Cover
Cover - shares | 3 Months Ended | |
Sep. 29, 2023 | Oct. 27, 2023 | |
Cover [Abstract] | ||
Document type | 10-Q | |
Document quarterly report | true | |
Document period end date | Sep. 29, 2023 | |
Document transition report | false | |
Entity file number | 001-34775 | |
Entity registrant name | FABRINET | |
Entity incorporation, state or country code | E9 | |
Entity tax identification number | 98-1228572 | |
Entity address, address line one | c/o Intertrust Corporate Services | |
Entity address, address line two | One Nexus Way, Camana Bay | |
Entity address, city or town | Grand Cayman | |
Entity address, country | KY | |
Entity address, postal zip code | KY1-9005 | |
City area code | 66 2 | |
Local phone number | 524-9600 | |
Title of 12(b) security | Ordinary Shares, $0.01 par value | |
Trading symbol | FN | |
Security exchange name | NYSE | |
Entity current reporting status | Yes | |
Entity interactive data current | Yes | |
Entity filer category | Large Accelerated Filer | |
Entity small business | false | |
Entity emerging growth company | false | |
Entity shell company | false | |
Entity common stock, shares outstanding (in shares) | 36,330,858 | |
Current fiscal year end date | --06-30 | |
Amendment flag | false | |
Document fiscal year focus | 2024 | |
Document fiscal period focus | Q1 | |
Entity central index key | 0001408710 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Current assets | ||
Cash and cash equivalents | $ 308,338 | $ 231,368 |
Short-term investments | 362,428 | 319,100 |
Trade accounts receivable, net of allowance for doubtful accounts of $1,768 and $965, respectively | 535,006 | 531,767 |
Inventories | 440,095 | 519,576 |
Prepaid expenses | 6,328 | 7,849 |
Other current assets | 39,766 | 42,880 |
Total current assets | 1,691,961 | 1,652,540 |
Non-current assets | ||
Property, plant and equipment, net | 306,665 | 310,350 |
Intangibles, net | 2,598 | 2,394 |
Operating right-of-use assets | 6,024 | 1,634 |
Deferred tax assets | 11,363 | 12,095 |
Other non-current assets | 610 | 635 |
Total non-current assets | 327,260 | 327,108 |
Total Assets | 2,019,221 | 1,979,648 |
Current liabilities | ||
Long-term borrowings, current portion, net | 9,117 | 12,156 |
Trade accounts payable | 357,106 | 381,129 |
Fixed assets payable | 9,313 | 13,526 |
Operating lease liabilities, current portion | 1,587 | 1,201 |
Income tax payable | 7,013 | 6,024 |
Accrued payroll, bonus and related expenses | 22,976 | 23,748 |
Accrued expenses | 24,034 | 20,447 |
Other payables | 24,287 | 23,654 |
Total current liabilities | 455,433 | 481,885 |
Non-current liabilities | ||
Deferred tax liability | 5,117 | 4,799 |
Operating lease liability, non-current portion | 4,052 | 66 |
Severance liabilities | 22,269 | 22,159 |
Other non-current liabilities | 2,181 | 2,081 |
Total non-current liabilities | 33,619 | 29,105 |
Total Liabilities | 489,052 | 510,990 |
Commitments and contingencies (Note 15) | ||
Shareholders’ equity | ||
Preferred shares (5,000,000 shares authorized, $0.01 par value; no shares issued and outstanding as of September 29, 2023 and June 30, 2023) | 0 | 0 |
Ordinary shares (500,000,000 shares authorized, $0.01 par value; 39,430,970 shares and 39,284,176 shares issued at September 29, 2023 and June 30, 2023, respectively; and 36,330,476 shares and 36,183,682 shares outstanding at September 29, 2023 and June 30, 2023, respectively) | 394 | 393 |
Additional paid-in capital | $ 202,432 | $ 206,624 |
Treasury stocks, shares (in shares) | 3,100,494 | 3,100,494 |
Less: Treasury shares (3,100,494 shares as of September 29, 2023 and June 30, 2023) | $ (194,833) | $ (194,833) |
Accumulated other comprehensive income (loss) | (7,502) | (8,115) |
Retained earnings | 1,529,678 | 1,464,589 |
Total Shareholders’ Equity | 1,530,169 | 1,468,658 |
Total Liabilities and Shareholders’ Equity | $ 2,019,221 | $ 1,979,648 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,768 | $ 965 |
Preferred shares, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred shares, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred shares, shares issued (in shares) | 0 | 0 |
Preferred shares, shares outstanding (in shares) | 0 | 0 |
Ordinary shares, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Ordinary shares, par value (in USD per share) | $ 0.01 | $ 0.01 |
Ordinary shares, shares issued (in shares) | 39,430,970 | 39,284,176 |
Ordinary shares, shares outstanding (in shares) | 36,330,476 | 36,183,682 |
Treasury stocks, shares (in shares) | 3,100,494 | 3,100,494 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||
Revenues | $ 685,477 | $ 655,429 |
Cost of revenues | (601,073) | (572,673) |
Gross profit | 84,404 | 82,756 |
Selling, general and administrative expenses | (20,429) | (20,565) |
Operating income | 63,975 | 62,191 |
Interest income | 5,898 | 1,559 |
Interest expense | (45) | (391) |
Foreign exchange gain (loss), net | 415 | 2,085 |
Other income (expense), net | (80) | (141) |
Income before income taxes | 70,163 | 65,303 |
Income tax expense | (5,074) | (688) |
Net income | 65,089 | 64,615 |
Other comprehensive income (loss), net of tax: | ||
Change in net unrealized gain (loss) on available-for-sale securities | 948 | (1,461) |
Change in net unrealized gain (loss) on derivative instruments | (561) | (1,218) |
Change in net retirement benefits plan – prior service cost | 126 | 168 |
Change in foreign currency translation adjustment | 100 | 246 |
Total other comprehensive income (loss), net of tax | 613 | (2,265) |
Net comprehensive income | $ 65,702 | $ 62,350 |
Earnings per share | ||
Basic (in USD per share) | $ 1.80 | $ 1.77 |
Diluted (in USD per share) | $ 1.78 | $ 1.76 |
Weighted-average number of ordinary shares outstanding (thousands of shares) | ||
Basic (in shares) | 36,256 | 36,528 |
Diluted (in shares) | 36,481 | 36,758 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (unaudited) - USD ($) $ in Thousands | Total | Ordinary Share | Additional Paid-in Capital | Treasury Shares | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Beginning balance (in shares) at Jun. 24, 2022 | 39,048,700 | |||||
Beginning balance at Jun. 24, 2022 | $ 1,253,682 | $ 390 | $ 196,667 | $ (147,258) | $ (12,793) | $ 1,216,676 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 64,615 | 64,615 | ||||
Other comprehensive income (loss) | (2,265) | (2,265) | ||||
Share-based compensation | 7,723 | 7,723 | ||||
Issuance of ordinary shares (in shares) | 196,847 | |||||
Issuance of ordinary shares | 0 | $ 2 | (2) | |||
Repurchase of shares held as treasury shares | (4,900) | (4,900) | ||||
Tax withholdings related to net share settlement of restricted share units | (16,489) | (16,489) | ||||
Ending balance (in shares) at Sep. 30, 2022 | 39,245,547 | |||||
Ending balance at Sep. 30, 2022 | 1,302,366 | $ 392 | 187,899 | (152,158) | (15,058) | 1,281,291 |
Beginning balance (in shares) at Jun. 30, 2023 | 39,284,176 | |||||
Beginning balance at Jun. 30, 2023 | 1,468,658 | $ 393 | 206,624 | (194,833) | (8,115) | 1,464,589 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 65,089 | 65,089 | ||||
Other comprehensive income (loss) | 613 | 613 | ||||
Share-based compensation | 7,956 | 7,956 | ||||
Issuance of ordinary shares (in shares) | 146,794 | |||||
Issuance of ordinary shares | 0 | $ 1 | (1) | |||
Tax withholdings related to net share settlement of restricted share units | (12,147) | (12,147) | ||||
Ending balance (in shares) at Sep. 29, 2023 | 39,430,970 | |||||
Ending balance at Sep. 29, 2023 | $ 1,530,169 | $ 394 | $ 202,432 | $ (194,833) | $ (7,502) | $ 1,529,678 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (unaudited) (Parenthetical) - shares | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Treasury stock acquired (in shares) | 0 | 46,977 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||
Net income for the period | $ 65,089 | $ 64,615 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 11,961 | 11,055 |
(Gain) loss on disposal and impairment of property, plant and equipment and intangibles | 12 | (9) |
(Gain) loss from sales and maturities of available-for-sale securities | 0 | 92 |
Amortization of discount (premium) of short-term investments | (596) | 442 |
(Reversal of) allowance for doubtful accounts | 803 | (91) |
Unrealized loss (gain) on exchange rate and fair value of foreign currency forward contracts | (52) | (386) |
Amortization of fair value at hedge inception of interest rate swaps | (88) | (191) |
Share-based compensation | 7,733 | 7,723 |
Deferred income tax | 1,377 | (219) |
Other non-cash expenses | 222 | (439) |
Changes in operating assets and liabilities | ||
Trade accounts receivable | (4,138) | (24,476) |
Inventories | 79,481 | 28,808 |
Other current assets and non-current assets | 3,238 | (10,661) |
Trade accounts payable | (24,397) | (29,774) |
Income tax payable | 963 | (276) |
Severance liabilities | 706 | 617 |
Other current liabilities and non-current liabilities | 2,735 | 13,804 |
Net cash provided by operating activities | 145,049 | 60,634 |
Cash flows from investing activities | ||
Purchase of short-term investments | (77,692) | (25,609) |
Proceeds from sales of short-term investments | 0 | 30,000 |
Proceeds from maturities of short-term investments | 35,909 | 29,236 |
Purchase of property, plant and equipment | (11,435) | (10,258) |
Purchase of intangibles | (180) | (11) |
Proceeds from disposal of property, plant and equipment | 318 | 9 |
Net cash used in investing activities | (53,080) | 23,367 |
Cash flows from financing activities | ||
Repayment of long-term borrowings | (3,047) | (6,094) |
Repayment of finance lease liability | 0 | (2) |
Repurchase of ordinary shares | 0 | (4,900) |
Withholding tax related to net share settlement of restricted share units | (12,147) | (16,489) |
Net cash used in financing activities | (15,194) | (27,485) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 76,775 | 56,516 |
Movement in cash, cash equivalents and restricted cash | ||
Cash, cash equivalents and restricted cash at the beginning of period | 231,368 | 198,365 |
Increase (decrease) in cash, cash equivalents and restricted cash | 76,775 | 56,516 |
Effect of exchange rate on cash, cash equivalents and restricted cash | 195 | 520 |
Cash, cash equivalents and restricted cash at the end of period | 308,338 | 255,401 |
Non-cash investing and financing activities | ||
Construction, software and equipment-related payables | $ 9,313 | $ 12,541 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 29, 2023 | Sep. 30, 2022 |
Reconciliation of cash, cash equivalents and restricted cash | ||
Cash and cash equivalents | $ 308,338 | $ 255,260 |
Restricted cash | 0 | 141 |
Cash, cash equivalents and restricted cash | $ 308,338 | $ 255,401 |
Business and organization
Business and organization | 3 Months Ended |
Sep. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and organization | Business and organization General Fabrinet (“Fabrinet” or the “Parent Company”) was incorporated on August 12, 1999, and commenced operations on January 1, 2000. The Parent Company is an exempted company incorporated in the Cayman Islands, British West Indies. The “Company” refers to Fabrinet and its subsidiaries as a group. The Company provides advanced optical packaging and precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers of complex products, such as optical communication components, modules and sub-systems, automotive components, industrial lasers, medical devices and sensors. The Company offers a broad range of advanced optical and electro-mechanical capabilities across the entire manufacturing process, including process design and engineering, supply chain management, manufacturing, complex printed circuit board assembly, advanced packaging, integration, final assembly and testing. The Company focuses primarily on the production of low-volume, high-mix products. The principal subsidiaries of Fabrinet include Fabrinet Co., Ltd. (“Fabrinet Thailand”), Casix, Inc. (“Casix”), Fabrinet West, Inc. (“Fabrinet West”) and Fabrinet Israel Ltd. (“Fabrinet Israel”). |
Accounting policies
Accounting policies | 3 Months Ended |
Sep. 29, 2023 | |
Accounting Policies [Abstract] | |
Accounting policies | Accounting policies Basis of presentation The accompanying unaudited condensed consolidated financial statements for Fabrinet as of September 29, 2023 and for the three months ended September 29, 2023 and September 30, 2022 include normal recurring adjustments necessary for a fair statement of the financial statements set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP” or "GAAP") for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in Fabrinet’s Annual Report on Form 10-K for the year ended June 30, 2023. The balance sheet as of June 30, 2023 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results for the three months ended September 29, 2023 may not be indicative of results for the year ending June 28, 2024 or any future periods. Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of total revenues and expenses during the year. The Company bases estimates on historical experience and various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial position or results of operations may be materially different under different conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies, which are discussed below. Significant assumptions are used in accounting for share-based compensation, allowance for doubtful accounts, allowance for expected credit losses, income taxes, inventory obsolescence, goodwill and valuation of intangible assets related to business acquisition, among others. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates. In the event that the Company's estimates or assumptions prove to be different from actual results, adjustments will be made in subsequent periods to reflect more current information. Fiscal years The Company utilizes a 52-53 week fiscal year ending on the Friday in June closest to June 30. The three months ended September 29, 2023 and September 30, 2022 consisted of 13 and 14 weeks, respectively. Fiscal year 2024 will comprise 52 weeks and will end on June 28, 2024. Adoption of New Accounting Standards No new accounting standard was adopted in the first quarter of fiscal year 2024. |
Revenues from contracts with cu
Revenues from contracts with customers | 3 Months Ended |
Sep. 29, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenues from contracts with customers | Revenues from contracts with customers Revenue by Geographic Area and End Market Revenues are attributed to a particular geographic area based on the bill-to-location of the Company’s customers. The Company operates in three geographic regions: North America; Asia-Pacific and others; and Europe. The following table presents total revenues by geographic region: (in thousands, except percentages) Three Months Ended As a % of Total Three Months Ended As a % of Total North America U.S. $ 254,859 $ 345,080 Others (1) 3,460 3,624 Total revenue in North America 258,319 37.7 % 348,704 53.2 % Asia-Pacific and others Israel (2) 210,676 37,277 India 70,777 80,033 Malaysia 33,319 49,324 China 20,260 23,064 Hong Kong 15,788 32,472 Thailand 13,027 12,616 Japan 6,810 10,348 Others 1,165 3,160 Total revenue in Asia-Pacific and others 371,822 54.2 % 248,294 37.9 % Europe U.K. 29,774 32,832 Germany 12,780 13,314 Others 12,782 12,285 Total revenue in Europe $ 55,336 8.1 % $ 58,431 8.9 % Total revenue $ 685,477 100.0 % $ 655,429 100.0 % (1) Others includes revenues from external customers based in our country of domicile, the Cayman Islands, which for each year presented is $0. (2) Due to increase in revenue from a significant customer. The following table presents revenues by end market: (in thousands, except percentages) Three Months Ended As a % of Total Three Months Ended As a % of Total Optical communications $ 533,257 77.8 % $ 497,561 75.9 % Automotive, lasers and other 152,220 22.2 % 157,868 24.1 % Total $ 685,477 100.0 % $ 655,429 100.0 % Contract Assets and Liabilities A contract asset is recognized when the Company has recognized revenues prior to an invoice for payment. Contract assets are recognized in the unaudited condensed consolidated balance sheets under other current assets and transferred to accounts receivable when rights to payment become unconditional. As of September 29, 2023 and June 30, 2023, the contract assets are de minimis. A contract liability is recognized when the Company has advance payment arrangements with customers. Contract liabilities are recognized in the unaudited condensed consolidated balance sheets under other payables. The contract liabilities balance is normally recognized as revenue within six months. The following tables summarize the activity in the Company’s contract liabilities during the three months ended September 29, 2023: (in thousands) Contract Beginning balance, June 30, 2023 $ 3,036 Advance payment received during the period 1,497 Revenue recognized (3,285) Ending balance, September 29, 2023 $ 1,248 |
Earnings per ordinary share
Earnings per ordinary share | 3 Months Ended |
Sep. 29, 2023 | |
Earnings Per Share [Abstract] | |
Earnings per ordinary share | Earnings per ordinary share Basic earnings per ordinary share is computed by dividing reported net income by the weighted-average number of ordinary shares outstanding during each period. Diluted earnings per ordinary share is computed by calculating the effect of potential dilutive ordinary shares outstanding during the period using the treasury stock method. Dilutive ordinary equivalent shares consist of restricted share units and performance share units. Earnings per ordinary share was calculated as follows: Three Months Ended (in thousands, except per share data) September 29, September 30, Net income attributable to shareholders $ 65,089 $ 64,615 Weighted-average number of ordinary shares outstanding 36,256 36,528 Incremental shares arising from the assumed vesting of restricted share units and performance share units 225 230 Weighted-average number of ordinary shares for diluted earnings per ordinary share 36,481 36,758 Basic earnings per ordinary share $ 1.80 $ 1.77 Diluted earnings per ordinary share $ 1.78 $ 1.76 |
Cash, cash equivalents and shor
Cash, cash equivalents and short-term investments | 3 Months Ended |
Sep. 29, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Cash, cash equivalents and short-term investments | Cash, cash equivalents and short-term investments The Company’s cash, cash equivalents, and short-term investments are as follows: Fair Value (in thousands) Carrying Unrealized Cash and Marketable Other As of September 29, 2023 Cash $ 306,108 $ — $ 306,108 $ — $ — Cash equivalents 2,230 — 2,230 — — Liquidity funds 41,723 — — — 41,723 Certificates of deposit and time deposits 84,278 826 — 85,104 — Corporate debt securities 145,138 (3,007) — 142,131 — U.S. agency and U.S. treasury securities 93,618 (148) — 93,470 — Total $ 673,095 $ (2,329) $ 308,338 $ 320,705 $ 41,723 As of June 30, 2023 Cash $ 230,967 $ — $ 230,967 $ — $ — Cash equivalents 401 — 401 — — Liquidity funds 41,104 — — — 41,104 Certificates of deposit and time deposits 64,278 329 — 64,607 — Corporate debt securities 161,453 (3,375) — 158,078 — U.S. agency and U.S. treasury securities 55,542 (231) — 55,311 — Total $ 553,745 $ (3,277) $ 231,368 $ 277,996 $ 41,104 All highly liquid investments with original maturities of three months or less at the date of purchase are classified as cash equivalents. Management determines the appropriate classification of its investments at the time of purchase and reevaluates the designations at each balance sheet date. The Company may sell certain of its short-term investments prior to their stated maturities for strategic reasons including, but not limited to, anticipation of credit deterioration and duration management. The maturities of the Company’s short-term investments generally range from three months to three years. The following table summarizes the cost and estimated fair value of short-term investments classified as available-for-sale securities based on stated effective maturities as of September 29, 2023 and June 30, 2023: September 29, 2023 June 30, 2023 (in thousands) Carrying Fair Value Carrying Fair Value Due within one year $ 185,691 $ 186,414 $ 172,992 $ 173,137 Due between one to five years 179,066 176,014 149,385 145,963 Total $ 364,757 $ 362,428 $ 322,377 $ 319,100 |
Fair value of financial instrum
Fair value of financial instruments | 3 Months Ended |
Sep. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial instruments | Fair value of financial instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy is established, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs for the valuation of an asset or liability as of the measurement date. The three levels of inputs that may be used to measure fair value are defined as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for assets or liabilities, either directly or indirectly. If the assets or liabilities have a specified (contractual) term, Level 2 inputs must be observable for substantially the full term of assets or liabilities. Level 3 inputs are unobservable inputs for assets or liabilities, which require the reporting entity to develop its own valuation techniques and assumptions. The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The following table provides details of the financial instruments measured at fair value on a recurring basis, including: Fair Value Measurements at Reporting Date Using (in thousands) Level 1 Level 2 Level 3 Total As of September 29, 2023 Assets Cash equivalents $ — $ 2,230 $ — $ 2,230 Liquidity funds — 41,723 — 41,723 Certificates of deposit and time deposits — 85,104 — 85,104 Corporate debt securities — 142,131 — 142,131 U.S. agency and U.S. treasury securities — 93,470 — 93,470 Derivative assets – current portion — 148 (1) — 148 Total $ — $ 364,806 $ — $ 364,806 Liabilities Derivative liabilities – current portion $ — $ (6,812) $ — $ (6,812) Total $ — $ (6,812) (2) $ — $ (6,812) Fair Value Measurements at Reporting Date Using (in thousands) Level 1 Level 2 Level 3 Total As of June 30, 2023 Assets Cash equivalents $ — $ 401 $ — $ 401 Liquidity funds — 41,104 — 41,104 Certificates of deposit and time deposits — 64,607 — 64,607 Corporate debt securities — 158,078 — 158,078 U.S. agency and U.S. treasury securities — 55,311 — 55,311 Derivative assets – current portion — 221 (3) — 221 Total $ — $ 319,722 $ — $ 319,722 Liabilities Derivative liabilities – current portion $ — $ (5,236) $ — $ (5,236) Total $ — $ (5,236) (4) $ — $ (5,236) (1) Foreign currency forward contracts with an aggregate notional amount of $3.0 million and an interest rate swap agreement with a notional amount of $60.9 million. (2) Foreign currency forward contracts with an aggregate notional amount of $142.0 million and 0.2 million Canadian dollars. (3) Foreign currency forward contracts with an aggregate notional amount of $3.0 million and 0.2 million Canadian dollars and an interest rate swap agreement with a notional amount of $60.9 million. (4) Foreign currency forward contracts with an aggregate notional amount of $140.0 million. Derivative Financial Instruments The Company utilizes derivative financial instruments to hedge (i) foreign exchange risk associated with certain foreign currency denominated assets and liabilities and other foreign currency transactions, and (ii) interest rate risk associated with its long-term debt. The Company minimizes the credit risk associated with its derivative instruments by limiting the exposure to any single counterparty and by entering into derivative instruments only with counterparties that meet the Company’s minimum credit quality standard. Foreign currency forward and option contracts As a result of foreign currency rate fluctuations, the U.S. dollar equivalent values of the Company’s foreign currency denominated assets and liabilities fluctuate. The Company uses foreign currency forward and option contracts to manage the foreign exchange risk associated with a portion of its foreign currency denominated assets and liabilities and other foreign currency transactions. The Company enters into foreign currency forward and option contracts to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht and Canadian dollars with counterparties that meet the Company’s minimum credit quality standard. The Company may enter into foreign currency forward contracts with maturities of up to 12 months to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht, including inventory purchases, payroll and other operating expenses. The Company considers these forward contracts as dual-purpose hedges, that hedge both the foreign exchange fluctuation (i) from inception through the forecasted expenditure, and (ii) any subsequent revaluation of the account payable or accrual. The Company may designate the forward contracts that hedge the foreign exchange fluctuation from inception through the forecasted expenditure as cash flow hedges. The gain or loss on a derivative instrument designated and qualified as a cash flow hedging instrument is recorded as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings. The reclassified amounts are presented in the same income statement line item as the earnings effect of the hedged item. Once the forecasted transactions are recorded, the Company will discontinue the hedging relationship by de-designating the derivative instrument and recording subsequent changes in fair value through contract maturity to foreign exchange gain (loss), net in the unaudited condensed consolidated statements of operations and comprehensive income as a natural hedge against the Thai baht denominated assets and liabilities. The Company may also enter into non-designated foreign currency forward and option contracts to provide an offset to the re-measurement of foreign currency denominated assets and liabilities and to hedge certain forecasted exposures. Changes in the fair value of these non-designated derivatives are recorded as foreign exchange gain (loss), net in the unaudited condensed consolidated statements of operations and comprehensive income. As of September 29, 2023, the Company had 145 outstanding U.S. dollar foreign currency forward contracts against Thai baht, with an aggregate notional amount of $145.0 million and maturity dates ranging from October 2023 through April 2024 and one outstanding Canadian dollar foreign currency forward contract with a notional amount of 0.2 million Canadian dollars and a maturity date in December 2023. As of June 30, 2023, the Company had 143 outstanding U.S. dollar foreign currency forward contracts against Thai baht with an aggregate notional amount of $143.0 million and maturity dates ranging from July 2023 through January 2024, and one foreign currency contract with a notional amount of 0.2 million Canadian dollars and with a maturity date in September 2023. As of September 29, 2023, the hedging relationship over foreign currency forward contracts designated for hedge accounting was determined to be highly effective based on the performance of retrospective and prospective regression testing. As of September 29, 2023, the amount in accumulated other comprehensive income (“AOCI”) expected to be reclassified into earnings within 12 months was a loss of $4.9 million. As of June 30, 2023, the hedging relationship over foreign currency forward contracts designated for hedge accounting had been tested to be highly effective based on the performance of retrospective and prospective regression testing. As of June 30, 2023, the amount in AOCI expected to be reclassified into earnings within 12 months was a loss of $4.0 million. During the three months ended September 29, 2023 and September 30, 2022, the Company included an unrealized gain of $0.3 million and unrealized loss of $0.2 million, respectively, from changes in the fair value of a foreign currency forward contract that was not designated for hedge accounting in earnings as foreign exchange gain (loss), net in the unaudited condensed consolidated statements of operations and comprehensive income. Interest Rate Swap Agreements The Company entered into interest rate swap agreements to mitigate interest rate risk and improve the interest rate profile of the Company’s debt obligations. As of September 29, 2023 and June 30, 2023, the Company had one outstanding interest rate swap agreement with a notional amount of $60.9 million. On July 25, 2018, Fabrinet Thailand entered into an interest rate swap agreement to effectively convert the floating interest rate of the term loan under the Company's previous syndicated senior credit facility agreement to a fixed interest rate of 2.86% per annum through the scheduled maturity of the term loan in June 2023 (see Note 10). The Company did not designate this interest rate swap for hedge accounting. On September 3, 2019, Fabrinet Thailand entered into a term loan agreement under a credit facility agreement with Bank of Ayudhya Public Company Limited, and on September 10, 2019, the Company repaid in full the outstanding term loan under the Company's previous syndicated senior credit facility agreement (see Note 10). In conjunction with the funding of the new term loan, the Company entered into a second interest rate swap agreement. The combination of both of these interest rate swaps effectively converts the floating interest rate of the Company’s term loan with Bank of Ayudhya Public Company Limited to a fixed interest rate of 4.36% per annum through the maturity of the term loan in June 2024. On September 27, 2019, the Company designated these two interest rate swaps as a cash flow hedge for the Company’s term loan under the credit facility agreement with Bank of Ayudhya Public Company Limited. The combination of these two interest rate swaps qualified for hedge accounting because the hedges are highly effective, and the Company has designated and documented contemporaneously the hedging relationships involving these interest rate swaps. While the Company intends to continue to meet the conditions for hedge accounting, if hedges do not qualify as highly effective, the changes in the fair value of the derivatives used as hedges would be reflected in earnings. From September 27, 2019, any gains or losses related to these interest rate swaps are recorded in AOCI in the unaudited condensed consolidated balance sheets. The Company reclassifies a portion of the gains or losses from AOCI into earnings at each reporting period based on either the accrued interest amount or the interest payment. As of September 29, 2023, the amount in AOCI that is expected to be reclassified into earnings within 12 months was a gain of $0.3 million. As of June 30, 2023, the amount in AOCI that is expected to be reclassified into earnings within 12 months was a gain of $0.4 million. The following table provides a summary of the impact of derivative gain (loss) of the Company’s foreign currency forward contracts and interest rate swaps which were designated as cash flow hedges on the unaudited condensed consolidated statements of operations and other comprehensive income: Three Months Ended (in thousands) Financial September 29, September 30, Derivatives gain (loss) recognized in other comprehensive income (loss): Foreign currency forward contracts Other $ (1,565) $ (2,992) Interest rate swaps Other (78) 516 Total derivatives gain (loss) recognized in other comprehensive income (loss) $ (1,643) $ (2,476) Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: Foreign currency forward contracts Cost of revenues $ 3,672 $ 3,794 Foreign currency forward contracts SG&A 155 160 Foreign currency forward contracts Foreign exchange loss, net (3,215) (2,505) Interest rate swaps Interest expense (89) (191) Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings $ 523 $ 1,258 Change in net unrealized gain (loss) on derivatives instruments $ (1,120) $ (1,218) Fair Value of derivatives The following table provides the fair values of the Company’s derivative financial instruments for the periods presented: September 29, June 30, (in thousands) Derivative Derivative Derivative Derivative Derivatives not designated as hedging instruments Foreign currency forward and option contracts $ — $ (1,910) $ 2 $ (1,256) Derivatives designated as hedging instruments Foreign currency forward contracts 12 (4,902) 4 (3,980) Interest rate swaps 136 — 215 — Derivatives, gross balances $ 148 $ (6,812) $ 221 $ (5,236) The Company recorded the fair value of derivative financial instruments in the unaudited condensed consolidated balance sheets as follows: Derivative Financial Instruments Balance Sheet line item Fair Value of Derivative Assets Other current assets, Other non-current assets Fair Value of Derivative Liabilities Accrued expenses, Other non-current liabilities |
Inventories
Inventories | 3 Months Ended |
Sep. 29, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories (in thousands) As of September 29, As of June 30, Raw materials $ 119,200 $ 157,379 Work in progress 248,919 305,627 Finished goods 47,916 28,608 Goods in transit 24,060 27,962 Total inventories $ 440,095 $ 519,576 |
Leases
Leases | 3 Months Ended |
Sep. 29, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company leases facilities under non-cancelable operating lease agreements. The Company leases a portion of its capital equipment and vehicles, certain land and buildings for its facilities in Thailand, the Cayman Islands, the PRC, the U.S., the U.K., Israel and Singapore under operating lease arrangements that expire at various dates through 2029. Certain of these lease arrangements provide the Company the ability to extend the lease from one Operating leases As of September 29, 2023, the maturities of the Company’s operating lease liabilities were as follows: (in thousands) 2024 (remaining nine months) $ 1,465 2025 1,136 2026 1,068 2027 1,093 2028 1,119 Thereafter 283 Total undiscounted lease payments 6,164 Less imputed interest (525) Total present value of lease liabilities $ 5,639 (1) (1) Includes current portion of operating lease liabilities of $1.6 million. Rental expense related to the Company’s operating leases is recognized on a straight-line basis over the lease term. Rental expense for long-term leases for the three months ended September 29, 2023 and September 30, 2022 was $0.5 million and $0.6 million, respectively. Rental expense for short-term leases for the three months ended September 29, 2023 was $0.4 million and September 30, 2022 was immaterial. The following summarizes additional information related to the Company’s operating leases: As of September 29, 2023 As of June 30, 2023 Weighted-average remaining lease term (in years) 4.5 1.2 Weighted-average discount rate 3.9 % 3.4 % The following table presents supplemental disclosure for the unaudited condensed consolidated statement of cash flows related to operating and finance leases for the three months ended September 29, 2023 and September 30, 2022: Three Months Ended (in thousands) September 29, September 30, Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 959 $ 641 Financing cash flows from finance leases $ — $ 2 ROU assets obtained in exchange for lease liabilities $ 4,936 $ — |
Intangibles
Intangibles | 3 Months Ended |
Sep. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles | Intangibles The following tables present details of the Company’s intangibles: (in thousands) Gross Accumulated Net As of September 29, 2023 Software $ 10,968 $ (8,370) $ 2,598 (in thousands) Gross Accumulated Net As of June 30, 2023 Software $ 10,533 $ (8,139) $ 2,394 The Company recorded amortization expense relating to intangibles of $0.2 million and $0.4 million for the three months ended September 29, 2023 and September 30, 2022, respectively. The weighted-average remaining life of software and customer relationships was: (years) As of September 29, 2023 As of June 30, 2023 Software 2.6 3.1 Based on the carrying amount of intangibles as of September 29, 2023, and assuming no future impairment of the underlying assets, the estimated future amortization during each fiscal year was as follows: (in thousands) 2024 (remaining nine months) $ 1,206 2025 640 2026 435 2027 244 2028 73 Total $ 2,598 |
Borrowings
Borrowings | 3 Months Ended |
Sep. 29, 2023 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings The Company’s total borrowings, including current and non-current portions of long-term borrowings, consisted of the following: (in thousands) Rate Conditions Maturity As of September 29, 2023 As of June 30, 2023 Long-term borrowings, current portion, net: Term loan borrowings: 3-month LIBOR +1.35% per annum (1) Repayable in June 2024 $ 9,141 $ 12,188 Less: Unamortized debt issuance costs, current portion (24) (32) Long-term borrowings, current portion, net $ 9,117 $ 12,156 (1) The Company has entered into interest rate swaps that effectively fix a series of future interest payments on its term loans. Refer to Note 6. The movements of long-term borrowings for the three months ended September 29, 2023 and September 30, 2022 were as follows: Three Months Ended (in thousands) September 29, September 30, Opening balance $ 12,188 $ 27,421 Repayments during the period (3,047) (6,094) Closing balance $ 9,141 $ 21,327 As of September 29, 2023, future maturities of long-term borrowings during each fiscal year were as follows: (in thousands) 2024 (remaining nine months) $ 9,141 Credit facility agreements: On August 20, 2019, Fabrinet Thailand (the “Borrower”) and Bank of Ayudhya Public Company Limited (the “Bank”) entered into a credit facility agreement (the “2019 Credit Facility Agreement”), which provides for a facility of 110.0 million Thai baht (approximately $3.6 million based on the applicable exchange rate as of September 27, 2019) and $160.9 million that may be used for, among other things, an overdraft facility, short-term loans against promissory notes, a letter of guarantee facility, a term loan facility and foreign exchange facilities. The Bank may approve any request for extension of credit under the 2019 Credit Facility Agreement and may increase or decrease any facility amount in its sole discretion. Under the 2019 Credit Facility Agreement, on August 20, 2019, the Borrower and the Bank entered into a term loan agreement (the "Term Loan Agreement") pursuant to which the Borrower drew down on September 3, 2019 a term loan in the original principal amount of $60.9 million. The proceeds from the term loan, together with cash on hand, were used to repay outstanding obligations under the Company's previous syndicated senior credit facility agreement. The term loan accrues interest at 3-month LIBOR plus 1.35% and is repayable in quarterly installments of $3.0 million, commencing on September 30, 2019. On March 9, 2023, the Borrower and the Bank amended the Term Loan Agreement to replace the interest rate reference from LIBOR to the Secured Overnight Financing Rate ("SOFR") effective from September 29, 2023. The term loan will mature on June 30, 2024. The Borrower may prepay the term loan in whole or in part at any time without premium or penalty. Any portion of the term loan repaid or prepaid may not be borrowed again. During the three months ended September 29, 2023, the Company recorded $0.1 million of interest expense in connection with this term loan, including the impact from interest rate swaps. Any borrowings under the 2019 Credit Facility Agreement, including those borrowings under the Term Loan Agreement, are guaranteed by Fabrinet and secured by land and buildings owned by the Borrower in the Pathumthani and Chonburi Provinces in Thailand. The Term Loan Agreement contains affirmative and negative covenants applicable to the Borrower, including delivery of financial statements and other information, compliance with laws, maintenance of insurance, and restrictions on granting security interests or liens on its assets, disposing of its assets, incurring indebtedness and making acquisitions. While the term loan is outstanding, the Borrower is required to maintain a loan to value of the mortgaged real property ratio of not greater than 65%. If the loan to value ratio is not maintained, the Borrower will be required to provide additional security or prepay a portion of the term loan in order to restore the required ratio. The Company is also required to maintain a debt service coverage ratio of at least 1.25 times and a debt-to-equity ratio of less than or equal to 1.0 times. In the case of any payment of a dividend by the Company, its debt service coverage ratio must be at least 1.50 times. As of September 29, 2023, the Company was in compliance with all of its financial covenants under the Term Loan Agreement. The events of default under the Term Loan Agreement include failure to timely pay amounts due under the Term Loan Agreement or the related finance documents, failure to comply with the covenants under the Term Loan Agreement or the related finance documents, cross default with other indebtedness of the Borrower, events of bankruptcy or insolvency in respect of the Borrower, and the occurrence of any event or series of events that in the opinion of the Bank has or is reasonably likely to have a material adverse effect. As of September 29, 2023, there was $9.1 million outstanding under the term loan. On March 9, 2023, Fabrinet Thailand and the Parent Company (the “Borrowers”) and the Bank entered into a credit facility agreement (the “2023 Credit Facility Agreement”), which provides a facility of $55.0 million. Any borrowings under the 2023 Credit Facility Agreement are secured by land and buildings owned by the Borrowers in the Pathumthani and Chonburi Provinces in Thailand. Under the 2023 Credit Facility Agreement, the Borrowers are required to maintain a loan to value of the mortgaged real property ratio of not greater than 60%. The Borrowers are also required to maintain a debt service coverage ratio of at least 1.25 times and a debt-to-equity ratio of less than or equal to 1.0 times. In the case of any payment of a dividend by the Company, its debt service coverage ratio must be at least 1.50 times. As of September 29, 2023, there was no amount outstanding under the 2023 Credit Facility Agreement. |
Income taxes
Income taxes | 3 Months Ended |
Sep. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes As of September 29, 2023 and June 30, 2023, the liability for uncertain tax positions including accrued interest and penalties was $1.4 million and $1.5 million, respectively. The Company expects the estimated amount of liability associated with its uncertain tax positions to increase within the next 12 months due to additional provisions on uncertain tax positions from one of the subsidiaries and interest on these positions. The Company files income tax returns in the United States and foreign tax jurisdictions. The tax years from 2016 to 2022 remain open to examination by U.S. federal and state, and foreign tax authorities. The Company’s income tax is recognized based on the best estimate of the expected annual effective tax rate for the full financial year of each entity in the Company, adjusted for discrete items arising in that quarter. If the Company’s estimated annual effective tax rate changes, the Company makes a cumulative adjustment in that quarter. The effective tax rate for the Company for the three months ended September 29, 2023 and September 30, 2022 was 7.2% and 1.1%, respectively, of net income. The increase was due to an increase in income subject to tax during the three months ended September 29, 2023 as compared to the three months ended September 30, 2022. In addition, a full valuation allowance of $2.1 million for deferred tax assets was set up during the three months ended September 29, 2023 due to management's belief that the Company's subsidiary in Israel would continue to have losses in the foreseeable future such that the deferred tax assets of such subsidiary would not be utilized. |
Share-based compensation
Share-based compensation | 3 Months Ended |
Sep. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based compensation | Share-based compensation Share-based compensation The grant date fair value of restricted share units and performance share units is based on the market value of the Company's ordinary shares on the date of grant. The effect of recording share-based compensation expense for the three months ended September 29, 2023 and September 30, 2022 was as follows: Three Months Ended (in thousands) September 29, September 30, Share-based compensation expense by type of award: Restricted share units $ 4,879 $ 4,901 Performance share units 2,854 2,822 Total share-based compensation expense 7,733 7,723 Tax effect on share-based compensation expense — — Net effect on share-based compensation expense $ 7,733 $ 7,723 Share-based compensation expense was recorded in the unaudited condensed consolidated statements of operations and comprehensive income as follows: Three Months Ended (in thousands) September 29, September 30, Cost of revenue $ 2,165 $ 1,915 Selling, general and administrative expense 5,568 5,808 Total share-based compensation expense $ 7,733 $ 7,723 The Company did not capitalize any share-based compensation expense as part of any asset costs during the three months ended September 29, 2023 and September 30, 2022. Share-based award activity On December 12, 2019, the Company’s shareholders approved Fabrinet’s 2020 Equity Incentive Plan (the “2020 Plan”). Upon the approval of the 2020 Plan, Fabrinet’s Amended and Restated 2010 Performance Incentive Plan (the “2010 Plan”) was simultaneously terminated. The 2020 Plan provides for the grant of equity awards thereunder with respect to (i) 1,700,000 ordinary shares, plus (ii) up to 1,300,000 ordinary shares that, as of immediately prior to the termination of the 2010 Plan, had been reserved but not issued pursuant to any awards granted under the 2010 Plan and are not subject to any awards thereunder. Upon termination of the 2010 Plan, 1,281,619 ordinary shares were reserved for issuance under the 2020 Plan pursuant to clause (ii) of the preceding sentence. On November 2, 2017, the Company adopted the 2017 Inducement Equity Incentive Plan (the “2017 Inducement Plan”) with a reserve of 160,000 ordinary shares authorized for future issuance solely for the granting of inducement share options and equity awards to new employees. The 2017 Inducement Plan was adopted without shareholder approval in reliance on the “employment inducement exemption” provided under the New York Stock Exchange Listed Company Manual. The 2020 Plan, 2010 Plan and 2017 Inducement Plan are collectively referred to as the “Equity Incentive Plans.” The following table summarizes the number of equity awards outstanding and ordinary shares available for grant under each of the Equity Incentive Plans as of September 29, 2023: (share units) Restricted Share Units outstanding Performance Share Units outstanding Ordinary Shares available for future grant 2020 Plan 320,011 171,078 1,777,609 2017 Inducement Plan — — 111,347 Total 320,011 171,078 1,888,956 Restricted share units and performance share units Restricted share units and performance share units have been granted under the Equity Incentive Plans. Restricted share units granted to employees generally vest in equal installments over three Performance share units granted to executives will vest, if at all, at the end of a two-year performance period based on the Company’s achievement of pre-defined performance criteria, which consist of revenue and non-GAAP operating margin targets. The actual number of performance share units that may vest at the end of the performance period ranges from 0% to 100% of the award grant. The following table summarizes restricted share unit activity under the Equity Incentive Plans: Number Weighted- Balance as of June 30, 2023 368,765 $ 97.49 Granted 95,393 $ 158.91 Vested (139,438) $ 85.02 Forfeited (4,709) $ 108.19 Balance as of September 29, 2023 320,011 $ 121.07 Number Weighted- Balance as of June 24, 2022 459,626 $ 75.14 Granted 122,743 $ 117.35 Vested (180,824) $ 64.19 Forfeited (9,446) $ 90.47 Balance as of September 30, 2022 392,099 $ 93.03 The following table summarizes performance share unit activity under the Equity Incentive Plans: Number Weighted- Balance as of June 30, 2023 204,016 $ 108.81 Granted 73,936 $ 158.91 Vested (106,874) $ 101.05 Forfeited — $ — Balance as of September 29, 2023 171,078 $ 135.31 Number Weighted- Balance as of June 24, 2022 285,882 $ 81.64 Granted 97,142 $ 117.35 Vested (179,008) 70.05 Forfeited — $ — Balance as of September 30, 2022 204,016 $ 108.81 The fair value of restricted share units and performance share units is based on the market value of Fabrinet's ordinary shares on the date of grant. As of September 29, 2023, there was $21.3 million and $15.5 million of unrecognized share-based compensation expense related to restricted share units and performance share units, respectively, under the Equity Incentive Plans that is expected to be recorded over a weighted-average period of 2.9 and 1.5 years, respectively. For the three months ended September 29, 2023 and September 30, 2022, the Company withheld an aggregate of 99,518 shares and 162,985 shares, respectively, upon the vesting of restricted share units and performance shares units, based upon the closing share price on the vesting date to settle employee tax withholding obligations. For the three months ended September 29, 2023 and September 30, 2022, the Company then remitted cash of $12.1 million and $16.5 million, respectively, to the appropriate taxing authorities and presented it as a financing activity within the unaudited condensed consolidated statements of cash flows. The payment was recorded as a reduction of additional paid-in capital. |
Shareholders' equity
Shareholders' equity | 3 Months Ended |
Sep. 29, 2023 | |
Equity [Abstract] | |
Shareholders' equity | Shareholders’ equity Share capital Fabrinet’s authorized share capital is 500,000,000 ordinary shares, par value of $0.01 per ordinary share, and 5,000,000 preferred shares, par value of $0.01 per preferred share. For the three months ended September 29, 2023, Fabrinet issued 146,794 ordinary shares upon the vesting of restricted share units and performance share units under the Equity Incentive Plans, net of shares withheld. For the three months ended September 30, 2022, Fabrinet issued 196,847 ordinary shares upon the vesting of restricted share units and performance share units under the Equity Incentive Plans, net of shares withheld. All such issued shares are fully paid. Treasury shares In August 2017, the Company’s board of directors approved a share repurchase program to permit the Company to repurchase up to $30.0 million worth of its issued and outstanding ordinary shares in the open market in accordance with applicable rules and regulations. In February 2018, May 2019, August 2020, August 2022, and August 2023, the Company’s board of directors approved an increase of $30.0 million, $50.0 million, $58.5 million, $78.7 million, and $47.6 million, respectively, to the original share repurchase authorization, bringing the aggregate authorization to $294.8 million. During the three months ended September 29, 2023, the Company did not repurchase any shares. As of September 29, 2023, the Company had a remaining authorization to repurchase up to $100.0 million worth of its ordinary shares under the share repurchase program. Shares repurchased under the share repurchase program are held as treasury shares. |
Accumulated other comprehensive
Accumulated other comprehensive income (loss) | 3 Months Ended |
Sep. 29, 2023 | |
Equity [Abstract] | |
Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) The changes in AOCI for the three months ended September 29, 2023 and September 30, 2022 were as follows: (in thousands) Unrealized net Unrealized net Retirement Foreign Total Balance as of June 30, 2023 $ (3,279) $ (3,541) $ (330) $ (965) $ (8,115) Other comprehensive income (loss) before reclassification 948 (1,643) — 100 (595) Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income — 523 90 — 613 Tax effects — 559 36 — 595 Other comprehensive income (loss) $ 948 $ (561) $ 126 $ 100 $ 613 Balance as of September 29, 2023 $ (2,331) $ (4,102) $ (204) $ (865) $ (7,502) (in thousands) Unrealized net Unrealized net Retirement Foreign Total Balance as of June 24, 2022 $ (6,018) $ (5,082) $ (803) $ (890) $ (12,793) Other comprehensive income (loss) before reclassification (1,553) (2,476) — 246 (3,783) Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income 92 1,258 168 — 1,518 Tax effects — — — — — Other comprehensive income (loss) $ (1,461) $ (1,218) $ 168 $ 246 $ (2,265) Balance as of September 30, 2022 $ (7,479) $ (6,300) $ (635) $ (644) $ (15,058) |
Commitments and contingencies
Commitments and contingencies | 3 Months Ended |
Sep. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Bank guarantees As of September 29, 2023 and June 30, 2023, there were outstanding bank guarantees on behalf of the Company's subsidiary in Thailand for electricity usage and other normal business expenses totaling $2.0 million and $1.5 million, respectively, or Thai baht 73.2 million and 53.0 million, respectively. In addition, there were other immaterial bank guarantees on behalf of the Company's subsidiary in Israel to support the operations related to the Israeli Customs department. Purchase obligations Purchase obligations represent legally binding commitments to purchase inventory and other commitments made in the normal course of business to meet operational requirements. Although open purchase orders are considered enforceable and legally binding, their terms generally give the Company the option to cancel, reschedule and/or adjust its requirements based on its business needs prior to the delivery of goods or performance of services. Obligations to purchase inventory and other commitments are generally expected to be fulfilled within one year. As of September 29, 2023, the Company had purchase obligations and other commitments to third parties of $1.22 billion. Capital expenditures As of September 29, 2023, the Company had total capital expenditure commitments to third parties of $12.3 million. Indemnification of directors and officers Cayman Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification of directors and officers, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Fabrinet’s amended and restated memorandum and articles of association provide for indemnification of directors and officers for actions, costs, charges, losses, damages and expenses incurred in their capacities as such, except that such indemnification does not extend to any matter in respect of any fraud or dishonesty that may attach to any of them. In accordance with Fabrinet’s form of indemnification agreement for its directors and officers, Fabrinet has agreed to indemnify its directors and officers against certain liabilities and expenses incurred by such persons in connection with claims by reason of their being such a director or officer. Fabrinet maintains a director and officer liability insurance policy that may enable it to recover a portion of any future amounts paid under the indemnification agreements. |
Business segments and geographi
Business segments and geographic information | 3 Months Ended |
Sep. 29, 2023 | |
Segment Reporting [Abstract] | |
Business segments and geographic information | Business segments and geographic information Operating segments are defined as components of an enterprise that engage in business activities for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (the “CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM is Fabrinet’s Chief Executive Officer. As of September 29, 2023, the Company operated and internally managed a single operating segment. Accordingly, the Company does not accumulate discrete information with respect to separate product lines and does not have separate reportable segments. For the Company’s revenues by geographic region, see “Revenue by Geographic Area and End Market” in Note 3. The following table presents long-lived assets by the country in which they are based: (in thousands) September 29, June 30, Long-Lived Assets: Thailand $ 261,117 $ 264,382 U.S. 25,538 25,267 China 16,531 17,407 Israel 2,998 2,796 Others 481 498 Total $ 306,665 $ 310,350 Significant customers The Company had three customers that each contributed to 10% or more of the Company's total trade accounts receivable as of September 29, 2023 and June 30, 2023. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||
Net income | $ 65,089 | $ 64,615 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 29, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Accounting policies (Policies)
Accounting policies (Policies) | 3 Months Ended |
Sep. 29, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements for Fabrinet as of September 29, 2023 and for the three months ended September 29, 2023 and September 30, 2022 include normal recurring adjustments necessary for a fair statement of the financial statements set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP” or "GAAP") for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in Fabrinet’s Annual Report on Form 10-K for the year ended June 30, 2023. The balance sheet as of June 30, 2023 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results for the three months ended September 29, 2023 may not be indicative of results for the year ending June 28, 2024 or any future periods. |
Use of Estimates | Use of Estimates The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of total revenues and expenses during the year. The Company bases estimates on historical experience and various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial position or results of operations may be materially different under different conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies, which are discussed below. Significant assumptions are used in accounting for share-based compensation, allowance for doubtful accounts, allowance for expected credit losses, income taxes, inventory obsolescence, goodwill and valuation of intangible assets related to business acquisition, among others. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates. In the event that the Company's estimates or assumptions prove to be different from actual results, adjustments will be made in subsequent periods to reflect more current information. |
Fiscal years | Fiscal years The Company utilizes a 52-53 week fiscal year ending on the Friday in June closest to June 30. The three months ended September 29, 2023 and September 30, 2022 consisted of 13 and 14 weeks, respectively. Fiscal year 2024 will comprise 52 weeks and will end on June 28, 2024. |
Contract Assets and Liabilities | Contract Assets and Liabilities A contract asset is recognized when the Company has recognized revenues prior to an invoice for payment. Contract assets are recognized in the unaudited condensed consolidated balance sheets under other current assets and transferred to accounts receivable when rights to payment become unconditional. As of September 29, 2023 and June 30, 2023, the contract assets are de minimis. A contract liability is recognized when the Company has advance payment arrangements with customers. Contract liabilities are recognized in the unaudited condensed consolidated balance sheets under other payables. The contract liabilities balance is normally recognized as revenue within six months. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards No new accounting standard was adopted in the first quarter of fiscal year 2024. |
Revenues from contracts with _2
Revenues from contracts with customers (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue by Geographical Regions | The following table presents total revenues by geographic region: (in thousands, except percentages) Three Months Ended As a % of Total Three Months Ended As a % of Total North America U.S. $ 254,859 $ 345,080 Others (1) 3,460 3,624 Total revenue in North America 258,319 37.7 % 348,704 53.2 % Asia-Pacific and others Israel (2) 210,676 37,277 India 70,777 80,033 Malaysia 33,319 49,324 China 20,260 23,064 Hong Kong 15,788 32,472 Thailand 13,027 12,616 Japan 6,810 10,348 Others 1,165 3,160 Total revenue in Asia-Pacific and others 371,822 54.2 % 248,294 37.9 % Europe U.K. 29,774 32,832 Germany 12,780 13,314 Others 12,782 12,285 Total revenue in Europe $ 55,336 8.1 % $ 58,431 8.9 % Total revenue $ 685,477 100.0 % $ 655,429 100.0 % (1) Others includes revenues from external customers based in our country of domicile, the Cayman Islands, which for each year presented is $0. (2) Due to increase in revenue from a significant customer. |
Schedule of Revenues by End Market | The following table presents revenues by end market: (in thousands, except percentages) Three Months Ended As a % of Total Three Months Ended As a % of Total Optical communications $ 533,257 77.8 % $ 497,561 75.9 % Automotive, lasers and other 152,220 22.2 % 157,868 24.1 % Total $ 685,477 100.0 % $ 655,429 100.0 % |
Schedule of Activity in the Company's Contract Assets and Liabilities | The following tables summarize the activity in the Company’s contract liabilities during the three months ended September 29, 2023: (in thousands) Contract Beginning balance, June 30, 2023 $ 3,036 Advance payment received during the period 1,497 Revenue recognized (3,285) Ending balance, September 29, 2023 $ 1,248 |
Earnings per ordinary share (Ta
Earnings per ordinary share (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Ordinary Share | Earnings per ordinary share was calculated as follows: Three Months Ended (in thousands, except per share data) September 29, September 30, Net income attributable to shareholders $ 65,089 $ 64,615 Weighted-average number of ordinary shares outstanding 36,256 36,528 Incremental shares arising from the assumed vesting of restricted share units and performance share units 225 230 Weighted-average number of ordinary shares for diluted earnings per ordinary share 36,481 36,758 Basic earnings per ordinary share $ 1.80 $ 1.77 Diluted earnings per ordinary share $ 1.78 $ 1.76 |
Cash, cash equivalents and sh_2
Cash, cash equivalents and short-term investments (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Summary of Components of Cash, Cash Equivalents, and Short-Term Investments | The Company’s cash, cash equivalents, and short-term investments are as follows: Fair Value (in thousands) Carrying Unrealized Cash and Marketable Other As of September 29, 2023 Cash $ 306,108 $ — $ 306,108 $ — $ — Cash equivalents 2,230 — 2,230 — — Liquidity funds 41,723 — — — 41,723 Certificates of deposit and time deposits 84,278 826 — 85,104 — Corporate debt securities 145,138 (3,007) — 142,131 — U.S. agency and U.S. treasury securities 93,618 (148) — 93,470 — Total $ 673,095 $ (2,329) $ 308,338 $ 320,705 $ 41,723 As of June 30, 2023 Cash $ 230,967 $ — $ 230,967 $ — $ — Cash equivalents 401 — 401 — — Liquidity funds 41,104 — — — 41,104 Certificates of deposit and time deposits 64,278 329 — 64,607 — Corporate debt securities 161,453 (3,375) — 158,078 — U.S. agency and U.S. treasury securities 55,542 (231) — 55,311 — Total $ 553,745 $ (3,277) $ 231,368 $ 277,996 $ 41,104 |
Schedule of Available-for-Sale Securities Based on Stated Effective Maturities | The following table summarizes the cost and estimated fair value of short-term investments classified as available-for-sale securities based on stated effective maturities as of September 29, 2023 and June 30, 2023: September 29, 2023 June 30, 2023 (in thousands) Carrying Fair Value Carrying Fair Value Due within one year $ 185,691 $ 186,414 $ 172,992 $ 173,137 Due between one to five years 179,066 176,014 149,385 145,963 Total $ 364,757 $ 362,428 $ 322,377 $ 319,100 |
Fair value of financial instr_2
Fair value of financial instruments (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | The following table provides details of the financial instruments measured at fair value on a recurring basis, including: Fair Value Measurements at Reporting Date Using (in thousands) Level 1 Level 2 Level 3 Total As of September 29, 2023 Assets Cash equivalents $ — $ 2,230 $ — $ 2,230 Liquidity funds — 41,723 — 41,723 Certificates of deposit and time deposits — 85,104 — 85,104 Corporate debt securities — 142,131 — 142,131 U.S. agency and U.S. treasury securities — 93,470 — 93,470 Derivative assets – current portion — 148 (1) — 148 Total $ — $ 364,806 $ — $ 364,806 Liabilities Derivative liabilities – current portion $ — $ (6,812) $ — $ (6,812) Total $ — $ (6,812) (2) $ — $ (6,812) Fair Value Measurements at Reporting Date Using (in thousands) Level 1 Level 2 Level 3 Total As of June 30, 2023 Assets Cash equivalents $ — $ 401 $ — $ 401 Liquidity funds — 41,104 — 41,104 Certificates of deposit and time deposits — 64,607 — 64,607 Corporate debt securities — 158,078 — 158,078 U.S. agency and U.S. treasury securities — 55,311 — 55,311 Derivative assets – current portion — 221 (3) — 221 Total $ — $ 319,722 $ — $ 319,722 Liabilities Derivative liabilities – current portion $ — $ (5,236) $ — $ (5,236) Total $ — $ (5,236) (4) $ — $ (5,236) (1) Foreign currency forward contracts with an aggregate notional amount of $3.0 million and an interest rate swap agreement with a notional amount of $60.9 million. (2) Foreign currency forward contracts with an aggregate notional amount of $142.0 million and 0.2 million Canadian dollars. (3) Foreign currency forward contracts with an aggregate notional amount of $3.0 million and 0.2 million Canadian dollars and an interest rate swap agreement with a notional amount of $60.9 million. (4) Foreign currency forward contracts with an aggregate notional amount of $140.0 million. |
Schedule of Impacts of Derivative Gain (Loss) of Cash Flow Hedges | The following table provides a summary of the impact of derivative gain (loss) of the Company’s foreign currency forward contracts and interest rate swaps which were designated as cash flow hedges on the unaudited condensed consolidated statements of operations and other comprehensive income: Three Months Ended (in thousands) Financial September 29, September 30, Derivatives gain (loss) recognized in other comprehensive income (loss): Foreign currency forward contracts Other $ (1,565) $ (2,992) Interest rate swaps Other (78) 516 Total derivatives gain (loss) recognized in other comprehensive income (loss) $ (1,643) $ (2,476) Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: Foreign currency forward contracts Cost of revenues $ 3,672 $ 3,794 Foreign currency forward contracts SG&A 155 160 Foreign currency forward contracts Foreign exchange loss, net (3,215) (2,505) Interest rate swaps Interest expense (89) (191) Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings $ 523 $ 1,258 Change in net unrealized gain (loss) on derivatives instruments $ (1,120) $ (1,218) |
Schedule of Derivative Financial Instruments | The following table provides the fair values of the Company’s derivative financial instruments for the periods presented: September 29, June 30, (in thousands) Derivative Derivative Derivative Derivative Derivatives not designated as hedging instruments Foreign currency forward and option contracts $ — $ (1,910) $ 2 $ (1,256) Derivatives designated as hedging instruments Foreign currency forward contracts 12 (4,902) 4 (3,980) Interest rate swaps 136 — 215 — Derivatives, gross balances $ 148 $ (6,812) $ 221 $ (5,236) |
Schedule of Derivative Financial Instruments in the Unaudited Condensed Consolidated Balance Sheets | The Company recorded the fair value of derivative financial instruments in the unaudited condensed consolidated balance sheets as follows: Derivative Financial Instruments Balance Sheet line item Fair Value of Derivative Assets Other current assets, Other non-current assets Fair Value of Derivative Liabilities Accrued expenses, Other non-current liabilities |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | (in thousands) As of September 29, As of June 30, Raw materials $ 119,200 $ 157,379 Work in progress 248,919 305,627 Finished goods 47,916 28,608 Goods in transit 24,060 27,962 Total inventories $ 440,095 $ 519,576 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Leases [Abstract] | |
Schedule of Operating Lease Liabilities | As of September 29, 2023, the maturities of the Company’s operating lease liabilities were as follows: (in thousands) 2024 (remaining nine months) $ 1,465 2025 1,136 2026 1,068 2027 1,093 2028 1,119 Thereafter 283 Total undiscounted lease payments 6,164 Less imputed interest (525) Total present value of lease liabilities $ 5,639 (1) |
Summary of Additional Information Related to Operating and Finance Lease | The following summarizes additional information related to the Company’s operating leases: As of September 29, 2023 As of June 30, 2023 Weighted-average remaining lease term (in years) 4.5 1.2 Weighted-average discount rate 3.9 % 3.4 % |
Schedule of Supplemental Cash Flow and Other Information Related to Leases | The following table presents supplemental disclosure for the unaudited condensed consolidated statement of cash flows related to operating and finance leases for the three months ended September 29, 2023 and September 30, 2022: Three Months Ended (in thousands) September 29, September 30, Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 959 $ 641 Financing cash flows from finance leases $ — $ 2 ROU assets obtained in exchange for lease liabilities $ 4,936 $ — |
Intangibles (Tables)
Intangibles (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | The following tables present details of the Company’s intangibles: (in thousands) Gross Accumulated Net As of September 29, 2023 Software $ 10,968 $ (8,370) $ 2,598 (in thousands) Gross Accumulated Net As of June 30, 2023 Software $ 10,533 $ (8,139) $ 2,394 |
Schedule of Weighted-Average Remaining Life of Intangible Assets | The weighted-average remaining life of software and customer relationships was: (years) As of September 29, 2023 As of June 30, 2023 Software 2.6 3.1 |
Schedule of Estimated Future Amortization of Intangibles Assets | Based on the carrying amount of intangibles as of September 29, 2023, and assuming no future impairment of the underlying assets, the estimated future amortization during each fiscal year was as follows: (in thousands) 2024 (remaining nine months) $ 1,206 2025 640 2026 435 2027 244 2028 73 Total $ 2,598 |
Borrowings (Tables)
Borrowings (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Total Borrowings, Including Revolving and Long-Term Borrowings | The Company’s total borrowings, including current and non-current portions of long-term borrowings, consisted of the following: (in thousands) Rate Conditions Maturity As of September 29, 2023 As of June 30, 2023 Long-term borrowings, current portion, net: Term loan borrowings: 3-month LIBOR +1.35% per annum (1) Repayable in June 2024 $ 9,141 $ 12,188 Less: Unamortized debt issuance costs, current portion (24) (32) Long-term borrowings, current portion, net $ 9,117 $ 12,156 (1) The Company has entered into interest rate swaps that effectively fix a series of future interest payments on its term loans. Refer to Note 6. |
Schedule of Movements of Long-Term Loans | The movements of long-term borrowings for the three months ended September 29, 2023 and September 30, 2022 were as follows: Three Months Ended (in thousands) September 29, September 30, Opening balance $ 12,188 $ 27,421 Repayments during the period (3,047) (6,094) Closing balance $ 9,141 $ 21,327 |
Schedule of Future Maturities of Long-Term Debt | As of September 29, 2023, future maturities of long-term borrowings during each fiscal year were as follows: (in thousands) 2024 (remaining nine months) $ 9,141 |
Share-based compensation (Table
Share-based compensation (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Effect of Recording Share-Based Compensation Expense | The effect of recording share-based compensation expense for the three months ended September 29, 2023 and September 30, 2022 was as follows: Three Months Ended (in thousands) September 29, September 30, Share-based compensation expense by type of award: Restricted share units $ 4,879 $ 4,901 Performance share units 2,854 2,822 Total share-based compensation expense 7,733 7,723 Tax effect on share-based compensation expense — — Net effect on share-based compensation expense $ 7,733 $ 7,723 |
Schedule of Share-Based Compensation Expense Recorded in Condensed Consolidated Statements of Operations and Comprehensive Income | Share-based compensation expense was recorded in the unaudited condensed consolidated statements of operations and comprehensive income as follows: Three Months Ended (in thousands) September 29, September 30, Cost of revenue $ 2,165 $ 1,915 Selling, general and administrative expense 5,568 5,808 Total share-based compensation expense $ 7,733 $ 7,723 |
Share-Based Payment Arrangement, Activity | The following table summarizes the number of equity awards outstanding and ordinary shares available for grant under each of the Equity Incentive Plans as of September 29, 2023: (share units) Restricted Share Units outstanding Performance Share Units outstanding Ordinary Shares available for future grant 2020 Plan 320,011 171,078 1,777,609 2017 Inducement Plan — — 111,347 Total 320,011 171,078 1,888,956 |
Schedule of Restricted Share Unit Activity | The following table summarizes restricted share unit activity under the Equity Incentive Plans: Number Weighted- Balance as of June 30, 2023 368,765 $ 97.49 Granted 95,393 $ 158.91 Vested (139,438) $ 85.02 Forfeited (4,709) $ 108.19 Balance as of September 29, 2023 320,011 $ 121.07 Number Weighted- Balance as of June 24, 2022 459,626 $ 75.14 Granted 122,743 $ 117.35 Vested (180,824) $ 64.19 Forfeited (9,446) $ 90.47 Balance as of September 30, 2022 392,099 $ 93.03 |
Schedule of Performance Share Unit Activity | The following table summarizes performance share unit activity under the Equity Incentive Plans: Number Weighted- Balance as of June 30, 2023 204,016 $ 108.81 Granted 73,936 $ 158.91 Vested (106,874) $ 101.05 Forfeited — $ — Balance as of September 29, 2023 171,078 $ 135.31 Number Weighted- Balance as of June 24, 2022 285,882 $ 81.64 Granted 97,142 $ 117.35 Vested (179,008) 70.05 Forfeited — $ — Balance as of September 30, 2022 204,016 $ 108.81 |
Accumulated other comprehensi_2
Accumulated other comprehensive income (loss) (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Equity [Abstract] | |
Schedule of Changes in AOCI | The changes in AOCI for the three months ended September 29, 2023 and September 30, 2022 were as follows: (in thousands) Unrealized net Unrealized net Retirement Foreign Total Balance as of June 30, 2023 $ (3,279) $ (3,541) $ (330) $ (965) $ (8,115) Other comprehensive income (loss) before reclassification 948 (1,643) — 100 (595) Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income — 523 90 — 613 Tax effects — 559 36 — 595 Other comprehensive income (loss) $ 948 $ (561) $ 126 $ 100 $ 613 Balance as of September 29, 2023 $ (2,331) $ (4,102) $ (204) $ (865) $ (7,502) (in thousands) Unrealized net Unrealized net Retirement Foreign Total Balance as of June 24, 2022 $ (6,018) $ (5,082) $ (803) $ (890) $ (12,793) Other comprehensive income (loss) before reclassification (1,553) (2,476) — 246 (3,783) Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income 92 1,258 168 — 1,518 Tax effects — — — — — Other comprehensive income (loss) $ (1,461) $ (1,218) $ 168 $ 246 $ (2,265) Balance as of September 30, 2022 $ (7,479) $ (6,300) $ (635) $ (644) $ (15,058) |
Business segments and geograp_2
Business segments and geographic information (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers and Long-lived Assets | The following table presents long-lived assets by the country in which they are based: (in thousands) September 29, June 30, Long-Lived Assets: Thailand $ 261,117 $ 264,382 U.S. 25,538 25,267 China 16,531 17,407 Israel 2,998 2,796 Others 481 498 Total $ 306,665 $ 310,350 |
Revenues from contracts with _3
Revenues from contracts with customers - Narrative (Details) | 3 Months Ended |
Sep. 29, 2023 region | |
Revenue from Contract with Customer [Abstract] | |
Number of geographic regions | 3 |
Revenues from contracts with _4
Revenues from contracts with customers - Schedule of Disaggregation of Revenue by Geographical Regions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 685,477 | $ 655,429 |
Geographic concentration risk | Revenue from contract with customer benchmark | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 100% | 100% |
North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 258,319 | $ 348,704 |
North America | Geographic concentration risk | Revenue from contract with customer benchmark | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 37.70% | 53.20% |
U.S. | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 254,859 | $ 345,080 |
Others | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 3,460 | 3,624 |
Cayman Islands | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | 0 |
Asia-Pacific and others | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 371,822 | $ 248,294 |
Asia-Pacific and others | Geographic concentration risk | Revenue from contract with customer benchmark | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 54.20% | 37.90% |
Israel | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 210,676 | $ 37,277 |
India | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 70,777 | 80,033 |
Malaysia | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 33,319 | 49,324 |
China | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 20,260 | 23,064 |
Hong Kong | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 15,788 | 32,472 |
Thailand | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 13,027 | 12,616 |
Japan | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 6,810 | 10,348 |
Others | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 1,165 | 3,160 |
Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 55,336 | $ 58,431 |
Europe | Geographic concentration risk | Revenue from contract with customer benchmark | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 8.10% | 8.90% |
U.K. | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 29,774 | $ 32,832 |
Germany | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 12,780 | 13,314 |
Others | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 12,782 | $ 12,285 |
Revenues from contracts with _5
Revenues from contracts with customers - Schedule of Revenues by End Market (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 685,477 | $ 655,429 |
Revenue from contract with customer benchmark | Geographic concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 100% | 100% |
Optical communications | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 533,257 | $ 497,561 |
Optical communications | Revenue from contract with customer benchmark | Geographic concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 77.80% | 75.90% |
Automotive, lasers and other | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 152,220 | $ 157,868 |
Automotive, lasers and other | Revenue from contract with customer benchmark | Geographic concentration risk | ||
Disaggregation of Revenue [Line Items] | ||
Revenues, percentage | 22.20% | 24.10% |
Revenues from contracts with _6
Revenues from contracts with customers - Schedule of Activity in the Company's Contract Assets and Liabilities (Details) $ in Thousands | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Contract Liabilities | |
Beginning balance, June 30, 2023 | $ 3,036 |
Advance payment received during the period | 1,497 |
Revenue recognized | (3,285) |
Ending balance, September 29, 2023 | $ 1,248 |
Earnings per ordinary share (De
Earnings per ordinary share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||
Net income attributable to shareholders | $ 65,089 | $ 64,615 |
Weighted-average number of ordinary shares outstanding (in shares) | 36,256 | 36,528 |
Incremental shares arising from the assumed vesting of restricted share units and performance share units (in shares) | 225 | 230 |
Weighted-average number of ordinary shares for diluted earnings per ordinary share (in shares) | 36,481 | 36,758 |
Basic earnings per ordinary share (in USD per share) | $ 1.80 | $ 1.77 |
Diluted earnings per ordinary share (in USD per share) | $ 1.78 | $ 1.76 |
Cash, cash equivalents and sh_3
Cash, cash equivalents and short-term investments - Summary of Components of Cash, Cash Equivalents, and Short-Term Investments (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 | Sep. 30, 2022 |
Cash and Cash Equivalents [Line Items] | |||
Carrying cost, total | $ 364,757 | $ 322,377 | |
Cash and cash equivalents and marketable securities, carrying cost | 673,095 | 553,745 | |
Unrealized Gain/ (Loss) | (2,329) | (3,277) | |
Cash and cash equivalents | 308,338 | 231,368 | $ 255,260 |
Marketable Securities | 320,705 | 277,996 | |
Other Investments | 41,723 | 41,104 | |
Cash | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying Cost | 306,108 | 230,967 | |
Cash and cash equivalents | 306,108 | 230,967 | |
Cash equivalents | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying Cost | 2,230 | 401 | |
Unrealized Gain/ (Loss) | 0 | ||
Cash and cash equivalents | 2,230 | 401 | |
Liquidity funds | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying Cost | 41,723 | 41,104 | |
Other Investments | 41,723 | 41,104 | |
Certificates of deposit and time deposits | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying cost, total | 84,278 | 64,278 | |
Unrealized Gain/ (Loss) | 826 | 329 | |
Marketable Securities | 85,104 | 64,607 | |
Corporate debt securities | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying cost, total | 145,138 | 161,453 | |
Unrealized Gain/ (Loss) | (3,007) | (3,375) | |
Marketable Securities | 142,131 | 158,078 | |
U.S. agency and U.S. treasury securities | |||
Cash and Cash Equivalents [Line Items] | |||
Carrying cost, total | 93,618 | 55,542 | |
Unrealized Gain/ (Loss) | (148) | (231) | |
Marketable Securities | $ 93,470 | $ 55,311 |
Cash, cash equivalents and sh_4
Cash, cash equivalents and short-term investments - Narrative (Details) | 3 Months Ended |
Sep. 29, 2023 | |
Minimum | |
Cash, cash equivalents and marketable securities [Line Items] | |
Maturities period of marketable securities | 3 months |
Maximum | |
Cash, cash equivalents and marketable securities [Line Items] | |
Maturities period of marketable securities | 3 years |
Cash, cash equivalents and sh_5
Cash, cash equivalents and short-term investments - Schedule of Available-for-Sale Securities Based on Stated Effective Maturities (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Investments Classified by Contractual Maturity Date [Line Items] | ||
Carrying cost, total | $ 364,757 | $ 322,377 |
Fair value, total | 320,705 | 277,996 |
Carrying Cost | ||
Investments Classified by Contractual Maturity Date [Line Items] | ||
Carrying cost, due within one year | 185,691 | 172,992 |
Carrying cost, due between one to five years | 179,066 | 149,385 |
Fair Value | ||
Investments Classified by Contractual Maturity Date [Line Items] | ||
Fair value, due within one year | 186,414 | 173,137 |
Fair value, due between one to five years | 176,014 | 145,963 |
Fair value, total | $ 362,428 | $ 319,100 |
Fair value of financial instr_3
Fair value of financial instruments - Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Details) $ in Thousands, $ in Millions | Sep. 29, 2023 USD ($) | Sep. 29, 2023 CAD ($) | Jun. 30, 2023 USD ($) |
Foreign currency forward contracts | |||
Liabilities | |||
Derivative assets, notional amount | $ 3,000 | $ 3,000 | |
Derivative liabilities, notional amount | 142,000 | $ 0.2 | 140,000 |
Fair value, measurements, recurring | |||
Assets | |||
Derivative assets – current portion | 148 | 221 | |
Total | 364,806 | 319,722 | |
Liabilities | |||
Derivative liabilities – current portion | 6,812 | 5,236 | |
Total | (6,812) | (5,236) | |
Fair value, measurements, recurring | Interest rate swaps | |||
Liabilities | |||
Derivative assets, notional amount | 60,900 | 60,900 | |
Fair value, measurements, recurring | Cash equivalents | |||
Assets | |||
Marketable securities | 2,230 | 401 | |
Fair value, measurements, recurring | Liquidity funds | |||
Assets | |||
Marketable securities | 41,723 | 41,104 | |
Fair value, measurements, recurring | Certificates of deposit and time deposits | |||
Assets | |||
Marketable securities | 85,104 | 64,607 | |
Fair value, measurements, recurring | Corporate debt securities | |||
Assets | |||
Marketable securities | 142,131 | 158,078 | |
Fair value, measurements, recurring | U.S. agency and U.S. treasury securities | |||
Assets | |||
Marketable securities | 93,470 | 55,311 | |
Level 1 | Fair value, measurements, recurring | |||
Assets | |||
Derivative assets – current portion | 0 | 0 | |
Total | 0 | 0 | |
Liabilities | |||
Derivative liabilities – current portion | 0 | 0 | |
Total | 0 | 0 | |
Level 1 | Fair value, measurements, recurring | Cash equivalents | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 1 | Fair value, measurements, recurring | Liquidity funds | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 1 | Fair value, measurements, recurring | Certificates of deposit and time deposits | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 1 | Fair value, measurements, recurring | Corporate debt securities | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 1 | Fair value, measurements, recurring | U.S. agency and U.S. treasury securities | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 2 | Fair value, measurements, recurring | |||
Assets | |||
Derivative assets – current portion | 148 | 221 | |
Total | 364,806 | 319,722 | |
Liabilities | |||
Derivative liabilities – current portion | 6,812 | 5,236 | |
Total | (6,812) | (5,236) | |
Level 2 | Fair value, measurements, recurring | Cash equivalents | |||
Assets | |||
Marketable securities | 2,230 | 401 | |
Level 2 | Fair value, measurements, recurring | Liquidity funds | |||
Assets | |||
Marketable securities | 41,723 | 41,104 | |
Level 2 | Fair value, measurements, recurring | Certificates of deposit and time deposits | |||
Assets | |||
Marketable securities | 85,104 | 64,607 | |
Level 2 | Fair value, measurements, recurring | Corporate debt securities | |||
Assets | |||
Marketable securities | 142,131 | 158,078 | |
Level 2 | Fair value, measurements, recurring | U.S. agency and U.S. treasury securities | |||
Assets | |||
Marketable securities | 93,470 | 55,311 | |
Level 3 | Fair value, measurements, recurring | |||
Assets | |||
Derivative assets – current portion | 0 | 0 | |
Total | 0 | 0 | |
Liabilities | |||
Derivative liabilities – current portion | 0 | 0 | |
Total | 0 | 0 | |
Level 3 | Fair value, measurements, recurring | Cash equivalents | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 3 | Fair value, measurements, recurring | Liquidity funds | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 3 | Fair value, measurements, recurring | Certificates of deposit and time deposits | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 3 | Fair value, measurements, recurring | Corporate debt securities | |||
Assets | |||
Marketable securities | 0 | 0 | |
Level 3 | Fair value, measurements, recurring | U.S. agency and U.S. treasury securities | |||
Assets | |||
Marketable securities | $ 0 | $ 0 |
Fair value of financial instr_4
Fair value of financial instruments - Narrative (Details) $ in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||
Sep. 29, 2023 USD ($) contract | Sep. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) contract | Sep. 29, 2023 CAD ($) contract | Jun. 30, 2023 CAD ($) contract | Sep. 27, 2019 contract | Sep. 03, 2019 | Jul. 25, 2018 | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Fixed interest rate | 2.86% | |||||||
Foreign currency forward contracts | ||||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Derivative liabilities, notional amount | $ 142 | $ 140 | $ 0.2 | |||||
Derivative assets, notional amount | 3 | 3 | ||||||
Loss from accumulated other comprehensive income expected to be reclassified | 4.9 | $ 4 | ||||||
Unrealized gain (loss) on derivatives | $ 0.3 | $ (0.2) | ||||||
Foreign currency forward contracts | Designated as hedging instrument | Thailand, baht | ||||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Number of forward contracts outstanding | contract | 145 | 143,000 | 145 | 143,000 | ||||
Derivative, notional amount | $ 145 | $ 143 | ||||||
Foreign currency forward contracts | Designated as hedging instrument | Canada, dollars | ||||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Number of forward contracts outstanding | contract | 1 | 1 | 1 | 1 | ||||
Derivative liabilities, notional amount | $ 0.2 | |||||||
Derivative assets, notional amount | $ 0.2 | |||||||
Interest rate swaps | ||||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Number of forward contracts outstanding | contract | 1 | 1 | 2 | |||||
Derivative, notional amount | $ 60.9 | |||||||
Loss from accumulated other comprehensive income expected to be reclassified | $ (0.3) | $ (0.4) | ||||||
Interest rate swaps | Bank of Ayudhya Public Company | Bank of America Credit Facility | ||||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||||||||
Debt instrument stated interest percentage | 4.36% |
Fair value of financial instr_5
Fair value of financial instruments - Schedule of Impacts of Derivative Gain (Loss) of Cash Flow Hedges (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Derivatives gain (loss) recognized in other comprehensive income (loss): | ||
Total derivatives gain (loss) recognized in other comprehensive income (loss) | $ (1,643) | $ (2,476) |
Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: | ||
Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings | 523 | 1,258 |
Change in net unrealized gain (loss) on derivatives instruments | (1,120) | (1,218) |
Foreign currency forward contracts | Cost of revenues | ||
Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: | ||
Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings | 3,672 | 3,794 |
Foreign currency forward contracts | SG&A | ||
Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: | ||
Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings | 155 | 160 |
Foreign currency forward contracts | Foreign exchange loss, net | ||
Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: | ||
Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings | (3,215) | (2,505) |
Foreign currency forward contracts | Other comprehensive income | ||
Derivatives gain (loss) recognized in other comprehensive income (loss): | ||
Total derivatives gain (loss) recognized in other comprehensive income (loss) | (1,565) | (2,992) |
Interest rate swaps | Interest expense | ||
Derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings: | ||
Total derivatives (gain) loss reclassified from accumulated other comprehensive income (loss) into earnings | (89) | (191) |
Interest rate swaps | Other comprehensive income | ||
Derivatives gain (loss) recognized in other comprehensive income (loss): | ||
Total derivatives gain (loss) recognized in other comprehensive income (loss) | $ (78) | $ 516 |
Fair value of financial instr_6
Fair value of financial instruments - Schedule of Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Derivatives designated as hedging instruments | ||
Derivative assets, gross balances | $ 148 | $ 221 |
Derivative liabilities, gross balances | (6,812) | (5,236) |
Foreign currency forward and option contracts | ||
Derivatives not designated as hedging instruments | ||
Derivative Assets | 0 | 2 |
Derivative Liabilities | (1,910) | (1,256) |
Foreign currency forward contracts | ||
Derivatives designated as hedging instruments | ||
Derivative Assets | 12 | 4 |
Derivative Liabilities | (4,902) | (3,980) |
Interest rate swaps | ||
Derivatives designated as hedging instruments | ||
Derivative Assets | 136 | 215 |
Derivative Liabilities | $ 0 | $ 0 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 119,200 | $ 157,379 |
Work in progress | 248,919 | 305,627 |
Finished goods | 47,916 | 28,608 |
Goods in transit | 24,060 | 27,962 |
Total inventories | $ 440,095 | $ 519,576 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 USD ($) lease | Sep. 30, 2022 USD ($) | |
Number of intercompany lease | lease | 1 | |
Operating lease rental expense, long term | $ 0.5 | $ 0.6 |
Operating lease rental expense, short term | $ 0.4 | $ 0 |
Minimum | ||
Lessee operating lease option to extend term | 1 year | |
Maximum | ||
Lessee operating lease option to extend term | 5 years |
Leases - Schedule of Operating
Leases - Schedule of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Leases [Abstract] | ||
2024 (remaining nine months) | $ 1,465 | |
2025 | 1,136 | |
2026 | 1,068 | |
2027 | 1,093 | |
2028 | 1,119 | |
Thereafter | 283 | |
Total undiscounted lease payments | 6,164 | |
Less imputed interest | (525) | |
Total present value of lease liabilities | 5,639 | |
Operating lease liabilities, current portion | $ 1,587 | $ 1,201 |
Leases - Summary of Additional
Leases - Summary of Additional Information Related to Operating and Finance Lease (Details) | Sep. 29, 2023 | Jun. 30, 2023 |
Leases [Abstract] | ||
Weighted-average remaining lease term (in years) | 4 years 6 months | 1 year 2 months 12 days |
Weighted-average discount rate | 3.90% | 3.40% |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow and Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash flows from operating leases | $ 959 | $ 641 |
Financing cash flows from finance leases | 0 | 2 |
ROU assets obtained in exchange for lease liabilities | $ 4,936 | $ 0 |
Intangibles - Schedule of Intan
Intangibles - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangibles, net | $ 2,598 | $ 2,394 |
Software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 10,968 | 10,533 |
Accumulated Amortization | (8,370) | (8,139) |
Intangibles, net | $ 2,598 | $ 2,394 |
Intangibles - Narrative (Detail
Intangibles - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense related to intangibles | $ 0.2 | $ 0.4 |
Intangibles - Schedule of Weigh
Intangibles - Schedule of Weighted-Average Remaining Life of Intangible Assets (Details) | 3 Months Ended | 6 Months Ended |
Sep. 29, 2023 | Dec. 30, 2022 | |
Software | ||
Finite-Lived Intangible Liabilities [Line Items] | ||
Weighted average remaining life of acquired intangible assets | 2 years 7 months 6 days | 3 years 1 month 6 days |
Intangibles - Schedule of Estim
Intangibles - Schedule of Estimated Future Amortization of Intangibles Assets (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 (remaining nine months) | $ 1,206 | |
2025 | 640 | |
2026 | 435 | |
2027 | 244 | |
2028 | 73 | |
Total | $ 2,598 | $ 2,394 |
Borrowings - Schedule of Total
Borrowings - Schedule of Total Borrowings, Including Revolving and Long-Term Borrowings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Jun. 30, 2023 | |
Debt Instrument [Line Items] | ||
3-month LIBOR +1.35% per annum | $ 9,141 | $ 12,188 |
Less: Unamortized debt issuance costs, current portion | (24) | (32) |
Long-term borrowings, current portion, net | $ 9,117 | $ 12,156 |
Loan payable due June 2024 | LIBOR | ||
Debt Instrument [Line Items] | ||
Debt instrument, basis spread on variable rate | 1.35% |
Borrowings - Schedule of Moveme
Borrowings - Schedule of Movements of Long-Term Loans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Debt Disclosure [Abstract] | ||
Opening balance | $ 12,188 | $ 27,421 |
Repayments during the period | (3,047) | (6,094) |
Closing balance | $ 9,141 | $ 21,327 |
Borrowings - Schedule of Future
Borrowings - Schedule of Future Maturities of Long-Term Debt (Details) $ in Thousands | Sep. 29, 2023 USD ($) |
Debt Disclosure [Abstract] | |
2024 (remaining nine months) | $ 9,141 |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) ฿ in Millions, $ in Millions | 3 Months Ended | |||||
Sep. 29, 2023 USD ($) | Mar. 09, 2023 USD ($) | Sep. 27, 2019 USD ($) | Sep. 03, 2019 USD ($) | Aug. 20, 2019 THB (฿) | Aug. 20, 2019 USD ($) | |
Loan payable due June 2024 | LIBOR | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, basis spread on variable rate | 1.35% | |||||
Line of Credit | 2023 Credit Facility Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit facility borrowing capacity | $ 55 | |||||
Loan to value ratio | 0.60 | |||||
Minimum service coverage ratio | 1.25 | |||||
Maximum debt to equity ratio | 1 | |||||
Service coverage ratio, minimum at payment of a dividend | 1.50 | |||||
Long term debt outstanding | $ 0 | |||||
Term loan agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Long term debt outstanding | 9.1 | |||||
Bank of Ayudhya Public Company Limited | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, periodic payment | 3 | |||||
Interest expense on debt | $ 0.1 | |||||
Bank of Ayudhya Public Company Limited | Term loan agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Loan to value ratio | 0.65 | |||||
Minimum service coverage ratio | 1.25 | |||||
Maximum debt to equity ratio | 1 | |||||
Service coverage ratio, minimum at payment of a dividend | 1.50 | |||||
Bank of Ayudhya Public Company Limited | 2019 Credit Facility Agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit facility borrowing capacity | $ 3.6 | ฿ 110 | $ 160.9 | |||
Bank of Ayudhya Public Company Limited | Term loan agreement | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 60.9 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 29, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |||
Liability for uncertain tax positions including accrued interest and penalties | $ 1.4 | $ 1.5 | |
Corporate effective income tax rate | 7.20% | 1.10% | |
Deferred tax assets, valuation allowance | $ 2.1 |
Share-based compensation - Summ
Share-based compensation - Summary of Effect of Recording Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Share-based compensation expense by type of award: | ||
Restricted share units | $ 4,879 | $ 4,901 |
Performance share units | 2,854 | 2,822 |
Total share-based compensation expense | 7,733 | 7,723 |
Tax effect on share-based compensation expense | 0 | 0 |
Net effect on share-based compensation expense | $ 7,733 | $ 7,723 |
Share-based compensation - Sche
Share-based compensation - Schedule of Share-Based Compensation Expense Recorded in Condensed Consolidated Statements of Operations and Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | $ 7,733 | $ 7,723 |
Cost of revenue | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | 2,165 | 1,915 |
Selling, general and administrative expense | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | $ 5,568 | $ 5,808 |
Share-based compensation - Narr
Share-based compensation - Narrative (Details) - USD ($) | 3 Months Ended | |||
Sep. 29, 2023 | Sep. 30, 2022 | Dec. 12, 2019 | Nov. 02, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation costs capitalized | $ 0 | $ 0 | ||
Number of ordinary shares available for future grant (in shares) | 1,888,956 | |||
Shares withheld to settle employee minimum statutory obligation for applicable income and other employment taxes (in shares) | 99,518 | 162,985 | ||
Tax withholdings related to net share settlement of restricted share units | $ 12,147,000 | $ 16,489,000 | ||
Restricted share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized share-based compensation expense | $ 21,300,000 | |||
Unrecognized compensation expense, weighted-average period for recognition | 2 years 10 months 24 days | |||
Restricted share units | Vesting option one | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award granted vesting period, year | 3 years | |||
Restricted share units | Vesting option two | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award granted vesting period, year | 4 years | |||
Restricted share units | Non-employee director | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award granted vesting period, year | 1 year | |||
Restricted share units | Non-employee director | Vest on the first of January | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 100% | |||
Performance share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized share-based compensation expense | $ 15,500,000 | |||
Unrecognized compensation expense, weighted-average period for recognition | 1 year 6 months | |||
Performance share units | Executive of the Company | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award granted vesting period, year | 2 years | |||
Performance share units | Executive of the Company | Vest at the end of the performance period | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 0% | |||
Performance share units | Executive of the Company | Vest at the end of the performance period | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting percentage | 100% | |||
Equity Incentive 2020 plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of ordinary shares available for future grant (in shares) | 1,700,000 | |||
Shares reserved for future issuance (in shares) | 1,300,000 | |||
Shares authorized for future issuance (in shares) | 1,281,619 | |||
2017 Inducement Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of ordinary shares available for future grant (in shares) | 111,347 | |||
Shares authorized for future issuance (in shares) | 160,000 |
Share-based compensation - Shar
Share-based compensation - Share-based award activity (Details) - shares | Sep. 29, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 24, 2022 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of ordinary shares available for future grant (in shares) | 1,888,956 | |||
2020 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of ordinary shares available for future grant (in shares) | 1,777,609 | |||
2017 Inducement Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of ordinary shares available for future grant (in shares) | 111,347 | |||
Restricted share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 320,011 | 368,765 | 392,099 | 459,626 |
Restricted share units | 2020 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 320,011 | |||
Restricted share units | 2017 Inducement Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 0 | |||
Performance share units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 171,078 | 204,016 | 204,016 | 285,882 |
Performance share units | 2020 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 171,078 | |||
Performance share units | 2017 Inducement Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share units outstanding (in shares) | 0 |
Share-based compensation - Sc_2
Share-based compensation - Schedule of Restricted Share Unit Activity (Details) - Restricted share units - $ / shares | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Number of Shares | ||
Number of share units, beginning balance (in shares) | 368,765 | 459,626 |
Number of share units, granted (in shares) | 95,393 | 122,743 |
Number of share units, vested (in shares) | (139,438) | (180,824) |
Number of share units, forfeited (in shares) | (4,709) | (9,446) |
Number of share units, ending balance (in shares) | 320,011 | 392,099 |
Weighted- Average Grant Date Fair Value Per Share | ||
Weighted-average grant date fair value per share, beginning balance (in USD per share) | $ 97.49 | $ 75.14 |
Weighted-average grant date fair value per share, granted (in USD per share) | 158.91 | 117.35 |
Weighted-average grant date fair value per share, vested (in USD per share) | 85.02 | 64.19 |
Weighted-average grant date fair value per share, forfeited (in USD per share) | 108.19 | 90.47 |
Weighted-average grant date fair value per share, ending balance (in USD per share) | $ 121.07 | $ 93.03 |
Share-based compensation - Sc_3
Share-based compensation - Schedule of Performance Share Unit Activity (Details) - Performance share units - $ / shares | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Number of Shares | ||
Number of share units, beginning balance (in shares) | 204,016 | 285,882 |
Number of share units, granted (in shares) | 73,936 | 97,142 |
Number of share units, vested (in shares) | (106,874) | (179,008) |
Number of share units, forfeited (in shares) | 0 | 0 |
Number of share units, ending balance (in shares) | 171,078 | 204,016 |
Weighted- Average Grant Date Fair Value Per Share | ||
Weighted-average grant date fair value per share, beginning balance (in USD per share) | $ 108.81 | $ 81.64 |
Weighted-average grant date fair value per share, granted (in USD per share) | 158.91 | 117.35 |
Weighted-average grant date fair value per share, vested (in USD per share) | 101.05 | 70.05 |
Weighted-average grant date fair value per share, forfeited (in USD per share) | 0 | 0 |
Weighted-average grant date fair value per share, ending balance (in USD per share) | $ 135.31 | $ 108.81 |
Shareholders' equity (Details)
Shareholders' equity (Details) - USD ($) | 3 Months Ended | ||||||||
Sep. 29, 2023 | Sep. 30, 2022 | Aug. 31, 2023 | Jun. 30, 2023 | Aug. 31, 2022 | Aug. 31, 2020 | May 31, 2019 | Feb. 28, 2018 | Aug. 31, 2017 | |
Shareholders Equity [Line Items] | |||||||||
Ordinary shares, authorized share capital (in shares) | 500,000,000 | 500,000,000 | |||||||
Ordinary shares, par value (in USD per share) | $ 0.01 | $ 0.01 | |||||||
Preferred shares, shares authorized (in shares) | 5,000,000 | 5,000,000 | |||||||
Preferred shares, par value (in USD per share) | $ 0.01 | $ 0.01 | |||||||
Share repurchase program, approved amount | $ 30,000,000 | ||||||||
Share repurchase program, increase in shares authorized for repurchase | $ 47,600,000 | $ 78,700,000 | $ 58,500,000 | $ 50,000,000 | $ 30,000,000 | ||||
Treasury stock, carrying basis | $ 100,000,000 | $ 294,800,000 | |||||||
1999 and 2010 Stock Plan | |||||||||
Shareholders Equity [Line Items] | |||||||||
Ordinary shares issued upon vesting of restricted shares (in shares) | 146,794 | 196,847 |
Accumulated other comprehensi_3
Accumulated other comprehensive income (loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 1,468,658 | $ 1,253,682 |
Other comprehensive income (loss) before reclassification | (595) | (3,783) |
Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income | 613 | 1,518 |
Tax effects | 595 | 0 |
Total other comprehensive income (loss), net of tax | 613 | (2,265) |
Ending balance | 1,530,169 | 1,302,366 |
Unrealized net (Losses)/Gains on Available-for-sale Securities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (3,279) | (6,018) |
Other comprehensive income (loss) before reclassification | 948 | (1,553) |
Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income | 0 | 92 |
Tax effects | 0 | 0 |
Total other comprehensive income (loss), net of tax | 948 | (1,461) |
Ending balance | (2,331) | (7,479) |
Unrealized net (Losses)/Gains on Derivative Instruments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (3,541) | (5,082) |
Other comprehensive income (loss) before reclassification | (1,643) | (2,476) |
Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income | 523 | 1,258 |
Tax effects | 559 | 0 |
Total other comprehensive income (loss), net of tax | (561) | (1,218) |
Ending balance | (4,102) | (6,300) |
Retirement benefit plan - Prior service cost | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (330) | (803) |
Other comprehensive income (loss) before reclassification | 0 | 0 |
Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income | 90 | 168 |
Tax effects | 36 | 0 |
Total other comprehensive income (loss), net of tax | 126 | 168 |
Ending balance | (204) | (635) |
Foreign Currency Translation Adjustment | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (965) | (890) |
Other comprehensive income (loss) before reclassification | 100 | 246 |
Amounts reclassified out of AOCI to the unaudited condensed consolidated statements of operations and comprehensive income | 0 | 0 |
Tax effects | 0 | 0 |
Total other comprehensive income (loss), net of tax | 100 | 246 |
Ending balance | (865) | (644) |
AOCI Attributable to parent | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (8,115) | (12,793) |
Total other comprehensive income (loss), net of tax | 613 | (2,265) |
Ending balance | $ (7,502) | $ (15,058) |
Commitments and contingencies (
Commitments and contingencies (Details) ฿ in Millions, $ in Millions | Sep. 29, 2023 USD ($) | Sep. 29, 2023 THB (฿) | Jun. 30, 2023 USD ($) | Jun. 30, 2023 THB (฿) |
Commitments and Contingencies Disclosure [Line Items] | ||||
Outstanding bank guarantees given by banks on behalf of the company | $ 2 | ฿ 73.2 | $ 1.5 | ฿ 53 |
Inventories | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Outstanding commitment to third parties | 1,220 | |||
Thailand | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Outstanding commitment to third parties | $ 12.3 |
Business segments and geograp_3
Business segments and geographic information - Schedule of Revenue from External Customers and Long-lived Assets (Details) - USD ($) $ in Thousands | Sep. 29, 2023 | Jun. 30, 2023 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 306,665 | $ 310,350 |
Thailand | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 261,117 | 264,382 |
U.S. | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 25,538 | 25,267 |
China | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 16,531 | 17,407 |
Israel | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 2,998 | 2,796 |
Others | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 481 | $ 498 |
Business segments and geograp_4
Business segments and geographic information - Narrative (Details) - customer | 3 Months Ended | 12 Months Ended |
Sep. 29, 2023 | Jun. 30, 2023 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Number of customers that contributed to more than 10% of trade accounts receivable | 3 | 3 |
Largest customer 1 | Trade accounts receivable | Customer Concentration Risk | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues, percentage | 10% | 10% |
Largest customer 2 | Trade accounts receivable | Customer Concentration Risk | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues, percentage | 10% | 10% |
Largest customer 3 | Trade accounts receivable | Customer Concentration Risk | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenues, percentage | 10% | 10% |