Cohu , Inc. (NASDAQ: NASDAQ:), a number one provider of semiconductor check and inspection handlers, reported a gentle monetary efficiency in its third-quarter 2024 earnings name. The corporate introduced revenues of $95.3 million and a gross margin of 47%, with a good portion of its income, 67%, coming from recurring sources.
Regardless of a difficult market, Cohu has made strategic developments into excessive development areas resembling excessive bandwidth reminiscence (HBM) and silicon carbide markets, setting the stage for future development.
Key Takeaways
- Cohu’s Q3 income reached $95.3 million with a gross margin of roughly 47%.
- Recurring income made up 67% of complete income, exhibiting resilience in market downturns.
- The cell section grew by 13% year-over-year.
- The corporate secured a big check cell design win within the automotive sector.
- Cohu entered the HBM and silicon carbide markets, anticipating to capitalize on their projected development.
- For This autumn, income is projected to stay secure at round $95 million, with a 44% gross margin.
- Non-GAAP EPS for Q3 was a lack of $0.08, however money and investments rose to $269 million.
- Q1 2025 is anticipated to see a ten% income enhance.
- Upcoming investor conferences embrace the Stifel Midwest Convention and the Needham Progress Convention.
Firm Outlook
- Cohu initiatives This autumn income to be flat at round $95 million, with a gross margin of about 44%.
- Working bills are anticipated to extend to roughly $46 million resulting from rising labor prices.
- A ten% income enhance is anticipated for Q1 2025, indicating a restoration from low seasonality.
Bearish Highlights
- Non-GAAP EPS for Q3 resulted in a lack of $0.08.
- Bookings declined within the client market section.
Bullish Highlights
- Cohu has entered the HBM market, projected to develop to $23 billion with a 22% CAGR by way of the last decade.
- The silicon carbide market is anticipated to develop at 25% CAGR by way of 2029.
- The automotive section is exhibiting indicators of restoration with elevated bookings and revenues.
Misses
- Regardless of the general constructive outlook, the corporate did report a non-GAAP EPS loss in Q3.
Q&A Highlights
- The corporate clarified its deal with stacked die inspection metrology throughout the HBM market.
- It isn’t competing with wafer-level inspection corporations like Camtek (NASDAQ:).
- The die-level burn-in market is anticipated to develop with an estimated annual alternative of $50 million.
Cohu’s strategic developments within the semiconductor sector have been underscored by a big design win within the automotive section and its entry into the HBM and silicon carbide markets. The corporate’s resilience is mirrored in its secure income and powerful recurring income base, regardless of a loss in non-GAAP EPS for Q3.
With the automotive sector on the mend and the introduction of the Diamondx tester and VI-100 instrument, Cohu is poised to capitalize on rising market alternatives. The corporate stays optimistic about its development trajectory heading into 2025, supported by its diversified product choices and strategic market expansions.
InvestingPro Insights
Cohu’s current monetary efficiency and strategic market positioning align with a number of key insights from InvestingPro. Regardless of the corporate’s reported loss in Q3, InvestingPro information reveals that Cohu holds extra cash than debt on its steadiness sheet, which supplies monetary flexibility throughout difficult market situations. This sturdy liquidity place is additional supported by the InvestingPro Tip indicating that Cohu’s liquid belongings exceed short-term obligations.
The corporate’s deal with high-growth areas like HBM and silicon carbide markets is especially related given the InvestingPro Tip that analysts anticipate a gross sales decline within the present yr. This strategic pivot may assist offset the projected income contraction and place Cohu for future development. Furthermore, the corporate’s entry into these markets aligns with its excessive EBITDA valuation a number of, suggesting investor expectations for future earnings potential.
Cohu’s inventory value actions are famous to be fairly risky, in response to InvestingPro Suggestions. This volatility is mirrored within the firm’s current efficiency, with a 1-year value complete return of -17.76% and a year-to-date return of -29.58%. Nevertheless, the honest worth estimates from each analysts and InvestingPro recommend potential upside, with targets of $30 and $28.26, respectively, in comparison with the earlier closing value of $24.92.
For buyers looking for a extra complete evaluation, InvestingPro affords 10 further ideas for Cohu, offering a deeper understanding of the corporate’s monetary well being and market place.
Full transcript – Cohu Inc (COHU) Q3 2024:
Operator: Good day, and thanks for standing by. Welcome to Cohu’s Third Quarter 2024 Monetary Outcomes Convention Name. [Operator Instructions] Please be suggested that at the moment’s convention is being recorded. I’d now like handy the convention over to your speaker at the moment, Jeff Jones, Chief Monetary Officer. Please go forward.
Jeffrey Jones: Good afternoon, and welcome to our convention name to debate Cohu’s third quarter 2024 outcomes and fourth quarter outlook. I am joined at the moment by our President and CEO, Luis Muller. If you happen to want a duplicate of our earnings launch, you might entry it from our web site at cohu.com or by contacting Cohu Investor Relations. There’s additionally a slide presentation along with at the moment’s name that could be accessed on Cohu’s web site within the Investor Relations part. Replays of this name will likely be obtainable through the identical web page after the decision concludes. Now to the protected harbor. Throughout at the moment’s name, we’ll make forward-looking statements reflecting administration’s present expectations regarding Cohu’s future enterprise. These statements are primarily based on present info that we have now assessed, however which, by its nature, is topic to fast and even abrupt modifications. We encourage you to assessment the forward-looking statements part of the slide presentation and the earnings launch in addition to Cohu’s filings with the SEC, together with probably the most lately filed Kind 10-Ok and Kind 10-Q. Our feedback communicate solely as of at the moment, October 31, 2024, and Cohu assumes no obligation to replace these statements for developments occurring after this name. Lastly, throughout this name, we’ll talk about sure non-GAAP monetary measures. Please consult with our earnings launch and slide presentation for reconciliations to probably the most comparable GAAP measures. Now I might like to show the decision over to Luis Muller, Cohu’s President and CEO. Luis?
Luis Muller: Good day, and welcome to our quarterly earnings name. Third quarter non-GAAP gross margin was sturdy at roughly 47%. Gross margin benefited from preliminary income of some new merchandise and decrease manufacturing prices. Jeff will get into extra particulars on these later. Income of $95.3 million was break up 67% recurring within the steadiness methods, persevering with to display the resilience of our enterprise mannequin throughout a market downturn. Programs income elevated sequentially in automotive and cell segments, though offset by declines in computing, client and industrial. The cell section was strongest in third quarter at 12% of consolidated income. Cellular additionally posted 13% year-over-year income development, defining a turning level in a section that was first into this market downturn. We had a big check cell design win final quarter at a prime 5 automotive semiconductor producer. With this win, Cohu is delivering a mixed tester, handler and interface resolution for testing energy administration units. We’re excited to see traction with our Diamondx within the blended sign market and anticipate to have further excellent news within the coming quarters as extra prospects are evaluating our platform. Whereas market situations stay delicate throughout our major segments in automotive and industrial, we’re busy realigning our investments to outsized development alternatives. We made good progress lately getting into the reminiscence and silicon carbide energy semiconductor markets. Earlier at the moment, we introduced a buyer order for our Neon inspection metrology platform configured for top bandwidth reminiscence, often known as HBM. The HBM market is estimated to be roughly $23 billion at the moment and projected to develop about 22% a yr by way of the top of this decade. We’re happy to have acquired an preliminary order from one of many world’s main semiconductor reminiscence producers, marking an enormous strategic win with substantial development alternatives within the subsequent couple of years. We imagine the trade is buying roughly $100 million of inspection metrology gear for this HBM manufacturing course of step at the moment and increasing at a quick tempo to maintain up with AI information heart demand. Neon affords a extremely environment friendly imaginative and prescient system, enabling full 6-sided optical inspection and measurement of micro pillars, together with imaginative and prescient optimization powered by Cohu’s AI inspection know-how. We’re anticipating follow-on orders in early 2025 to assist a manufacturing ramp within the second half of subsequent yr. We additionally introduced at the moment {that a} main European buyer has chosen Cohu for high-speed dealing with and inspection of silicon carbide dies. We’ve been offering inspection metrology methods to silicon carbide manufacturing now for over a yr. However this resolution extends our providing into burn-in check on the die stage. Cohu’s product configuration will considerably enhance yield and productiveness, eliminating greater than 40% losses by way of burn-in of examined good solely dies. We’ll even be supplying a high-power check interface for two.5 kilovolts examined per die, satisfying stringent automotive zero-defect necessities. The silicon carbide market is poised to develop at 25% CAGR by way of 2029, and we’re happy to be an enabler of the subsequent technology of units coming to market in 2025. Now turning to our DI-Core software program platform. A number of prospects have expressed curiosity in our information analytics software program that’s demonstrating yield and productiveness beneficial properties. Whereas we have now validations operating at a number of prospects, in Q3, a key Cohu buyer positioned orders to broaden use of our AI inspection software program. This subscription-based software program resolution optimizes inspection yield by way of a convolutional neural community machine. In different phrases, it makes use of deep studying fashions to course of imaginative and prescient information. We’re excited to broaden Cohu’s recurring enterprise with machine studying analytics. Though that is nonetheless a small a part of our complete income, the extent of buyer engagement and curiosity in our options is exceeding our expectations. Placing this a bit in context, we estimate that the semiconductor back-end manufacturing trade is spending about $600 million in information analytics for course of management, information visualization, connectivity and predictive purposes. These investments are centered on positioning our merchandise to development purposes whereas additionally enabling our prospects to broaden use of manufacturing unit automation and assist on and close to shoring semiconductor manufacturing. We’re committing sources to creating this a development vector in our technique, increasing our recurring income with subscription software program aligned with our prospects’ push for what is called Trade 4.0. I am anticipating to see some very thrilling years forward of Cohu as we enter the reminiscence market, increasing silicon carbide purposes, together with burn-in and stress check and really importantly, construct on our analytics platform. Let me now flip it over to Jeff to supply additional particulars on final quarter outcomes and subsequent quarter steerage. Jeff?
Jeffrey Jones: Thanks, Luis. Earlier than I stroll by way of the Q3 outcomes and This autumn steerage, please be aware that my feedback that observe, I am going to consult with non-GAAP figures. Details about the non-GAAP monetary measures, together with the GAAP to non-GAAP reconciliations and different disclosures are included within the accompanying earnings launch and investor presentation, that are situated on the Investor web page of our web site. Now turning to the Q3 monetary outcomes. Income for the quarter was $95.3 million and consistent with steerage. Recurring income, which is essentially consumable-driven and extra secure than methods income, represented 67% of complete income in Q3. Through the third quarter, one buyer within the automotive market accounted for greater than 10% of gross sales. Q3 gross margin was sturdy at 47.1% and better than steerage, benefiting from some new merchandise, the onetime utilization of beforehand reserved stock in addition to decrease manufacturing prices in our interface or contactor enterprise. Working bills for Q3 have been $45.2 million and decrease than steerage by roughly $1.6 million, pushed by decrease labor prices resulting from substitute and new rent delays in addition to increased trip utilization than forecasted. Third quarter non-GAAP working earnings was roughly breakeven and adjusted EBITDA was 2.3%. Curiosity earnings, web of curiosity expense and a overseas forex lack of roughly $1.6 million was $900,000. The overseas forex loss was pushed by typical steadiness sheet publicity to foreign currency echange along with the devaluation of the U.S. greenback in Q3 after the Federal Reserve’s price lower announcement. Q3 pretax earnings consists of overseas earnings mixed with a loss within the U.S. The Q3 tax provision of $4.4 million displays tax expense on overseas earnings however no tax profit from the U.S. loss resulting from our valuation allowance in opposition to deferred tax belongings. Non-GAAP EPS for the third quarter was an $0.08 loss. Transferring to the steadiness sheet. General, money and investments elevated by $7 million throughout Q3 to $269 million due primarily to constructive money stream from operations of $17 million much less $8 million used to repurchase 315,000 shares of Cohu frequent inventory and capital expenditures of $2 million associated to our factories within the Philippines and Germany, supporting operations for our interface and automation companies. General, Cohu’s steadiness sheet stays sturdy supporting funding alternatives to broaden our served markets and know-how portfolio consistent with our development technique and returning capital to shareholders by way of our share repurchase program. Now transferring to our This autumn outlook. We’re guiding This autumn income to be within the vary of $95 million, plus or minus $7 million, primarily flat to Q3 as we bounce alongside the underside of this cyclical trough. The preliminary order forecast for This autumn displays a book-to-bill ratio over one, and our present view of Q1 income is roughly 10% increased than This autumn. Fourth quarter gross margin is forecasted to be roughly 44%, decrease than Q3, however increased than the monetary goal mannequin at this stage of income due partly to Cohu’s differentiated merchandise and our secure high-margin recurring enterprise, which provides resilience to profitability and supplies constant money stream by way of trade cycles. We anticipate gross margin to extend once more when our income recovers with the broader semiconductor machine market and with higher absorption of our factories infrastructure. Working bills for This autumn are projected to extend about $1 million quarter-over-quarter to roughly $46 million resulting from a rise of labor prices because of the U.S. greenback weakening in Q3 in opposition to many foreign currency echange. As I famous on prior calls, we have taken motion all through 2024 to scale back working bills with out sacrificing vital new product investments whereas navigating by way of the trough of the cycle. Our primary focus has been on structural modifications, producing everlasting value discount and resulting in projected 2025 working bills to be comparatively flat in comparison with 2024, whereas supporting a restoration in enterprise and better income. We’re projecting This autumn curiosity earnings, web of curiosity expense and overseas forex impacts to be roughly $1.8 million at present rates of interest. The This autumn non-GAAP tax provision is anticipated to be roughly $3.1 million due to tax on overseas earnings with out profit from the U.S. loss. Till the markets recuperate, we anticipate an analogous tax provision profile as we navigate by way of the cycle. The fundamental share rely for This autumn is anticipated to be roughly 46.5 million shares. And that concludes our ready remarks. And now we’ll open the decision to questions.
Operator: [Operator Instructions] Our first query comes from the road of Craig Ellis with B. Riley.
Craig Ellis: And guys, congratulations on the brand new merchandise which are coming to market. Luis, I needed to begin simply by following up in your feedback on cell. I believe you might need remarked that the enterprise in its power is at or close to a flip? Did I hear that proper? And was it simply up in 3Q due to a number of the power we see seasonally at the moment? Or do you actually suppose it is hit a backside, and we must be transferring up sequentially from right here?
Luis Muller: Craig, sure, I did make the remark that cell income was up year-on-year by 13%. But when I needed to broaden on that, I can inform you that additionally bookings within the third quarter have been up sequentially throughout all market segments, which I did not say in my ready remarks, however that can also be the case. And so they’re additionally up year-on-year throughout all segments, aside from client. So, sure, we have now seen an enchancment in cell income quarter-on-quarter, year-on-year, however we additionally have not seen an enchancment in orders throughout automotive, industrial, computing, cell. So, principally, throughout the board quarter-on-quarter and year-on-year as effectively. So, we’re a little bit bit extra optimistic now as we head into 2025.
Craig Ellis: Good to listen to. After which I needed to deal with Neon and die stage burn-in assessments. So, within the deck and in your feedback, I imagine you framed them as revered $150 million alternatives. What’s an affordable approach to have a look at income potential for these respective merchandise subsequent yr, Luis? And the way lengthy does it take to understand or construct as much as the market sizing that you simply recognized the $150 million?
Luis Muller: Sure. We do not — initially, Craig, the market sizing, clearly, goes to be break up between us and different suppliers which are at the moment in — one specific case at the moment in it, proper? So, in case you take a look at the HBM inspection at the moment, for instance, it is largely supported by an organization in Korea referred to as Hanmi, I believe form of they’re the most important provider on this house at the moment. So, we’re simply stepping into this. We obtained our first order; we’re alleged to be delivering the product right here within the coming months after which anticipating subsequent orders to start with of the yr. And we’re instructed intercepting a manufacturing ramp that ought to begin within the summertime. So, how briskly are we going to eat into this $100 million? Properly, we’ll see, proper? I imply I believe there are actually three or 4 main producers on the market of this know-how. And at this level, we’re working with considered one of them form of a seashore had entrance. On the silicon carbide facet, burn-in, this is a chance to truly resolve a serious downside in burning the silicon carbides, which goes in with a wafer that’s already at a low yield from the beginning and you then’re losing course of time, burning in non-good units. So, we have now now an answer with some companions for doing burn-in on the die stage. We’ve the main provider within the house embrace in driving us to get this product to their manufacturing ASAP. So, I believe we’re the bottleneck in the intervening time, and we’re beginning to dialogue with different prospects concerning the alternative to principally to decrease their value of burn-in course of check of silicon carbide units. So, I haven’t got a trajectory precisely to inform you of how a lot of the $150 million we will get, how briskly that is going to occur. We simply broke into these — each of these segments. On the HBM facet, not solely we will likely be speaking to the opposite suppliers, however we’re additionally beginning to discover what else can we do in HBM. Are there extra upstream inspection alternatives that we may intercept within the HBM market? So, we’ll see. We’ll inform you extra concerning the story because it evolves in 2025.
Craig Ellis: Okay. After which, Jeff, if I may, I believe I heard your remarks that orders have been monitoring up round 10% for the primary quarter. Does that provide you with confidence that we are able to see revenues rise sequentially? And if revenues have been to rise equally, how would that examine to the way you regard regular seasonality in 1Q?
Jeffrey Jones: Sure. I believe at this level, we’re out of the traditional seasonality. So, I would not put any weight into the seasonality there, Craig. My remark was that orders are over — forecasted to be over 1 in This autumn. And in order that we’re anticipating or projecting that income in Q1 will likely be 10% increased than This autumn. So, once more, we’ve not actually seen regular seasonality right here happening shut to 2 years. And so, I am not anticipating that, that begins again up in Q1.
Operator: Our subsequent query comes from Christian Schwab with Craig-Hallum.
Christian Schwab: So, a few questions. First on the high-bandwidth reminiscence. Are you aware if that is the high-bandwidth reminiscence 3E or if that is high-bandwidth reminiscence 4 that you’ll be inspecting?
Luis Muller: No, personally, I haven’t got that info to share proper now, Christian.
Christian Schwab: Okay. After which because it pertains to the wafer stage burn-in forged for silicon carbide, how does that — how does your product examine to the opposite firm is doing that so far as ASP and what number of wafers you may check in parallel?
Luis Muller: So, that is truly a die — singulated die burn-in, probably not a wafer. So, it is a little bit bit totally different, proper? You do not have a direct comparability. So, we have now a few hundred guys in a provider in a burn-in slot, however there are a number of of these. So, sure, not a straight one-to-one comparability to wafer stage. The distinction right here is you will have recognized — since you’re testing the wafer, the silicon carbide wafer earlier than the burn-in. So, you will have recognized “good dies” to that step within the course of, going into the burn-in versus a recognized part of the wafer that’s already unhealthy going into the burn-in. That is your benefit there.
Christian Schwab: Okay. Okay. So, do you suppose that may be complementary product then?
Luis Muller: Complementary to what? To wafer burn-in, you imply?
Christian Schwab: Sure.
Luis Muller: No. No. It is displacement off.
Christian Schwab: Sure. So, it is another resolution to that?
Luis Muller: That is appropriate.
Christian Schwab: After which — and does the shopper who’s taking a look at that or working at that, do they suppose {that a} decrease value, sooner throughput resolution or are they doing wafer-level burn-in on the wafer? Are they — or is that this an extra step to that they are including in an effort to — effectively, not put it in a module and throw it away?
Luis Muller: No, no. It is just about — it is the identical query you requested earlier than. This can be a substitute of present wafer burn-in course of with a die burn-in course of. It is only a a lot decrease value, extra environment friendly approach of doing it since you’re not burning in recognized unhealthy units which are caught all collectively in a monolithic wafer.
Christian Schwab: Placing that collectively to verify I utterly understood that. And congrats on sequential development in Q1, which might — to the sooner query, form of appears countercyclical. So, we really must be bouncing alongside the underside right here, as you stated, with ready for finish market demand to form of enhance plus probably a number of the new merchandise kicking in as we go all through ’25. Did I hear what you have been making an attempt to say?
Luis Muller: Sure. Sure, you are appropriate. We simply — so as to add to the query that got here earlier than from Craig Ellis, we’re seeing demand enchancment. Our system — effectively, I believe a remark I made within the ready remarks, recurring, for instance, recurring bookings have been up 8% quarter-on-quarter. After which system bookings have been up throughout all market segments quarter-on-quarter and throughout all market segments, aside from client year-over-year as effectively. So, we’re seeing form of the beginning of an enchancment throughout the board. No, albeit a part of that is associated to the brand new merchandise and a few market share beneficial properties. Certainly, it isn’t simply purely market. It is a mixture of each embedded in there. Nevertheless it’s excellent news to see schedule in entrance of you that has black numbers and constructive indicators in entrance of it exhibiting each bookings quarter-over-quarter and year-over-year enhancements.
Christian Schwab: And I am sorry, Jeff, I haven’t got your organization file in entrance of me, however are you able to remind me what number of quarters it has been because you felt assured in essence, to present directional steerage for 2 quarters in a row as an alternative of only one to me, I believe it has been over a yr in my head, but when you recognize that off hand, that may be nice?
Jeffrey Jones: Sure. Christian, it has been over a yr. I haven’t got it proper in entrance of me both, but it surely’s positively been over a yr.
Operator: Our subsequent query comes from Ross Cole with Needham.
Ross Cole: I used to be questioning in case you may present some up to date directional shade on the totally different enterprise segments going into 2025. I keep in mind you had thought cell and computing would have been a powerful spot. And it is nice to see that cell did effectively this quarter. I simply need to see your feeling going into subsequent yr.
Luis Muller: Properly, I believe you have — I assume I am going to communicate when it comes to orders. Once more, I stated all segments have been up quarter-over-quarter and year-over-year when it comes to bookings. So, that’s maybe one of the best indication at the very least into the early a part of subsequent yr, proper? I can not — I am not going to talk to the whole thing of subsequent yr. But when I take a look at quarter-over-quarter, year-over-year, the strongest reserving segments change — sequential change or annual change have been in cell for a year-over-year. Automotive has been the strongest on a quarter-over-quarter and second strongest on a year-over-year. After which industrial got here out fairly sturdy on a quarter-over-quarter as effectively. So, that is form of the sample that we see right here is extra throughout cell, auto and industrial. And it varies a little bit bit, whether or not you are speaking quarter-over-quarter or year-over-year, however these three segments are form of main the development — the sequential enhancements.
Operator: Our subsequent query comes from Robert Mertens with TD Cowen.
Krish Sankar: I am on for, Krish Sankar. Congrats on the design wins through the quarter. I assume my first query is simply round your automotive enterprise. It seems to be prefer it did significantly better within the quarter than beforehand anticipated, however the utilization within the house is definitely down in comparison with the June quarter. Is that this discrepancy largely simply resulting from that one better than 10% buyer within the quarter? Or are you beginning to see an precise quarter-over-quarter enchancment within the automotive enterprise? Simply any shade into the subsequent quarter and subsequent yr can be useful.
Luis Muller: Sure. I can remark that, look, the automotive, I do not know if it’s a must to try this 10% truly, I must dig into the numbers a little bit bit right here. However the automotive section has had an enchancment quarter-over-quarter and year-over-year in bookings after which additionally an enchancment quarter-over-quarter in income. Now you additionally obtained to take it a little bit little bit of a grain of salt. I imply, you are ranging from pretty depressed market surroundings. So, it isn’t terribly tough to see an enchancment. I believe extra so the year-over-year is form of encouraging. Trying on the numbers, I can see the automotive section going primarily by way of a [indiscernible] curve the place it began to go down Q2 after which Q3 final yr, appears to have hit a backside right here on the second quarter this yr and climbing its approach again up beginning within the third quarter. And I am taking a look at this from a — once more, from a reserving perspective in the intervening time. So, extra indicative of what is forward. I believe we have now a couple of prospects which have turned on a couple of orders within the quarter. I can consider one specifically that has been maybe driving demand earlier relative to others, however that is at all times the case. There’s at all times anyone first and others that come later. However that is what we’re seeing on the automotive house at the moment.
Krish Sankar: Received it. That is useful. After which only a fast query on the die stage burn-in. I believe in your slides, the income alternative is round $50 million yearly. Is that perhaps what your win with the shopper may ramp to? Or is that only for the general market?
Luis Muller: We expect that is for the market at giant, not one buyer, however what the market may take up because it begins emigrate from a wafer stage to a die stage burn-in.
Operator: Our subsequent query comes from Brian Chin with Stifel.
Unidentified Analyst: That is Dennis on for Brian. So, my first query is about this HBM alternative. Might you perhaps talk about a little bit bit just like the steps or the elements of the method that you have gained? And are you by likelihood competing in any respect with an organization like Camtech or [indiscernible]? And maybe additionally talk about the form of income significance and the timing for income for these merchandise?
Luis Muller: Dennis, sure, good questions. No, we’re not competing with Onto or Camtek. They’re doing inspection on the wafer — on the wafer stage pre-simulation to my understanding. That is — what we have right here initially is the stacked die inspection metrology. So, you already get your multilayer HBM dies stacked on prime of one another in form of the ultimate product inspection metrology. That is what we’re doing. Jeffrey, touch upon the second a part of the query.
Jeffrey Jones: There was income and there was timing subsequent to it, which I believe we addressed already simply when it comes to the revenues too quickly to inform, however we’ll present updates as we have now them.
Unidentified Analyst: All proper. Nice. After which for my follow-up, you’d additionally introduced one with the main, I believe, multinational analog within the Midsemi-customer. How has that engagement progressed? And form of what’s the timeframe for seeing income with this buyer? After which perhaps you possibly can discuss concerning the income contribution as effectively. After which is it simply testers? Or is it handlers and contactors as effectively? Might you inform us a little bit bit extra about that?
Luis Muller: Positive. That is a part of a press launch we put out in July truly at semicon. So, it is a little bit dated now, but it surely was certainly a part of a Q3 occasion. We’ve been speaking about positioning our Diamondx tester extra into the blended sign market. A variety of it’s analog, however there’s some digital, some RF content material. And in July, we introduced that we gained a variety at a prime 5 semiconductor automotive producer. And form of coincidentally right here, this win was not simply the Diamondx, but additionally handlers and contactors. So, we primarily are promoting them a whole check cell. We are going to see preliminary income, though it is nonetheless at early stage, so small numbers, however preliminary income right here within the fourth quarter, and there is a continuation of that going into subsequent yr. We’re bearing on a number of product teams with these guys and dealing our approach up on check software growth, to allow them to transfer merchandise onto our Diamondx testing. Together with that announcement we did in July, we introduced a brand new instrument that goes together with the Diamondx referred to as the VI-100, primarily a voltage present instrument that’s utilized in analog purposes. And anyhow, that is form of a key instrument enabler for our positioning into the blended sign market. There are a couple of different issues that we did. There are another platform enhancements that we did along with the VI-100, some refresh and different instrument capabilities in order that the — we spherical up the Diamondx is a really cost-effective check platform for common blended sign prospects, sometimes these supplying auto, industrial markets, additionally energy purposes for information facilities.
Operator: That concludes at the moment’s question-and-answer session. I might like to show the decision again to Jeff Jones for closing remarks.
Jeffrey Jones: Thanks. And earlier than we log out, I might like to say that we’ll be taking part in a couple of investor conferences over the subsequent three months. First one is Stifel Midwest Convention in Chicago on November 7, adopted by the New York Summit Convention in New York Metropolis on December 17. After which we’ll be attending just about the Needham Progress Convention on January 9 of subsequent yr. If you happen to’re excited by assembly with us at any of those conferences, please let me know or attain out to the respective analysis analysts to schedule a gathering. That is it, and I might prefer to thanks for becoming a member of at the moment’s name, and we stay up for talking with you quickly.
Operator: This concludes at the moment’s convention name. Thanks for taking part. Chances are you’ll now disconnect.
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