Shares of Fabrinet (NYSE:FN) tanked in early trading on Tuesday, even after the company reported upbeat fiscal third-quarter results.

Here are the key analyst insights:

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Rosenblatt Securities: Fabrinet's revenues grew 39% year-on-year to $1.21 billion. Earnings grew 47.4% to a record high of $3.72 per share. It beat the consensus estimate of $3.56 by 4.49%, according to Benzinga Pro data. 

Revenues were driven by Telecom sales, which grew 55% year-on-year to $628 million, he added.

NVIDIA Corp (NASDAQ:NVDA), or the Datacom segment, revenue contracted by 6% sequentially and grew by only 4% year-on-year to $260 million. Gross margins contracting by 30 basis points (bps) quarter-on-quarter, Genovese said.

"We are upbeat on FN’s Datacom sales even though we do not view NVIDIA as a growth driver," he added

Needham: While Fabrinet's revenue of $1.21 billion came in higher than consensus of $1.19 billion, non-GAAP gross margins of 12.1% missed expectations due to currency headwinds, Koontz said. Telecom revenues, which contribute more than 50% of the company's total revenues, grew 55% year-on-year and 13% sequentially to $628 million, driven by DCI's growth accelerating to 90%, he added.

Management guided to revenues of $1.25-$1.29 billion for the fourth quarter of fiscal 2026, representing 40% year-on-year growth and coming above consensus of $1.26 billion at the midpoint, while earnings guidance of $3.72 $3.87 per share was in-line with expectations, the analyst stated. Management noted several new design wins for Datacom, "with most ramping over C26 and into C27," he further wrote.

FN Price Action: Shares of Fabrinet had declined by 5.88% to $675.97 at the time of publication on Tuesday.

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