Document and Entity Information - USD ($) $ in Billions	12 Months Ended
Document and Entity Information - USD ($) $ in Billions	Jun. 30, 2017	Aug. 11, 2017	Dec. 30, 2016
Document Information [Line Items]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Jun. 30, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Trading Symbol	FN
Entity Registrant Name	FABRINET
Entity Central Index Key	0001408710
Current Fiscal Year End Date	--06-30
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		37,365,443
Entity Public Float			$ 1.5

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Current assets
Cash and cash equivalents	$ 133,825	$ 142,804
Marketable securities	151,450	141,709
Trade accounts receivable, net	264,349	196,145
Inventory, net	238,665	181,499
Deferred tax assets		1,358
Prepaid expenses	6,306	3,114
Other current assets	4,159	6,662
Total current assets	798,754	673,291
Non-current assets
Restricted cash in connection with business acquisition	3,312
Property, plant and equipment, net	216,881	178,410
Intangibles, net	5,840	499
Goodwill	3,806	0
Deferred tax assets	2,905	1,806
Deferred debt issuance costs on revolving loan and other non-current assets	1,577	1,851
Total non-current assets	234,321	182,566
Total Assets	1,033,075	855,857
Current liabilities
Bank borrowings, net of unamortized debt issuance costs	48,402	24,307
Trade accounts payable	215,262	172,052
Fixed assets payable	8,141	20,628
Capital lease liability, current portion	344
Income tax payable	1,976	2,010
Accrued payroll, bonus and related expenses	13,852	12,300
Accrued expenses	9,227	8,072
Other payables	14,068	16,356
Total current liabilities	311,272	255,725
Non-current liabilities
Long-term loan from bank, net of unamortized debt issuance costs	22,701	36,100
Deferred tax liability	1,981	854
Capital lease liability, non-current portion	1,024
Deferred liability in connection with business acquisition	3,312
Severance liabilities	8,488	6,684
Other non-current liabilities	2,723	2,075
Total non-current liabilities	40,229	45,713
Total Liabilities	351,501	301,438
Commitments and contingencies (Note 19)
Shareholders' equity
Preferred shares (5,000,000 shares authorized, $0.01 par value; no shares issued and outstanding as of June 30, 2017 and June 24, 2016)
Ordinary shares (500,000,000 shares authorized, $0.01 par value; 37,340,496 shares and 36,156,446 shares issued and outstanding as of June 30, 2017 and June 24, 2016, respectively)	373	362
Additional paid-in capital	133,293	102,325
Accumulated other comprehensive (loss) income	(348)	591
Retained earnings	548,256	451,141
Total Shareholders' Equity	681,574	554,419
Total Liabilities and Shareholders' Equity	$ 1,033,075	$ 855,857

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2017	Jun. 24, 2016
Preferred shares, shares authorized	5,000,000	5,000,000
Preferred shares, par value	$ 0.01	$ 0.01
Preferred shares, shares issued	0	0
Preferred shares, shares outstanding	0	0
Ordinary shares, shares authorized	500,000,000	500,000,000
Ordinary shares, par value	$ 0.01	$ 0.01
Ordinary shares, shares issued	37,340,496	36,156,446
Ordinary shares, shares outstanding	37,340,496	36,156,446

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Revenues	$ 1,420,490	$ 976,747	$ 773,587
Cost of revenues	(1,249,030)	(857,224)	(685,814)
Gross profit	171,460	119,523	87,773
Selling, general and administrative expenses	(65,626)	(49,753)	(39,460)
Other income related to flooding, net		36
Expenses related to reduction in workforce			(1,153)
Operating income	105,834	69,806	47,160
Interest income	1,977	1,535	1,253
Interest expense	(3,321)	(1,569)	(616)
Foreign exchange loss, net	(1,142)	(1,916)	(19)
Other income (expense), net	509	376	(152)
Income before income taxes	103,857	68,232	47,626
Income tax expense	(6,742)	(6,335)	(3,984)
Net income	97,115	61,897	43,642
Other comprehensive (losses) gains, net of tax:
Change in net unrealized (losses) gains on marketable securities	(471)	443	(44)
Change in net unrealized (losses) gains on derivative instruments	(158)	192
Change in foreign currency translation adjustment	(310)
Total other comprehensive (loss) income, net of tax	(939)	635	(44)
Net comprehensive income	$ 96,176	$ 62,532	$ 43,598
Earnings per share
Basic	$ 2.63	$ 1.73	$ 1.23
Diluted	$ 2.57	$ 1.68	$ 1.21
Weighted average number of ordinary shares outstanding (thousands of shares)
Basic	36,927	35,857	35,354
Diluted	37,852	36,872	35,984

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Ordinary Shares	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings
Beginning Balance (in shares) at Jun. 27, 2014		35,152,772
Beginning Balance at Jun. 27, 2014	$ 426,836	$ 352	$ 80,882		$ 345,602
Net income	43,642				43,642
Other comprehensive income (loss)	(44)			$ (44)
Share-based compensation expense	8,027		8,027
Issuance of ordinary shares (in shares)		284,882
Issuance of ordinary shares	835	$ 2	833
Tax withholdings related to net share settlement of restricted share units	(352)		(352)
Ending Balance (in shares) at Jun. 26, 2015		35,437,654
Ending Balance at Jun. 26, 2015	478,944	$ 354	89,390	(44)	389,244
Net income	61,897				61,897
Other comprehensive income (loss)	635			635
Share-based compensation expense	9,927		9,927
Issuance of ordinary shares (in shares)		718,792
Issuance of ordinary shares	5,479	$ 8	5,471
Tax withholdings related to net share settlement of restricted share units	(2,463)		(2,463)
Ending Balance (in shares) at Jun. 24, 2016		36,156,446
Ending Balance at Jun. 24, 2016	554,419	$ 362	102,325	591	451,141
Net income	97,115				97,115
Other comprehensive income (loss)	(939)			(939)
Share-based compensation expense	26,507		26,507
Issuance of ordinary shares (in shares)		1,184,050
Issuance of ordinary shares	5,897	$ 11	5,886
Tax withholdings related to net share settlement of restricted share units	(1,425)		(1,425)
Ending Balance (in shares) at Jun. 30, 2017		37,340,496
Ending Balance at Jun. 30, 2017	$ 681,574	$ 373	$ 133,293	$ (348)	$ 548,256

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Cash flows from operating activities
Net income for the year	$ 97,115	$ 61,897	$ 43,642
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	23,793	17,357	12,947
Gain on disposal of property, plant and equipment	(30)	(73)	(42)
Loss from sales and maturities of marketable securities	822	194	120
Amortization of investment (discount) premium	(193)	798	985
Amortization of deferred debt issuance costs	1,396	758	527
Income related to flooding		(828)
Proceeds from insurers in settlement of claim related to flood damage		272
(Reversal of) allowance for doubtful accounts	(1)	(17)	13
Unrealized loss on exchange rate and fair value of derivative	1,884	1,905	671
Share-based compensation	26,507	9,927	8,027
Deferred income tax	754	864	(878)
Other non-cash expenses	2,173	1,744	1,722
Inventory obsolescence (reversal of)	42	(521)	397
Loss from written-off inventory due to flood loss		233
Changes in operating assets and liabilities
Trade accounts receivable	(64,142)	(61,013)	(33,797)
Inventory	(53,802)	(50,598)	(6,440)
Other current assets and non-current assets	(2,231)	(5,901)	(283)
Trade accounts payable	38,293	56,308	20,466
Income tax payable	(67)	573	446
Other current liabilities and non-current liabilities	(1,379)	13,209	4,106
Net cash provided by operating activities	70,934	47,088	52,629
Cash flows from investing activities
Purchase of marketable securities	(122,778)	(108,341)	(203,407)
Proceeds from sales of marketable securities	39,578	41,836	29,036
Proceeds from maturities of marketable securities	72,361	67,113	30,356
Payments in connection with business acquisition, net of cash acquired	(9,917)
Purchase of property, plant and equipment	(68,262)	(40,616)	(51,398)
Gain on cash settlement of hedged forward contracts		34
Proceeds from disposal of property, plant and equipment	230	194	48
Purchase of intangibles	(1,768)	(379)	(134)
Proceeds from insurers in settlement of claims related to flood damage		556
Net cash used in investing activities	(90,556)	(39,603)	(195,499)
Cash flows from financing activities
Payment of debt issuance costs		(654)	(1,946)
Proceeds of short-term loan from bank	27,500	18,000	30,000
Repayment of short-term loan from bank	(157)	(41,500)
Proceeds of long-term loan from bank		50,000
Repayment of long-term loan from bank	(18,100)	(6,000)	(6,000)
Proceeds from issuance of ordinary shares under employee share option plan	5,890	5,479	835
Repayment of capital lease liability	(276)
Withholding tax related to net share settlement of restricted share units	(1,425)	(2,463)	(352)
Net cash provided by financing activities	13,432	22,862	22,537
Net (decrease) increase in cash, cash equivalents and restricted cash	(6,190)	30,347	(120,333)
Movement in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period	142,804	112,978	233,477
(Decrease) increase in cash, cash equivalents and restricted cash	(6,190)	30,347	(120,333)
Effect of exchange rate on cash, cash equivalents and restricted cash	523	(521)	(166)
Cash, cash equivalents and restricted cash at end of period	137,137	142,804	112,978
Cash paid for
Interest	1,924	1,091	590
Taxes	5,218	5,473	2,841
Cash received for interest	1,753	1,049	749
Non-cash investing and financing activities
Construction, software related and equipment related payables	$ 8,434	$ 20,628	$ 6,026

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015	Jun. 27, 2014
Reconciliation of cash, cash equivalents and restricted cash
Cash and cash equivalents	$ 133,825	$ 142,804	$ 112,978
Restricted cash in connection with business acquisition (non-current assets)	3,312
Cash, cash equivalents and restricted cash	$ 137,137	$ 142,804	$ 112,978	$ 233,477

Business and organization

12 Months Ended

Jun. 30, 2017

Business and organization

1.	Business and organization

Description of Business

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 (“OEMs”) of complex products, such as optical communication components, modules and sub-systems, 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 test. 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 Exception EMS Ltd.

Summary of significant accounting policies

12 Months Ended

Jun. 30, 2017

Summary of significant accounting policies

2.	Summary of significant accounting policies

Principles of consolidation

The Company utilizes a 52-53 week fiscal year ending on the Friday in June closest to June 30. Fiscal year 2017 ended on June 30, 2017 and consisted of 53 weeks. Fiscal year 2016 and fiscal year 2015 ended on June 24, 2016 and June 26, 2015, respectively, and each consisted of 52 weeks.

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and include Fabrinet and its subsidiaries. All inter-company accounts and transactions have been eliminated.

Where necessary, comparative figures have been reclassified to conform to the current period accounting policies and presentation adopted.

On September 14, 2016, the Company acquired Global CEM Solutions, Ltd. and all of its subsidiaries (collectively, “Exception EMS”), a privately-held group located in Wiltshire, United Kingdom. The consolidated financial statements of the Company include the financial position, results of operations and the cash flows of Exception EMS commencing as of the acquisition date. See Note 9—Business acquisition for further details on the accounting for this transaction.

Use of estimates

The preparation of the Company’s 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, income taxes, inventory obsolescence 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 estimates or assumptions prove to differ from actual results, adjustments will be made in subsequent periods to reflect more current information.

Foreign currency transactions and translation

The consolidated financial statements are presented in United States dollars (“$” or “USD”). The functional currency of Fabrinet and most of its subsidiaries is the USD.

With respect to subsidiaries that use USD as their functional currency, transactions denominated in a currency other than USD are translated into USD at the rates of exchange in effect at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate prevailing at the consolidated balance sheet dates. Transaction gains and losses are included in other income (expense) or foreign exchange gain (loss) in the accompanying consolidated statements of operations and comprehensive income.

Fabrinet translates the assets and liabilities of its subsidiaries that do not use USD as their functional currency into USD using exchange rates in effect at the end of each period. Revenue and expenses for such subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recognized in foreign currency translation adjustment included in accumulated other comprehensive income (loss) (“AOCI”).

Cash and cash equivalents

All highly liquid investments with original maturities of three months or less at the date of purchase are classified as cash equivalents. Cash and cash equivalents consist of cash deposited in checking accounts, time deposits with maturities of less than three months, money market accounts, and marketable securities with maturities of three months or less at the date of purchase.

Marketable securities

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 the Company’s marketable securities 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 marketable securities generally range from three months to three years. The Company’s marketable securities consist of investment in U.S. Treasury and fixed income securities and have been classified and accounted for as available-for-sale.

The Company’s investments in marketable securities are classified as available-for-sale securities and reported at fair value. Unrealized gains and losses related to changes in the fair value of securities are recognized in accumulated other comprehensive income, net of tax, in the Company’s consolidated balance sheets. Changes in the fair value of available-for-sale securities impact the Company’s net income only when such securities are sold or other-than-temporary impairment is recognized. Realized gains and losses on the sale of securities are determined by specific identification of each security’s cost basis.

The Company reviews its marketable securities on a regular basis to evaluate whether or not any security has experienced an other-than-temporary decline in fair value. The Company considers factors such as the length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issue and the Company’s intent to sell, or whether it is more likely than not the Company will be required to sell the investment before recovery of the investment’s amortized cost basis. If the Company believes that an other-than-temporary decline exists in one of these securities, the Company will write down these investments to fair value.

Trade accounts receivable

Accounts receivable are carried at anticipated realizable value. The Company assesses the collectability of its accounts receivable based on specific customer circumstances, current economic trends, historical experience with collection and the age of past due receivables and provides an allowance for doubtful receivables based on a review of all outstanding amounts at the period end. Bad debts are written-off when identified.

Unanticipated changes in the liquidity or financial position of the Company’s customers may require revision to the allowances for doubtful accounts.

Inventory

Inventory is stated at the lower of cost or market value. Cost is estimated using the standard costing method, computed on a first-in, first-out basis, with adjustments for variances to reflect actual costs not in excess of net realizable market value. Market value is the estimated selling price in the ordinary course of business, less the costs of completion and selling expenses. The Company assesses the valuation of inventory on a quarterly basis and writes down the value for estimated excess and obsolete inventory based upon estimates of future demand.

Leases

Operating leases

Payments made under operating leases are expensed on a straight-line basis over the lease term.

Capital lease

Certain machine and equipment held under capital leases are classified as property, plant and equipment and amortized using the straight-line method over the terms of the lease contracts. The related obligations from the capital lease are recorded as liabilities in the consolidated balance sheets.

Property, plant and equipment

Land is stated at historical cost. Other property, plant and equipment, except for construction in process and machinery under installation, are stated at historical cost less accumulated depreciation. Depreciation is calculated using the straight-line method to write-off the cost of each asset to its residual value over its estimated useful life as follows:


Land improvements			10 years
Building and building improvements			7 - 30 years
Leasehold improvements			Shorter of useful life or lease term
Manufacturing equipment			3 - 7 years
Office equipment			3 - 7 years
Motor vehicles			3 - 5 years
Computer hardware			3 - 5 years

Construction in process and machinery under installation is stated at historic cost and depreciation begins after it is constructed and fully installed and is ready for its intended use in the operations of the Company.

Gains and losses on disposal are determined by comparing proceeds with carrying amounts and are included in operating income in the consolidated statements of operations and comprehensive income.

The Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Recoverability of long-lived assets or asset groups is measured by comparing their carrying amount to the projected undiscounted cash flows that the long-lived assets or asset groups are expected to generate. If such assets are considered to be impaired, the impairment loss recognized, if any, is the amount by which the carrying amount of the property and equipment exceeds its fair value.

Intangibles

Intangibles are stated at historical cost less amortization. Amortization of customer relationships is calculated using the accelerated method as to reflect the pattern in which the economic benefits of the intangible assets are consumed. Amortization of other intangibles is calculated using the straight-line method.

Business acquisition

For the acquisition of Exception EMS, the Company allocated the fair value of purchase consideration to the assets acquired and liabilities assumed based on their fair values at the acquisition date. The allocation of consideration to the individual net assets was finalized in the fourth quarter of fiscal year 2017.

The acquired intangible assets, which consist of customer relationships and backlog, are recorded as intangibles in the consolidated balance sheets. The fair value of the acquired intangible assets was determined based on the multi-period excess earnings method. The Company reviews intangibles for impairment whenever changes or circumstances indicate the carrying amount may not be recoverable.

In connection with the business acquisition, $3.3 million of cash for deferred consideration, net of foreign currency translation adjustment, was placed into an escrow account which is under the Company’s control. However, the Company has contractually agreed to remit this deferred consideration to the sellers of Exception EMS, subject to the resolution of claims that the Company may make against the funds with respect to indemnification and other claims within 24 months from the closing date of the transaction. The cash is presented as restricted cash in the consolidated balance sheets within non-current assets and the related liability is presented within non-current liabilities for the deferred consideration.

Goodwill

Goodwill arising from the acquisition is primarily attributable to the ability to expand future products and services and the assembled workforce. Goodwill is reviewed annually for impairment or more frequently whenever changes or circumstances indicate the carrying amount of goodwill may not be recoverable.

Borrowing costs

Borrowing costs are accounted for on an accrual basis and are charged to the consolidated statements of operations and comprehensive income in the year incurred, except for interest costs on general and specific borrowings attributable to finance certain qualifying assets. Such costs to finance qualifying assets are capitalized during the period of time that is required to complete and prepare the assets for their intended use, as part of the cost of the assets. All other borrowing costs are expensed as incurred.

Where funds are not borrowed for a specific acquisition, construction or production of assets, the capitalization rate used to determine the amount of interest to be capitalized is the weighted average interest rate applicable to the Company’s outstanding borrowings during the year. Where funds are borrowed specifically for the acquisition, construction or production of assets, the amount of borrowing costs eligible for capitalization on the respective assets is determined as the actual borrowing costs are incurred on that borrowing during the respective periods.

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 for similar assets and liabilities in active markets other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.

Level 3 inputs that are significant to the fair value measurement and unobservable (i.e. supported by little or no market activity), 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 carrying amounts of certain financial instruments, which include cash and cash equivalents, trade accounts receivable, and trade accounts payable, approximate their fair values due to their short maturities. The carrying amounts of borrowings approximate their fair values as the applicable interest rate is based on market interest rates. The particular recognition methods adopted are disclosed in the individual policy statements associated with each item.

Derivatives

The derivatives assets and liabilities are recognized on the consolidated balance sheets as other current assets or accrued expenses and are measured at fair value.

The Company applies hedge accounting to arrangements that qualify and are designated for cash flow or fair value hedge accounting treatment. Hedge accounting is discontinued prospectively if the hedging relationship ceases to be effective or the hedging or hedged items cease to exist as a result of maturity, sale, termination or cancellation.

Derivatives designated and qualifying as hedges of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges which include forward currency contracts. In a cash flow hedging relationship, the effective portion of the change in the fair value of the hedging derivative is initially recorded in AOCI, while any ineffective portion is recognized directly in earnings, as a component of other income (expense). The portion of gain or loss on the derivative instrument remains in AOCI until the forecasted transaction is recognized in earnings.

The Company also enters into derivative contracts that are intended to economically hedge certain of the Company’s risks. The changes in the fair value of the derivatives are recorded directly in earnings as a component of other income (expense). In accordance with the fair value measurement guidance, the Company’s accounting policy is to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. The Company executes derivative instruments with financial institutions that are credit-worthy, which the Company defines as institutions that hold an investment grade credit rating.

Concentration of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, marketable securities, derivatives and accounts receivable.

Cash, cash equivalents and marketable securities are maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions with reputable credit and therefore bear minimal credit risk. The Company seeks to mitigate its credit risks by spreading such risks across multiple counterparties and monitoring the risk profiles of these counterparties. The Company limits its investments in marketable securities to securities with a maturity not in excess of three years, and all marketable securities that the Company invests in are rated A1, P-1, F1, or better.

The Company performs ongoing credit evaluations for credit worthiness of its customers and usually does not require collateral from its customers. Management has implemented a program to closely monitor near term cash collection and credit exposures to mitigate any material losses.

Revenue recognition

The Company derives total revenues primarily from the assembly of products under supply agreements with its customers and the fabrication of customized optics and glass. Revenues represent the invoiced value of products, net of trade discounts and allowances, and exclude goods and services tax. The Company recognizes revenues when realized or realizable and earned. The Company considers revenues realized or realizable and earned when there is persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured. Delivery does not occur until products have been shipped or services have been provided to the customer, risk of loss has transferred to the customer and customer acceptance has been obtained, customer acceptance provisions have lapsed, or the Company has objective evidence that the criteria specified in the customer acceptance provisions have been satisfied. In situations where a formal acceptance is required but the acceptance only relates to whether the product meets its published specifications, revenues are generally recognized upon shipment provided all other revenue recognition criteria are met. The sales price is not considered to be fixed or determinable until all contingencies related to the sale have been resolved. The Company reduces revenues for rebates and other similar allowances. Revenues are recognized only if these estimates can be reasonably and reliably determined. The Company bases its estimates utilizing historical results taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. In addition to the aforementioned general policies, the following are the specific revenue recognition policies for each major category of revenues.

Services

The Company provides services for its customers that range from process design to product manufacturing. The Company recognizes service revenues when the services have been performed. The related costs are expensed as incurred.

Services revenue of $75.4 million, $31.7 million and $32.3 million were recognized in the consolidated statements of operations and comprehensive income for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

Sales of goods

Revenues from sales of goods are generally recognized when the product is shipped to the customer and when there are no unfulfilled obligations that affect the customer’s final acceptance of the arrangement. Any cost of warranties and remaining obligations that are inconsequential or perfunctory are accrued when the corresponding revenues are recognized.

Certain customers may request the Company to store finished products purchased by them at the Company’s warehouse. In these instances, the Company receives a written request from the customer asking the Company to hold the inventory at the Company’s warehouse and the ordered goods are segregated in the Company’s warehouse from other inventory and cannot be used to fulfill other customer orders. In these situations, revenue is only recognized when persuasive evidence of the sales arrangement exists, the goods are completed and ready for shipment, pricing is fixed or determinable, collection is reasonably assured, and title and risk of loss have passed to the customer.

Warranty provision

Provisions for estimated expenses relating to product warranties are made at the time the products are sold using historical experience. Generally, this warranty is limited to workmanship and the Company’s liability is capped at the price of the product. The provisions will be adjusted when experience indicates an expected settlement will differ from initial estimates.

Warranty cost allowances of $1.0 million, $0.1 million and $0.03 million were recognized in the consolidated statements of operations and comprehensive income for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

Shipping and handling costs

The Company records costs related to shipping and handling in cost of revenues for all periods presented.

Share-based compensation

Share-based compensation is recognized in the consolidated financial statements based on grant-date fair value. The value of the portion of the award that is ultimately expected to vest is recognized as expense ratably over the requisite service period. The Company estimates the fair value of share option awards utilizing the Black-Scholes-Merton option-pricing model (“BSM”), net of estimated forfeitures. For restricted share units and performance share units, the fair values are based on the market value of our ordinary shares on the date of grant.

Employee contribution plan

The Company operates a defined contribution plan, known as a provident fund, in its subsidiaries in Thailand and the United Kingdom. The assets of these plans are in separate trustee-administered funds. The provident fund is funded by matching payments from employees and by the subsidiaries on a monthly basis. Current contributions to the provident fund are accrued and paid to the fund manager on a monthly basis. The Company sponsors the Fabrinet U.S. 401(k) Retirement Plan (the “401(k) Plan”), a Defined Contribution Plan under ERISA, at its subsidiaries in the United States, which provides retirement benefits for its eligible employees through tax deferred salary deductions.

Severance liabilities

Under labor protection laws applicable in Thailand and the Company’s subsidiary in Thailand’s employment policy, all employees of such subsidiary with more than 120 days of service are entitled to severance pay on forced termination or retrenchment or in the event that the employee reaches the retirement age of 55. The entitlement to severance pay is determined according to an employee’s individual employment tenure with the Company and is subject to a maximum benefit of 10 months of salary unless otherwise agreed upon in an employee’s employment contract. For employees of other subsidiaries who have a specific termination date, the entitlement to severance pay is determined according to their employment tenure, until their designated termination date.

The Company accounts for these severance liabilities on an actuarial basis using the Projected Unit Credit Method, using the long-term Thai government bond yield as a discount rate. There are no separate plan assets held in respect of these liabilities.

Annual leave

Employee entitlements to annual leave are recognized when they accrue to the employee. On termination of employment, accrued employee entitlement to annual leave is paid in cash.

Income taxes

The Company uses the asset and liability method of accounting for income taxes, whereby deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Fabrinet’s subsidiaries are subject to income tax audits by the respective tax authorities in all of the jurisdictions in which they operate. The determination of tax liabilities in each of these jurisdictions requires the interpretation and application of complex and sometimes uncertain tax laws and regulations. The Company recognizes liabilities based on its estimate of whether, and the extent to which, additional tax liabilities are more-likely-than-not. If the Company ultimately determines that the payment of such a liability is not probable, then it reverses the liability and recognizes a tax benefit during the period in which the determination is made that the liability is no longer probable. The recognition and measurement of current taxes payable or refundable and deferred tax assets and liabilities requires that the Company makes certain estimates and judgments. Changes to these estimates or a change in judgment may have a material impact on the Company’s tax provision in a future period.

The authoritative guidance provides for recognition of deferred tax assets if the realization of such deferred tax assets is more likely than not to occur based on an evaluation of both positive and negative evidence and the relative weight of the evidence. The Company has determined that it is more likely than not that deferred tax asset attributable to a subsidiary in the United States will not be realized, primarily due to uncertainties related to its ability to utilize its net operating loss carryforward before they expire. Accordingly, the Company has established a valuation allowance for such deferred tax asset. If there is a change in the Company’s ability to realize its deferred tax assets for which a valuation allowance has been established, then its tax provision may decrease in the period in which it determines that realization is more likely than not. Likewise, if the Company determines that it is not more likely than not that its deferred tax assets will be realized, then a valuation allowance may be established for such deferred tax assets and the Company’s tax provision may increase in the period in which it makes the determination.

The accounting standard clarifies the accounting for uncertainty in income taxes recognized in an entity’s financial statements and prescribes a recognition threshold and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return.

The Company recognizes a tax benefit in the financial statements for an uncertain tax position only if management’s assessment is that the position is “more likely than not” (i.e., a likelihood greater than 50 percent) to be sustained upon examination by the tax jurisdiction based solely on the technical merits of the position. The term “tax position” refers to a position in a previously filed tax return or a position expected to be taken in a future tax return that is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. The accounting interpretation also provides guidance on measurement methodology, derecognition thresholds, financial statement classification and disclosures, recognition of interest and penalties, and accounting for the cumulative-effect adjustment at the date of adoption.

New Accounting Pronouncements—not yet adopted by the Company

In January 2017, the FASB issued ASU 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This amendment modified the concept of impairment assessment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. Public companies that are SEC filers should adopt the amendment for its annual and any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments—Equity Method and Joint Ventures (Topic 323): Amendments to SEC Paragraphs Pursuant to Staff Announcements at the September 22, 2016 and November 17, 2016 Emerging Issues Task Force (“EITF”) Meetings.” The amendment provides guidance to the Company in relation to the disclosure of the impact that ASU 2014-09, ASU 2016-02 and ASU 2016-13 will have on the Company’s financial statements when adopted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In January 2017, the FASB issued ASU 2017-01, “Business Combination (Topic 805): Clarifying the Definition of a Business.” This amendment clarifies the definition of a business to assist entities when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or business. For public companies, this ASU is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted for the transactions that occur before the issuance date or effective date of the amendment, only when the transaction has not been reported in financial statements that have been issued or made available for issuance. The Company does not expect that the adoption of this update will have a material impact to its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).” The amendments in this ASU provide guidance on the presentation of certain cash receipts and cash payments in the statement of cash flows in order to reduce diversity in existing practice. The amendments in ASU 2016-15 are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This ASU simplifies several aspects of the accounting for share-based payment award transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, for public companies. Early adoption is permitted for any entity in any interim or annual period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-05, “Derivatives and Hedging (Topic 815),” to clarify that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument under Topic 815, does not, in and of itself, require a de-designation of the hedging relationship, provided that all other hedge accounting criteria continue to be met. This guidance is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Lease (Topic 842).” The core principle of Topic 842 is that a lessee should recognize the lease assets and liabilities that arise from leases in the statement of financial position. For public business entities, this update is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” This new guidance requires certain equity investments to be measured at fair value, use of the exit price notion and separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The ASU on recognition and measurement will take effect for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606), issued as a new Topic, Accounting Standards Codification.” The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update is effective for public companies, as amended by ASU 2015-14, for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Earlier application of this guidance is permitted, but not before the original date of December 15, 2016, which can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. Subsequently, in March 2016 and April 2016, the FASB issued ASU 2016-08 and ASU 2016-10, respectively, to clarify the implementation guidance on principle versus agent considerations and address the potential diversity in practice at initial application and cost; and the complexity of applying Topic 606, both at transition and on an ongoing basis related to identification of performance obligations and licensing arrangements; and ASU 2016-12 and ASU 2016-20, in May 2016 and December 2016, respectively, to improve in certain aspects of Topic 606, with the same effective date as ASU 2015-14. The Company is continuing to assess the impact of adopting this new guidance on its consolidated financial statements, including whether the effect will be material. The Company has not decided on the method of adoption. Additionally, as the Company continues to assess the new standard along with industry trends and additional interpretive guidance, the Company may adjust its implementation plan accordingly. The process is still ongoing and the Company expects to make significant progress in the coming quarters.

New Accounting Pronouncements—adopted by the Company

In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires the statement of cash flows to explain the change during the period in the total of cash, cash equivalents and restricted cash or restricted cash equivalents. The Company has early adopted this update in the second quarter of fiscal year 2017 on a retrospective basis but there was no impact to the presentation of the comparative period in the consolidated financial statements.

In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes,” which will require entities to present deferred tax assets (“DTAs”) and deferred tax liabilities (“DTLs”) as non-current in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and non-current in a classified balance sheet. The Company has early adopted this update in the first quarter of fiscal year 2017. The Company adopted this update on a prospective basis and did not change the presentation of the comparative period.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments” which require an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The Company adopted this update in the first quarter of fiscal year 2017 and applied it on a prospective basis. See Footnote 9—Business acquisition, for further disclosure on measurement period adjustments recorded in the year ended June 30, 2017.

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” The update provides the guidance that an entity, that measured inventory by using first-in, first-out or average cost, should measure inventory at the lower of cost and net realizable value. Subsequent measurement is unchanged for inventory measured using last-in, first-out or the retail inventory method. The Company adopted this update in the first quarter of fiscal year 2017 with no impact to the consolidated financial statements.

In April 2015, the FASB issued ASU 2015-03, “Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The update requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset. Debt disclosures will include the face amount of the debt liability and the effective interest rate. The update requires retrospective application and represents a change in accounting principle. Additionally, in August 2015, the FASB issued ASU 2015-15, “Interest – Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” to amend ASU 2015-03. The Company adopted this amendment retrospectively in the first quarter of fiscal year 2017. As of June 30, 2017 and June 24, 2016, debt issuance costs of $0.3 million and $0.6 million, respectively, related to a recognized debt liability are presented in the balance sheet as a direct reduction of the carrying amount of the related debts.

In February 2015, the FASB issued ASU 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis.” ASU No. 2015-02 amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. In the first quarter of fiscal year 2017, the Company adopted this update with no impact to the consolidated financial statements.

In January 2015, the FASB issued ASU 2015-01, “Income Statement—Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” The objective of this amendment is to reduce the complexity in accounting standards by eliminating the concept of extraordinary items from U.S. GAAP. To meet for extraordinary classification the underlying event or transaction should (a) possess a high degree of abnormality and be of a type clearly unrelated to, or only incidentally related to, the ordinary and typical activities of the entity and (b) not reasonably be expected to recur in the foreseeable future. In the first quarter of fiscal year 2017, the Company adopted this update with no impact to the consolidated financial statements.

Income taxes

12 Months Ended

Jun. 30, 2017

Income taxes

3.	Income taxes

Cayman Islands

Fabrinet is domiciled in the Cayman Islands. Under the current laws of the Cayman Islands, Fabrinet is not subject to tax in the Cayman Islands on income or capital gains. Fabrinet has received this undertaking for a 20-year period ending August 24, 2019, and after the expiration date, Fabrinet can make a request for renewal with the office of the Clerk of the Cabinet for another 20 years.

Income of the Company exempted from corporate income tax in the Cayman Islands amounted to $64.2 million, $41.0 million and $27.0 million in the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

Thailand

Fabrinet Thailand is where the majority of the Company’s operations and production takes place. The Company was not subject to tax for the period from July 2010 through June 2015 on income generated from the manufacture of products at Pinehurst Building 5, and is not subject to tax from July 2012 through June 2020 on income generated from the manufacture of products at Pinehurst Building 6. Such preferential tax treatment is contingent on, among other things, the export of the Company’s customers’ products out of Thailand and the Company’s agreement not to move its manufacturing facilities out of its current province in Thailand for at least 15 years from the date on which preferential tax treatment was granted i.e., at least until June 2020. Additionally, in March 2016, the Thailand Revenue Department announced the permanent decrease of corporate income tax rates to 20% for tax periods beginning on or after January 1, 2016. As a result, corporate income tax rates for Fabrinet Thailand remain at 20% from fiscal year 2017 onwards.

People’s Republic of China

The corporate income tax rate for Casix is 25%.

The Company’s income tax expense consisted of the following:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Current	$	6,299	$	5,413	$	4,191
Deferred		443		922		(207	)

Total income tax expense	$	6,742	$	6,335	$	3,984

The reconciliation between the Company’s taxes that would arise by applying the statutory tax rate of the country of the Company’s principal operations, Thailand, to the Company’s effective tax charge is shown below:


	Years Ended
(amount in thousands)	June 30, 2017			June 24, 2016			June 26, 2015
Income before income taxes ⁽¹⁾	$	103,857		$	68,232		$	47,626
Tax expense calculated at a statutory corporate income tax rate of 20%		20,771			13,646			9,525
Effect of income taxes from locations with tax rates different from Thailand		1,469			1,573			1,134
Income not subject to tax ⁽²⁾		(17,212	)		(10,493	)		(7,094	)
Income tax on unremitted earnings		1,058			741			1,263
Effect of different tax rate in relation to deferred tax utilization ⁽³⁾		—			894			(221	)
Effect of foreign exchange rate adjustment		667			375			(365	)
Tax rebate from research and development application		(226	)		(145	)		(102	)
Others		215			(256	)		(156	)

Corporate income tax expense	$	6,742		$	6,335		$	3,984

⁽¹⁾	Income before income taxes was mostly generated from domestic income in the Cayman Islands.

⁽²⁾

Income not subject to tax relates to income earned in the Cayman Islands and income subject to an investment promotion privilege for Building 5 and Building 6. Income not subject to tax per ordinary share on a diluted basis (in dollars) was $0.18, $0.06 and $0.20 for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

⁽³⁾	The balances were effect of different tax rate in relation to the rate recognized deferred taxes during the fiscal year and the rate when deferred taxes will be utilized in the following fiscal years.

The Company’s deferred tax assets and deferred tax liabilities, net of valuation allowance, at each balance sheet date are as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016
Deferred tax assets:
Depreciation	$	1,674	$	1,679
Severance liability		1,127		955
Reserves and allowance		1,046		1,363
Loss carrying forward		496		—
Others		10		—

Total	$	4,353	$	3,997


	Years Ended
(amount in thousands)	June 30, 2017			June 24, 2016
Deferred tax liabilities:
Temporary differences from intangibles and changes in the fair value of assets acquired	$	(944	)	$	—
Deferred tax from unremitted earnings		(2,485	)		(1,687	)

Total		(3,429	)		(1,687	)

Net	$	924		$	2,310

As of June 30, 2017 and June 24, 2016, the Company recognized deferred tax assets of $6.4 million and $4.9 million, respectively, from tax on net operating loss carrying forward of Fabrinet West. Utilization of the tax net operating losses carrying forward may be subject to substantial limitations according to the subsidiary’s future operation, which may result in the reduced utilization of a portion of the Company’s net operating losses.

Income tax liabilities have not been established for withholding tax and other taxes that would be payable on the unremitted earnings of Fabrinet Thailand. Such amounts of Fabrinet Thailand are permanently reinvested; unremitted earnings for Fabrinet Thailand totaled $97.3 million and $68.8 million as of June 30, 2017 and June 24, 2016, respectively. Unrecognized deferred tax liabilities for such unremitted earnings were $5.2 million and $4.2 million as of June 30, 2017 and June 24, 2016, respectively.

Deferred tax liabilities of $0.8 million and $0.7 million have been established for withholding tax on the unremitted earnings of Casix for the year ended June 30, 2017, which are included in non-current deferred tax liability as of June 30, 2017 and June 24, 2016, respectively.

Uncertain income tax positions

Interest and penalties related to uncertain tax positions are recognized in income tax expense. The Company had approximately $0.6 million and $0.4 million of accrued interest and penalties related to uncertain tax positions on the consolidated balance sheets as of June 30, 2017 and June 24, 2016, respectively. The Company recorded interest and penalties of $0.3 million, $0.2 million and $0.1 million for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively, in the consolidated statements of operations and comprehensive income. With regard to the Thailand jurisdiction, tax years 2012 through 2016 remain open to examination by the local authorities.

The following table indicates the changes to the Company’s uncertain income tax positions for the years ended June 30, 2017, June 24, 2016 and June 26, 2015 included in other non-current liabilities.


(amount in thousands)	As of June 30, 2017		As of June 24, 2016		As of June 26, 2015
Beginning balance	$	1,420	$	1,420	$	868
Additions during the year		—		—		552
Reductions for tax positions of prior years		—		—		—

Ending balance	$	1,420	$	1,420	$	1,420

Earnings per ordinary share

12 Months Ended

Jun. 30, 2017

Earnings per ordinary share

4.	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 year using the treasury stock method. Dilutive ordinary equivalent shares consist of share options, restricted share units and performance share units. The earnings per ordinary share was calculated as follows:


	Years Ended
(amount in thousands except per share amounts)	June 30, 2017		June 24, 2016		June 26, 2015
Net income attributable to shareholders	$	97,115	$	61,897	$	43,642

Weighted-average number of ordinary shares outstanding (thousands of shares)		36,927		35,857		35,354
Incremental shares arising from the assumed exercise of share options and vesting of restricted share units and performance share units (thousands of shares)		925		1,015		630

Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares)		37,852		36,872		35,984

Basic earnings per ordinary share	$	2.63	$	1.73	$	1.23
Diluted earnings per ordinary share	$	2.57	$	1.68	$	1.21
Outstanding share options excluded in the computation of diluted earnings per ordinary share⁽¹⁾		—		—		39,544

⁽¹⁾	These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares.

Cash, cash equivalents and marketable securities

12 Months Ended

Jun. 30, 2017

Cash, cash equivalents and marketable securities

5.	Cash, cash equivalents and marketable securities

The Company’s cash, cash equivalents, and marketable securities can be analyzed as follows:


						Fair Value
(amount in thousands)	Carrying Cost		Unrealized (Loss)/Gain			Cash and Cash Equivalents		Marketable Securities
As of June 30, 2017
Cash	$	131,240	$	—		$	131,240	$	—
Cash equivalents		2,585		—			2,585		—
Corporate bonds and commercial papers		98,247		27			—		98,274
U.S. agency and U.S. treasury securities		50,768		(102	)		—		50,666
Sovereign and municipal securities		2,507		3			—		2,510

Total	$	285,347	$	(72	)	$	133,825	$	151,450


					Fair Value
(amount in thousands)	Carrying Cost		Unrealized Gain		Cash and Cash Equivalents		Marketable Securities
As of June 24, 2016
Cash	$	136,754	$	—	$	136,754	$	—
Cash equivalents		6,050		—		6,050		—
Corporate bonds and commercial papers		112,128		394		—		112,522
U.S. agency and U.S. treasury securities		28,028		2		—		28,030
Sovereign and municipal securities		1,154		3		—		1,157

Total	$	284,114	$	399	$	142,804	$	141,709

The cash equivalents include short-term bank deposits, investments in money market funds, and marketable securities with maturities of three months or less at the date of purchase. The effective interest rate on short term bank deposits was 0.6% and 0.7% per annum for the years ended June 30, 2017 and June 24, 2016, respectively.

As of June 30, 2017 and June 24, 2016, 66% of our cash and cash equivalents were held by the Parent Company.

The following table summarizes the cost and estimated fair value of marketable securities classified as available-for-sale securities based on stated effective maturities as of June 30, 2017:


(amount in thousands)	Carrying Cost		Fair Value
Due within one year	$	14,369	$	14,363
Due between one to three years		133,634		133,574
Due after three years		3,519		3,513

Total	$	151,522	$	151,450

During the year ended June 30, 2017, the net realized loss from changes in fair value of marketable securities recognized by the Company was $0.8 million.

As of June 30, 2017 and June 24, 2016, the Company considered the declines in market value of its marketable securities investment portfolio to be temporary in nature and did not consider any of its securities other-than-temporarily impaired. The Company typically invests in highly-rated securities, and its investment policy generally limits the amount of credit exposure to any one issuer. The policy requires investments generally to be investment grade, with the primary objective of minimizing the potential risk of principal loss. Fair values were determined for each individual security in the investment portfolio. When evaluating an investment for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, changes in market interest rates, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s cost basis. No impairment losses were recorded for the years ended June 30, 2017 and June 24, 2016.

As of June 30, 2017 and June 24, 2016, cash, cash equivalents, and marketable securities included bank deposits of $40.0 million held in various financial institutions located in the United States in order to support the availability of the Facility Agreement and comply with covenants. Under the terms and conditions of the Facility Agreement, the Company shall maintain cash, cash equivalents and/or marketable securities in an aggregate amount not less than $40.0 million in unencumbered deposits, and/or securities in accounts located in the United States at all times during the term of the Facility Agreement. As discussed in Note 13, the Company must comply with this covenant from and after the effective date of the Facility Agreement.

Fair Value

12 Months Ended

Jun. 30, 2017

Fair Value

6.	Fair Value

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
(amount in thousands)	Level 1		Level 2			Level 3		Total
As of June 30, 2017
Assets
Cash equivalents	$	—	$	2,585		$	—	$	2,585
Corporate bonds and commercial papers		—		98,274			—		98,274
U.S. agency and U.S. treasury securities		—		50,666			—		50,666
Sovereign and municipal securities		—		2,510			—		2,510
Derivative assets		—		15	⁽¹⁾		—		15

Total	$	—	$	154,050		$	—	$	154,050

Liabilities
Derivative liabilities	$	—	$	—		$	—	$	—

Total	$	—	$	—		$	—	$	—


	Fair Value Measurements at Reporting Date Using
(amount in thousands)	Level 1		Level 2			Level 3		Total
As of June 24, 2016
Assets
Cash equivalents	$	—	$	6,050		$	—	$	6,050
Corporate bonds and commercial papers		—		112,522			—		112,522
U.S. agency and U.S. treasury securities		—		28,030			—		28,030
Sovereign and municipal securities		—		1,157			—		1,157
Derivative assets		—		158	⁽²⁾		—		158

Total	$	—	$	147,917		$	—	$	147,917

Liabilities
Derivative liabilities	$	—	$	1,754	⁽³⁾	$	—	$	1,754

Total	$	—	$	1,754		$	—	$	1,754

⁽¹⁾	Foreign currency forward contract with notional amount of $1.0 million and Canadian dollars 0.6 million.

⁽²⁾	Foreign currency forward contract with notional amount of $7.0 million.

⁽³⁾	Foreign currency forward contract with notional amount of $77.5 million and Canadian dollars 0.6 million.

Derivative Financial Instruments

As a result of foreign currency rate fluctuations, the U.S. dollar equivalent values of the Company’s foreign currency denominated assets and liabilities change. The Company uses foreign currency contracts to manage the foreign exchange risk associated with certain foreign currency denominated assets and liabilities and other foreign currency transactions. The Company minimizes the credit risk in derivative instruments by limiting its exposure to any single counterparty and by entering into derivative instruments only with counterparties that meet the Company’s minimum credit quality standard. As of June 30, 2017, the Company recognized the fair value of foreign currency forward contracts of $0.02 million as derivative assets in the consolidated balance sheets under other current assets. As of June 24, 2016, the Company recognized the fair value of foreign currency forward contracts of $0.2 million as derivative assets and $1.7 million as derivative liabilities in the consolidated balance sheets under other current assets and accrued expenses, respectively.

As of June 30, 2017, the Company had no foreign currency forward contracts designated as cash flow hedges. During the year ended June 30, 2017, the Company discontinued cash flow hedges and recognized a gain from unwinding foreign currency forward contracts of $0.3 million as foreign exchange gain, net in the consolidated statements of operations and comprehensive income.

As of June 24, 2016, the Company hedged forecasted foreign currency transactions related to the construction costs of a new manufacturing building at the Company’s Chonburi Campus with certain forward contracts, designated as cash flow hedges. The Company had two outstanding forward contracts with notional amount of $7.0 million, which mature during August 2016 and September 2016. The Company included unrealized gain of $0.2 million from changes in fair value of these foreign currency forward contracts, designated as hedging instrument in AOCI in the consolidated balance sheets. As of June 24, 2016, gain of $0.01 million in AOCI is expected to be reclassified as earning within the next 12 months. During the year ended June 24, 2016, there was no ineffective portion or discontinued cash flow hedges recognized in the consolidated statements of operations and comprehensive income.

As of June 30, 2017, the Company had 2 outstanding foreign currency forward contracts with notional amount of $1.0 million and Canadian dollars 0.6 million, with maturity dates from July through September 2017. These foreign currency forward contracts were not designated for hedge accounting and were used to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht and Canadian dollars. During the year ended June 30, 2017, the Company included unrealized gain of $0.02 million from changes in fair value of foreign currency contracts in the consolidated statements of operations and comprehensive income.

As of June 24, 2016, the Company had 14 outstanding foreign currency forward contracts with notional amount of $77.5 million and Canadian dollars 0.6 million, which matured during July to December 2016. These foreign currency forward contracts were not designated for hedge accounting and were used to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht and Canadian dollar. During the year ended June 24, 2016, the Company included unrealized loss of $1.8 million from changes in fair value of foreign currency contracts in the consolidated statements of operations and comprehensive income.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Trade accounts receivable, net

12 Months Ended

Jun. 30, 2017

Trade accounts receivable, net

7.	Trade accounts receivable, net


(amount in thousands)	As of June 30, 2017			As of June 24, 2016
Trade accounts receivable	$	264,389		$	196,178
Less: Allowance for doubtful account		(40	)		(33	)

Trade accounts receivable, net	$	264,349		$	196,145

As of June 30, 2017, trade accounts receivable of $3.0 million were secured to short-term loans from bank (see Note 13).

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References + Details

Inventory

12 Months Ended

Jun. 30, 2017

Inventory

8.	Inventory


(amount in thousands)	As of June 30, 2017			As of June 24, 2016
Raw materials	$	88,640		$	58,199
Work in progress		105,732			94,762
Finished goods		33,998			21,593
Goods in transit		13,025			9,381

		241,395			183,935
Less: Inventory obsolescence		(2,730	)		(2,436	)

Inventory, net	$	238,665		$	181,499

Business acquisition

12 Months Ended

Jun. 30, 2017

Business acquisition

9.	Business acquisition

On September 14, 2016, the Company acquired 100% shareholding in Exception EMS for cash consideration of approximately $13.0 million, net of $0.5 million cash acquired. Exception EMS provides contract electronics manufacturing services to the global electronics industry with innovative solutions, adding value to the design, manufacture and testing of printed circuit board assemblies. Pursuant to the acquisition agreement, the Company has placed $3.3 million of cash, net of foreign currency translation adjustment, for deferred consideration in an escrow account which is under the Company’s control. However, the Company has contractually agreed to remit this deferred consideration to the sellers of Exception EMS, subject to the resolution of claims that the Company may make against the funds with respect to indemnification and other claims within 24 months from the closing date of the transaction.

The Company has accounted for this acquisition under the provisions of business combinations accounting, in accordance with Accounting Standards Codification Topic 805—Business Combinations. Accordingly, the estimated fair value of the acquisition consideration was allocated to the assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. The Company has made certain estimates and assumptions in determining the allocation of the acquisition consideration.

The allocation of consideration to the individual net assets acquired was finalized in the fourth quarter of fiscal year 2017. As the functional currency of Exception EMS is pound sterling (“GBP”), for the year ended June 30, 2017, the Company recognized a $0.3 million loss from foreign currency translation adjustment in its consolidated statements of operations and comprehensive income.

During the year ended June 30, 2017, the Company recorded a measurement period adjustment to recognized deferred tax liabilities of $1.2 million related to taxable temporary differences from intangibles and changes in the fair value of assets acquired. Therefore, goodwill which was previously reported at acquisition date of $2.7 million was changed to $3.9 million.

The Company’s allocation of the total purchase price for the acquisition is summarized below:


(amount in thousands)	Purchase price allocation
Cash	$	474
Accounts receivable		4,064
Inventory		3,490
Other current assets		427
Property, plant and equipment		5,678
Intangibles		4,492
Goodwill		3,883
Other non-current assets		516
Current liabilities		(6,796	)
Deferred tax liabilities		(1,148	)
Other non-current liabilities		(1,563	)

Total fair value of assets acquired and liabilities assumed	$	13,517

Total purchase price, net of cash acquired	$	13,043

In connection with the Company’s acquisition of Exception EMS, the Company assumed lease agreements for certain machine and equipment, which are accounted for as capital leases. As of June 30, 2017, the Company included approximately $1.9 million of capital lease assets and $1.4 million of capital lease liability in the consolidated balance sheets associated with these acquired lease agreements.

During the year ended June 30, 2017, the Company incurred approximately $1.5 million in transaction costs related to the acquisition, which primarily consisted of legal, accounting and valuation-related expenses. These expenses were recorded in selling, general and administrative expense in the accompanying consolidated statements of operations and comprehensive income.

Pro forma results of operations for the acquisition have not been presented as they were not material to the Company’s results of operations.

Identifiable intangibles

The acquired identifiable intangible assets include customer relationships and backlog. The fair value of the identified intangible assets was determined based on the multi-period excess earnings method, which applied the following key assumptions:


Risk free rate:		30-year UK Government Bond adjusted by spot yield to reflect recent volatility
Long-term revenue growth:		5.0% - 8.0%
Churn rate:		10%
Operating margin:		4.0% - 6.0%

Customer relationships represent the fair value of future projected revenues derived from the estimated sale of products to existing customers of the acquired company. The fair value of $4.4 million will be amortized over an estimated useful life of ten years.

Backlog represents the fair value of sales orders backlog as of the valuation date. The fair value of $0.1 million will be amortized over an estimated useful life of three years.

Goodwill

Goodwill arising from the acquisition is primarily attributable to the ability to expand future products and services and the assembled workforce. Goodwill is not deductible for tax purposes.

Property, plant and equipment, net

12 Months Ended

Jun. 30, 2017

Property, plant and equipment, net

10.

Property, plant and equipment, net

The components of property, plant and equipment, net were as follows:


(amount in thousands)	Land and Land Improvements			Building and Building Improvements			Manufacturing Equipment			Office Equipment			Motor Vehicles			Computers			Construction and Machinery Under Installation		Total
As of June 30, 2017
Cost	$	39,096		$	138,578		$	127,085		$	7,688		$	534		$	19,642		$	6,058	$	338,681
Less: Accumulated depreciation		(2	)		(31,881	)		(72,130	)		(4,163	)		(376	)		(13,248	)		—		(121,800	)

Net book value	$	39,094		$	106,697		$	54,955		$	3,525		$	158		$	6,394		$	6,058	$	216,881

As of June 24, 2016
Cost	$	39,048		$	95,386		$	96,041		$	5,826		$	443		$	15,578		$	23,248	$	275,570
Less: Accumulated depreciation		—			(25,438	)		(56,564	)		(3,500	)		(366	)		(11,292	)		—		(97,160	)

Net book value	$	39,048		$	69,948		$	39,477		$	2,326		$	77		$	4,286		$	23,248	$	178,410

During the year ended June 30, 2017, property, plant and equipment, net included $5.0 million in assets acquired from the acquisition of Exception EMS, of which $1.9 million was capital leased assets. During the year ended June 24, 2016, the Company purchased a parcel of land in Chonburi, Thailand, with an aggregate purchase price of approximately $12.4 million, to support the expansion of its production capacity and capabilities in Thailand.

Leased assets included above comprise certain machine and equipment from capital lease agreements assumed from the acquisition of Exception EMS.


(amount in thousands)	As of June 30, 2017
Cost—Capital leases	$	2,725
Less: Accumulated depreciation		(856	)

Net book value	$	1,869

Depreciation expense amounted to $22.5 million, $17.3 million and $12.9 million for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively, and have been allocated between cost of revenues and selling, general and administrative expenses in the consolidated statements of operations and comprehensive income.

The cost of fully depreciated property, plant and equipment written-off during the years ended June 30, 2017, June 24, 2016 and June 26, 2015 amounted to $5.4 million, $2.0 million and $1.1 million, respectively.

During the years ended June 30, 2017 and June 24, 2016, the Company capitalized $0.5 million and $0.1 million of borrowing costs in construction in progress of its new manufacturing building at Chonburi Campus. The Company stopped capitalizing borrowing costs in the third quarter of fiscal year 2017 upon the completion of this campus.

Intangibles

12 Months Ended

Jun. 30, 2017

Intangibles

11.

Intangibles

The following tables present details of the Company’s intangibles:


(amount in thousands)	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment			Net
As of June 30, 2017
Software	$	5,944	$	(3,850	)	$	—		$	2,094
Customer relationships		4,373		(606	)		(88	)		3,679
Backlog		119		(51	)		(1	)		67

Total intangibles	$	10,436	$	(4,507	)	$	(89	)	$	5,840


(amount in thousands)	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment		Net
As of June 24, 2016
Software	$	3,786	$	(3,287	)	$	—	$	499
Customer relationships		—		—			—		—
Backlog		—		—			—		—

Total intangibles	$	3,786	$	(3,287	)	$	—	$	499

In connection with the acquisition of Exception EMS, the Company recorded $4.4 million of customer relationships and $0.1 million of backlog. As of June 30, 2017, the weighted-average remaining life of customer relationships and backlog was 6.9 years and 1.6 years, respectively.

The Company recorded amortization expense relating to intangibles of $1.2 million, $0.1 million and $0.1 million for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

As of June 30, 2017, the estimated future amortization of intangible assets during each fiscal year was as follows:


(amount in thousand)
2018	$	1,482
2019		1,339
2020		934
2021		787
2022		527
Thereafter		771

Total	$	5,840

Goodwill

12 Months Ended

Jun. 30, 2017

Goodwill

12.

Goodwill

As of June 30, 2017, the Company recorded $3.8 million of goodwill, in connection with the acquisition of Exception EMS, in the consolidated balance sheets.

The

changes in the carrying amount of goodwill were as follows:


(amount in thousands)	Goodwill
Balance as of June 24, 2016	$	—
Addition in connection with business acquisition		3,883
Foreign currency translation adjustment		(77	)

Balance as of June 30, 2017	$	3,806

Goodwill is not deductible for tax purposes. Goodwill is reviewed annually for impairment or more frequently whenever changes or circumstances indicate the carrying amount of goodwill may not be recoverable. As of June 30, 2017, the Company performed the annual impairment test for goodwill, which indicated there was no goodwill impairment.

Borrowings

12 Months Ended

Jun. 30, 2017

Borrowings

13. Borrowings

The Company’s total borrowings, including revolving and long-term borrowings, consisted of the following (dollars in thousands):


Rate ⁽¹⁾	Conditions		Maturity			As of June 30, 2017			As of June 24, 2016
Short-term borrowing:
Revolving borrowing:
LIBOR + 1.75% per annum		Repayable in 1 to 6 months		July 2017	⁽²⁾	$	34,000		$	6,500
Short-term loans from bank:
Bank of England base rate +1.85%		Repayable based on credit terms of secured accounts receivable					1,003			—
Current portion of long-term borrowing							13,600			18,100

							48,603			24,600
Less: Unamortized debt issuance costs							(201	)		(293	)

						$	48,402		$	24,307

Long-term borrowing:
LIBOR + 2.80% per annum		Repayable in quarterly installments		March 2017		$	—		$	4,500
Term loan borrowing:
LIBOR + 1.75% per annum		Repayable in quarterly installments		May 2019			36,400		$	50,000

							36,400			54,500
Less: Current portion							(13,600	)		(18,100	)
Unamortized debt issuance costs							(99	)		(300	)

Non-current portion						$	22,701		$	36,100

⁽¹⁾

LIBOR is London Interbank Offered Rate.

⁽²⁾

In June 2017, the maturity date of this revolving borrowing was extended to mature in July 2017.

The movements of long-term loans were as follows for the years ended June 30, 2017 and June 24, 2016:


	Years ended
(amount in thousands)	June 30, 2017			June 24, 2016
Opening net book amount	$	54,500		$	10,500
Additional loan during the period		—			50,000
Repayment during the period		(18,100	)		(6,000	)

Closing net book amount	$	36,400		$	54,500

As of June 30, 2017, the future maturities of long-term debt during each fiscal year were as follows:


(amount in thousand)
2018	$	13,600
2019		22,800

Total	$	36,400

Credit facilities:

The Company entered into a syndicated senior credit facility agreement (the “Facility Agreement”) with a consortium of banks on May 22, 2014. The Facility Agreement, led by Bank of America, provides for a $200.0 million credit line, comprised of a $150.0 million revolving loan facility and a $50.0 million delayed draw term loan facility. The revolving loan facility contains an accordion feature permitting Fabrinet to request an increase in the facility up to $100.0 million subject to customary terms and conditions and provided that no default or event of default exists at the time of request. The revolving loan facility terminates and all amounts outstanding are due and payable in full on May 22, 2019. The principal amount of any drawn term loans must be repaid according to the scheduled quarterly amortization payments, with final payment of all amounts outstanding, plus accrued interest, being due on May 22, 2019.

On February 26, 2015, the Company entered into the Second Amendment to the Facility Agreement. The amendment extended the availability period for draws on the term loan facility from May 21, 2015 to July 31, 2015. It also allows the Company, upon the satisfaction of certain conditions, to designate from time to time one or more of its subsidiaries as borrowers under the Facility Agreement. On July 31, 2015, the Company entered into the Third Amendment to the Facility Agreement. The amendment extended the availability period for draws on the term loan facility from July 31, 2015 to July 31, 2016. The Company fully drew down the term loan facility of $50.0 million in fiscal year 2016. As of June 30, 2017, $34.0 million of revolving borrowing and $36.4 million of term loan borrowing was outstanding under the Facility Agreement, resulting in available credit facilities of $116.0 million. Borrowings under the revolving credit facility are classified as current liabilities in the audited consolidated balance sheet as the Company has the periodic option to renew or pay, all or a portion of, the outstanding balance at the end of the maturity date, which is in the range of one to six months, without premium or penalty, upon notice to the administrative agent. Subsequent to the balance sheet date, the Company sent a notice to the bank to renew the maturity date of this revolving borrowing. The bank approved the notice and extended the maturity to July 2017.

Loans under the Facility Agreement bear interest, at Fabrinet’s option, at a rate per annum equal to a LIBOR rate plus a spread of 1.75% to 2.50%, or a base rate, determined in accordance with the Facility Agreement, plus a spread of 0.75% to 1.50%, in each case with such spread determined based on Fabrinet’s consolidated total leverage ratio for the preceding four fiscal quarter period. Interest is due and payable quarterly in arrears for loans bearing interest at the base rate and at the end of an interest period (or at each three-month interval in the case of loans with interest periods greater than three months) in the case of loans bearing interest at the LIBOR rate.

Fabrinet’s obligations under the Facility Agreement are guaranteed by certain of its existing and future direct material subsidiaries. In addition, the Facility Agreement is secured by Fabrinet’s present and future accounts receivable, deposit accounts and cash, and a pledge of the capital stock of certain of Fabrinet’s direct subsidiaries. Fabrinet is required to maintain at least $40.0 million of cash, cash equivalents, and marketable securities at financial institutions located in the United States. Further, Fabrinet is required to maintain any of its deposits accounts or securities accounts with balances in excess of $10.0 million in a jurisdiction where a control agreement, or the equivalent under the local law, can be effected. The Facility Agreement contains customary affirmative and negative covenants. Negative covenants include, among other things, limitations on liens, indebtedness, investments, mergers, sales of assets, changes in the nature of the business, dividends and distributions, affiliate transactions and capital expenditures. The Facility Agreement contains financial covenants requiring Fabrinet to maintain: (i) a minimum tangible net worth of not less than $200.0 million plus 50% of quarterly net income, exclusive of quarterly losses; (ii) a minimum debt service coverage ratio of not less than 1.50:1.00; (iii) a maximum senior leverage ratio of not more than 2.50:1.00; and (iv) a minimum quick ratio of not less than 1.10:1.00. Each of these financial covenants is calculated on a consolidated basis for the consecutive four fiscal quarter period then ended. As of June 30, 2017, the Company was in compliance with all covenants under the Facility Agreement.

The Facility Agreement also contains customary events of default including, among other things, payment defaults, breaches of covenants or representations and warranties, cross-defaults with certain other indebtedness, bankruptcy and insolvency events and change in control of Fabrinet, subject to grace periods in certain instances. Upon an event of default, the lenders may terminate their commitments, declare all or a portion of the outstanding obligations payable by Fabrinet to be immediately due and payable and exercise other rights and remedies provided for under the Facility Agreement.

Fabrinet intends to use the proceeds of the credit line to finance its future expansion in the United States and Thailand, and for general corporate purposes including mergers and acquisitions of complementary manufacturing businesses or technology, although Fabrinet has no current commitments with respect to any such acquisitions.

Short-term borrowings from bank

In connection with the acquisition of Exception EMS, the Company assumed a secured borrowing agreement that is secured by trade accounts receivable of Exception EMS. As of June 30, 2017, the carrying amount of trade accounts receivable secured to the loans was $3.0 million. The secured borrowing agreement contains certain covenants that Exception EMS is required to comply with: (1) the value of credit notes may not exceed 4% of the value of assigned debts measured on a monthly basis, and (2) rolling cash flow must be provided to the financial institution along with monthly management information. As of June 30, 2017, the subsidiary was in compliance with all covenants under the secured borrowing agreement.

As of June 30, 2017, the Company drew down $1.0 million from this facility, which is recorded as short-term loans in the consolidated balance sheets. The agreement bears interest for discount charge at 1.85% per annum above Bank of England base rate.

Undrawn available credit facilities classified by available period of future borrowing as of June 30, 2017 and June 24, 2016 were as follows:


(amount in thousands)	June 30, 2017		June 24, 2016
Short-term	$	1,965	$	1,414
Long-term	$	116,000	$	143,500

Severance liabilities

12 Months Ended

Jun. 30, 2017

Severance liabilities

14.

Severance liabilities

The following table provides the information of the severance liabilities:


(amount in thousands)	As of June 30, 2017		As of June 24, 2016
Balance, beginning of the fiscal year	$	6,684	$	5,477
Charged to selling, general and administrative expenses in the consolidated statements of operations and comprehensive income		1,804		1,207

Balance, end of the fiscal year	$	8,488	$	6,684

The amount recognized in the consolidated balance sheets under non-current liabilities was determined as follows:


(amount in thousands)	As of June 30, 2017		As of June 24, 2016
Present value of defined benefit obligation	$	8,488	$	6,684

Total	$	8,488	$	6,684

The amount recognized in the consolidated statements of operations and comprehensive income was as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016			June 26, 2015
Current service cost	$	1,451	$	842		$	360
Interest cost		213		203			203
Benefit paid		—		(11	)		(10	)
Actuarial loss on obligation		140		173			471

Total	$	1,804	$	1,207		$	1,024

The principal actuarial assumptions used were as follows:


	Years Ended
	June 30, 2017	June 24, 2016		June 26, 2015
Discount rate	1.93% - 3.6%		2.0% - 3.2%		4.0%
Future salary increases	3.5% - 10.0%		4.1% - 10.0%		4.2%

Share-based compensation

12 Months Ended

Jun. 30, 2017

Share-based compensation

15.

Share-based compensation

Share-based compensation

In determining the fair value of share option awards, the Company is required to make estimates of expected dividends to be issued, expected volatility of Fabrinet’s ordinary shares, expected forfeitures of the awards, risk free interest rates for the expected term of the awards and expected terms of the awards. Forfeitures are estimated at the time of grant and revised if necessary in subsequent periods if actual forfeitures differ from those estimates. The fair value of restricted share units is based on the market value of our ordinary shares on the date of grant.

The effect of recording share-based compensation expense for the years ended June 30, 2017, June 24, 2016 and June 26, 2015 was as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Share-based compensation expense by type of award:
Share options	$	—	$	16	$	226
Restricted share units		22,412		9,911		7,801
Performance share units		4,095		—		—

Total share-based compensation expense		26,507		9,927		8,027
Tax effect on share-based compensation expense		—		—		—

Net effect on share-based compensation expense	$	26,507	$	9,927	$	8,027

Share-based compensation expense was recorded in the consolidated statements of operations and comprehensive income as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Cost of revenue	$	5,318	$	1,979	$	1,450
Selling, general and administrative expense		21,189		7,948		6,577

Total share-based compensation expense	$	26,507	$	9,927	$	8,027

The Company did not capitalize any share-based compensation expense as part of any asset costs during the years ended June 30, 2017, June 24, 2016 and June 26, 2015.

Share-based award activity

Share options have been granted to directors and employees. As of June 30, 2017, there were no share options outstanding under Fabrinet’s Amended and Restated 1999 Share Option Plan (“1999 Plan”). Additional option grants may not be made under the 1999 Plan.

As of June 30, 2017, there were an aggregate of 96,688 share options outstanding, 1,058,605 restricted share units outstanding and 227,268 performance share units outstanding under Fabrinet’s 2010 Performance Incentive Plan (“2010 Plan”). As of June 30, 2017, there were 1,111,573 ordinary shares available for future grant under Fabrinet’s 2010 Performance Incentive Plan (“2010 Plan”). The 1999 Plan and 2010 Plan are collectively referred to as the “Share Option Plans”.

Share options

Fabrinet’s board of directors has the authority to determine the type of option and the number of shares subject to an option. Options generally vest and become exercisable over four years and expire, if not exercised, within seven years of the grant date. In the case of a grantee’s first grant, 25 percent of the underlying shares subject to an option vest 12 months after the vesting commencement date and 1/48 of the underlying shares vest monthly over each of the subsequent 36 months. In the case of any additional grants to a grantee, 1/48 of the underlying shares subject to an option vest monthly over four years, commencing one month after the vesting commencement date.

The following table summarizes share options activity:


	Number of Shares			Number of Exercisable Options		Weighted- Average Exercise Price		Weighted- Average Grant Date Fair Value
Balance as of June 27, 2014		865,890			666,305	$	16.27
Granted		—					—		—
Exercised		(56,968	)			$	14.67
Forfeited		(8,347	)			$	15.90
Expired		(8,556	)			$	21.44

Balance as of June 26, 2015		792,019			758,451	$	16.33
Granted		—					—		—
Exercised		(325,530	)			$	16.83
Forfeited		(755	)			$	17.10
Expired		(1,400	)			$	23.62

Balance as of June 24, 2016		464,334			464,334	$	15.95
Granted		—					—		—
Exercised		(367,641	)			$	16.02
Forfeited		—					—
Expired		(5	)			$	5.75

Balance as of June 30, 2017		96,688			96,688	$	15.70

Expected to vest as of June 30, 2017		96,688				$	15.70

The fair value of each share option grant was determined by the Company using the methods and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment and management estimate to determine.

The total fair value of share options vested during the years ended June 30, 2017, June 24, 2016 and June 26, 2015 was nil, $0.2 million and $1.1 million, respectively. The total intrinsic value of options exercised during the years ended June 30, 2017 June 24, 2016 and June 26, 2015 was $8.9 million, $3.6 million and $0.2 million, respectively. In conjunction with these exercises, there was no tax benefit realized by the Company due to the fact that it is exempted from income tax. The amount of cash received from the exercise of share options was $5.9 million during the year ended June 30, 2017.

Valuation Method—The Company estimated the fair value of the Company’s ordinary shares to be used in the BSM by taking into consideration a number of assumptions, as discussed below.

Expected Dividend—The Company used zero as an annualized dividend yield since it did not anticipate paying any cash dividends in the near future.

Expected Volatility – The Company determined the expected volatility based on the Company’s historical volatility over the last four years.

Risk-Free Interest Rate—The Company based the risk-free interest rate on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equivalent to the expected term of the option.

Expected Term—Expected terms used in the BSM represent the periods that the company’s share options are expected to be outstanding and are determined based on the Company’s historical experience of similar awards, giving consideration to the contractual terms of the share options, vesting schedules and expectations of future employee behavior.

Vesting Period—Fabrinet’s share options generally vest and become exercisable over a four-year period, and expire seven years from the date of grant. For an initial grant, 25 percent of the underlying shares subject to an option vest 12 months after the vesting commencement date and 1/48 of the underlying shares vest monthly over each of the subsequent 36 months. In the case of any additional grants to an optionee, 1/48 of the underlying shares subject to an option vest monthly over four years, commencing one month after the vesting commencement date.

Fair Value—The fair value of Fabrinet’s share options granted to employees was estimated using the weighted-average for each assumption of expected volatility, risk-free rate of return, and expected term.

The following table summarizes information for share options outstanding as of June 30, 2017 under the Share Option Plans:


	Number of Shares Underlying Options		Exercise Price Per Share		Weighted Average Remaining Contractual Life (years)		Aggregate Intrinsic Value (amount in thousands)
		25,238	$	14.12		1.36
		30,000	$	15.05		0.35
		6,100	$	15.16		1.13
		28,300	$	16.83		0.29
		5,550	$	18.60		1.67
		1,500	$	25.50		0.54

Options outstanding		96,688				0.72	$	2,607

Options exercisable		96,688				0.72	$	2,607

Expected to vest as of June 30, 2017		96,688				0.72	$	2,607

As of June 30, 2017, there was no unrecognized compensation cost under the Share Option Plans.

Restricted share units and performance share units

Restricted share units are one type of share-based award that may be granted under the 2010 Plan. Restricted share units granted to non-employee directors generally cliff vest 100% on the first of January, approximately one year from the grant date, provided the director continues to serve through such date. Restricted share units granted to employees generally vest in four equal installments over four years on each anniversary of the vesting commencement date.

Performance share units granted to executives will vest 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 gross 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 Company has entered into an employment agreement, as amended on August 12, 2016, with one executive of the Company that provided for accelerated vesting of equity awards under certain circumstances. Pursuant to such agreement, because the executive’s employment with the Company continued through February 20, 2017, (1) all outstanding equity awards granted to the executive prior to August 2016 became 100% vested on February 20, 2017 and (2) certain restricted share units granted to the executive in August 2016 became 100% vested on February 20, 2017.

The following table summarizes restricted share unit activity under the 2010 Plan:


	Number of Shares			Weighted- Average Grant Date Fair Value Per Share
Balance as of June 27, 2014		762,295		$	14.23
Granted		666,582		$	17.53
Issued		(247,593	)	$	14.44
Forfeited		(40,357	)	$	16.68

Balance as of June 26, 2015		1,140,927		$	16.03
Granted		654,589		$	21.15
Issued		(507,621	)	$	15.60
Forfeited		(106,493	)	$	18.34

Balance as of June 24, 2016		1,181,402		$	18.34
Granted		861,356		$	38.95
Issued		(853,535	)	$	21.16
Forfeited		(130,618	)	$	29.31

Balance as of June 30, 2017		1,058,605		$	31.59

Expected to vest as of June 30, 2017		1,024,706		$	31.56

The following summarizes performance share unit activity under the 2010 Plan:


	Number of Shares			Weighted- Average Grant Date Fair Value Per Share
Balance as of June 24, 2016		—			—
Granted		234,678		$	40.48
Issued		—			—
Forfeited		(7,410	)		—

Balance as of June 30, 2017		227,268		$	40.48

Expected to vest as of June 30, 2017		227,268

The fair value of restricted share units and performance share units are based on the market value of our ordinary shares on the date of grant.

The total fair value of restricted share units and performance share unit vested during the year ended June 30, 2017, June 24, 2016 and June 26, 2015 was $18.1 million, $7.9 million and $3.6 million, respectively. The aggregate intrinsic value of restricted share units outstanding as of June 30, 2017 was $45.2 million.

As of June 30, 2017, there was $16.1 million and $5.1 million of unrecognized share-based compensation expense related to restricted share units and performance share units, respectively, under the 2010 Plan that is expected to be recorded over a weighted-average period of 2.46 years and 1.13 years, respectively.

For the years ended June 30, 2017 and June 24, 2016, the Company withheld an aggregate of 37,126 shares and 114,359 shares, respectively, upon the vesting of restricted share units, based upon the closing share price on the vesting date to settle the employees’ minimum statutory obligation for the applicable income and other employment taxes. For fiscal year 2017 and fiscal year 2016, the Company then remitted cash of $1.4 million and $2.5 million, respectively, to the appropriate taxing authorities, and presented it as a financing activity within the consolidated statements of cash flows. The payment had the effect on shares issued by the Company as it reduced the number of shares that would have been issued on the vesting date and was recorded as a reduction of additional paid-in capital.

Employee benefit plans

12 Months Ended

Jun. 30, 2017

Employee benefit plans

16.

Employee benefit plans

Employee contribution plan

The Company operates a defined contribution plan, known as a provident fund, in its subsidiaries in Thailand and the United Kingdom. The assets of these plans are in separate trustee-administered funds. The provident fund is funded by matching payments from employees and by the subsidiaries on a monthly basis. Current contributions to the provident fund are accrued and paid to the fund manager on a monthly basis. The Company’s contributions to the provident fund amounted to $3.6 million, $2.8 million and $2.3 million during the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

The Company sponsors the Fabrinet U.S. 401(k) Retirement Plan (“401(k) Plan”), a Defined Contribution Plan under ERISA, at its subsidiaries in the United States which provides retirement benefits for eligible employees through tax deferred salary deductions. The 401(k) Plan allows employees to contribute up to 80% of their annual compensation, subject to annual contributions limits established by the Internal Revenue Service. The Company provides for a 100% match of employees’ contributions to the 401(k) Plan up to the first 6% of annual compensation. All matching contributions are made in cash and vest immediately. The Company’s matching contributions to the 401(k) Plan were $0.6 million, $0.5 million and $0.3 million during the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

Executive incentive plan and employee performance bonuses

For the year ended June 30, 2017, the Company maintained an executive incentive plan with quantitative objectives, based on achieving certain revenue and gross margin targets. For the years ended June 24, 2016 and June 26, 2015, the Company maintained an executive incentive plan with quantitative objectives, based on achieving certain revenue and non-GAAP earnings per share targets as well as qualitative objectives, based on achieving individual performance goals for the applicable fiscal year. During the years ended June 30, 2017, June 24, 2016 and June 26, 2015, discretionary merit-based bonus awards were also available to Fabrinet’s non-executive employees.

Bonus distributions to employees were $7.6 million, $7.5 million and $6.0 million for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

Shareholders' equity

12 Months Ended

Jun. 30, 2017

Shareholders' equity

17.

Shareholders’ equity

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 year ended June 30, 2017, Fabrinet issued 367,641 ordinary shares upon the exercise of options, for cash consideration at a weighted average exercise price of $16.02 per share, and 816,409 ordinary shares upon the vesting of restricted share units, net of shares withheld.

For the year ended June 24, 2016, Fabrinet issued 325,530 ordinary shares upon the exercise of options, for cash consideration at a weighted average exercise price of $16.83 per share, and 393,262 ordinary shares upon the vesting of restricted share units, net of shares withheld.

For the year ended June 26, 2015, Fabrinet issued 56,968 ordinary shares upon the exercise of options, for cash consideration at a weighted average exercise price of $14.67 per share, and 227,914 ordinary shares upon the vesting of restricted share units, net of shares withheld.

All such issued shares are fully paid.

Accumulated other comprehensive income (loss)

12 Months Ended

Jun. 30, 2017

Accumulated other comprehensive income (loss)

18.

Accumulated other comprehensive income (loss)

The changes in AOCI by component for the years ended June 30, 2017 and June 24, 2016 were as follows:


(amount in thousands)	Unrealized net (Losses)/Gains on Marketable Securities			Unrealized net (Losses)/Gains on Derivative Instruments			Foreign Currency Translation Adjustment			Total
Balance as of June 26, 2015	$	(44	)	$	—		$	—		$	(44	)
Other comprehensive income before reclassification		637			(298	)		—			339
Amounts reclassified from AOCI		(194	)		490			—			296
Tax effects		—			—			—			—

Other comprehensive income		399			192			—			591

Balance as of June 24, 2016		399			192			—			591
Other comprehensive income before reclassification		351			—			(310	)		41
Amounts reclassified from AOCI		(822	)		(158	)		—			(980	)
Tax effects		—			—			—			—

Other comprehensive income		(471	)		(158	)		(310	)		(939	)

Balance as of June 30, 2017	$	(72	)	$	34		$	(310	)	$	(348	)

The following table presents the pre-tax amounts reclassified from AOCI into the consolidated statements of operations and comprehensive income for the years ended June 30, 2017 and June 24, 2016, respectively (amounts in thousands).


		Years ended
AOCI components	Financial statements line item	June 30, 2017			June 24, 2016
Unrealized losses on marketable securities	Interest income	$	(822	)	$	(194	)
Unrealized gains on derivative instruments	Cost of revenues		—			471
	Selling, general and administrative expenses		(158	)		19

Total amounts reclassified from AOCI		$	(980	)	$	296

Commitments and contingencies

12 Months Ended

Jun. 30, 2017

Commitments and contingencies

19.

Commitments and contingencies

Bank guarantees

As of June 30, 2017 and June 24, 2016, there were outstanding bank guarantees given by a bank on behalf of our subsidiary in Thailand for electricity usage and other normal business amounting to $1.5 and $0.8 million, respectively.

Operating lease commitments

The Company leases a portion of its capital equipment, vehicle, and certain land and buildings for its facilities in Thailand, Cayman Islands, China, the United States and the United Kingdom under operating lease arrangements that expire in various years through 2023. Rental expense under these operating leases amounted to $1.7 million, $1.2 million and $1.1 million for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.

As of June 30, 2017, the future minimum lease payments due under non-cancelable operating leases during each fiscal year were as follows:


(amount in thousands)
2018	$	1,744
2019		1,162
2020		946
2021		540
2022		416
Thereafter		520

Total future minimum operating lease payments	$	5,328

Capital lease commitments

In connection with the acquisition of Exception EMS, the Company assumed the capital lease commitments of several machines and equipment, with various expiration dates until September 2020. The equipment can be purchased at the determined prices upon expiration of such contracts.

As of June 30, 2017, the future minimum lease payments under non-cancelable capital leases during each fiscal year were as follows:


(amount in thousands)
2018	$	466
2019		479
2020		422
2021		105

Total		1,472
Less: Future finance charge on capital leases		(104	)

Present value of capital lease	$	1,368

Representing capital lease liabilities


Current	$	344
Non-current		1,024

Total capital lease liabilities	$	1,368

As of June 30, 2017, the present value of capital lease during each fiscal year were as follows:


(amount in thousands)
2018	$	344
2019		510
2020		409
2021		105

Total future minimum capital lease payments	$	1,368

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.

On December 23, 2016, the Company entered into an agreement to purchase a parcel of land in Chonburi, Thailand, to support the expansion of the Company’s production in Thailand. The aggregate purchase price is approximately $5.6 million, of which the first installment of $1.1 million was paid by the Company on January 10, 2017. The Company expects to pay the remaining balance of the purchase price on or before December 25, 2017.

As of June 30, 2017, the Company had an outstanding commitment to third parties of $10.6 million, of which $4.5 million was from the commitment to purchase land in Chonburi, Thailand.

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 geographic information

12 Months Ended

Jun. 30, 2017

Business segments and geographic information

20.

Business segments and geographic information

Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is Fabrinet’s chief executive officer. As of June 30, 2017, June 24, 2016 and June 26, 2015, 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.

Total revenues are attributed to a particular geographic area based on the bill-to-location of the customer. The Company operates primarily in three geographic regions: North America, Asia-Pacific and Europe. The following table presents total revenues by geographic regions:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
North America	$	661,267	$	525,161	$	370,836
Asia-Pacific		539,317		351,033		309,941
Europe		219,906		100,553		92,810

Total	$	1,420,490	$	976,747	$	773,587

As of June 30, 2017 and June 24, 2016, the Company had approximately $34.9 million and $34.7 million, respectively, of long-lived assets based in North America, with the substantial remainder of assets based in Asia-Pacific.

The following table presents revenues by end market:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Optical communications	$	1,108,637	$	727,580	$	553,245
Lasers, sensors, and other		311,853		249,167		220,342

Total	$	1,420,490	$	976,747	$	773,587

Significant customers

Total revenues, by percentage, from individual customers representing 10% or more of total revenues in the respective periods were as follows:


	Years Ended
	June 30, 2017			June 24, 2016			June 26, 2015
Lumentum Operations LLC		17	%		20	%		20	%
Oclaro, Inc.		*	⁽¹⁾		*	⁽¹⁾		10	%

⁽¹⁾

Less than 10% of total revenue.

Accounts receivable from individual customers representing 10% or more of accounts receivable as of June 30, 2017 and June 24, 2016, respectively, were as follows:


	As of June 30, 2017			As of June 24, 2016
Lumentum Operations LLC		15	%		18	%
NeoPhotonics Corporation		12	%		*	⁽¹⁾
Acacia Communications Inc.		10	%		*	⁽¹⁾
Valeo		*	⁽¹⁾		11	%

⁽¹⁾

Less than 10% of total accounts receivable.

Financial instruments

12 Months Ended

Jun. 30, 2017

Financial instruments

21.

Financial instruments

Objectives and significant terms and conditions

The principal financial risks faced by the Company are foreign currency risk and interest rate risk. The Company borrows at floating rates of interest to finance its operations. A minority of sales and purchases and a majority of labor and overhead costs are entered into in foreign currencies. In order to manage the risks arising from fluctuations in currency exchange rates, the Company uses derivative instruments. Trading for speculative purposes is prohibited under Company policies.

The Company enters into short-term foreign currency forward and option contracts to manage foreign currency exposures associated with certain assets, liabilities and other forecasted foreign currency transactions and may designate these instruments as hedging instruments. The foreign currency forward and option contracts generally have maturity of up to six months. All foreign currency exchange contracts are recognized on the consolidated balance sheets at fair value. Gain or loss on the Company’s derivative instruments generally offset the assets, liabilities and transactions economically hedged.

Foreign currency risk

The Company operates internationally and is exposed to foreign exchange risk arising from various currency exposures primarily with respect to the Thai baht, Chinese Renminbi (“RMB”) GBP.

As of June 30, 2017 and June 24, 2016, the Company had outstanding foreign currency assets and liabilities as follows:


	As of June 30, 2017				As of June 24, 2016
(amount in thousands)	Currency		$		Currency		$
Assets
Thai baht		395,123	$	11,628		834,536	$	23,594
RMB		26,965		3,980		14,835		2,255
GBP		6,896		8,982		—		—

Total			$	24,590			$	25,849

Liabilities
Thai baht		1,875,338	$	55,189		1,517,782	$	42,912
RMB		28,451		4,200		24,654		3,748
GBP		5,625		7,326		—		—

Total			$	66,715			$	46,660

The Thai baht assets represent cash and cash equivalents, trade accounts receivable, deposits and other current assets. The Thai baht liabilities represent trade accounts payable, accrued expenses, income tax payable and other payables. The Company manages its exposure to fluctuations in foreign exchange rates by the use of foreign currency contracts and offsetting assets and liabilities denominated in the same currency in accordance with management’s policy. As of June 30, 2017 and June 24, 2016, there was $1.0 million and $84.5 million in foreign currency forward contracts, respectively, outstanding on the Thai baht payables.

The RMB assets represent cash and cash equivalents, trade accounts receivable and other current assets. The RMB liabilities represent trade accounts payable, accrued expenses, income tax payable and other payables. As of June 30, 2017 and June 24, 2016, there were no derivative contracts denominated in RMB.

The GBP assets primarily represent cash, trade accounts receivable and property, plant and equipment, net. The GBP liabilities primarily represent short-term loans, trade accounts payable and other payables. As of June 30, 2017, there were no derivative contracts denominated in GBP.

For fiscal year 2017 and fiscal year 2016, the Company recorded unrealized loss of $0.02 million and $1.8 million, respectively, related to derivatives that are not designated as hedging instruments in its consolidated statements of operations and comprehensive income.

Interest Rate Risk

The Company’s principal interest bearing assets are time deposits and short-term investments with maturities of three months or less held with high quality financial institutions. The Company’s principal interest bearing liabilities are bank loans which bear interest at floating rates.

UNAUDITED QUARTERLY FINANCIAL INFORMATION

12 Months Ended

Jun. 30, 2017

UNAUDITED QUARTERLY FINANCIAL INFORMATION

UNAUDITED QUARTERLY FINANCIAL INFORMATION

The following table sets forth a summary of the Company’s quarterly financial information for each of the four quarters in the fiscal years ended June 30, 2017 and June 24, 2016:


	Three Months Ended
(in thousands, except per share data)	Jun 30, 2017		Mar 31, 2017		Dec 30, 2016		Sep 30, 2016		Jun 24, 2016		Mar 25, 2016		Dec 25, 2015		Sep 25, 2015
Total revenues	$	370,454	$	366,837	$	351,156	$	332,043	$	276,388	$	250,888	$	233,038	$	216,433

Gross profit	$	44,760	$	44,046	$	43,046	$	39,608	$	33,842	$	31,177	$	28,493	$	26,011

Net income	$	27,401	$	21,656	$	25,292	$	22,766	$	19,669	$	20,822	$	19,803	$	1,603

Basic net income per share:
Net income	$	0.73	$	0.58	$	0.69	$	0.63	$	0.55	$	0.58	$	0.55	$	0.05

Weighted-average shares used in basic net income per share calculations		37,334		37,116		36,848		36,404		36,075		35,964		35,812		35,579

Diluted net income per share:
Net income	$	0.72	$	0.57	$	0.67	$	0.61	$	0.53	$	0.56	$	0.54	$	0.04

Weighted-average shares used in diluted net income per share calculations		38,118		37,872		37,805		37,330		37,258		37,089		36,826		36,315

Summary of significant accounting policies (Policies)

12 Months Ended

Jun. 30, 2017

Principles of consolidation

Principles of consolidation

Where necessary, comparative figures have been reclassified to conform to the current period accounting policies and presentation adopted.

Use of estimates

Use of estimates

Foreign currency transactions and translation

Foreign currency transactions and translation

The consolidated financial statements are presented in United States dollars (“$” or “USD”). The functional currency of Fabrinet and most of its subsidiaries is the USD.

Cash and cash equivalents

Cash and cash equivalents

Marketable securities

Marketable securities

Trade accounts receivable

Trade accounts receivable

Unanticipated changes in the liquidity or financial position of the Company’s customers may require revision to the allowances for doubtful accounts.

Inventory

Inventory

Leases

Leases

Operating leases

Payments made under operating leases are expensed on a straight-line basis over the lease term.

Capital lease

Property, plant and equipment

Property, plant and equipment


Land improvements			10 years
Building and building improvements			7 - 30 years
Leasehold improvements			Shorter of useful life or lease term
Manufacturing equipment			3 - 7 years
Office equipment			3 - 7 years
Motor vehicles			3 - 5 years
Computer hardware			3 - 5 years

Gains and losses on disposal are determined by comparing proceeds with carrying amounts and are included in operating income in the consolidated statements of operations and comprehensive income.

Intangibles

Intangibles

Business acquisition

Business acquisition

Goodwill

Goodwill

Borrowing costs

Borrowing costs

Fair value of financial instruments

Fair value of financial instruments

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Derivatives

Derivatives

The derivatives assets and liabilities are recognized on the consolidated balance sheets as other current assets or accrued expenses and are measured at fair value.

Concentration of credit risk

Concentration of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, marketable securities, derivatives and accounts receivable.

Revenue recognition

Revenue recognition

Services

Sales of goods

Warranty provision

Warranty provision

Shipping and handling costs

Shipping and handling costs

The Company records costs related to shipping and handling in cost of revenues for all periods presented.

Share-based compensation

Share-based compensation

Employee contribution plan

Employee contribution plan

Severance liabilities

Severance liabilities

Annual leave

Annual leave

Employee entitlements to annual leave are recognized when they accrue to the employee. On termination of employment, accrued employee entitlement to annual leave is paid in cash.

Income taxes

Income taxes

New Accounting Pronouncements - not yet adopted by the Company

New Accounting Pronouncements—not yet adopted by the Company

New Accounting Pronouncements-adopted by the Company

New Accounting Pronouncements—adopted by the Company

Income taxes (Tables)

12 Months Ended

Jun. 30, 2017

Income Tax Expense

The Company’s income tax expense consisted of the following:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Current	$	6,299	$	5,413	$	4,191
Deferred		443		922		(207	)

Total income tax expense	$	6,742	$	6,335	$	3,984

Reconciliation between Taxes that Would Arise by Applying Statutory Tax Rate of Country of Principal Operations to Effective Tax Charge


	Years Ended
(amount in thousands)	June 30, 2017			June 24, 2016			June 26, 2015
Income before income taxes ⁽¹⁾	$	103,857		$	68,232		$	47,626
Tax expense calculated at a statutory corporate income tax rate of 20%		20,771			13,646			9,525
Effect of income taxes from locations with tax rates different from Thailand		1,469			1,573			1,134
Income not subject to tax ⁽²⁾		(17,212	)		(10,493	)		(7,094	)
Income tax on unremitted earnings		1,058			741			1,263
Effect of different tax rate in relation to deferred tax utilization ⁽³⁾		—			894			(221	)
Effect of foreign exchange rate adjustment		667			375			(365	)
Tax rebate from research and development application		(226	)		(145	)		(102	)
Others		215			(256	)		(156	)

Corporate income tax expense	$	6,742		$	6,335		$	3,984

⁽¹⁾	Income before income taxes was mostly generated from domestic income in the Cayman Islands.

⁽²⁾

⁽³⁾	The balances were effect of different tax rate in relation to the rate recognized deferred taxes during the fiscal year and the rate when deferred taxes will be utilized in the following fiscal years.

Deferred Tax Assets and Deferred Tax Liabilities, Net of Valuation Allowance

The Company’s deferred tax assets and deferred tax liabilities, net of valuation allowance, at each balance sheet date are as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016
Deferred tax assets:
Depreciation	$	1,674	$	1,679
Severance liability		1,127		955
Reserves and allowance		1,046		1,363
Loss carrying forward		496		—
Others		10		—

Total	$	4,353	$	3,997


	Years Ended
(amount in thousands)	June 30, 2017			June 24, 2016
Deferred tax liabilities:
Temporary differences from intangibles and changes in the fair value of assets acquired	$	(944	)	$	—
Deferred tax from unremitted earnings		(2,485	)		(1,687	)

Total		(3,429	)		(1,687	)

Net	$	924		$	2,310

Changes to Unrecognized Tax Benefits


(amount in thousands)	As of June 30, 2017		As of June 24, 2016		As of June 26, 2015
Beginning balance	$	1,420	$	1,420	$	868
Additions during the year		—		—		552
Reductions for tax positions of prior years		—		—		—

Ending balance	$	1,420	$	1,420	$	1,420

Earnings per ordinary share (Tables)

12 Months Ended

Jun. 30, 2017

Earnings Per Ordinary Share

The earnings per ordinary share was calculated as follows:


	Years Ended
(amount in thousands except per share amounts)	June 30, 2017		June 24, 2016		June 26, 2015
Net income attributable to shareholders	$	97,115	$	61,897	$	43,642

Weighted-average number of ordinary shares outstanding (thousands of shares)		36,927		35,857		35,354
Incremental shares arising from the assumed exercise of share options and vesting of restricted share units and performance share units (thousands of shares)		925		1,015		630

Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares)		37,852		36,872		35,984

Basic earnings per ordinary share	$	2.63	$	1.73	$	1.23
Diluted earnings per ordinary share	$	2.57	$	1.68	$	1.21
Outstanding share options excluded in the computation of diluted earnings per ordinary share⁽¹⁾		—		—		39,544

⁽¹⁾	These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares.

Cash, cash equivalents and marketable securities (Tables)

12 Months Ended

Jun. 30, 2017

Cash, Cash Equivalents, and Marketable Securities

The Company’s cash, cash equivalents, and marketable securities can be analyzed as follows:


						Fair Value
(amount in thousands)	Carrying Cost		Unrealized (Loss)/Gain			Cash and Cash Equivalents		Marketable Securities
As of June 30, 2017
Cash	$	131,240	$	—		$	131,240	$	—
Cash equivalents		2,585		—			2,585		—
Corporate bonds and commercial papers		98,247		27			—		98,274
U.S. agency and U.S. treasury securities		50,768		(102	)		—		50,666
Sovereign and municipal securities		2,507		3			—		2,510

Total	$	285,347	$	(72	)	$	133,825	$	151,450


					Fair Value
(amount in thousands)	Carrying Cost		Unrealized Gain		Cash and Cash Equivalents		Marketable Securities
As of June 24, 2016
Cash	$	136,754	$	—	$	136,754	$	—
Cash equivalents		6,050		—		6,050		—
Corporate bonds and commercial papers		112,128		394		—		112,522
U.S. agency and U.S. treasury securities		28,028		2		—		28,030
Sovereign and municipal securities		1,154		3		—		1,157

Total	$	284,114	$	399	$	142,804	$	141,709

Available-for-Sale Securities Based on Stated Effective Maturities

The following table summarizes the cost and estimated fair value of marketable securities classified as available-for-sale securities based on stated effective maturities as of June 30, 2017:


(amount in thousands)	Carrying Cost		Fair Value
Due within one year	$	14,369	$	14,363
Due between one to three years		133,634		133,574
Due after three years		3,519		3,513

Total	$	151,522	$	151,450

- Definition

Tabular disclosure of available-for-sale securities which includes, but is not limited to, changes in the cost basis and fair value, fair value and gross unrealized gain (loss), fair values by type of security, contractual maturity and classification, amortized cost basis, contracts to acquire securities to be accounted for as available-for-sale, debt maturities, transfers to trading, change in net unrealized holding gain (loss) net of tax, continuous unrealized loss position fair value, aggregate losses qualitative disclosures, other than temporary impairment (OTTI) losses or other disclosures related to available for sale securities.

+ References + Details

Fair Value (Tables)

12 Months Ended

Jun. 30, 2017

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
(amount in thousands)	Level 1		Level 2			Level 3		Total
As of June 30, 2017
Assets
Cash equivalents	$	—	$	2,585		$	—	$	2,585
Corporate bonds and commercial papers		—		98,274			—		98,274
U.S. agency and U.S. treasury securities		—		50,666			—		50,666
Sovereign and municipal securities		—		2,510			—		2,510
Derivative assets		—		15	⁽¹⁾		—		15

Total	$	—	$	154,050		$	—	$	154,050

Liabilities
Derivative liabilities	$	—	$	—		$	—	$	—

Total	$	—	$	—		$	—	$	—


	Fair Value Measurements at Reporting Date Using
(amount in thousands)	Level 1		Level 2			Level 3		Total
As of June 24, 2016
Assets
Cash equivalents	$	—	$	6,050		$	—	$	6,050
Corporate bonds and commercial papers		—		112,522			—		112,522
U.S. agency and U.S. treasury securities		—		28,030			—		28,030
Sovereign and municipal securities		—		1,157			—		1,157
Derivative assets		—		158	⁽²⁾		—		158

Total	$	—	$	147,917		$	—	$	147,917

Liabilities
Derivative liabilities	$	—	$	1,754	⁽³⁾	$	—	$	1,754

Total	$	—	$	1,754		$	—	$	1,754

⁽¹⁾	Foreign currency forward contract with notional amount of $1.0 million and Canadian dollars 0.6 million.

⁽²⁾	Foreign currency forward contract with notional amount of $7.0 million.

⁽³⁾	Foreign currency forward contract with notional amount of $77.5 million and Canadian dollars 0.6 million.

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

Inventory (Tables)

12 Months Ended

Jun. 30, 2017

Inventories


(amount in thousands)	As of June 30, 2017			As of June 24, 2016
Raw materials	$	88,640		$	58,199
Work in progress		105,732			94,762
Finished goods		33,998			21,593
Goods in transit		13,025			9,381

		241,395			183,935
Less: Inventory obsolescence		(2,730	)		(2,436	)

Inventory, net	$	238,665		$	181,499

Business acquisition (Tables)

12 Months Ended

Jun. 30, 2017

Allocation of Total Purchase Price

The Company’s allocation of the total purchase price for the acquisition is summarized below:


(amount in thousands)	Purchase price allocation
Cash	$	474
Accounts receivable		4,064
Inventory		3,490
Other current assets		427
Property, plant and equipment		5,678
Intangibles		4,492
Goodwill		3,883
Other non-current assets		516
Current liabilities		(6,796	)
Deferred tax liabilities		(1,148	)
Other non-current liabilities		(1,563	)

Total fair value of assets acquired and liabilities assumed	$	13,517

Total purchase price, net of cash acquired	$	13,043

Fair Value of Identified Intangible Assets

The fair value of the identified intangible assets was determined based on the multi-period excess earnings method, which applied the following key assumptions:


Risk free rate:		30-year UK Government Bond adjusted by spot yield to reflect recent volatility
Long-term revenue growth:		5.0% - 8.0%
Churn rate:		10%
Operating margin:		4.0% - 6.0%

Property, plant and equipment, net (Tables)

12 Months Ended

Jun. 30, 2017

Property, Plant and Equipment Net

The components of property, plant and equipment, net were as follows:


(amount in thousands)	Land and Land Improvements			Building and Building Improvements			Manufacturing Equipment			Office Equipment			Motor Vehicles			Computers			Construction and Machinery Under Installation		Total
As of June 30, 2017
Cost	$	39,096		$	138,578		$	127,085		$	7,688		$	534		$	19,642		$	6,058	$	338,681
Less: Accumulated depreciation		(2	)		(31,881	)		(72,130	)		(4,163	)		(376	)		(13,248	)		—		(121,800	)

Net book value	$	39,094		$	106,697		$	54,955		$	3,525		$	158		$	6,394		$	6,058	$	216,881

As of June 24, 2016
Cost	$	39,048		$	95,386		$	96,041		$	5,826		$	443		$	15,578		$	23,248	$	275,570
Less: Accumulated depreciation		—			(25,438	)		(56,564	)		(3,500	)		(366	)		(11,292	)		—		(97,160	)

Net book value	$	39,048		$	69,948		$	39,477		$	2,326		$	77		$	4,286		$	23,248	$	178,410

Leased Assets Under Capital Lease Agreements

Leased assets included above comprise certain machine and equipment from capital lease agreements assumed from the acquisition of Exception EMS.


(amount in thousands)	As of June 30, 2017
Cost—Capital leases	$	2,725
Less: Accumulated depreciation		(856	)

Net book value	$	1,869

Intangibles (Tables)

12 Months Ended

Jun. 30, 2017

Intangibles

The following tables present details of the Company’s intangibles:


(amount in thousands)	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment			Net
As of June 30, 2017
Software	$	5,944	$	(3,850	)	$	—		$	2,094
Customer relationships		4,373		(606	)		(88	)		3,679
Backlog		119		(51	)		(1	)		67

Total intangibles	$	10,436	$	(4,507	)	$	(89	)	$	5,840


(amount in thousands)	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment		Net
As of June 24, 2016
Software	$	3,786	$	(3,287	)	$	—	$	499
Customer relationships		—		—			—		—
Backlog		—		—			—		—

Total intangibles	$	3,786	$	(3,287	)	$	—	$	499

Estimated Future Amortization of intangibles

As of June 30, 2017, the estimated future amortization of intangible assets during each fiscal year was as follows:


(amount in thousand)
2018	$	1,482
2019		1,339
2020		934
2021		787
2022		527
Thereafter		771

Total	$	5,840

Borrowings (Tables)

12 Months Ended

Jun. 30, 2017

Total Borrowings, Including Revolving and Long-Term Borrowings

The Company’s total borrowings, including revolving and long-term borrowings, consisted of the following (dollars in thousands):


Rate ⁽¹⁾	Conditions		Maturity			As of June 30, 2017			As of June 24, 2016
Short-term borrowing:
Revolving borrowing:
LIBOR + 1.75% per annum		Repayable in 1 to 6 months		July 2017	⁽²⁾	$	34,000		$	6,500
Short-term loans from bank:
Bank of England base rate +1.85%		Repayable based on credit terms of secured accounts receivable					1,003			—
Current portion of long-term borrowing							13,600			18,100

							48,603			24,600
Less: Unamortized debt issuance costs							(201	)		(293	)

						$	48,402		$	24,307

Long-term borrowing:
LIBOR + 2.80% per annum		Repayable in quarterly installments		March 2017		$	—		$	4,500
Term loan borrowing:
LIBOR + 1.75% per annum		Repayable in quarterly installments		May 2019			36,400		$	50,000

							36,400			54,500
Less: Current portion							(13,600	)		(18,100	)
Unamortized debt issuance costs							(99	)		(300	)

Non-current portion						$	22,701		$	36,100

⁽¹⁾

LIBOR is London Interbank Offered Rate.

⁽²⁾

In June 2017, the maturity date of this revolving borrowing was extended to mature in July 2017.

Movements of Long-Term Loans

The movements of long-term loans were as follows for the years ended June 30, 2017 and June 24, 2016:


	Years ended
(amount in thousands)	June 30, 2017			June 24, 2016
Opening net book amount	$	54,500		$	10,500
Additional loan during the period		—			50,000
Repayment during the period		(18,100	)		(6,000	)

Closing net book amount	$	36,400		$	54,500

Future Maturities of Long-Term Debt

As of June 30, 2017, the future maturities of long-term debt during each fiscal year were as follows:


(amount in thousand)
2018	$	13,600
2019		22,800

Total	$	36,400

Undrawn Available Credit Facilities Classified by Available Period of Future Borrowing

Undrawn available credit facilities classified by available period of future borrowing as of June 30, 2017 and June 24, 2016 were as follows:


(amount in thousands)	June 30, 2017		June 24, 2016
Short-term	$	1,965	$	1,414
Long-term	$	116,000	$	143,500

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=64930739&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

+ Details

Severance liabilities (Tables)

12 Months Ended

Jun. 30, 2017

Severance Liabilities

The following table provides the information of the severance liabilities:


(amount in thousands)	As of June 30, 2017		As of June 24, 2016
Balance, beginning of the fiscal year	$	6,684	$	5,477
Charged to selling, general and administrative expenses in the consolidated statements of operations and comprehensive income		1,804		1,207

Balance, end of the fiscal year	$	8,488	$	6,684

Severance Liabilities Recognized in Balance Sheet

The amount recognized in the consolidated balance sheets under non-current liabilities was determined as follows:


(amount in thousands)	As of June 30, 2017		As of June 24, 2016
Present value of defined benefit obligation	$	8,488	$	6,684

Total	$	8,488	$	6,684

Severance Liabilities Recognized in Statements of Operations and Comprehensive Income

The amount recognized in the consolidated statements of operations and comprehensive income was as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016			June 26, 2015
Current service cost	$	1,451	$	842		$	360
Interest cost		213		203			203
Benefit paid		—		(11	)		(10	)
Actuarial loss on obligation		140		173			471

Total	$	1,804	$	1,207		$	1,024

Principal Actuarial Assumptions Used

The principal actuarial assumptions used were as follows:


	Years Ended
	June 30, 2017	June 24, 2016		June 26, 2015
Discount rate	1.93% - 3.6%		2.0% - 3.2%		4.0%
Future salary increases	3.5% - 10.0%		4.1% - 10.0%		4.2%

Share-based compensation (Tables)

12 Months Ended

Jun. 30, 2017

Effect of Recording Share-Based Compensation Expense

The effect of recording share-based compensation expense for the years ended June 30, 2017, June 24, 2016 and June 26, 2015 was as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Share-based compensation expense by type of award:
Share options	$	—	$	16	$	226
Restricted share units		22,412		9,911		7,801
Performance share units		4,095		—		—

Total share-based compensation expense		26,507		9,927		8,027
Tax effect on share-based compensation expense		—		—		—

Net effect on share-based compensation expense	$	26,507	$	9,927	$	8,027

Share-Based Compensation Expense Recorded in Consolidated Statements of Operations and Comprehensive Income

Share-based compensation expense was recorded in the consolidated statements of operations and comprehensive income as follows:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Cost of revenue	$	5,318	$	1,979	$	1,450
Selling, general and administrative expense		21,189		7,948		6,577

Total share-based compensation expense	$	26,507	$	9,927	$	8,027

Share Option Activity

The following table summarizes share options activity:


	Number of Shares			Number of Exercisable Options		Weighted- Average Exercise Price		Weighted- Average Grant Date Fair Value
Balance as of June 27, 2014		865,890			666,305	$	16.27
Granted		—					—		—
Exercised		(56,968	)			$	14.67
Forfeited		(8,347	)			$	15.90
Expired		(8,556	)			$	21.44

Balance as of June 26, 2015		792,019			758,451	$	16.33
Granted		—					—		—
Exercised		(325,530	)			$	16.83
Forfeited		(755	)			$	17.10
Expired		(1,400	)			$	23.62

Balance as of June 24, 2016		464,334			464,334	$	15.95
Granted		—					—		—
Exercised		(367,641	)			$	16.02
Forfeited		—					—
Expired		(5	)			$	5.75

Balance as of June 30, 2017		96,688			96,688	$	15.70

Expected to vest as of June 30, 2017		96,688				$	15.70

Information for Share Options Outstanding

The following table summarizes information for share options outstanding as of June 30, 2017 under the Share Option Plans:


	Number of Shares Underlying Options		Exercise Price Per Share		Weighted Average Remaining Contractual Life (years)		Aggregate Intrinsic Value (amount in thousands)
		25,238	$	14.12		1.36
		30,000	$	15.05		0.35
		6,100	$	15.16		1.13
		28,300	$	16.83		0.29
		5,550	$	18.60		1.67
		1,500	$	25.50		0.54

Options outstanding		96,688				0.72	$	2,607

Options exercisable		96,688				0.72	$	2,607

Expected to vest as of June 30, 2017		96,688				0.72	$	2,607

Restricted Share Unit Activity

The following table summarizes restricted share unit activity under the 2010 Plan:


	Number of Shares			Weighted- Average Grant Date Fair Value Per Share
Balance as of June 27, 2014		762,295		$	14.23
Granted		666,582		$	17.53
Issued		(247,593	)	$	14.44
Forfeited		(40,357	)	$	16.68

Balance as of June 26, 2015		1,140,927		$	16.03
Granted		654,589		$	21.15
Issued		(507,621	)	$	15.60
Forfeited		(106,493	)	$	18.34

Balance as of June 24, 2016		1,181,402		$	18.34
Granted		861,356		$	38.95
Issued		(853,535	)	$	21.16
Forfeited		(130,618	)	$	29.31

Balance as of June 30, 2017		1,058,605		$	31.59

Expected to vest as of June 30, 2017		1,024,706		$	31.56

Performance Share Unit Activity

The following summarizes performance share unit activity under the 2010 Plan:


	Number of Shares			Weighted- Average Grant Date Fair Value Per Share
Balance as of June 24, 2016		—			—
Granted		234,678		$	40.48
Issued		—			—
Forfeited		(7,410	)		—

Balance as of June 30, 2017		227,268		$	40.48

Expected to vest as of June 30, 2017		227,268

Accumulated other comprehensive income (loss) (Tables)

12 Months Ended

Jun. 30, 2017

Changes in AOCI, Net of Tax

The changes in AOCI by component for the years ended June 30, 2017 and June 24, 2016 were as follows:


(amount in thousands)	Unrealized net (Losses)/Gains on Marketable Securities			Unrealized net (Losses)/Gains on Derivative Instruments			Foreign Currency Translation Adjustment			Total
Balance as of June 26, 2015	$	(44	)	$	—		$	—		$	(44	)
Other comprehensive income before reclassification		637			(298	)		—			339
Amounts reclassified from AOCI		(194	)		490			—			296
Tax effects		—			—			—			—

Other comprehensive income		399			192			—			591

Balance as of June 24, 2016		399			192			—			591
Other comprehensive income before reclassification		351			—			(310	)		41
Amounts reclassified from AOCI		(822	)		(158	)		—			(980	)
Tax effects		—			—			—			—

Other comprehensive income		(471	)		(158	)		(310	)		(939	)

Balance as of June 30, 2017	$	(72	)	$	34		$	(310	)	$	(348	)

Pre-tax Amounts Reclassified from AOCI into Condensed Consolidated Statements of Operations and Comprehensive Income


		Years ended
AOCI components	Financial statements line item	June 30, 2017			June 24, 2016
Unrealized losses on marketable securities	Interest income	$	(822	)	$	(194	)
Unrealized gains on derivative instruments	Cost of revenues		—			471
	Selling, general and administrative expenses		(158	)		19

Total amounts reclassified from AOCI		$	(980	)	$	296

Commitments and contingencies (Tables)

12 Months Ended

Jun. 30, 2017

Future Minimum Lease Payments Due Under Non-Cancelable Operating Leases

As of June 30, 2017, the future minimum lease payments due under non-cancelable operating leases during each fiscal year were as follows:


(amount in thousands)
2018	$	1,744
2019		1,162
2020		946
2021		540
2022		416
Thereafter		520

Total future minimum operating lease payments	$	5,328

Future Minimum Lease Payments Under Non-Cancelable Capital Leases

As of June 30, 2017, the future minimum lease payments under non-cancelable capital leases during each fiscal year were as follows:


(amount in thousands)
2018	$	466
2019		479
2020		422
2021		105

Total		1,472
Less: Future finance charge on capital leases		(104	)

Present value of capital lease	$	1,368

As of June 30, 2017, the present value of capital lease during each fiscal year were as follows:


(amount in thousands)
2018	$	344
2019		510
2020		409
2021		105

Total future minimum capital lease payments	$	1,368

Capital Lease Liabilities

Representing capital lease liabilities


Current	$	344
Non-current		1,024

Total capital lease liabilities	$	1,368

Business segments and geographic information (Tables)

12 Months Ended

Jun. 30, 2017

Total Revenues by Geographic Regions

The following table presents total revenues by geographic regions:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
North America	$	661,267	$	525,161	$	370,836
Asia-Pacific		539,317		351,033		309,941
Europe		219,906		100,553		92,810

Total	$	1,420,490	$	976,747	$	773,587

Revenues by End Market

The following table presents revenues by end market:


	Years Ended
(amount in thousands)	June 30, 2017		June 24, 2016		June 26, 2015
Optical communications	$	1,108,637	$	727,580	$	553,245
Lasers, sensors, and other		311,853		249,167		220,342

Total	$	1,420,490	$	976,747	$	773,587

Total Revenues by Percentage from Individual Customers Representing Ten Percent or More of Total Revenues

Total revenues, by percentage, from individual customers representing 10% or more of total revenues in the respective periods were as follows:


	Years Ended
	June 30, 2017			June 24, 2016			June 26, 2015
Lumentum Operations LLC		17	%		20	%		20	%
Oclaro, Inc.		*	⁽¹⁾		*	⁽¹⁾		10	%

⁽¹⁾

Less than 10% of total revenue.

Accounts Receivable from Individual Customers Representing Ten Percent or More of Accounts Receivable

Accounts receivable from individual customers representing 10% or more of accounts receivable as of June 30, 2017 and June 24, 2016, respectively, were as follows:


	As of June 30, 2017			As of June 24, 2016
Lumentum Operations LLC		15	%		18	%
NeoPhotonics Corporation		12	%		*	⁽¹⁾
Acacia Communications Inc.		10	%		*	⁽¹⁾
Valeo		*	⁽¹⁾		11	%

⁽¹⁾

Less than 10% of total accounts receivable.

Financial instruments (Tables)

12 Months Ended

Jun. 30, 2017

Outstanding Foreign Currency Assets and Liabilities

As of June 30, 2017 and June 24, 2016, the Company had outstanding foreign currency assets and liabilities as follows:


	As of June 30, 2017				As of June 24, 2016
(amount in thousands)	Currency		$		Currency		$
Assets
Thai baht		395,123	$	11,628		834,536	$	23,594
RMB		26,965		3,980		14,835		2,255
GBP		6,896		8,982		—		—

Total			$	24,590			$	25,849

Liabilities
Thai baht		1,875,338	$	55,189		1,517,782	$	42,912
RMB		28,451		4,200		24,654		3,748
GBP		5,625		7,326		—		—

Total			$	66,715			$	46,660

UNAUDITED QUARTERLY FINANCIAL INFORMATION (Tables)

12 Months Ended

Jun. 30, 2017

Quarterly Financial Information

The following table sets forth a summary of the Company’s quarterly financial information for each of the four quarters in the fiscal years ended June 30, 2017 and June 24, 2016:


	Three Months Ended
(in thousands, except per share data)	Jun 30, 2017		Mar 31, 2017		Dec 30, 2016		Sep 30, 2016		Jun 24, 2016		Mar 25, 2016		Dec 25, 2015		Sep 25, 2015
Total revenues	$	370,454	$	366,837	$	351,156	$	332,043	$	276,388	$	250,888	$	233,038	$	216,433

Gross profit	$	44,760	$	44,046	$	43,046	$	39,608	$	33,842	$	31,177	$	28,493	$	26,011

Net income	$	27,401	$	21,656	$	25,292	$	22,766	$	19,669	$	20,822	$	19,803	$	1,603

Basic net income per share:
Net income	$	0.73	$	0.58	$	0.69	$	0.63	$	0.55	$	0.58	$	0.55	$	0.05

Weighted-average shares used in basic net income per share calculations		37,334		37,116		36,848		36,404		36,075		35,964		35,812		35,579

Diluted net income per share:
Net income	$	0.72	$	0.57	$	0.67	$	0.61	$	0.53	$	0.56	$	0.54	$	0.04

Weighted-average shares used in diluted net income per share calculations		38,118		37,872		37,805		37,330		37,258		37,089		36,826		36,315

Property Plant and Equipment Estimated Useful Life (Detail)	12 Months Ended
	Jun. 30, 2017
Land improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	10 years
Building and Building Improvements \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	7 years
Building and Building Improvements \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	30 years
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Leasehold improvements	Shorter of useful life or lease term
Manufacturing Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	3 years
Manufacturing Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	7 years
Office Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	3 years
Office Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	7 years
Motor Vehicles \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	3 years
Motor Vehicles \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	5 years
Computers \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	3 years
Computers \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment estimated useful life	5 years

Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015	Sep. 14, 2016
Accounting Policies [Line Items]
Restricted cash in connection with business acquisition	$ 3,312
Services revenue recognized	75,400	$ 31,700	$ 32,300
Warranty cost allowances	1,000	100	$ 30
ASU 2015-15
Accounting Policies [Line Items]
Debt issuance costs	$ 300	$ 600
Global CEM Solutions, Ltd.
Accounting Policies [Line Items]
Restricted cash in connection with business acquisition				$ 3,300

Income Taxes - Additional Information (Detail) - USD ($)
$ in Thousands

12 Months Ended

Jun. 30, 2017

Jun. 24, 2016

Jun. 26, 2015

Income Taxes [Line Items]

Exempted income from corporate income tax

^[1]

$ 17,212

$ 10,493

$ 7,094

Corporate income tax rate

20.00%

Deferred Tax Assets, Net operating Loss carry forwards

$ 496

Deferred tax liabilities

2,485

$ 1,687

Accrued interest and penalties related to uncertain tax positions

600

400

Recorded (reversed) interest and penalties

300

200

$ 100

Fabrinet West Inc

Income Taxes [Line Items]

Deferred Tax Assets, Net operating Loss carry forwards

$ 6,400

4,900

Cayman Islands

Income Taxes [Line Items]

Tax exemption period

20 years

Tax exemption renewal period

20 years

Exempted income from corporate income tax

$ 64,200

$ 41,000

$ 27,000

Thailand

Income Taxes [Line Items]

Reduced corporate Income Tax rate

20.00%

Period income earned from operation of Building 6 is not subject to tax

8 years

Unremitted earnings

97,300

$ 68,800

Unrecognized deferred tax liabilities

5,200

4,200

Deferred tax liabilities

$ 800

$ 700

Thailand | From fiscal year 2017 onwards

Income Taxes [Line Items]

Corporate income tax rate

20.00%

China

Income Taxes [Line Items]

Corporate income tax rate

25.00%

[1]

Income Tax Expense (Detail) - USD ($) $ in Thousands	12 Months Ended
Income Tax Expense (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Income Taxes [Line Items]
Current	$ 6,299	$ 5,413	$ 4,191
Deferred	443	922	(207)
Corporate income tax expense	$ 6,742	$ 6,335	$ 3,984

Reconciliation between Taxes that Would Arise by Applying Statutory Tax Rate of Country of Principal Operations to Effective Tax Charge (Detail) - USD ($)
$ in Thousands

12 Months Ended

Jun. 30, 2017

Jun. 24, 2016

Jun. 26, 2015

Reconciliation of Effective Income Tax Rate [Line Items]

Income before income taxes

^[1]

$ 103,857

$ 68,232

$ 47,626

Tax expense calculated at a statutory corporate income tax rate of 20%

20,771

13,646

9,525

Effect of income taxes from locations with tax rates different from Thailand

1,469

1,573

1,134

Income not subject to tax

^[2]

(17,212)

(10,493)

(7,094)

Income tax on unremitted earnings

1,058

741

1,263

Effect of different tax rate in relation to deferred tax utilization

^[3]

894

(221)

Effect of foreign exchange rate adjustment

667

375

(365)

Tax rebate from research and development application

(226)

(145)

(102)

Others

215

(256)

(156)

Corporate income tax expense

$ 6,742

$ 6,335

$ 3,984

[1]	Income before income taxes was mostly generated from domestic income in the Cayman Islands.
[2]	Income not subject to tax relates to income earned in the Cayman Islands and income subject to an investment promotion privilege for Building 5 and Building 6. Income not subject to tax per ordinary share on a diluted basis (in dollars) was $0.18, $0.06 and $0.20 for the years ended June 30, 2017, June 24, 2016 and June 26, 2015, respectively.
[3]	The balances were effect of different tax rate in relation to the rate recognized deferred taxes during the fiscal year and the rate when deferred taxes will be utilized in the following fiscal years

Reconciliation between Taxes that Would Arise by Applying Statutory Tax Rate of Country of Principal Operations to Effective Tax Charge (Parenthetical) (Detail) - $ / shares	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Reconciliation of Effective Income Tax Rate [Line Items]
Tax calculated at a corporate income tax rate, rate	20.00%	20.00%	20.00%
Income (loss) not subject to tax per ordinary share on a diluted basis	$ 0.18	$ 0.06	$ 0.20

Deferred Tax Assets and Deferred Tax Liabilities, Net of Valuation Allowance (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Deferred tax assets:
Depreciation	$ 1,674	$ 1,679
Severance liability	1,127	955
Reserves and allowance	1,046	1,363
Loss carrying forward	496
Others	10
Total	4,353	3,997
Deferred tax liabilities:
Temporary differences from intangibles and changes in the fair value of assets acquired	(944)
Deferred tax from unremitted earnings	(2,485)	(1,687)
Total	(3,429)	(1,687)
Net deferred income tax assets	$ 924	$ 2,310

Changes to Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Income Tax Contingency [Line Items]
Beginning balance	$ 1,420	$ 1,420	$ 868
Additions during the year			552
Reductions for tax positions of prior years	0	0	0
Ending balance	$ 1,420	$ 1,420	$ 1,420

Earnings Per Ordinary Share (Detail) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands

3 Months Ended

12 Months Ended

Jun. 30, 2017

Mar. 31, 2017

Dec. 30, 2016

Sep. 30, 2016

Jun. 24, 2016

Mar. 25, 2016

Dec. 25, 2015

Sep. 25, 2015

Jun. 30, 2017

Jun. 24, 2016

Jun. 26, 2015

Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]

Net income attributable to shareholders

$ 27,401

$ 21,656

$ 25,292

$ 22,766

$ 19,669

$ 20,822

$ 19,803

$ 1,603

$ 97,115

$ 61,897

$ 43,642

Weighted-average number of ordinary shares outstanding (thousands of shares)

37,334

37,116

36,848

36,404

36,075

35,964

35,812

35,579

36,927

35,857

35,354

Incremental shares arising from the assumed exercise of share options and vesting of restricted share units and performance share units (thousands of shares)

925

1,015

630

Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares)

38,118

37,872

37,805

37,330

37,258

37,089

36,826

36,315

37,852

36,872

35,984

Basic earnings per ordinary share

$ 0.73

$ 0.58

$ 0.69

$ 0.63

$ 0.55

$ 0.58

$ 0.55

$ 0.05

$ 2.63

$ 1.73

$ 1.23

Diluted earnings per ordinary share

$ 0.72

$ 0.57

$ 0.67

$ 0.61

$ 0.53

$ 0.56

$ 0.54

$ 0.04

$ 2.57

$ 1.68

$ 1.21

Outstanding share options excluded in the computation of diluted earnings per ordinary share

^[1]

39,544

[1]	These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares.

Cash, Cash Equivalents, and Marketable Securities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Cash, cash equivalents and marketable securities [Line Items]
Cash and cash equivalents and Marketable securities, Carrying Cost	$ 285,347	$ 284,114
Marketable securities, Unrealized (Loss)/ Gain	(72)	399
Cash and cash equivalents	133,825	142,804	$ 112,978
Marketable securities	151,450	141,709
Cash
Cash, cash equivalents and marketable securities [Line Items]
Carrying Cost	131,240	136,754
Cash and cash equivalents	131,240	136,754
Cash Equivalents
Cash, cash equivalents and marketable securities [Line Items]
Carrying Cost	2,585	6,050
Cash and cash equivalents	2,585	6,050
Corporate bonds and commercial papers
Cash, cash equivalents and marketable securities [Line Items]
Marketable securities, Carrying cost	98,247	112,128
Marketable securities, Unrealized (Loss)/ Gain	27	394
Marketable securities	98,274	112,522
U.S. agency and U.S. treasury securities
Cash, cash equivalents and marketable securities [Line Items]
Marketable securities, Carrying cost	50,768	28,028
Marketable securities, Unrealized (Loss)/ Gain	(102)	2
Marketable securities	50,666	28,030
Sovereign And Municipal Securities
Cash, cash equivalents and marketable securities [Line Items]
Marketable securities, Carrying cost	2,507	1,154
Marketable securities, Unrealized (Loss)/ Gain	3	3
Marketable securities	$ 2,510	$ 1,157

Cash, Cash Equivalents and Marketable Securities - Additional Information (Detail) - USD ($)	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016
Cash, cash equivalents and marketable securities [Line Items]
Effective interest rate on short term bank deposits	0.60%	0.70%
Percentage of cash and cash equivalents held by parent company	66.00%	66.00%
Net realized loss from changes in fair value of marketable securities	$ 800,000
Impairment losses	0	$ 0
Cash, cash equivalents and marketable securities at financial institutions located in the United States	$ 40,000,000	$ 40,000,000

Available-for-Sale Securities Based on Stated Effective Maturities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Carrying cost
Due within one year	$ 14,369
Due between one to three years	133,634
Due after three years	3,519
Total	151,522
Fair value
Due within one year	14,363
Due between one to three years	133,574
Due after three years	3,513
Total	$ 151,450	$ 141,709

Financial Instruments Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($)
$ in Thousands

Jun. 30, 2017

Jun. 24, 2016

Assets

Derivative assets

$ 15

$ 158

Total

154,050

147,917

Liabilities

Derivative liabilities

1,754

Total

1,754

Cash Equivalents

Assets

Marketable securities

2,585

6,050

Corporate bonds and commercial papers

Assets

Marketable securities

98,274

112,522

U.S. agency and U.S. treasury securities

Assets

Marketable securities

50,666

28,030

Sovereign And Municipal Securities

Assets

Marketable securities

2,510

1,157

Significant Other Observable Inputs (Level 2)

Assets

Derivative assets

^[1]

158

^[2]

Total

154,050

147,917

Liabilities

Derivative liabilities

^[3]

1,754

Total

1,754

Significant Other Observable Inputs (Level 2) | Cash Equivalents

Assets

Marketable securities

2,585

6,050

Significant Other Observable Inputs (Level 2) | Corporate bonds and commercial papers

Assets

Marketable securities

98,274

112,522

Significant Other Observable Inputs (Level 2) | U.S. agency and U.S. treasury securities

Assets

Marketable securities

50,666

28,030

Significant Other Observable Inputs (Level 2) | Sovereign And Municipal Securities

Assets

Marketable securities

$ 2,510

$ 1,157

[1]	Foreign currency forward contract with notional amount of $1.0 million and Canadian dollars 0.6 million.
[2]	Foreign currency forward contract with notional amount of $7.0 million.
[3]	Foreign currency forward contract with notional amount of $77.5 million and Canadian dollars 0.6 million.

Financial Instruments Measured at Fair Value on Recurring Basis (Parenthetical) (Detail) - Foreign currency forward contracts - Fair Value, Measurements, Recurring CAD in Millions, $ in Millions	Jun. 30, 2017 USD ($)	Jun. 30, 2017 CAD	Jun. 24, 2016 USD ($)	Jun. 24, 2016 CAD
Fair Value Measurements at Reporting Date Using
Derivative assets, notional amount	$ 1.0	CAD 0.6	$ 7.0
Derivative liabilities, notional amount			$ 77.5	CAD 0.6

Fair Value - Additional Information (Detail)	12 Months Ended
Fair Value - Additional Information (Detail)	Jun. 30, 2017 USD ($) Contract	Jun. 24, 2016 USD ($) Contract	Jun. 26, 2015 USD ($)	Jun. 30, 2017 CAD Contract	Jun. 24, 2016 CAD Contract
Foreign Currency Fair Value Hedge Derivative [Line Items]
Unrealized gain (loss) on derivatives	$ (1,884,000)	$ (1,905,000)	$ (671,000)
Foreign currency forward contracts
Foreign Currency Fair Value Hedge Derivative [Line Items]
Derivative assets	$ 20,000	200,000
Derivative liabilities		$ 1,700,000
Foreign currency forward contracts \| Non designated
Foreign Currency Fair Value Hedge Derivative [Line Items]
Number of forward contracts outstanding \| Contract	2	14		2	14
Derivative notional amount	$ 1,000,000	$ 77,500,000		CAD 600,000	CAD 600,000
Unrealized gain (loss) on derivatives	$ 20,000	$ (1,800,000)
Foreign currency forward contracts \| Non designated \| Minimum
Foreign Currency Fair Value Hedge Derivative [Line Items]
Derivative maturity period	2017-07	2016-07
Foreign currency forward contracts \| Non designated \| Maximum
Foreign Currency Fair Value Hedge Derivative [Line Items]
Derivative maturity period	2017-09	2016-12
Foreign currency forward contracts \| Cash Flow Hedging
Foreign Currency Fair Value Hedge Derivative [Line Items]
Gain recognized from discontinued cash flow hedges	$ 300,000
Number of forward contracts outstanding \| Contract	0	2		0	2
Derivative assets, notional amount		$ 7,000,000
Unrealized gain (loss) on derivatives		200,000
Derivative ineffective portion		0
Foreign currency cash flow hedge gain to be reclassified during next 12 months		10,000
Discontinued of cash flow hedges recognized		$ 0
Foreign currency forward contracts \| Cash Flow Hedging \| Minimum
Foreign Currency Fair Value Hedge Derivative [Line Items]
Derivative maturity period		2016-08
Foreign currency forward contracts \| Cash Flow Hedging \| Maximum
Foreign Currency Fair Value Hedge Derivative [Line Items]
Derivative maturity period		2016-09

Trade Accounts Receivable, Net (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Accounts, Notes, Loans and Financing Receivable [Line Items]
Trade accounts receivable	$ 264,389	$ 196,178
Less: Allowance for doubtful account	(40)	(33)
Trade accounts receivable, net	$ 264,349	$ 196,145

Inventory (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Inventory [Line Items]
Raw materials	$ 88,640	$ 58,199
Work in progress	105,732	94,762
Finished goods	33,998	21,593
Goods in transit	13,025	9,381
Inventory, Gross, Total	241,395	183,935
Less: Inventory obsolescence	(2,730)	(2,436)
Inventory, net	$ 238,665	$ 181,499

Business Acquisition - Additional Information (Detail) - USD ($) $ in Thousands		12 Months Ended
	Sep. 14, 2016	Jun. 30, 2017	Jun. 24, 2016
Business Acquisition [Line Items]
Total cash consideration, net of cash acquired		$ 9,917
Restricted cash in connection with business acquisition		3,312
Foreign currency translation adjustment		(310)
Goodwill		3,806	$ 0
Capital lease assets		1,869
Capital lease liability		1,368
Global CEM Solutions, Ltd.
Business Acquisition [Line Items]
Total cash consideration, net of cash acquired	$ 13,043
Business acquisition, cash acquired	$ 500
Percentage of ownership acquired	100.00%
Restricted cash in connection with business acquisition	$ 3,300
Foreign currency translation adjustment		(300)
Goodwill	3,883	3,800
Deferred tax liabilities	1,148	1,200
Capital lease assets		1,900
Capital lease liability		1,400
Global CEM Solutions, Ltd. \| Scenario, Previously Reported
Business Acquisition [Line Items]
Goodwill	$ 2,700	3,900
Global CEM Solutions, Ltd. \| Customer relationships
Business Acquisition [Line Items]
Intangible assets acquired		$ 4,400
Estimated useful life		10 years
Global CEM Solutions, Ltd. \| Backlog
Business Acquisition [Line Items]
Intangible assets acquired		$ 100
Estimated useful life		3 years
Global CEM Solutions, Ltd. \| Selling, General and Administrative Expenses
Business Acquisition [Line Items]
Transaction costs related to acquisition		$ 1,500

Allocation of Total Purchase Price (Detail) - USD ($) $ in Thousands		12 Months Ended
	Sep. 14, 2016	Jun. 30, 2017	Jun. 24, 2016
Business Acquisition [Line Items]
Property, plant and equipment		$ 5,000
Goodwill		3,806	$ 0
Total purchase price, net of cash acquired		9,917
Global CEM Solutions, Ltd.
Business Acquisition [Line Items]
Cash	$ 474
Accounts receivable	4,064
Inventory	3,490
Other current assets	427
Property, plant and equipment	5,678
Intangibles	4,492
Goodwill	3,883	3,800
Other non-current assets	516
Current liabilities	(6,796)
Deferred tax liabilities	(1,148)	$ (1,200)
Other non-current liabilities	(1,563)
Total fair value of assets acquired and liabilities assumed	13,517
Total purchase price, net of cash acquired	$ 13,043

Fair Value of Identified Intangible Assets (Detail) - Identified Intangible Assets	12 Months Ended
	Jun. 30, 2017
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Risk free rate:	30-year UK Government Bond adjusted by spot yield to reflect recent volatility
Risk free rate:	30 years
Churn rate:	10.00%
Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Long-term revenue growth:	5.00%
Operating margin:	4.00%
Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Long-term revenue growth:	8.00%
Operating margin:	6.00%

Property Plant and Equipment Net (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Property, Plant and Equipment [Line Items]
Cost	$ 338,681	$ 275,570
Less: Accumulated depreciation	(121,800)	(97,160)
Net book value	216,881	178,410
Land and Land Improvements
Property, Plant and Equipment [Line Items]
Cost	39,096	39,048
Less: Accumulated depreciation	(2)
Net book value	39,094	39,048
Building and Building Improvements
Property, Plant and Equipment [Line Items]
Cost	138,578	95,386
Less: Accumulated depreciation	(31,881)	(25,438)
Net book value	106,697	69,948
Manufacturing Equipment
Property, Plant and Equipment [Line Items]
Cost	127,085	96,041
Less: Accumulated depreciation	(72,130)	(56,564)
Net book value	54,955	39,477
Office Equipment
Property, Plant and Equipment [Line Items]
Cost	7,688	5,826
Less: Accumulated depreciation	(4,163)	(3,500)
Net book value	3,525	2,326
Motor Vehicles
Property, Plant and Equipment [Line Items]
Cost	534	443
Less: Accumulated depreciation	(376)	(366)
Net book value	158	77
Computers
Property, Plant and Equipment [Line Items]
Cost	19,642	15,578
Less: Accumulated depreciation	(13,248)	(11,292)
Net book value	6,394	4,286
Construction and Machinery Under Installation
Property, Plant and Equipment [Line Items]
Cost	6,058	23,248
Net book value	$ 6,058	$ 23,248

Property Plant and Equipment, Net - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Property, Plant and Equipment [Line Items]
Aggregate Purchase price of land		$ 12,400
Property, plant and equipment, assets acquired from acquisition	$ 5,000
Capital leased asset	1,869
Depreciation expense	22,500	17,300	$ 12,900
Property, plant and equipment written-off, fully depreciated cost	5,400	2,000	$ 1,100
Capitalized interest expense related to long-term loan	$ 500	$ 100

Leased Assets Under Capital Lease Agreements (Detail) $ in Thousands	Jun. 30, 2017 USD ($)
Property, Plant and Equipment [Line Items]
Cost-Capital leases	$ 2,725
Less: Accumulated depreciation	(856)
Net book value	$ 1,869

Intangibles (Detail) - USD ($) $ in Thousands	12 Months Ended
Intangibles (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 10,436	$ 3,786
Accumulated Amortization	(4,507)	(3,287)
Foreign Currency Translation Adjustment	(89)
Net	5,840	499
Software
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	5,944	3,786
Accumulated Amortization	(3,850)	(3,287)
Net	2,094	$ 499
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	4,373
Accumulated Amortization	(606)
Foreign Currency Translation Adjustment	(88)
Net	3,679
Backlog
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	119
Accumulated Amortization	(51)
Foreign Currency Translation Adjustment	(1)
Net	$ 67

Intangibles - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Finite-Lived Intangible Assets [Line Items]
Amortization expense related to intangibles	$ 1.2	$ 0.1	$ 0.1
Global CEM Solutions, Ltd. \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	$ 4.4
Weighted average remaining life of acquired intangible assets	6 years 10 months 25 days
Global CEM Solutions, Ltd. \| Backlog
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	$ 0.1
Weighted average remaining life of acquired intangible assets	1 year 7 months 6 days

Estimated Future Amortization of Intangibles (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Finite-Lived Intangible Assets [Line Items]
2018	$ 1,482
2019	1,339
2020	934
2021	787
2022	527
Thereafter	771
Total	$ 5,840	$ 499

Goodwill - Additional Information (Detail) - USD ($)	Jun. 30, 2017	Sep. 14, 2016	Jun. 24, 2016
Goodwill [Line Items]
Goodwill	$ 3,806,000		$ 0
Goodwill impairment charges	0
Global CEM Solutions, Ltd.
Goodwill [Line Items]
Goodwill	$ 3,800,000	$ 3,883,000

Changes in Carrying Amount of Goodwill (Detail) $ in Thousands	12 Months Ended
	Jun. 30, 2017 USD ($)
Goodwill [Line Items]
Balance as of June 24, 2016	$ 0
Addition in connection with business acquisition	3,883
Foreign currency translation adjustment	(77)
Balance as of June 30, 2017	$ 3,806

Total Borrowings, Including Revolving and Long-Term Borrowings (Detail) - USD ($)
$ in Thousands

12 Months Ended

Jun. 30, 2017

Jun. 24, 2016

Jun. 26, 2015

Debt Instrument [Line Items]

Revolving borrowing

$ 34,000

$ 6,500

Short-term loans from bank

1,003

Current portion of long-term borrowing

13,600

18,100

Bank borrowings, gross

48,603

24,600

Less: Unamortized debt issuance costs

(201)

(293)

Bank borrowings, net of unamortized debt issuance costs

48,402

24,307

Long-term borrowing

36,400

54,500

$ 10,500

Unamortized debt issuance costs

(99)

(300)

Non-current portion

$ 22,701

36,100

Short-term loans from bank

Debt Instrument [Line Items]

Rate

^[1]

Bank of England base rate +1.85%

Conditions

Repayable based on credit terms of secured accounts receivable

Revolving Credit Facility

Debt Instrument [Line Items]

Rate

^[1]

LIBOR + 1.75% per annum

Conditions

Repayable in 1 to 6 months

Term

^[2]

2017-07

Revolving borrowing

$ 34,000

Revolving Credit Facility | Minimum

Debt Instrument [Line Items]

Repayment duration

1 month

Revolving Credit Facility | Maximum

Debt Instrument [Line Items]

Repayment duration

6 months

LIBOR | Minimum

Debt Instrument [Line Items]

Margin above rate

1.75%

LIBOR | Maximum

Debt Instrument [Line Items]

Margin above rate

2.50%

LIBOR | Revolving Credit Facility

Debt Instrument [Line Items]

Margin above rate

1.75%

Base Rate | Minimum

Debt Instrument [Line Items]

Margin above rate

0.75%

Base Rate | Maximum

Debt Instrument [Line Items]

Margin above rate

1.50%

Base Rate | Short-term loans from bank

Debt Instrument [Line Items]

Margin above rate

1.85%

Loans Payable Due March 2017

Debt Instrument [Line Items]

Rate

^[1]

LIBOR + 2.80% per annum

Conditions

Repayable in quarterly installments

Term

2017-03

Long-term borrowing

4,500

Loans Payable Due March 2017 | LIBOR

Debt Instrument [Line Items]

Margin above rate

2.80%

Loans Payable Due May 2019

Debt Instrument [Line Items]

Rate

^[1]

LIBOR + 1.75% per annum

Conditions

Repayable in quarterly installments

Term

2019-05

Long-term borrowing

$ 36,400

$ 50,000

Loans Payable Due May 2019 | LIBOR

Debt Instrument [Line Items]

Margin above rate

1.75%

[1]	LIBOR is London Interbank Offered Rate.
[2]	In June 2017, the maturity date of this revolving borrowing was extended to mature in July 2017.

Movements of Long-Term Loans (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Debt Instrument [Line Items]
Opening net book amount	$ 54,500	$ 10,500
Additional loan during the period		50,000
Repayment during the period	(18,100)	(6,000)	$ (6,000)
Closing net book amount	$ 36,400	$ 54,500	$ 10,500

Future Maturities of Long-Term Debt (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Debt Instrument [Line Items]
2018	$ 13,600
2019	22,800
Total	$ 36,400	$ 54,500	$ 10,500

Borrowings - Additional Information (Detail) - USD ($)	1 Months Ended	12 Months Ended
Borrowings - Additional Information (Detail) - USD ($)	Jun. 30, 2017	Jun. 30, 2017	Jun. 24, 2016
Line of Credit Facility [Line Items]
Line of credit facility borrowing capacity	$ 200,000,000	$ 200,000,000
Line of credit facility amounts outstanding	34,000,000	34,000,000	$ 6,500,000
Proceeds of long-term loan from bank			50,000,000
Undrawn available credit facilities for long-term borrowing	$ 116,000,000	116,000,000
Extended maturity date	2017-07
Cash, cash equivalents and marketable securities at financial institutions located in the United States	$ 40,000,000	40,000,000	40,000,000
Deposits or securities	10,000,000	10,000,000
Minimum net worth required for credit agreement	200,000,000	$ 200,000,000
Percentage of quarterly net income required for credit agreement		50.00%
Minimum debt service coverage ratio		150.00%
Maximum senior leverage ratio		250.00%
Minimum quick ratio required for credit agreement		110.00%
Trade accounts receivable, net	264,349,000	$ 264,349,000	196,145,000
Short-term loans from bank	1,003,000	1,003,000
Short-term loans from bank
Line of Credit Facility [Line Items]
Trade accounts receivable, net	$ 3,000,000	$ 3,000,000
Credit facility maximum borrowing capacity, percentage	4.00%	4.00%
Interest rate on short term loans	1.85%	1.85%
LIBOR
Line of Credit Facility [Line Items]
Credit line interest rate		LIBOR rate plus a spread of 1.75% to 2.50%
LIBOR \| Minimum
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		1.75%
LIBOR \| Maximum
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		2.50%
Base Rate
Line of Credit Facility [Line Items]
Credit line interest rate		Base rate, determined in accordance with the Facility Agreement, plus a spread of 0.75% to 1.50%
Base Rate \| Minimum
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		0.75%
Base Rate \| Maximum
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		1.50%
Base Rate \| Short-term loans from bank
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		1.85%
Revolving Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility borrowing capacity	$ 150,000,000	$ 150,000,000
Line of credit facility increase in borrowing capacity	100,000,000	$ 100,000,000
Line of credit expiration date		May 22, 2019
Line of credit facility amounts outstanding	$ 34,000,000	$ 34,000,000
Extended maturity date	2017-07
Revolving Credit Facility \| Minimum
Line of Credit Facility [Line Items]
Repayment duration		1 month
Revolving Credit Facility \| Maximum
Line of Credit Facility [Line Items]
Repayment duration		6 months
Revolving Credit Facility \| LIBOR
Line of Credit Facility [Line Items]
Credit line interest rate, percentage		1.75%
Term Loan Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility borrowing capacity	$ 50,000,000	$ 50,000,000
Line of credit expiration date		May 22, 2019
Line of credit facility amounts outstanding	$ 36,400,000	$ 36,400,000
Proceeds of long-term loan from bank			$ 50,000,000

Undrawn Available Credit Facilities Classified by Available Period of Future Borrowing (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016
Line of Credit Facility [Line Items]
Undrawn available credit facilities	$ 116,000
Short-term loans
Line of Credit Facility [Line Items]
Undrawn available credit facilities	1,965	$ 1,414
Long-term loans
Line of Credit Facility [Line Items]
Undrawn available credit facilities	$ 116,000	$ 143,500

Severance Liabilities (Detail) - USD ($) $ in Thousands	12 Months Ended
Severance Liabilities (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Balance, beginning of the fiscal year	$ 6,684	$ 5,477
Charged to selling, general and administrative expenses in the consolidated statements of operations and comprehensive income	1,804	1,207	$ 1,024
Balance, end of the fiscal year	$ 8,488	$ 6,684	$ 5,477

Severance Liabilities Recognized in Balance Sheet (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Present value of defined benefit obligation	$ 8,488	$ 6,684
Total	$ 8,488	$ 6,684	$ 5,477

Severance Costs Recognized in Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Current service cost	$ 1,451	$ 842	$ 360
Interest cost	213	203	203
Benefit paid		(11)	(10)
Actuarial loss on obligation	140	173	471
Total	$ 1,804	$ 1,207	$ 1,024

Principal Actuarial Assumptions Used (Detail)	12 Months Ended
Principal Actuarial Assumptions Used (Detail)	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Defined Benefit Plan Disclosure [Line Items]
Discount rate			4.00%
Future salary increases			4.20%
Minimum
Defined Benefit Plan Disclosure [Line Items]
Discount rate	1.93%	2.00%
Future salary increases	3.50%	4.10%
Maximum
Defined Benefit Plan Disclosure [Line Items]
Discount rate	3.60%	3.20%
Future salary increases	10.00%	10.00%

Effect of Recording Share-Based Compensation Expense (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Share-based compensation expense by type of award:
Share options		$ 16	$ 226
Restricted share units	$ 22,412	9,911	7,801
Performance share units	4,095
Total share-based compensation expense	26,507	9,927	8,027
Tax effect on share-based compensation expense	0	0	0
Net effect on share-based compensation expense	$ 26,507	$ 9,927	$ 8,027

Share-Based Compensation Expense Recorded in Condensed Consolidated Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	$ 26,507	$ 9,927	$ 8,027
Cost of Revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	5,318	1,979	1,450
Selling, General and Administrative Expenses
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based compensation expense	$ 21,189	$ 7,948	$ 6,577

Share-Based Compensation - Additional Information (Detail)	12 Months Ended
	Jun. 30, 2017 USD ($) Installment shares	Jun. 24, 2016 USD ($) shares	Jun. 26, 2015 USD ($) shares	Jun. 27, 2014 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation costs capitalized	$ 0	$ 0	$ 0
Total fair value of shares vested		200,000	1,100,000
Total intrinsic value of options exercised	8,900,000	$ 3,600,000	200,000
Cash received from the exercise of share options	5,900,000
Tax benefit realized	$ 0
Annualized dividend yield	0.00%
Shares withheld to settle employee minimum statutory obligation for applicable income and other employment taxes \| shares	37,126	114,359
Tax withholdings related to net share settlement of restricted share units	$ 1,425,000	$ 2,463,000	$ 352,000
Stock Plan 1999
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share options outstanding \| shares	0
Stock Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share options outstanding \| shares	96,688
Ordinary shares available for future grant \| shares	1,111,573
Performance Share Units \| Stock Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share units outstanding \| shares	227,268	0
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	0.00%
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	100.00%
Restricted Share Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award granted vesting period, year	4 years
Award granted, equal installments \| Installment	4
Aggregate intrinsic value of restricted share units outstanding	$ 45,200,000
Restricted Share Units \| Stock Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share units outstanding \| shares	1,058,605	1,181,402	1,140,927	762,295
Unrecognized share-based compensation expense	$ 16,100,000
Unrecognized compensation expense, weighted-average period for recognition	2 years 5 months 16 days
Restricted Share Units \| Executive of the Company \| Granted to the executive prior to August 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	100.00%
Restricted Share Units \| Executive of the Company \| Granted to the executive in August 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	100.00%
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	100.00%
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award granted vesting period, year	4 years
Options expiration period, year	7 years
Employee Stock Option \| Stock Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized share-based compensation expense	$ 0
Employee Stock Option \| Vest 12 months after the vesting commencement date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	25.00%
Employee Stock Option \| Vest monthly over each of the subsequent 36 months
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	2.083%
Employee Stock Option \| Vest monthly over four years, commencing one month after the vesting commencement date
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting percentage	2.083%
Restricted Share Units and Performance Share Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total fair value of restricted share units vested	$ 18,100,000	$ 7,900,000	$ 3,600,000
Performance Stock Units PSU \| Stock Plan 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized share-based compensation expense	$ 5,100,000
Unrecognized compensation expense, weighted-average period for recognition	1 year 1 month 16 days

Share Option Activity (Detail) - Stock Plan Nineteen Ninety Nine and Twenty Ten - $ / shares	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015	Jun. 27, 2014
Number of shares
Beginning balance	464,334	792,019	865,890
Granted	0	0	0
Exercised	(367,641)	(325,530)	(56,968)
Forfeited		(755)	(8,347)
Expired	(5)	(1,400)	(8,556)
Ending balance	96,688	464,334	792,019
Expected to vest as of June 30, 2017	96,688
Weighted-Average Exercise Price per share
Beginning balance	$ 15.95	$ 16.33	$ 16.27
Granted	0	0	0
Exercised	16.02	16.83	14.67
Forfeited		17.10	15.90
Expired	5.75	23.62	21.44
Ending balance	$ 15.70	$ 15.95	$ 16.33
Number of Exercisable Options
Number of Exercisable Options	96,688	464,334	758,451	666,305
Weighted-Average Grant Date Fair Value
Granted	$ 0	$ 0	$ 0
Expected to vest as of June 30, 2017	$ 15.70

Information for Share Options Outstanding (Detail) $ / shares in Units, $ in Thousands	12 Months Ended
	Jun. 30, 2017 USD ($) $ / shares shares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	96,688
Options outstanding, weighted average remaining contractual life (years)	8 months 19 days
Options outstanding, aggregate intrinsic value \| $	$ 2,607
Range of Exercise Price 1
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	25,238
Exercise Price Per Share \| $ / shares	$ 14.12
Options outstanding, weighted average remaining contractual life (years)	1 year 4 months 9 days
Range of Exercise Price 2
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	30,000
Exercise Price Per Share \| $ / shares	$ 15.05
Options outstanding, weighted average remaining contractual life (years)	4 months 6 days
Range of Exercise Price 3
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	6,100
Exercise Price Per Share \| $ / shares	$ 15.16
Options outstanding, weighted average remaining contractual life (years)	1 year 1 month 16 days
Range of Exercise Price 4
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	28,300
Exercise Price Per Share \| $ / shares	$ 16.83
Options outstanding, weighted average remaining contractual life (years)	3 months 15 days
Range of Exercise Price 5
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	5,550
Exercise Price Per Share \| $ / shares	$ 18.60
Options outstanding, weighted average remaining contractual life (years)	1 year 8 months 2 days
Range of Exercise Price 6
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, outstanding	1,500
Exercise Price Per Share \| $ / shares	$ 25.50
Options outstanding, weighted average remaining contractual life (years)	6 months 14 days
Stock Plan Nineteen Ninety Nine and Twenty Ten
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Number of Shares Underlying Options, exercisable	96,688
Options exercisable, weighted average remaining contractual life (years)	8 months 19 days
Options exercisable, aggregate intrinsic value \| $	$ 2,607
Number of Shares Underlying Options, Expected to vest	96,688
Options Expected to vest, weighted average remaining contractual life (years)	8 months 19 days
Options Expected to vest, aggregate intrinsic value \| $	$ 2,607

Restricted Share Unit Activity (Detail) - Stock Plan 2010 - Restricted Share Units - $ / shares	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Number of restricted share units
Number of share units, beginning balance	1,181,402	1,140,927	762,295
Number of share units, Granted	861,356	654,589	666,582
Number of share units, Issued	(853,535)	(507,621)	(247,593)
Number of share units, Forfeited	(130,618)	(106,493)	(40,357)
Number of restricted share units, ending balance	1,058,605	1,181,402	1,140,927
Number of restricted share units, Expected to vest	1,024,706
Weighted Average Grant Date Fair Value Per Share
Weighted-average grant date fair value per share, Beginning Balance	$ 18.34	$ 16.03	$ 14.23
Weighted-average grant date fair value per share, Granted	38.95	21.15	17.53
Weighted-average grant date fair value per share, Issued	21.16	15.60	14.44
Weighted-average grant date fair value per share, Forfeited	29.31	18.34	16.68
Weighted-average grant date fair value per share, Ending Balance	31.59	$ 18.34	$ 16.03
Weighted-average grant date fair value per share, Expected to vest	$ 31.56

Performance Share Unit Activity (Detail) - Stock Plan 2010 - Performance Share Units	12 Months Ended
	Jun. 30, 2017 $ / shares shares
Number of performance share units
Number of share units, beginning balance	0
Number of share units, Granted	234,678
Number of share units, Issued	0
Number of share units, Forfeited	(7,410)
Number of restricted share units, ending balance	227,268
Expected to vest as of June 30, 2017	227,268
Weighted Average Grant Date Fair Value Per Share
Weighted-average grant date fair value per share, Granted \| $ / shares	$ 40.48
Weighted-average grant date fair value per share, Issued \| $ / shares	0
Weighted-average grant date fair value per share, Forfeited \| $ / shares	0
Weighted-average grant date fair value per share, Ending Balance \| $ / shares	$ 40.48

Employee Benefit Plans -Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Defined Contribution and Defined Benefit Plans [Line Items]
Bonus distributions to employees	$ 7.6	$ 7.5	$ 6.0
Provident Fund
Defined Contribution and Defined Benefit Plans [Line Items]
Defined contribution plan, employer annual contribution	3.6	2.8	2.3
Defined Contribution Plan 401k
Defined Contribution and Defined Benefit Plans [Line Items]
Defined contribution plan, employer annual contribution	$ 0.6	$ 0.5	$ 0.3
Employees maximum contribution to 401 (K) Plan	80.00%
Percentage of employees' contribution, eligible for employer match	100.00%
Percentage of employees' annual contribution, eligible for employers match	6.00%

Shareholders' Equity - Additional Information (Detail) - $ / shares	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Shareholders Equity [Line Items]
Ordinary shares, authorized share capital	500,000,000	500,000,000
Ordinary shares, par value	$ 0.01	$ 0.01
Preferred shares, shares authorized	5,000,000	5,000,000
Preferred shares, par value	$ 0.01	$ 0.01
Stock Plan Nineteen Ninety Nine and Twenty Ten
Shareholders Equity [Line Items]
Ordinary shares issued upon exercise of options	367,641	325,530	56,968
Ordinary shares issued upon exercise of options, weight average exercise price	$ 16.02	$ 16.83	$ 14.67
Ordinary shares issued upon vesting of restricted shares	816,409	393,262	227,914

Changes in AOCI, Net of Tax (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	$ 554,419	$ 478,944	$ 426,836
Other comprehensive income before reclassification	41	339
Amounts reclassified from AOCI	(980)	296
Tax effects	0	0
Total other comprehensive (loss) income, net of tax	(939)	635	(44)
Ending Balance	681,574	554,419	478,944
Unrealized Net (Losses)/Gains on Marketable Securities
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	399	(44)
Other comprehensive income before reclassification	351	637
Amounts reclassified from AOCI	(822)	(194)
Tax effects	0	0
Total other comprehensive (loss) income, net of tax	(471)	399
Ending Balance	(72)	399	(44)
Unrealized Net (Losses)/Gains on Derivative Instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	192
Other comprehensive income before reclassification	0	(298)
Amounts reclassified from AOCI	(158)	490
Tax effects	0	0
Total other comprehensive (loss) income, net of tax	(158)	192
Ending Balance	34	192
Foreign Currency Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	0
Other comprehensive income before reclassification	(310)
Amounts reclassified from AOCI	0
Tax effects	0	0
Total other comprehensive (loss) income, net of tax	(310)
Ending Balance	(310)	0
AOCI Attributable to Parent
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	591	(44)
Tax effects	0	0
Total other comprehensive (loss) income, net of tax	(939)	635	(44)
Ending Balance	$ (348)	$ 591	$ (44)

Pre-tax Amounts Reclassified from AOCI into Condensed Consolidated Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest income	$ (1,977)	$ (1,535)	$ (1,253)
Cost of revenues	1,249,030	857,224	685,814
Selling, general and administrative expenses	65,626	49,753	$ 39,460
Total amounts reclassified from AOCI	(980)	296
Unrealized Net (Losses)/Gains on Marketable Securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total amounts reclassified from AOCI	(822)	(194)
Unrealized Net (Losses)/Gains on Derivative Instruments
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total amounts reclassified from AOCI	(158)	490
Reclassification out of Accumulated Other Comprehensive Income \| Unrealized Net (Losses)/Gains on Marketable Securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Interest income	(822)	(194)
Reclassification out of Accumulated Other Comprehensive Income \| Unrealized Net (Losses)/Gains on Derivative Instruments
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Cost of revenues		471
Selling, general and administrative expenses	$ (158)	$ 19

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions		12 Months Ended
	Jan. 10, 2017	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015	Dec. 23, 2016
Commitments and Contingencies Disclosure [Line Items]
Outstanding bank guarantees given by banks on behalf of subsidiary		$ 1.5	$ 0.8
Rental expense under operating leases		1.7	1.2	$ 1.1
Payment to purchase of land			$ 12.4
Thailand
Commitments and Contingencies Disclosure [Line Items]
Purchase of land					$ 5.6
Payment to purchase of land	$ 1.1
Outstanding commitment to third parties		10.6
Thailand \| Land
Commitments and Contingencies Disclosure [Line Items]
Outstanding commitment to third parties		$ 4.5
Maximum
Commitments and Contingencies Disclosure [Line Items]
Operating lease expiration year		2023

Future Minimum Lease Payments Due Under Non-Cancelable Operating Leases (Detail) $ in Thousands	Jun. 30, 2017 USD ($)
Operating Leased Assets [Line Items]
2018	$ 1,744
2019	1,162
2020	946
2021	540
2022	416
Thereafter	520
Total future minimum operating lease payments	$ 5,328

Future Minimum Lease Payments Under Non-Cancelable Capital Leases (Detail) $ in Thousands	Jun. 30, 2017 USD ($)
Capital Leased Assets [Line Items]
2018	$ 466
2019	479
2020	422
2021	105
Total	1,472
Less: Future finance charge on capital leases	(104)
Present value of capital lease	$ 1,368

Capital Lease Liabilities (Detail) $ in Thousands	Jun. 30, 2017 USD ($)
Capital Leased Assets [Line Items]
Current	$ 344
Non-current	1,024
Present value of capital lease	$ 1,368

Present Value of Capital Lease (Detail) $ in Thousands	Jun. 30, 2017 USD ($)
Capital Leased Assets [Line Items]
2018	$ 344
2019	510
2020	409
2021	105
Present value of capital lease	$ 1,368

Business Segments and Geographic Information - Additional Information (Detail) $ in Millions	12 Months Ended
	Jun. 30, 2017 USD ($) Segment	Jun. 24, 2016 USD ($) Segment	Jun. 26, 2015 Segment
Segment Reporting Information [Line Items]
Number of operating segment \| Segment	1	1	1
North America
Segment Reporting Information [Line Items]
Long-lived assets \| $	$ 34.9	$ 34.7

Total Revenues by Geographic Regions (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Dec. 30, 2016	Sep. 30, 2016	Jun. 24, 2016	Mar. 25, 2016	Dec. 25, 2015	Sep. 25, 2015	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items]
Revenues	$ 370,454	$ 366,837	$ 351,156	$ 332,043	$ 276,388	$ 250,888	$ 233,038	$ 216,433	$ 1,420,490	$ 976,747	$ 773,587
North America
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items]
Revenues									661,267	525,161	370,836
Asia-Pacific
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items]
Revenues									539,317	351,033	309,941
Europe
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items]
Revenues									$ 219,906	$ 100,553	$ 92,810

Revenues by End Market (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
Revenues by End Market (Detail) - USD ($) $ in Thousands	Jun. 30, 2017	Mar. 31, 2017	Dec. 30, 2016	Sep. 30, 2016	Jun. 24, 2016	Mar. 25, 2016	Dec. 25, 2015	Sep. 25, 2015	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Revenue from External Customer [Line Items]
Revenues	$ 370,454	$ 366,837	$ 351,156	$ 332,043	$ 276,388	$ 250,888	$ 233,038	$ 216,433	$ 1,420,490	$ 976,747	$ 773,587
Optical communications
Revenue from External Customer [Line Items]
Revenues									1,108,637	727,580	553,245
Lasers, sensors, and other
Revenue from External Customer [Line Items]
Revenues									$ 311,853	$ 249,167	$ 220,342

Total Revenues by Percentage from Individual Customers Representing Ten Percent or More of Total Revenues (Detail) - Revenue - Customer Concentration Risk	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Lumentum Operations LLC
Revenue, Major Customer [Line Items]
Concentration of risk percentage	17.00%	20.00%	20.00%
Oclaro, Inc.
Revenue, Major Customer [Line Items]
Concentration of risk percentage			10.00%

Accounts Receivable from Individual Customers Representing Ten Percent or More of Accounts Receivable (Detail) - Accounts Receivable - Customer Concentration Risk	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016
Lumentum Operations LLC
Schedule Of Entity Wide Accounts Receivable By Major Customers By Reporting Segments [Line Items]
Concentration of risk percentage	15.00%	18.00%
NeoPhotonics Corporation
Schedule Of Entity Wide Accounts Receivable By Major Customers By Reporting Segments [Line Items]
Concentration of risk percentage	12.00%
Acacia Communications Inc
Schedule Of Entity Wide Accounts Receivable By Major Customers By Reporting Segments [Line Items]
Concentration of risk percentage	10.00%
Valeo
Schedule Of Entity Wide Accounts Receivable By Major Customers By Reporting Segments [Line Items]
Concentration of risk percentage		11.00%

Financial instruments - Additional Information (Detail) - USD ($)	12 Months Ended
	Jun. 30, 2017	Jun. 24, 2016
Financial Instrument [Line Items]
Amount of unrealized loss recognized in net income on derivatives	$ 20,000	$ 1,800,000
Forward Foreign Currency and Option Contracts \| Maximum
Financial Instrument [Line Items]
Derivative term of contract	6 months
China, Yuan Renminbi
Financial Instrument [Line Items]
Derivative contracts	$ 0	0
United Kingdom, Pounds
Financial Instrument [Line Items]
Derivative contracts denominated in GBP	0
Foreign currency forward contracts \| Thailand, baht
Financial Instrument [Line Items]
Derivative contracts	$ 1,000,000	$ 84,500,000

Outstanding Foreign Currency Assets and Liabilities (Detail) ¥ in Thousands, £ in Thousands, THB in Thousands, $ in Thousands	Jun. 30, 2017 USD ($)	Jun. 30, 2017 THB	Jun. 30, 2017 CNY (¥)	Jun. 30, 2017 GBP (£)	Jun. 24, 2016 USD ($)	Jun. 24, 2016 THB	Jun. 24, 2016 CNY (¥)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign currency assets	$ 24,590				$ 25,849
Foreign currency liabilities	66,715				46,660
Thailand, baht
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign currency assets	11,628	THB 395,123			23,594	THB 834,536
Foreign currency liabilities	55,189	THB 1,875,338			42,912	THB 1,517,782
China, Yuan Renminbi
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign currency assets	3,980		¥ 26,965		2,255		¥ 14,835
Foreign currency liabilities	4,200		¥ 28,451		$ 3,748		¥ 24,654
United Kingdom, Pounds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Foreign currency assets	8,982			£ 6,896
Foreign currency liabilities	$ 7,326			£ 5,625

Income Related to Flooding - Additional Information (Detail) $ in Thousands	12 Months Ended
	Jun. 24, 2016 USD ($)
Unusual or Infrequent Item [Line Items]
Income related to flooding	$ 36
Final payment from insurer	900
Expense related to flooding	860
Repair cost of equipment	600
Inventory losses	$ 200

Unaudited Quarterly Financial Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Jun. 30, 2017	Mar. 31, 2017	Dec. 30, 2016	Sep. 30, 2016	Jun. 24, 2016	Mar. 25, 2016	Dec. 25, 2015	Sep. 25, 2015	Jun. 30, 2017	Jun. 24, 2016	Jun. 26, 2015
Quarterly Financial Information [Line Items]
Total revenues	$ 370,454	$ 366,837	$ 351,156	$ 332,043	$ 276,388	$ 250,888	$ 233,038	$ 216,433	$ 1,420,490	$ 976,747	$ 773,587
Gross profit	44,760	44,046	43,046	39,608	33,842	31,177	28,493	26,011	171,460	119,523	87,773
Net income	$ 27,401	$ 21,656	$ 25,292	$ 22,766	$ 19,669	$ 20,822	$ 19,803	$ 1,603	$ 97,115	$ 61,897	$ 43,642
Basic net income per share:
Net income	$ 0.73	$ 0.58	$ 0.69	$ 0.63	$ 0.55	$ 0.58	$ 0.55	$ 0.05	$ 2.63	$ 1.73	$ 1.23
Weighted-average shares used in basic net income per share calculations	37,334	37,116	36,848	36,404	36,075	35,964	35,812	35,579	36,927	35,857	35,354
Diluted net income per share:
Net income	$ 0.72	$ 0.57	$ 0.67	$ 0.61	$ 0.53	$ 0.56	$ 0.54	$ 0.04	$ 2.57	$ 1.68	$ 1.21
Weighted-average shares used in diluted net income per share calculations	38,118	37,872	37,805	37,330	37,258	37,089	36,826	36,315	37,852	36,872	35,984

Trade Accounts Receivable, Net - Additional Information (Detail) $ in Millions	Jun. 30, 2017 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Trade accounts receivable secured to short-term loans from bank	$ 3.0

Subsequent Event - Additional Information (Detail) $ in Millions	Aug. 31, 2017 USD ($)
Subsequent Event
Subsequent Event [Line Items]
Amount of repurchased ordinary shares	$ 30.0