Fabrinet Q4 2020 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : If I could just start off with the outlook here, particularly in relation to capacity additions, and quite a strong outlook and you're seeing strength across your businesses. What are your customers communicating to you in terms of capacity additions required over fiscal '21? And we did see your CapEx tick up a bit here, so are you kind of -- are we looking forward to a more material increase in CapEx in fiscal '21? Or are you primarily -- have you already cycled past the CapEx additions that you needed to do for your customers? And I have a follow-up.

Question: Samik Chatterjee - JPMorgan Chase & Co, Research Division - Analyst : Got it, got it. Just following up on gross margins here. You did mention that you expect to be back in the long-term range of 12% to 12.5% here in fiscal '21. Just help me think about outside of the revenue as it kind of -- as we go through the year. Probably you'll have sequential growth in revenues as we go through the year. But outside of that ramp, what are the other drivers here? Because I think you mentioned most of the COVID impact, you should be seeing, cycling past that in the first quarter itself. So what are the other drivers to think about timing when you get back to that range?