VSH - Earnings call 4 2023 | Vishay Intertechnology, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Vishay Intertechnology's Fourth Quarter 2023 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your host today, Peter Henrici, Head of Investor Relations. Please go ahead.

Peter Henrici

Liz. you, Thank welcome Year and Intertechnology's Quarter Fourth Good Earnings to Conference Fiscal XXXX Call. and morning, Vishay I'm joined Financial today Executive by Joel Smejkal, our by Lipcaman, Officer; President Lori our Chief Officer. and and Chief results for This morning, we our quarter. fourth reported available A Relations the ir.vishay.com. section release at Investor website in copy our earnings of our is of website. live being This web can call broadcast is be and the over accessed through our

on being In and will replay call via is recorded our today's addition, available website. be

we to During at also the which we slide call, posted referring a be ir.vishay.com. presentation, will

You aware will in future conference be to statements and today's making performance. results from discuss actual risks are differ and should that uncertainties the that be cause statements. call, that subject to certain we forward-looking events could These statements forward-looking

of please that to with Vishay's factors release and the results cause see Commission. XX-K Exchange press discussion and XX-Q differ, Form could Securities For Form filings today's a and

release various this information are on conference our measures. and non-GAAP on press call and We in including GAAP

a and full you will reconciliation the our ir.vishay.com, believe we have well in non-GAAP which presentation useful posted believe We the provide when and in we performance measures as release results. GAAP GAAP non-GAAP about conjunction businesses. by information should measures. We of our considered investors because find operating comparing as be included useful press on our in they non-GAAP to GAAP use with

President Chief Officer, Executive and to Joel over call the turn I Now Smejkal.

Joel Smejkal

be joining XXXX for end and for of After region. Good the of wrap XXXX. trends review with Thank that, first initiatives, we'll highlights conference channel Then happy review of Lori quarter the quarter the a quarter Thank to you Slide answer I'll for fourth by fourth remarks will questions. our of the key any you, then Peter. a financial the up on and start I'll with results our take guidance and X through morning, you everyone. call. earnings market, my demand

and moment CEO. company supplier. as to said megatrends company. company performance, change as you strategy to anticipates business-minded to take quarter a be growth remarkable ago call I that of lines e-mobility, a I we highest product look to From back of been highest to want from to to year that fourth what a ready to top foundation become flow customer a on margin to business Vishay's and increase shared with It's going to become more capacity customer- use needs. were connectivity. priority a and Vishay customer at P&L-driven market-focused to managed began operational first was A fulfills capitalize a implement a the disciplines I our a one our for reviewing we our in our year Before the sustainability my that of on cash orders

have a this and and change. of new to I approach is successfully my first the partners the scale. mind, employees Today, EMS appreciation drive the creating deepest puts OEMs, to embrace Decisions moment the organization. with because hold. their for taken commitment enthusiasm unless to the invested in has we across the is the business-minded dynamics regular new a Think the It customer energy help we putting are basis incremental distributors future made their position express Vishay a to customer-focused and culture market customer embraced customers engaging on them unique can of that None Vishay. and and first, Vishay Vishay. of to are the capacity all employees and in in is growth. strongly about a to the creating of being want this This take Vishay happen

forward the quarter. recent performance the move now of to Let's

of range revenue of reporting our guidance fourth $XXX are million. the quarter, to For XXX.X within $XXX we million USD million,

a demand of from levels many end finished resulted expected, goods bright inventory spots for As in defense the to softer by third higher customers markets due of consumption decrease medical continue as revenue Vishay. industrial the and Aerospace, markets in quarter.

the by steady market fourth automotive Compared revenue of and the of XXXX, grew prior Let's sequential percent X% side Automotive increased Slide quarter. X.X% of declined a X quarters left XX% quarter, revenue. with on as of at growth X the revenue total. revenue start automotive the held third After to in total segment. year's versus

Toward revenue Xs we supply made for automotive the as digest end year, saw stabilized. automotive adjustments to engines, year, demand e-vehicles chain inventory. XXXX, the the vehicle of increasing grew customers combustion For Throughout internal production electronic content of some greater XX.X%. hybrids, Tier and and

see As pace an we vehicle in of uptick production. the reevaluate hybrid for automotive adoption, EV volume OEMs

in time, discussions automotive to EV and strong region, long-term activity ADAS battery e-mobility, capability develop on and engaging inverters chargers. remains OEMs the projects. same automotive plus focused in management At traction design with us including Design for technology each onboard systems, are

quarter XXXX. support late high was of cases. share of capacitors in notably fourth margin to quarter we quarter. is reductions digest XX.X% grid we last offset year. remained and the plan contracts, Tier as with with levels. the XX.X% sluggish and after infrastructure lower this for to improvements. cost and The of Americas versus industrial for price revenue, to the industrial of XXXX were in the largest pro shipment Europe fourth the ongoing the know, XX.X% versus when percent accounted single-digit and growth pockets in Demand XXXX were complete declined We reduction in slowdown total electrical by higher Industrial China. and than projects, customers continue XX% last was quarter also inventory Asia support third segment most the you an negotiating As finalize low Overall, for revenue economic large There automotive OEMs our weak annual influenced X. volume did

in storage. infrastructure Automation to activity, design renewable customers major energy on Industrial energy all be made EV continues grid regions. generation, and industrial we infrastructure, a For progress around programs focus for smart charging

where the in a is want Americas, topic, example, near-shoring leverage factories to automation. customers factory common an As

last Aerospace and the In our XX% X.X% and year. versus quarter increased Defense, revenue versus third

year, We the XX.X% commercial fourth X saw and contractors grew military to XXXX. customers weapon revenue strong demand wars. quarter system the in aviation due versus orders from the with high continued For

from medical a revenue year. versus a over implantable Aerospace For Defense remote Revenue be last end government of customers is both monitoring in is and activity and equipment the news increased in Also, China from design by grew devices remains Medical as to year. other X.X% patients. grew revenue strong and to that launch the equipment the and medical sequentially XXXX. and quarter strong XX.X% quarter. to there last shipments an third year, declined medical XXXX. last delay for XX.X% major resumed after and XX%, continues compared planning some XX% compared of customers technology to X.X% customer Demand hospitals to for year-over-year markets diagnostic XXXX Medical create for respectively. their Revenue upgrade

and been in telecom for XXXX. markets revenue XX% has Demand and all the versus fell computer year, these year weak consumer,

fourth but decrease. third Turning business for to X.X% more our little lower declined year's than third the quarter, with each of the the half channel X.X% a than channels. relative revenue quarter. than higher was prior OEM the quarter Revenue accounting distribution from to

and some inventory industrial accounted adjustments from this year-end demand customers customers by automotive Soft for reduction.

regions. reflecting particularly in versus and demand XX.X% Europe, XX.X% year, EMS the companies EMS XX.X% EMS quarter increased and was quarter revenue last prior XX.X% below in industrial fell softening among and a of lower regions, year. revenue Asia. all another quarter-over-quarter as X.X% for the XXXX. programs was for X.X% for declined inventory result year-over-year, inventory sequentially for However, in fourth of adjustments XXXX all than Distribution nonglobal adjustments in OEM revenue year

where to versus in end weeks regions. of quarter XX Distribution year, at dollar declined was or weeks quarter-over-quarter. with all the value Distribution cleaning revenue inventory inventory their decreased XX from forecast POS For the the with decline customers were positions. distributor flat of XXXX. increases reducing from up XX% coming still The X.X%, inventory last most quarter Europe, increased

to X,XXX this on increase channel. by position quarter. We continue distributor These better help in participation the our numbers during shelves high-margin to steps the Vishay adding will part

Our customers expect of correction that the first the last half they are inventory through telling us XXXX. to

we in recover on passives order where well, to to quarter, markets on Vishay as increase and semiconductors. end the position notably wanting the semiconductors. Some increase their Based Americas, flow sooner, like their would defense may fourth grade aerospace distributors improve to distributors see automotive passives position the in expect faster the on we than

turn to the I'll review our for over results financial the Now of Lori call

Lori Lipcaman

the and our price I'll were decreased business quarter, quarter fourth decrease to in was everyone. X. morning, X.X%, review in on Good a million, reduction for semiconductor Revenues Joel. reduction start Most my third revenues quarter in X.X% our pricing. of third volume the Slide compared segments. of you, X.X% results and a $XXX.X volume reflecting the Thank

quarter demand and automotive industrial end held reflecting By industrial mainly business MOSFETs, channels OEM, attributable steady digestion decrease and under while during our Europe. distribution the put to customers revenues the reportable soft in contract in for and pressure pricing markets, by Compared were and and the and resistors, a X X.X% decrease generally primarily was Pricing in segment, on EMS last markets capacitors quarter, inventory conductors X.X% diodes of a down among customers stable. and followed in fourth in our reduction X.X% revenues reflecting other Revenues the to Passive pricing. volume end segments, opto. year, were of Components

X.X was $XX.X $X.XX months backlog in $XX.X total at to and fourth stockholders X.X million. the book-to-bill of a months quarter end end, million Vishay $XX.X of repurchases At the end compared quarter. of million and quarter to the of comprised quarter was dividends stock for at and We returned prior consolidated of

for gross margin of was $XXX.X guidance margin to our decreased to highlights. and were prior versus annual our foreign year salary for third compensation. Operating line quarter than gross lower a expenses versus The the profit. incentive decreased X.X% for million reflecting million, was decreased the to quarter third XX.X% margin the the XX.X%. higher expenses, XX.X% the million statement quarter for profit margin SG&A SG&A Compared $XXX.X Operating equity income to and lower on volume-related $XXX.X million general quarter, the due EBITDA with compared currency million to next quarter, compared to slightly third $XXX.X XX.X% of for primarily slide third compared volume. adjusted $XX.X in an XX.X% of million the guidance. and due presents Operating third income inflation increases, $XX.X quarter effects. profit EBITDA XXXX. was lower income lower primarily for Gross and gross due fourth to

up in tax normalized Europe. XX.X% on quarter guidance deferred and our impacts respectively, Our for and tax due rate were year-to-date periods, our exchange versus liabilities to effective negative rates the XX.X% for the

occurred which quarter and the the debt, effective loss the year-to-date GAAP in periods, most early of XX.X% Our respectively, XQ. of and tax were reflecting for extinguishment on rates XX.X% nondeductibility of

normalized was XXXX, a GAAP $X.XX For share. EPS approximately for of XQ. There per compares GAAP per per for quarter. were of EPS XX.X%. and rate we third adjustments expect of effective share $X.XX adjusted $X.XX to EPS This non-GAAP tax share the no

Slide gross margin For presentation, business on the your body of and X, our each book-to-bill have a revenue, convenience segments. of included reportable the depicting for we chart in ratios

to XXX XX days we DSOs days. up million Inventory slightly days, compared conversion for XX quarter compared conversion higher days. quarter, X X the days was third XX at to to to Inventory X, were days and as were XQ. fourth quarter metrics. year-end, the of of end Turning cash $XXX.X days Slide for XXX cycle present third cash cycle lower at outstanding the DPOs than million the were bringing days $XXX.X the

can last that and quarter quarter third million see year. flow for the was fourth of operations the from than $X.X lower you cash X, fourth lower quarter, Slide than the On the

foreign $XX.X to of previously taxes cash These During the subject represented intercompany had we taxes on been paid in cash U.S. are in Israel cash Germany upon such and when taxes of assertion U.S. accrued not the changed dividends of federal our earnings withholding indefinite reinvestment million foreign as years. taxes. on prior and quarter, to paid we repatriation The repatriation taxes income

$XXX We plan a was of result U.S. Newport use $XXX.X approximately in transactions, million complete acquisition. repatriation to to the the of received this cash million net As the

million We policy. for amounts the basis, CapEx Total last CapEx year. On was $XX.X also invested period future X.X% year the to plan with X.X% revenue a stockholder was to of pursuant to total $XXX.X total in same fund compared million capacity our full for return quarter, of the expansion.

a in The free CapEx during repatriation data in net fourth resulted cash taxes and quarter on cash the $XXX.X million of use the quarter. of

least million amounted For to for for repurchased were and for stockholder million the per year, at year, the amounted flows of our share full quarter $XX.X CapEx cash cash average million. price and $XXX million repurchases. our flow. $XX.X million $XXX.X at well quarter. commitment operations Total or $XX.XX of of consisting from to returns quarterly above million during $XX.X million fourth free the annual of to million, $XXX an Stockholder the X.X $XXX share We shares for return returns dividend XX%

For in and on up the million free drew year, $XX.X liquidity our make the difference. cash generated we flow to

$X.X at investments billion, million facility of Germany. $X.X including new and million billion, XX EUR undrawn our credit year-end in was Total short-term liquidity revolving in cash a undrawn facility $XXX

the We of the be U.S., million have in Newport $XXX which to includes on used approximately amounts for cash hand transaction.

guidance. X our Turning Slide now to for

be to expected basis and $XXX XXXX, revenues plus at plus XX $XXX plus first $X range the to $XX the Gross million for range in margin the to XX%, or plus of million. full or is $XXX the of or $X of minus million, minus SG&A expected For be expected or quarter minus rates. are in million, be for year million current are quarter exchange expenses million the minus points. profit

we XXXX, of expect approximately a effective For tax XX%. normalized rate

our to committed cash XX% at of with form shareholders of flow stock remain stockholder to least repurchases in distributing dividends and free the in policy. we return our Finally, accordance

XXXX, For Joel. back call to $XXX at million. the I'll return now expect to least turn we

Joel Smejkal

Lori. you, Thank

Let's turn update for quarter our to Slide a fourth key on initiatives. near-term XX

of invested the optimize We megatrends less million year due of to return year, ensure expand we returns in beginning capacity plan drive $XXX.X in support the quarter, million expand during the the $XXX and Vishay to our revenue our in to the e-mobility, and and lines, on During capital had we connectivity. continued sustainability is multiyear growth, at and growth investments staging delays and margins higher installing than capitalize ready highest highest planned delivering equipment. product to the

quarter, growing and Turin to on schedule for we fourth projects, the located fabs with customers. expansion stayed the industrial During meet including our demand our and automotive Itzehoe, Taipei in long-term

and affected We last our dedicated Taipei expect of the city continued first new qualification qualification diodes Turin at facilities to At which Mexico, [ and in in year. power is increasing ] opened to this deliver quarter, war at complete plants we our output of metal initially beginning X-inch shipments Laguna shipped of inductors, of on have products we mass strip campus, And At began of our production La and resistors, products. qualify where we qualification are XXXX, power qualification we commercial commercial automotive-grade the started we focusing products. automotive-grade of since added to products. that

in capacity, increase fab MOSFET we Itzehoe. To a continue construct to XX-inch

We are qualification second Foundry shipment for in the commercial in of expect for Key and XXXX. MOSFETs still ready be half SK of to

to November. foundry. Newport quarter by a the expect Wafer this government. foundries approval also transaction announced year, located SK As fab We still the We pending South an the Key automotive first certified acquisition the of Wales last reminder, close U.K. in in this is of

to silicon carbide develop and for technology GaN I Power development. Max for As Newport, last scale we and capabilities to make quarter, home plan the mentioned our

we silicon our our planner burn carbide installing and equipment To sampling facility. X,XXX-volt quarter, in additional planned. support are MOSFETs fourth production, released as Cauchon high-volume we and in the During test

technology. planner lead development have are Due half carbide parallel, and We the of the to at second technology, to in to have types different planning the the we the package X capabilities we available times currently available foundries, current expect first of X,XXX-volt the In to advance X,XXX-volt for planner resistance and half of XXXX. XXXX. XXX-volt trench silicon continue during the technology dual long samples

our We subcontractor also advance initiative. continue to

create some order products. high-return commodity our products incremental early reminder, year a high-growth for capacity outsourcing As this initiative we by the to and in in began

product we portfolio. support inductors, XX of the to bringing capacity different During an families a widening additional of quarter, our qualified

engaged continue Turning on number identify now expanding to our distributors to creating with technology. mix part actively the channel is units and maximizing of work focusing business our strategy profitability to by Each enhance POS we of distributors and management channel, participation on our a each with broader to demand.

Americas, As X,XXX movers distributors. added we the SKUs learned In our B weren't for year across we the the well in an diodes. and we largest positioned example, A during

saw As part their XXX count applications. these we by result, for increase Asia, distributors numbers automotive an in added customer with one a In distributor XXX.

a products for We're applications. XX-volt Vishay to a place also XX-volt, to mainly automotive XX-volt DC our and a building evaluate. continue releasing by in and bidirectional develop for E-circuit passives sampling battery portfolio we broad reference are of our Finally, for now leveraging DC have which testing. charger semiconductors engineers to breaker converter, QX. solutions, Customers will now available take discrete designs intelligent high-voltage onboard We sensor

Slide XX key to set XXXX. year we we started internally goals for this added in We've margin XXXX Let's incremental come to and faster come to will to recap externally year The growth and through online support and highest turn capacity both the last lines. of ago. product continue capacity a the for a online incremental invested year

mega are They doing, preparing our full paying And We're take our advantage the EMS we're what For protect to attention to to commitment scale We're more distributors Max throughout close they're by a see road through silicon trends. more planning, carbide Vishay more customers, to capabilities Newport. XXXX, and more the company new SKUs OEMs, increased a telling bring design engineers, the do. the At they Power to ability in to focus capacity creating up. map earlier time, demand put operational us. of developing the the addition capacity. we XX%. of the be We're the first meetings, and the shifts disciplines maintaining to customer everything their to as accelerate to cost product access our ready organization technology Visha, same want while and and we're us shelf business-minded and quickly our margins from building controlling on to we

was As at to design programs December, given a as selected last access an key suppliers X support only X preferred example, Vishay of EMS.

While fourth XXXX fiscal hear about you April I'm X. take scheduled to hold New place and Day, Stock detailed at quarter have typically we Exchange are a Investor York discussion off about going to the initiatives until next year, calls when goals for the our on which on

about for roughly we $XXX from In goal plan we we to USD Newport. We X.X view on continue our we'll of and foundation seeing X-year margin incremental towards total and of investing as projects and carbide have to that Day, Newport, including in reaching pushed share to XXXX, is our expansion goals. build there. silicon plan, billion the over XXXX XXXX into targets At excluding evolution years, XXXX, to on X We our forward were the and million including our that XXXX. in the invest in a advance financial manufacturing intend footprint, revenue Investor capacity laid look paths $XX of strategy everyone our capacity million budgeted to our

open With Q&A the to the your start that, call session. questions. please we'll Operator,

Operator

question of Instructions] Our from of Bhattacharya come first will America. line Bank Ruplu [Operator with the

Ruplu Bhattacharya

from to what do couple to I shifts? long you of the do seen the think mean respect last? number will 'XX? in still discussions that correction any are meaningful any I into that weave to And channel. share going that And What in are your know SKUs next that distributors, you long of be with more you the last have in giving the fiscal you distributors? the that do in terms your in What now selling think traction continue sufficient? region demand? thoughts we with of point How how And holding. that Joel, will that you've of they any about talked inventory are Are gained quarters? terms over are feedback can at lines in you you of in increased product are you that terms will the have discussion, distributors happening the the

Joel Smejkal

we're business in X/X have about we The probably question. Vishay. And units XX had active the for Thanks very distributors, meetings. have

business have the our got we've divisions, multiple units of meetings, cover scheduled regions. to All and

in head and the leadership this Asia. the visiting marketing Americas, Europe So the the in about leader, of in and division product the is distributors

not we our the meetings. into where are we So these about these when units, identifying and about There of midpoint quite support. discussion face-to-face lead happening with capabilities part go the and speaking numbers actively time at is capacity business meetings, we're having to preliminary

pushing well. to has available of we're distributors. of feedback the to half. overall, in comment So is about part continue may this played the feedback Americas, really the broaden in half part a at going narrow as role these into We at we're getting, I -- our The finding in key were to Vishay that X,XXX through least we have good. participation. achieved we're the I'd showing customers the to a distributors made is role say number third the This X/X The numbers XXX been a support go a those year. on reached capacity that first narrow in new based that technologies, about It quarter we've numbers the one placed XXXX.

So Vishay they're offer we about that's Vishay. feedback. customers, them got different once to If approach buying want We've to technologies. multiples. they're make are these technologies. buying that And one, we good Customers buy didn't broader learn we sure XX buying then

talk has about. correction So you good. The the been inventory feedback

with meetings have the We OEMs.

have with EMS. We meetings

our distributors. with meetings have We

inventory by end most The QX, of that products. correction there's but depends chain, say each those the at on So steps. we of it one the the hear

greater there to not our We Some them intend We demand. stuff some flexible as not 'XX. NCNR. We high is OEMs quite QX, We the for be we OEM not inventory that products year peers. want as signals some having demand didn't and grow in year, channel. still the inventory. flexible. QX, the didn't Vishay with how meetings in are did take We to high that Vishay strategy. the are did cancellations we're allowed position we were adjust the quite in treated with of of to but stuff how have lack in last us their happy they And inventory. OEMs, that they're with OEM the And this Cancellations they because or were high growth giving of enforce

have cut for So is us. out the work this we

So bit QX for targeting correction. but long by the inventory what end of it's is a a say I'll answer, of we're

Ruplu Bhattacharya

Opto Was onetime I that XX% this Can to gross trend items any you quarter. Opto thoughts happened margin. It us it here? there you on that there? looks ask gross Okay. from down should the on like the just give your how was margin Can

Lori Lipcaman

was So yes, We setting fab location had silicon started item. up a onetime new there the for Opto a in our Heilbron division.

Now to that on discontinued repeat been a had in the we work we on Newport close plan and that deal, up QX. to that some to point. already write-off the That take that will we achieved of had

Joel Smejkal

Ruplu, a front support the This this us allowing resistor MOSFETs, the in fab talk the film fab, some diodes the about is having bring silicon us. Campus. to is as about well -- -- a end. of we talk product as We approach new to thin plus ability Newport for Fab will Opto

that close overall the and be put to be this able the starting to Newport. in single Lori will talking write-off a was cost because cost front-end reduce efficient campus was we'll more most had having duplicate be initially we able So about, not fixed of that's to project that into and in Heilbron

Ruplu Bhattacharya

there you any on improve side, you thoughts how on see delevering? of should buybacks, on that -- about I -- the if some your passive where semiconductor trying capital talked for for priorities? either in remind potential about us or capital M&A, any the terms Lori, Okay. we I are do any capabilities. can But any areas the Joel, on just you allocation can your the one, Got And side to in on terms ask, last And the share think M&A? of pace of versus you're know it. return

Joel Smejkal

want do about to comment allocation? Lori, capital first the you

Lori Lipcaman

flow returning remain of cash million our and cash of free shareholders for year. firmly minimum a flow XX% -- So to $XXX committed still we to this free our

an strongly important in our strategy. of any -- very allocation We feel part don't we capital So that's make that. changes

Joel Smejkal

this an Ruplu, look regarding some portfolio. always addition is Vishay's we M&A, targets, circuit We broaden to look, continue one, our be to portfolio. we and protection to have would

one. is protection circuit So

that an We same also are also is with help that we expand look materials, that in we taking to where regionalization. region important about positions in We And an technology. positioned in then see at element region. or approaches today. verticals, customers that speak find look today, a us, expansions of at specialty help we would that can are us a in possibly advance better manufacturing us region verticals the look our businesses suppliers that do Vishay Those at quickly we're make as the we particular acquisition we that as

Operator

question next Stifel. Sheerin will of come from with the Matt line Our

Matthew Sheerin

My QX. first question just regarding your guidance in for

as in In you're Is well? sequential decline guiding terms X% customers OEM around the that Or of the -- X%, revenue. primarily distribution destocking? is your that

Joel Smejkal

Primarily the distributor destocking.

it's they know, in. were lot even OEMs, growth that industrial of isn't demand talk The single-digit the plus count with we XX% met OEMs there's a the content necessarily They were growth. talking if car about greater in about OEMs, in electronic talk we've XXXX. going automotives of components, As about as

We largest the grow, continue well. have. we segments medical as to that. will X those are defense see segments Aerospace So

So those outward shipment it's growth. X their of segments they Vishay. From their percent representing in see of the between. XX-plus product, steps

So it at digestion inventory and is EMS. some of the distributor

Matthew Sheerin

you guidance, looks margin below then just to last it margin over trough just that. EPS the in late the And were is your which 'XX, is out around based into like take Okay. X.X%, operating back on and backing going operating

down step huge a obviously, So year-over-year.

we year? about margins think the we trough through as should Is how the So this operating go here?

Lori Lipcaman

gross on the it or trough, some that the margin. operating we potential have the I'd putting would long-term XX%. have like expenses revenues pick And a relatively say this -- put would going are is some yes, and high lower as to drop. the But to gross in -- pressure into our due incentive say, yes, reducing inflation, to have increases as a wage approximately to a fact, matter X% place, margins of the I are we to approximatelyu of are that for programs the years, we're is very then SG&A margin coming up

Matthew Sheerin

growth Yes. to X% and you're OpEx, And just guiding should basically this revenue least on for for SG&A the actually, single at digits high year. mid- year down be

not here? actions take some So why cost-cutting

Joel Smejkal

are We company. discussion looking across and It daily weekly a at cost topic is cutting. of the

manufacturing are fixed countries. cost, down. we The volumes have that to at low-cost in Looking moving

We our the The aligning in, looked program. continue customer in that are is to cost to cost past. It's of different us number working we that we're SG&A very the short-time with the in be using customer, also government-funded we've There's in things reduce. technical on than is in variable a on, invested being at. the way that work pace important a the top staff

look the the So to market. guidance we quarter. the see we It is do is cost. to we put if make being have We're different, forecast QX for to staying going we're adjustments. close This at -- those in appropriate

protect we business manage to but important the have We is it it, see margins. to our a topic as very

Operator

[Operator from of come Instructions] TD Our next question Buchalter Cowen. will the with Joshua line

Joshua Buchalter

of bigger picture sort to wanted one. of bit ask I a a a

has an go business activity get channel. channel of the its move the sort of of transition picture start channel your inventory been you've to made that -- needs quickly? I because slower, out of up about clear as rightsized your more I that things get channel in a correction. Or the to that you very to you're changes It's the coming Is peers to and leaning lean big at of the trying wants sort you're as or down. So rebuild is the when as to does seize faster guess? levels opportunity guess, trying dynamic time

Joel Smejkal

these SKUs. feedback are we're and They numbers But shown we've of the with they conscious as discussion that is They the the understand Vishay distributor, a because are suppliers. I inventories would we umbrella say with their They're quarter customers it's product. to their requirements go. at investing They the their -- inventory. look we earnings. finding speak when umbrella a about all to they are of every making of from pace they're number have as total the adding that you slower in report progress, part wants when their we get shareholders where little and

requires a make of to of front faster. point at the be We We distributor really to important rate then replenishment continue we're POS an this We'd with POS move growth, It's to the the of year, and facilitates continued greater this. as addition realizing out XXXX to our initiative. which inventory. sure like element it customer Vishay a which

Joshua Buchalter

the this with all near-term but also plus guess, again, I for appreciate of declines, ability could spend your And a it the you're that as Maybe I year easing prepared the offset you some them you've and then in color pressures been talking you in that cost confidence to now? improvements. tailwind? time low also, mentioned is the about input much Or a inflationary your there. how with undergoing self-help is costs ASP And the single-digit outlining manufacturing steps footprint. remarks, mainly levers

Joel Smejkal

Cost reduction go year. and initiatives required important of calendar with each divisions into each are the we as

our spoke commodity So Having efficiencies, here. about. reductions materials us also like some manufacturing additions supported of some subcontractors Mexico, by those of that products provides benefits being landing lower-cost cost cost in we sites

for most somewhat. We has be other pull. materials, those leveling number part, have fairly flat. of seem but inflationary items a are logistics, the to than wage the The Logistics items, declined inflationary items we inflation, levers

it's of going which help with think the improvements sites. efficiencies, well the I So offset as reductions, our this in low-cost operations material team as those Vishay initiatives to is processes, us

Operator

to for today's I'd turn That back call concludes session. Smejkal to Joel question-and-answer closing remarks. like the

Joel Smejkal

everyone, review All us for results. today right. of for quarter Thank you again, the fourth joining our

ever an holding to forward Have very our are Investor Stock you seeing at April Thank York we Day much. the there. first New on reminder, look We a day. good you a As Exchange. X

Operator

conference concludes for participating. you This today's Thank call.

disconnect. now may You

Vishay Intertechnology (VSH) 7 Feb 242023 Q4 Earnings call transcript