Fabrinet (FN)
Profitability ratios
Return on sales
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Gross profit margin | 12.09% | 12.35% | 12.71% | 12.32% | 11.78% |
| Operating profit margin | 9.53% | 9.63% | 9.52% | 9.04% | 8.02% |
| Pretax margin | 10.39% | 10.80% | 9.83% | 9.15% | 8.01% |
| Net profit margin | 9.72% | 10.27% | 9.37% | 8.86% | 7.89% |
Fabrinet's profitability ratios over the period from June 30, 2021, to June 30, 2025, demonstrate a general trend of improvement, albeit with some fluctuations. The gross profit margin increased steadily from 11.78% in 2021 to a peak of 12.71% in 2023 before experiencing a slight decline to 12.35% in 2024 and further to 12.09% in 2025. This indicates a consistent ability to manage cost of goods sold relative to revenue, with a marginal weakening of gross profitability in the most recent year.
Similarly, the operating profit margin showed a consistent upward trajectory, rising from 8.02% in 2021 to 9.52% in 2023, suggesting improved operational efficiency and cost control measures. In 2024, the operating margin marginally increased to 9.63%, then slightly declined to 9.53% in 2025, signaling that operational efficiency has been maintained with minimal deterioration.
The pretax profit margin reflects a comparable pattern, improving from 8.01% in 2021 to a peak of 10.80% in 2024, before decreasing slightly to 10.39% in 2025. This trend suggests that Fabrinet has been effective at translating operating profits into pretax earnings, though the slight decrease in 2025 indicates potential challenges in recently reported pretax profitability.
The net profit margin experienced a consistent upward trend, rising from 7.89% in 2021 to 9.37% in 2023, and reaching 10.27% in 2024. In 2025, the net margin experienced a minor decrease to 9.72%. Overall, this signifies that Fabrinet has been able to enhance net profitability over the period, likely benefiting from improved operational performance and effective cost management, although recent margins indicate a slight compression.
In summary, Fabrinet’s profitability ratios reveal an overall positive trend over the analyzed period, characterized by increasing gross, operating, pretax, and net profit margins through 2024, with a slight decline in 2025. The data suggests sustained improvements in cost control, operational efficiency, and overall profitability, though recent figures may point to emerging pressures affecting profit margins slightly.
Return on investment
| Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 11.51% | 11.87% | 12.71% | 11.14% | 9.33% |
| Return on assets (ROA) | 11.74% | 12.67% | 12.52% | 10.92% | 9.18% |
| Return on total capital | 0.00% | 15.87% | 17.77% | 16.47% | 13.55% |
| Return on equity (ROE) | 16.78% | 16.97% | 16.88% | 15.98% | 13.33% |
The analysis of Fabrinet's profitability ratios over the period from June 30, 2021, to June 30, 2025, indicates a generally positive trend with some fluctuations.
The Operating Return on Assets (Operating ROA) experienced an increasing trajectory from 9.33% in June 2021 to a peak of 12.71% in June 2023. Following this peak, there was a slight decline to 11.87% in June 2024, with a marginal decrease further to 11.51% projected for June 2025. This trend suggests that the company's operational efficiency in utilizing assets to generate earnings improved significantly over the initial two years, reaching its highest point in mid-2023, before exhibiting a modest decline.
The Return on Assets (ROA), which accounts for all income drivers including non-operational factors, followed a similar upward trajectory, increasing from 9.18% in June 2021 to 12.52% in June 2023. Subsequently, it remained relatively stable, slightly rising to 12.67% in June 2024 before declining slightly to an estimated 11.74% in June 2025. The pattern indicates overall strengthening of asset efficiency and profitability, with stabilization in the recent period.
The Return on Total Capital demonstrated a consistent upward trend initially, rising from 13.55% in June 2021 to a peak of 17.77% in June 2023. However, a notable decline is observed afterward, with a decrease to 15.87% in June 2024 and an unexpected drop to 0.00% projected for June 2025. The latter likely indicates a significant change in the capital structure or accounting adjustments that substantially impacted this ratio, warranting further investigation.
The Return on Equity (ROE) showed a steady improvement throughout the period, increasing from 13.33% in June 2021 to a peak of 16.97% in June 2024. The slight decline to 16.78% in June 2025 suggests that the company maintained strong profitability from shareholders’ equity, though the margin of growth slowed in the most recent year.
Overall, Fabrinet demonstrated robust improvement in profitability ratios during the initial years, reflecting enhanced operational efficiency and effective use of capital. The recent slight declines and drastic change in the return on total capital ratio highlight areas that may warrant further analysis, such as changes in capital structure or strategic shifts.