the intelligence we have from our customers, we think the telecom decline is set to continue probably until the middle of the calendar year, which would be the end of our fiscal year. So further declines this quarter and the next quarter, and then we think it will begin to bottom out in the -- we call it the June quarter. And then the rate of growth of datacom, I guess, it should slow down at some point. That rate of growth, it's been very strong for us. But it will inevitably begin to -- again, the growth will begin to slow at some point.

然後，當我們進入第二季時，是的，我們認為我們的電信業務將在第二季進一步下滑。如您所知，我們每次的指導不會超過四分之一。但從一般意義上來說，我認為──我們認為電信將會衰退。數據通訊的增幅將超過降幅。然後，當我們展望未來時，再次根據我們從客戶那裡獲得的情報，我們認為電信下滑可能會持續到日曆年中期，也就是我們財年結束時。因此，本季和下季進一步下降，然後我們認為它將在我們稱之為六月季度的時候開始觸底。我想，數據通訊的成長速度應該會在某個時候放緩。這樣的成長率對我們來說非常強勁。但它不可避免地會開始——同樣，增長將在某個時候開始放緩。

Our next question is going to come from the line of Mike Genovese with Rosenblatt Securities.

我們的下一個問題將來自羅森布拉特證券公司的 Mike Genovese。

Can you give us any commentary at all on kind of performance breakout between 400G and 800G datacom or new programs versus existing older programs? Is there any color we can get there?

您能否對 400G 和 800G 數據通訊之間的效能突破或新程式與現有舊程式的比較發表任何評論？我們可以在那裡得到任何顏色嗎？

Well, in general, we break out 400-gig and above and which, of course, at this point, is a pretty large category. And at some point, we may want to revise how we do that. But for now, it's really everything in that 400-gig and above category, so 400-gig inside the data center, 400ZR, DCI, 800-gig, AI, everything really in that 400-gig and above category. But the growth has been coming from primarily the higher-speed newer programs.

嗯，總的來說，我們突破了 400 場及以上，當然，在這一點上，這是一個相當大的類別。在某些時候，我們可能會想要修改我們的做法。但就目前而言，它實際上是400-gig 及以上類別中的所有內容，因此資料中心內的400-gig、400ZR、DCI、800-gig、AI，實際上是400-gig 及以上類別中的所有內容。但成長主要來自速度更快的新程序。

Older programs and, let's call it, traditional datacom products have not been as strong, especially with the -- at the lower speeds, 100-gig and the like. The growth for us, certainly -- we don't speak for the whole industry. But for us, the growth that we've seen has been primarily on the higher-speed newer programs, mainly focused around these newer AI applications, 800-gig being the biggest driver for us there.

較舊的程序，我們稱之為傳統數據通訊產品，並沒有那麼強大，尤其是在較低速度、100G 等情況下。當然，我們的成長並不代表整個產業。但對我們來說，我們所看到的成長主要來自於更高速的新程序，主要集中在這些新的人工智慧應用程式上，800G 是我們最大的驅動力。

Perfect. Maybe I'd follow up on that question by -- because I thought the color you gave about telecom and DCI driving less -- a decline in telecom but less than expected was -- I mean, that was great color. So maybe comparing how telecom came into having the older datacom programs, I mean was there any surprise on the upside there? Or did it behave -- or downside? Or did it behave as expected?

完美的。也許我會繼續回答這個問題——因為我認為你給出的關於電信和 DCI 驅動力下降的顏色——電信下降，但低於預期——我的意思是，這是很棒的顏色。因此，也許比較一下電信公司如何擁有較舊的數據通訊程序，我的意思是，那裡有什麼令人驚訝的好處嗎？或者它有什麼表現──或者有什麼缺點？或者它的表現是否符合預期？

I think the traditional, we call it -- traditional datacom, I think, behaved pretty much as expected. Newer datacom has been just very strong. But for us, it's expected, I think, at this point. And then like I said earlier, the strength in DCI was maybe a little bit of a surprise. We had expected telecom to be down. If you just took the guidance from our customers going into the quarter and you just straight line that, we should have been down double digits, probably 12% to 15% in telecom. Instead, we were down about 6%, so down a lot less than we thought it would be, again, primarily driven by DCI. So even though it's in telecom, it's driven by the data center expansion that's going on everywhere.

我認為傳統的，我們稱之為傳統數據通信，我認為，其表現與預期基本一致。 較新的數據通訊非常強大。但對我們來說，我認為目前這是預料之中的。正如我之前所說，DCI 的實力可能有點令人驚訝。我們原本預期電信會癱瘓。如果你只是從我們的客戶那裡得到本季的指導，然後你就直接得出結論，我們的業績應該會下降兩位數，電信業可能下降 12% 到 15%。相反，我們下跌了約 6%，因此下跌幅度比我們想像的要少得多，這主要是由 DCI 推動的。因此，即使是在電信領域，它也是受到各地資料中心擴張的推動。

Got it. Okay. Great. And then finally for me, just could you -- maybe Csaba or both of you talk about just the decision to not buy back stock in the quarter and kind of going forward, what you're thinking about buybacks.

知道了。好的。偉大的。最後對我來說，你們——也許是 Csaba 或你們倆能談談在本季度不回購股票的決定以及未來的發展，你們對回購的看法。

Mike, this is Csaba. Last quarter, as I mentioned in our prepared remarks, we didn't buy anything back. We have, obviously, an OMR opportunity in the open window. In addition, we have a 10b5 plan in place. The 10b5 plan is rule-based and subject to certain prices. Obviously, it didn't trigger last quarter. But obviously, we are still committed to return surplus cash to our shareholders. So obviously, we are revisiting the 10b5 plan from time to time. And subject to the new pricing and the market conditions, we will make amendments. And we continue to be committed to return surplus cash we generate to shareholders.

麥克，這是 Csaba。上個季度，正如我在準備好的發言中提到的，我們沒有回購任何東西。顯然，我們在開放窗口中擁有 OMR 機會。此外，我們也制定了 10b5 計畫。 10b5 計劃是基於規則的，並受某些價格的限制。顯然，它並沒有在上個季度觸發。但顯然，我們仍然致力於將剩餘現金回饋給股東。顯然，我們會不時重新檢視 10b5 計畫。並根據新的定價和市場情況，我們會做出修改。我們持續致力於將產生的剩餘現金回饋給股東。

(Operator Instructions) Our next question is going to come from the line of Tim Savageaux with Northland Capital Markets.

（操作員說明）我們的下一個問題將來自 Northland Capital Markets 的 Tim Savageaux。

A couple of questions. You previously described the AI connectivity opportunity, I think, at 800-gig or maybe just in general, as in very early stages and a very large opportunity. I actually maybe missing a few veries there.

有幾個問題。我認為，您之前描述了 800g 或一般情況下的人工智慧連接機會，因為處於非常早期的階段，這是一個非常大的機會。實際上我可能在那裡錯過了一些。

Yes. I think at one point, I maybe said very twice. I think I called it as very, very.

是的。我想在某一時刻，我可能說了兩次。我想我稱其為“非常非常”。

Well, I guess, as you -- as we've moved forward a few months here into the end of the year, would you add or subtract any veries at this point? Or can you give us your current assessment of where Fabrinet is in terms of the ramp and how that opportunity is looking relative to what you were seeing previously?

好吧，我想，正如您一樣，我們已經向前推進了幾個月，進入年底，您現在會添加或減少任何數量嗎？或者您能否向我們提供您目前對 Fabrinet 在成長方面的評估以及該機會相對於您之前看到的情況如何？

I think we're still very optimistic about -- you can insert or remove as many veries as you like there, Tim. We're still very optimistic about the market, in general. I would say, the interconnect, the optical interconnect opportunity for artificial intelligence applications and really, our position within that, we're building the products for the leader in the industry. It's their own design, their own product, and I know they have other choices. But for now at least, we believe they're quite committed to sourcing from us.

我認為我們仍然非常樂觀 - 您可以在那裡插入或刪除任意數量的版本，Tim。總體而言，我們對市場仍然非常樂觀。我想說的是，互連、人工智慧應用的光學互連機會，以及我們在其中的地位，我們正在為產業領導者建立產品。這是他們自己的設計，他們自己的產品，我知道他們還有其他選擇。但至少目前，我們相信他們非常致力於從我們這裡採購。

We're still ramping. We continue to ramp both the existing programs' [goal], and there's additional business that we're looking at and getting qualified on. As you know, we're maniacally focused on executing the business that we've already won. But then, I'm making sure we win the next-generation programs, the new products. So we're working very, very hard on both of those, Tim. Both on executing, I think we've done a very good job there. Maybe a very, very good job executing.

我們仍在努力。我們繼續提高現有計劃的[目標]，並且我們正在考慮並獲得資格的其他業務。如您所知，我們瘋狂地專注於執行我們已經贏得的業務。但接下來，我要確保我們贏得下一代專案、新產品。所以我們在這兩方面都非常非常努力，提姆。在執行方面，我認為我們都做得很好。也許執行得非常非常好。

And we're also making sure we win the next-generation products and then execute very well on those. It's the best way to stay ahead of the competition. It's just work like crazy to delight the customer and make sure we do a great job and win the next-generation products. So that's really our focus. And we're -- we see a lot of kind of runway ahead of us, and we think it's a really good opportunity for us.

我們還確保贏得下一代產品，然後很好地執行這些產品。這是在競爭中保持領先的最佳方式。為了取悅客戶並確保我們做得很好並贏得下一代產品，我們需要瘋狂地工作。這確實是我們的重點。我們看到前面有很多跑道，我們認為這對我們來說是一個非常好的機會。

Great. Appreciate that. And just a follow-up. I know -- ZR, I think you've gotten within shouting distance of 10% of revenue for you guys before the latest inventory correction. Given that you've called it out as kind of the source of unexpected growth in the quarter, maybe you can give us an update on kind of where that stands in terms of materiality of the overall business or telecom or however you want to talk about it. And I just got one more quick follow-up after that.

偉大的。很欣賞這一點。只是後續行動。我知道——ZR，我認為在最近的庫存調整之前，你們已經獲得了 10% 的收入。鑑於您已將其稱為本季度意外增長的來源，也許您可以向我們提供有關整體業務或電信重要性的最新信息，或者您想談論的任何內容它。此後我又得到了一次快速跟進。

Yes. I think ZR is very strong for us. We haven't broken it out yet in a separate category, but it is quite strong for us and continues to grow. It doesn't necessarily grow in a straight line, so there'll be maybe still a little bit of stops and starts with 400ZR. But we're just very happy to be participating in it, and it was a source of really most of that offset between the -- what we would have expected last quarter, that kind of down 12% to 15%, the difference between that and where we ended up was primarily 400ZR for DCI applications. So we still think it's early days. We have a number of customers and a number of programs there, and we continue to ramp those. And they're not all at the same stage. Some are ahead. Some are just getting qualified. But we still think 400ZR has good runway left for us.

是的。我認為ZR對我們來說非常強大。我們還沒有將其分解為一個單獨的類別，但它對我們來說相當強大且持續成長。它不一定是直線成長，所以可能還會有一點點停止，並從 400ZR 開始。但我們很高興能夠參與其中，這實際上是我們上季度預期的大部分抵消的來源，下降了 12% 到 15%，兩者之間的差異我們最終得到的主要是用於 DCI 應用的 400ZR。所以我們仍然認為現在還為時過早。我們在那裡擁有許多客戶和許多項目，我們將繼續擴大這些項目。而且他們並不都處於同一階段。有些人領先。有些人剛剛獲得資格。但我們仍然認為400ZR為我們留下了良好的跑道。

Well -- and this wasn't going to be my question. But now that you mention it, should we look at this sort of ZR thing as kind of a blip that's coming in and coming back down? Are you seeing weakness elsewhere across telecom as you look forward into your December quarter guide and continued growth in ZR?

嗯——這不會是我的問題。但既然你提到了，我們是否應該將這種 ZR 事件視為一種來來去去的曇花一現？當您期待 12 月季度指南和 ZR 的持續成長時，您是否看到電信領域其他領域的疲軟？

Yes. I think we have -- as I said earlier, we still see continued weakness in telecom generally. I think were it not for 400ZR, there will be even more weakness. But that's really in the traditional telecom products. We see continued softness in the December quarter and really out to the mid -- probably out into the middle of next year when we think it will start to level out.

是的。我認為，正如我之前所說，我們仍然看到電信業整體持續疲軟。我想如果不是400ZR的話，還會有更多的弱點。 但這確實是在傳統電信產品中。我們看到 12 月季度持續疲軟，並且真正持續到中期 - 可能到明年中期，屆時我們認為它將開始趨於平穩。

Got it. And last question for me is given the growth that you've seen and the kind of metrics you've discussed in the past, where do we stand in terms of major additional capacity additions in your facilities?

知道了。我的最後一個問題是考慮到您所看到的成長以及您過去討論過的指標類型，我們在您的設施的主要額外產能增加方面處於什麼位置？

It seems -- in a way, it seems crazy that we're even talking about it. But it is something we have to keep a close eye on as we ramp. It seems like the blink of an eye ago that we opened Building 8 in Chonburi. It's now completely full, and Building 9 is off to a flying start. So we'll be keeping a close eye on that. I think in all probability, you could say -- well, if we pull the trigger too early, what are the implications of that? They're very small implications really.

從某種程度上來說，我們談論這個問題似乎很瘋狂。但這是我們在發展過程中必須密切注意的事情。我們在春武里府開設 8 號大樓似乎只是一眨眼的事。現在已經完全滿員，9 號大樓正在順利開工。所以我們將密切關注這一點。我認為你很可能會說——好吧，如果我們太早扣動扳機，會產生什麼影響？它們的影響確實很小。

So typically, what we've said in the past is once we get to 70% utilization in our last building, we'll build another building. Whether we do that this time around or whether we pull the trigger a little bit earlier remains to be seen. But I think we're -- I would say, stay tuned over the next couple of quarters. It's not going to take us 5 years or anything like that to get to capacity in Building 9. We're off to a great start there.

因此，通常情況下，我們過去說過，一旦我們上一棟大樓的利用率達到 70%，我們就會建造另一棟大樓。這次我們是否這樣做，或者我們是否提前扣動扳機還有待觀察。但我認為我們——我想說，請繼續關注接下來的幾季。我們不需要 5 年或類似的時間就能讓 9 號大樓達到產能。

I was there last week, and the facilitization that's going on in Building 9 and the expansion is just amazing. It's really encouraging to see. And whether it was good luck or good planning on our part, I think our timing on Building 9 was, as it turns out, exactly right. A little bit of luck, I think, never hurt anyone, so we'll be keeping a close eye on that. And once we do make that decision, we communicate it on this call in due course. But again, the cost would be, subject to Csaba correcting me, I would say, if I put a range, on $50 million to $60 million for another 1 million square feet and about 1 year to 18 months time horizon. But yes, it's something we'll be keeping a close eye on, Tim.

上週我去過那裡，9 號樓正在進行的便利化和擴建真是令人驚嘆。看到這真是令人鼓舞。無論是運氣好還是我們計劃得好，我認為我們在 9 號樓上的時機，事實證明是完全正確的。我想，運氣好的話，永遠不會傷害任何人，所以我們會密切注意這一點。一旦我們做出決定，我們就會在適當的時候透過這次電話會議傳達。但同樣，如果 Csaba 糾正我的話，我想說，如果我設定一個範圍，成本將是 5000 萬至 6000 萬美元，另外 100 萬平方英尺，時間範圍約為 1 年至 18 個月。但是，是的，這是我們將密切關注的事情，蒂姆。

We have a follow-up question from the line of Samik Chatterjee with JPM.

我們有來自 JPM Samik Chatterjee 的後續問題。

I'll be quick, I promise. Just Csaba, any color on -- I know you mentioned the gross margin moderated sequentially because of the merit increases. But as you embed that now into the cost structure, puts and takes of how to think about gross margin going forward. And then Seamus, either for you or Csaba, like with the automotive revenue declining and you said it will decline modestly, is that more of a temporary production-led headwind? Or is this a falloff of the legacy programs while growth is sort of [continuing] on the new programs? Any clarification on those 2 items?

我會很快的，我保證。只是 Csaba，任何顏色 - 我知道您提到了由於績效增加而導致毛利率連續下降。但是，當您現在將其嵌入成本結構中時，請考慮如何考慮未來的毛利率。然後Seamus，無論是對你還是對Csaba 來說，就像汽車收入下降一樣，你說它將溫和下降，這更多的是暫時的生產主導的逆風嗎？或者這是舊項目的衰退，而新項目的成長在某種程度上[繼續]？對這兩項有任何澄清嗎？

Maybe I'll take the automotive question first, and then I'll let Csaba discuss the gross margin. Yes, we saw some, I would call it, inventory digestion going on in automotive this past quarter. We think it's primarily temporary. Maybe another quarter or so of inventory digestion, but nothing to get too concerned about. We remain optimistic about our EV charging business overall. But like any business that's ramping, it's -- there's a little bit of inventory digestion going on. If you look at our overall revenue, we've always said we are around kind of the $90 million mark since we overcame the component charges a couple of quarters ago. So it's been pretty stable, actually, if you look at the last few quarters.

也許我會先討論汽車問題，然後讓 Csaba 討論毛利率。是的，上個季度我們看到汽車產業正在消化庫存。我們認為這主要是暫時的。也許還要消化一個季度左右的庫存，但沒有什麼值得太擔心的。 我們對電動車充電業務整體保持樂觀。但就像任何正在擴張的業務一樣，它正在消化一些庫存。如果你看看我們的整體收入，我們總是說自從幾個季度前我們克服了組件費用以來，我們的收入大約在 9000 萬美元左右。事實上，如果你看看過去幾個季度，它就相當穩定了。

In our Q3, we were -- we had $94 million of automotive revenue. Last -- sorry, Q4 was $93 million, and then Q1 was $88 million. So not a huge amount of variation, kind of normal variability, as our customers go through inventory digestion, I would say. But overall, we remain optimistic about that business.

在第三季度，我們的汽車收入為 9,400 萬美元。最後——抱歉，第四季是 9300 萬美元，然後第一季是 8800 萬美元。因此，我想說，當我們的客戶消化庫存時，不會出現巨大的變化，而是正常的變化。但整體而言，我們對該業務仍持樂觀態度。

Regarding gross margin, Samik, obviously, as you know, there are a lot of puts and takes in the gross margin. And this last fiscal quarter, we had a mild headwind as usually from merit increases, and gross margin came in as we had anticipated at 12.6%. And obviously, we are working hard to make sure that we continue to execute well efficiently, provide cost reductions for our customers, and also make sure that we manage the mix and mix of business to deliver industry-leading margins.

關於毛利率，Samik，顯然，如你所知，毛利率中有很多看跌和看跌。在上一個財政季度，我們遇到了通常來自業績成長的溫和阻力，毛利率達到了我們預期的 12.6%。顯然，我們正在努力確保我們繼續高效執行，為客戶降低成本，並確保我們管理業務組合以提供行業領先的利潤。

I think we have done a good job there in the last couple of years. But obviously, there are a couple of factors to be mindful that may result some seasonalities like the merit increases in the first quarter. It's also subject to foreign exchanges, which have been a tailwind in the past, and then we managed to overcome the temporary headwinds there as well. So there are lots of puts and takes, but we are optimistic that we can maintain this middle 12.5% and round about gross margin and above. Working hard to make sure that we continue to deliver on the operating margins as we scale the business and accomplish our road map for growth.

我認為過去幾年我們在這方面做得很好。但顯然，有幾個因素需要注意，這些因素可能會導致一些季節性因素，例如第一季的績效增加。它也受到外匯的影響，外匯在過去一直是順風，然後我們也設法克服了暫時的逆風。因此，有許多看跌期權和看跌期權，但我們樂觀地認為，我們可以維持 12.5% 左右的中間毛利率及以上。努力確保我們在擴大業務並完成成長路線圖的同時繼續實現營業利潤。

Our next question comes from the line of Dave Kang with B. Riley.

我們的下一個問題來自 Dave Kang 和 B. Riley 的對話。

First question is regarding your 400-gig plus revenue of $322 million. What is the rough split between datacom versus telecom?

第一個問題是關於您的 400 場演出以及 3.22 億美元的收入。數據通訊與電信之間的大致差異是什麼？

We typically don't break out and provide that breakdown. But obviously, as you appreciate, as what we have communicated in the past, datacom growth in that space have been obviously far more than the telecom growth. So you would think datacom is going to be much stronger in that area, but we haven't provided a breakdown on that.

我們通常不會分解並提供詳細資訊。但顯然，正如您所意識到的，正如我們過去所傳達的那樣，該領域的數據通訊成長顯然遠遠超過電信成長。因此，您可能會認為數據通訊在該領域會變得更加強大，但我們尚未對此進行細分。

Right. And then on the telecom portion of that 400-gig plus, I mean, is this growing? Or is it going through inventory correction? Any color on that segment?

正確的。然後，我的意思是，在 400 多千兆的電信部分，這個數字還在成長嗎？還是正在進行庫存調整？該部分有任何顏色嗎？

I think we touched on that as well that the traditional telecom business that's not DCI, as we typically would include that in the telecom segment, has been going through inventory digestion and has been there for a while, and we continue to see a headwind there. But our DCI and 400ZR particularly have been very strong over the last couple of quarters, and we continue to be optimistic on that space. So I think, again, the puts and takes there is traditional telecom still experiencing headwinds and -- while the datacom, which is again driven by data center DCI, is going strong for us.

我認為我們也談到了這一點，即非 DCI 的傳統電信業務（我們通常將其納入電信領域）一直在經歷庫存消化，並且已經存在了一段時間，我們繼續看到那裡的逆風。但我們的 DCI 和 400ZR 在過去幾季中表現尤其強勁，我們繼續對該領域持樂觀態度。因此，我再次認為，傳統電信仍然面臨阻力，而數據通訊再次受到資料中心 DCI 的推動，對我們來說表現強勁。

Got it. And just quickly on the number of 10% customers you had or near 10% customers, any new 10% or near 10% customers?

知道了。快速了解您擁有的 10% 或接近 10% 客戶的數量，是否有任何新的 10% 或接近 10% 客戶？

We are disclosing our 10% customers in our 10-K at the end of the year. So obviously, we have disclosed it in August. At that time, we obviously had 4 10% customers, but we are not disclosing this during the quarter. So you will have to wait for another couple of quarters to see any changes there.

我們將在年底的 10-K 中披露 10% 的客戶。顯然，我們在八月就已經披露了這一點。當時，我們顯然有 4 個 10% 的客戶，但我們在本季沒有揭露這一點。因此，您將不得不再等待幾個季度才能看到那裡的任何變化。

And I'm showing no further questions. And I would like to hand the conference back over to Seamus Grady for any closing remarks.

我不會提出任何進一步的問題。我想將會議交還給謝默斯·格雷迪（Seamus Grady）發表閉幕詞。

Thank you. Thank you for joining our call today. We are very pleased with our first quarter performance, including record revenue, net income and free cash flow. We're optimistic about the longer-term drivers of our business and our ability to continue to execute well to produce strong results. We look forward to speaking with you again and seeing those of you participating in the Needham Virtual Conference next week. Thank you, and goodbye.

謝謝。感謝您今天加入我們的電話會議。我們對第一季的業績非常滿意，包括創紀錄的收入、淨利潤和自由現金流。我們對業務的長期驅動因素以及我們繼續良好執行以產生強勁業績的能力感到樂觀。我們期待再次與您交談，並期待下週參加尼達姆虛擬會議的各位。謝謝你，再見。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。