MKSI - Earnings call transcript Q1 2019

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Operator

Good day, ladies and gentlemen, and welcome to the MKS Instruments First Quarter 2019 Earnings Conference Call. [Operator Instructions].

As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Seth Bagshaw, Chief Financial Officer. Please go ahead, sir.

Seth Bagshaw

you. Thank everyone. morning, Good Senior and Bagshaw, Financial Vice Seth Chief President Officer. I'm Officer. Jerry joined our Chief Operating this I'm Colella, President morning Chief Lee, And John by our and Executive and Officer; call. Thank you our for earnings joining conference market of quarter after for XXXX. closed, financial our Yesterday, results released first we

to results posted scheduled have as www.mksinst.com. financial forma revenue website, Our market by pro been our

views factors, may end a represent should including be the statements. subsequent of comprise today in only forward-looking date MKS adjusted reminder, prospects yesterday's earnings as company and as to for GAAP of today, result yesterday's in various expectations As discussed Form Reconciliations These and most a or also Actual those contained remarks any for call differ relied results press financial plans various these of in not update statements as as measures. about company. obligation company's the important to to report future the expectations, any and XX-K representing materially and non-GAAP statements. upon includes the disclaims release Today's estimates on the release. company's recent measures

In addition, with Industries acquisition on XXXX. of measures or pro we certain Scientific the closed had Electro February the to ESI, which XXXX, occurred first quarter forma Inc, X, of at the of refer beginning

Now I'll turn the call over to Jerry.

Gerald Colella

for non-GAAP I'll On first second on by quarter standalone us information share on call Thanks, of open $X.XX share, results midpoint a additional results. first standalone $XXX On reported million, our months earnings or the reported a thank followed ESI revenue X basis, was basis, John a strong financial Seth. of primarily the On earnings our included which who'll and Advanced XXXX per the million, Good I'll quarter line XXXX for results. net MKS markets, included mention $X.XX $XXX revenue start or and strategy, and we overall supplemented which overall and Market was X per business bottom above first several another of to driven which quarter additional ESI with by the outperformance results and long-standing the a million by today. market everyone, business, non-GAAP to guidance delivered for joining customers basis, On MKS guidance, you before basis, of questions. were months cost range. $XX $XX.X net the quarter call quarter our highlights. over were turn details was share. the market commitment morning, semiconductor first quarter for million through cycles. This Then our

and in laser, to products Workpiece grow For our is share. the to the leading in on from Advanced offerings. first which cornerstone quarter, markets, strategy in photonics the we we Markets, our deliver The and optic and laser particular, strength this continued business see of the and Surround services turn,

We positioning a strong remained and growth take opportunities. in solar ourself Due both had we the to advantage the also to macroeconomic focused China, China, dynamic markets. environment in on quarter of in semiconductor

and in John localization these wins the with design X new markets revenues us customers as this details with very positioned has and exposure more performance China, annual broadening I'm technical strategies pleased Our in at past years well the provide in other our did around long-term quarter. than our the over we triple. around areas. more to Korea much and will successes

has capital last know, moderated As quarters. you X semiconductor over the spending

by preparing are have for our to business us into However, we stabilized, and recovery well capacity, support to the future. building appears

exposure strategy to approximately market step our X, billion. and broadening in $X.X addressable this Our executing by acquisition acquisition of is ESI and expands markets significant closed on This customers XXXX. new our and February another

division, and will solutions acquired the to segment. be Going reportable refer revenue a forward, we'll this equipment business we and ESI our as

For sales Light revenue. had our elements the both strong optimizing million In XXXX, including deliver of key design we success this document and emphasis our the wins a markets pictured has and our few over of Motion divisions. been across years, customer potential $XX last model, our relationships analysis we've served on and outperformed to leveraging our that annualized

We will division. same the to apply front-end equipment the strategy and solutions

prospects semiconductor in drive excited division. terms In new we XG are long-term equipment our technology Advanced will and this growth, market technology and implementation. new drivers, both of enabling markets, the about including of anticipate We for solutions the Markets

$XXX quarter QX our second to to earnings our range $XXX and from million million. XXXX we could guidance, sales in Turning estimate that

per net remarks. from quarter his At the could earnings quarter the this turn provide will non-GAAP to per share. range balance share like over I'd guidance to point, in $X.XX Second Seth second $X.XX John. to call of

John Lee

Thanks, Jerry.

rotate with on are We will progress cultural strong a integration. and ongoing very fit business. share pleased ESI very similar into our a us It our core integrating values, smooth, which companies has help both

we other done MKS process, have collaboration As areas to we acquisitions, applying with are have begun leverage. the for find business and

released, pulse example, Circuit are which drilling incorporates laser. solution, collaborating on Board a our laser Printed For flexible we recently spectra-physics nanosecond

density, with the the flexible PCBs, quarters ramp already in solution was Printed its product Award this first flexible operational and the quarter, Also board award Design Circuit further manufacturers high PCB Technologies Europe recognition market. for for significant in ESI Corporation, have Career's awarded XXXX. that XXXX, of printed in honored outstanding improvements support in for interconnect leading magazines Principal new solution. rigid our Partner driven of leadership the fabrication. solidifies Fab unmatched business productivity ESI circuit world's one market Asia in Career In We We of received provide the the

Advanced interactions. the Surround our our expertise the of during offerings last adding acquisition laser call, discussed by systems Workpiece deep further understanding we've broadens technical and ESI As materials

processing and photonics leadership to opportunity roadmaps laser, of to We circuit the expect ESI complex portfolios. our MKS systems motion provide and board accelerate printed performance the and

In we the had of importance to design the through of While we continue in support uninterrupted our emphasize roadmaps. of quarter, manage wins business. customers' the through we semiconductor first development noteworthy power the solutions cycles wins market, our

generator. with We next generation share our in memory XX.XX take applications, conductor to in most power megahertz etch continue from our recently,

We also generators in a for that And RF received processes memory networks improved we support and China. exclusive yet, to significant our fab volume matching or uniformity won etching etch contract enables order Korea, expansion an from in application. another a

deposition several continue Our multiple microwave Atomic win customers for business power another And synthetic for plasma-assisted, from applications. solutions semiconductor win, to microwave market. a we orders design layer diamond the power application for received

health a glass the cutting was applications including life scribing quarter. drilling industrial and and We in a of market, application events, first secured China number wins Our strong stem sciences applications, market lasers and business the photovoltaic for market. in also for the for and number market the for design of cutting

have end-to-end want our for opportunity key customers a cross-selling we mentioned, range solutions. sub-assembly to As inspection a used a partner with broad in capability, our design our Jerry appreciate We a and work of that for application. strength solution the optical wafer has semiconductor

collection inspection for and capture and will devices. nanostructures a various used and at Packaging. elimination dimensions be design flash precision logic and to wafer applications critical and Then motion Advanced wins DOM, Our OpEx had number of we

will MKS the growth of devices. shift We antenna a performance performance refresh this will that for we deliver broader about driver materials and will new new and a In be and deployments will we short This the and connectivity be enable new the new same expect be processes. components XG and require use new to solutions our term, portfolio. designs term, that out which are XG also divisions. of cycle which new laser-based the designs across innovative required, opportunity our anticipate for for connectivity. devices There more there communications cases, and a long-term provide mobile Longer will wave new require excited all of roll IoT expect XG enable chips will

Our outlook remains optimistic. very

strong continue markets, all to This growing growth. the in like uniquely by Markets wins our positions this portfolio bolstered and acquisition. garner is to call long-term our to our At in Seth. for point, the of over ESI in Advanced solutions position I'd balance We us turn design products and

Seth Bagshaw

quarter financial then on guidance. QX GAAP X. the I'll recent discuss our QX cover first closed of acquisition John. our non-GAAP February ESI, the results Thank and XXXX the include of you, The results which for results XXXX combined

pro the sequentially. sales we QX, and XX% a $XXX pro sales forma XX% $XXX PCB serve. industry XX our of approximately semiconductor well semiconductor decrease pro sequentially. forma pro market as flexible primarily capacity of were our semiconductor the the absorbed by as million, to were On sales as to Pro driven XX% million, quarter the for $XXX by in last Advanced additions Markets in The million forma ESI's XX% sale Turning Advanced the were other forma Markets were for for basis, sales and forma over a decreased decrease customers both market customers market the were months. sales for moderation

expenses net finance in million non-GAAP for of Non-GAAP fulfilling $X respectively. debt associated expense was XX%, interest million accounting gross million, $XXX expenses impact $X.X the of non-GAAP GAAP results million the expenses operating was issuance to for $X.X acquisition million in and million. was non-GAAP of were and Reported GAAP customer and $X ESI. in XX.X%, charges. fees intangible Now included $X.X million amortization acquisition obligation transaction margin $XXX XX.X%. moving the quarter. million the expense $XXX margin included purchase loan non-GAAP quarter million to the net GAAP was $XX cost, and integration was GAAP assets, operating operating gross $XX to were related a million, with and in interest and revenue margin of of inventory term

to We've was $X.XX announced revenue end million our $X higher schedule decreased our which million basis. well. compared per which non-GAAP at begun second Non-GAAP revenue GAAP net rate of synergies, Standalone and closing. of XX%. synergies per or on million was which in of and our net million and net the in operating approximately GAAP XX%. proceeding which impact gross also favorable the million of rate non-GAAP to Standalone expenses earnings the expectations our transaction on an acquisition XX the were per range. $XX at million quarter, to this are to XX integration was subsequent $XX is already The realize non-GAAP expected $X.XX revenue midpoint ESI non-GAAP share was $XX.X to guidance Our million or both approximated operating sales, was tax cost $XXX margin standalone to guidance very was the share. the was $XXX share, volume. of QX of excluding ESI realize months $X range total was of results, cost $XX.X XX% and We're GAAP and annualized be $X.XX of to Respect or the income $XXX earnings was million. the million, were XX.X%, margin above tax MKS acquisition, or to non-GAAP X%

turning Now by and ESI financed and $X investments. of & and to term term were the $XXX debt billion million of had BaX sheet. institutional acquisition DD+ approximately B rated $XXX by which with Moody's. B We cash the approximately loan total quarter balance we At of end, incremental, outstanding, Poor's loan million Standard

investing Our leverage with Xx. million goal over of have and period the the the capacity payments included the additions of acquisition, net asset-based were the maintained $XXX Cap for been in $XXX investments, million $XX compensation and a stock sheet million an Stock XX-month the loan of million of where employees Newport cash of stock $XXX acquisition, in acquisition. was quarter million modest Furthermore, liquidity end and credit postacquisition. awards pro under impact excluded deleverage over were $XX was expenses variable depreciation compensation sheet the certain cost from debt ESI stock a done charges results the flow acceleration under in for and we compensation and ratio of quarter. to for we acquisition integration early compensation included strong during million. $XX of charges to at And are have continues quarter, amortization the trailing quarter. these $XX expenses non-GAAP cash term of well balance borrowing as million, in forma Free through a stance XX-month line reduce by for of as we available the balance million and quarter $XX as

million capital we $XX the share. balanced to a demonstrate dividend approach paid a In per of to deployment. continue cash quarter, or $X.XX We

end the the compared of quarter days in terms forma and were pro working of were at the In days XX X.Xx forma X.Xx end the outstanding quarter. fourth capital, at of days fourth compared first the quarter, inventory to XX to returns pro

includes $XXX which sales current margin that operating range and and from million guidance, to quarter XX.X% million discuss our we in approximately full be million R&D to results. QX our million. levels, interest second from a the could I'll XX.X%. expenses Finally, rate on million. $XXX ESI from a could could non-GAAP our from could Based quarter to $XX.X non-GAAP XXXX gross could range estimated of SG&A $XXX.X to estimate $XX.X net the range million, business $XXX.X million expenses expenses be expense $XX.X tax is to million, approximately Non-GAAP $XX.X XX%. to range $XX.X non-GAAP range from to and million QX

expected net In be costs Integration-related these per million the quarter, net to million. Given second are quarter to $XX.X to be or $XX.X charges to $X.X million. interest assets accounting $X.X earnings and of $XX.X expense could GAAP non-GAAP expected be million million. estimated share. estimated to Inventory-related approximately $X.XX $XX.X assumptions, purchase from approximately $X.XX range is tangible million amortization are is second to be

GAAP range open remarks. I'll expected of these now per our million to for income call result As transaction-related share approximately the $XX.X prepared to XX from million, shares net outstanding. or million questions. concludes $X.XX This $XX.X charges, on is to $X.XX

Operator

from [Operator line Stifel. first Patrick of with Ho the question Instructions]. And comes our

Patrick Ho

the a a represents stabilizing. a business qualitative for and why on can one, ESI believe you MKS' two, the June Jerry, is do believe or stabilize Congrats business? Maybe bottom give it's on, little basis, a you closing that you nice March said and the on quarter your color March represents believe the quarter that in more prepared semi semi you maybe remarks, quarter to acquisition. starting you --

Gerald Colella

Markets everyday, about Yes. the Thanks, revenue. comment I it And the is what look on orders We we and because probably. Patrick, question. like look I've for made [indiscernible] XX on is really and reason Advanced the for report the call -- orders report orders. stabilizing everyday, No, felt a don't -- semi But stabilized why very at nicely, I strong. have it, look done years I the on

order commentary So stability there's in about only we've the I rate at rate specifics. what things, terms maybe those what -- had real about, seen. no, that positive we of good comment and We've that I -- positive look of things reflect for don't year the to see which like But of customers back the XXXX. for coming back strong they preparing backs it and But at to -- towards 'XX maybe rates, our and into end us. are have the further looks a themselves, more hopefully, quarter you off

is year The and other though the be thing there's I history. highest we to in industry, revenue gloom the always doom do year flat this in semi semi, want company's the and stay it'll if of third mention even

sad close close to the semiconductor third are supplying run years been billion. we've People be And year, about and that. the highest $X this industry Markets, over is will well the rate be So it's XX to Advanced $XXX and on million. to

just about looks [indiscernible], inventory to I feel you things you great be order generally, little it adjusted order that's Patrick, good internally it very If business consistent. that DRAM I like this together. like even stabilize that side about But been predictions. we downturns pretty but coming look churn cost And bit. the a and a was and for I running about little a look answer But pretty business in because can our Hope and our bad give the a it, if at the I we've I close some continuing maybe because we about have feeling point. what those to memory now. were to to talk said, be down rates, looks to prospect not that seems feels I've appear flat and stabilized, this think People they question. rates past, right horrific costs happy I'm through are healthy on more efficiency But at a not productivity. feels, And I more and at feel the I'm it So as structure, I'd $X most $X.XX. billion know,

Patrick Ho

China, question, as there opportunities design the when quarter, that you of be follow-up and in of particularly some that the described Advanced wins driving, John, of Can the helpful. like detail Markets got some in the markets scribing, No, Markets that you cutting, May and some project my that. and business? you now think year was you I are a the applications glass maybe mentioned other they Advanced your in

John Lee

Yes. Sure, Patrick.

in you as what referred kinds Asian of in that's the cetera. prepared But the certainly ESI, at are of of lot that is a to And remarks, So countries. strong well so flexible applications and as was if applications brings solar. a laser solar also different that's than which in as market scribing look level such the the China whole different another PCB, other et

Patrick Ho

from And for me Great. final question Seth.

the how terms gross has profile I second margin half gross look into of primarily variable product driven XXXX? mix. do the you an And quarter. influence, had In in guess, of June that go historically, by margin that at is much of ESI, the we How outlook, a as volatile

Seth Bagshaw

Patrick. Yes.

So again, still side. you'd assume businesses the there's million the pretty of of consistent -- in that QX, midpoint $XXX revenue kind MKS is on guidance,

XX% range. at that model. even ESI a what's the still you the on they margin a mid-XX basis of $X XX% -- in those environment, on now, have basis, a the standalone is operating right seeing margins and so million flex variable forward, the variable And we're to get operating at difference and margin think range gross XX% a give modest in mix a consolidated the MKS pretty strong it's volumes, interesting it then going I to in for relatively a quarter, And gross little range, the or is that at kind take bit. ESI's so And in spending

So it as right additional long-term is interesting line in revenue. MKS robust of with based profitability, flow on operating in of a model ESI was through the model kind with terms

kind that's Right, of what we're how but impact going mix in we're based yes, obviously, a seeing that's quarter, the So pretty projections level. gross our on looking the at forward. for again, healthy have could model an the margins, second

So going on. about we're happy pretty that

Operator

of from the with next Deutsche our Sidney line Bank. comes question the And Ho

Sidney Ho

or talk the just Can as taken the outside I that think guidance ESI side ESI? your of semi itself chose first, you the and to about about splits Markets given for between the kind the you side talked Advanced the the guidance? of MKS guys is difference into consistent. helps What's

John Lee

this John. Patrick, is Yes.

So I business, was the your what if question saying MKS consistent, that for semi, it's is. that's

For the Advanced Markets, been it's but it's steady. little a lumpy,

it so still And Surround lot lasers is driven the Workpiece in portfolio. still of by a the

we're growth growing confident -- our twice and very So Markets, Advanced said, the we're at the still of In Advanced growth Markets there. base pretty probably happy rates. and with we still rate those

see. to And that's we're continuing so what

Sidney Ho

Okay. That's question -- That's is. of kind fair. next my

I guys basis, on think expected. be look the a have organic I you QX advanced an to at lighter may little be than think market

the X% -- the is Is and wondering XX% and there still driving expecting what are you looking a Just lumpiness, is mix? year? for this some that growth you're

Gerald Colella

Advanced business. always Yes. lumpy been has I know, that Phil business -- Markets Sidney, a

based frankly. for been of and is MKS it the calling Some cards project that's forever,

-- I that saw strong last order So rates in I for the Advanced coming Markets. we're guess the quarter in

in quarter-to-quarter, down get off Then when can and solar -- a I huge little hot months was the they a orders for another at move back contract. remember was huge days And X years time bit. order. run, later, then than the So ever be long hot, would and and and you rather a up a we'd this that do over LED you over a back get look bit.

to and business around. of kind that that, that's strong that expect a moves But So consistent. remain we relatively way

Sidney Ho

what quarters, closing Okay. PCB by quality be accretive which accretive in the there you post-closing. months my that previously just kind Are the during at on expect question parts, one what to your you where over you expect happen think ESI. ESI XX also do business, half all customer? the the -- related was to expect And the about are that you the I to EPS? revenue Clearly, projection you Maybe we finish to be of first up the first things deals growth especially, maybe margins level of talked How the to And would revenue -- next to last give to should calendar is is And expecting QX? little tough happen? down few year. believe about

Seth Bagshaw

Yes.

question accretive So this is Seth. I'll first. take the

So XX%. that'd single I just is actually kind in I quarter. revenue or $X take, the for know the That give be digits. guidance, is midpoint a that said operating plus it non-GAAP a on QX or high minus, And accretive profit accretive. it's million of basis

So more million we and cost QX, of again, and forward going get in and we those in that well. $X synergies as have again, numbers, -- opportunity in only about

So right we're fit out shoe, great. of pretty is which

John Lee

then, secure And about where other referred prepared already market to what the question for in your want the ones been getting that Sydney, [indiscernible], the orders. a few the and are business. Yes. that how was release those And is and we I have at PCB's flex released, that assuming which position we're remarks. our I'm look to to #X

drilling. talked that XXXX got tool, about, start in Award. happy in I said we flexible And were PCB remarks, the magazine's confident the I for Best my we #X And really -- delivering maintain our via so as prepared we're ready which about to then we'll Product and [indiscernible] getting

out do just don't frame segment QX today. And hope go QX, by as of so participate real the in market to those we participate sites with PCB; And kind the beta as going we that's flex forward. next time we which

look that's forward. So you what going should for

Gerald Colella

[indiscernible]. the share And been the there When all. HDI past. that of seeing they the the in the really that, business at prospect award future to quite Virtually, on the us doing was at at that they that be there design organic in is HDI with just about the great what they that market on the have the in they've reasonable we confidence that solution at an business already appeared provided with at we're awarded looked looking company, opportunity. business Yes. and PCB, gives It looked market. of us. of I flex were mean, they looked to along no pickup we looked We really share, their growth excited facts the in we're now in top

So the we the that's positive for thinking company think years going to very over to XG. be several next for the sure,

Operator

And our next from Krish Cowen Sankar Company. with of line and question comes the

Krish Sankar

taking for in I'm question. Is I them. revenues down Jerry Q-over-Q the that out Thanks John, my Yes. June just MKS have assume side on a few versus to of or March? to legacy It trying core figure the semiconductor of are business. just fair

John Lee

Yes, Krish.

March versus June think slightly about some X% from saw down, March flat. where I QX was ins pull we a maybe high pretty QX. just into So is

we think why as characterized -- it that that's stable it's So we and flat.

Krish Sankar

today think very in the Got you you stabilization they inventory like your inventory that are on where inventory, how customers semiconductor John. or side? do it. That's rationalizing see process helpful, do And then the

Gerald Colella

Yes.

I that would think it's they wish than needed of to a last to. a pretty irrational now, what it does decent that thought this a inventory. appear as weren't X saw. leaned compared months people a X mixed bought off But bag, think Unfortunately, we're they be, good I and it to I And little as though they more in we about Krish. segment place

that said at we what that's point. think I no this is -- flat this it's just think I So

when on didn't another that they at so good, have right about stabilized. me pretty hit a stable it debt And degradation have stead that, had for to to appears me consistent -- I meant appears in pretty which pretty order bulk this at though large inventory a be the is the we and inventory. team rate we they good the And the the look see would [indiscernible] in it pretty stabilized, We position were is consumed now, rates which that with to And much which Because really order the is Krish. reflection that thought mean that. to more little the orders, up good my tell as part, that and most this feel I eat about point. needs I

Krish Sankar

think a it. in -- theory, on are that quarter Is in that of I Got upwards, business or customers your X And tandem shipment should inflection your semicap fair? follow customers point, your lag? without if the just mean, any follow an in to the does kind up

Gerald Colella

is the no things Yes. one remarks, There's in. question. in This mentioned we're putting of was capacity example, -- an I actually my

not very, short, have putting an We I'm albeit unit, It's next of We're of in immediate JT times up. worth pick capital business one can But for customer, a of they the so anticipation $XX so million would the that in are product pickup. quarter very Krish. a on we lag. lot see

revenue pick fast. that probably You'd see OEMs pickup. us the see -- our revenue up before you We're would

Krish Sankar

that follow-up question different share kind market single XX% within customer versus b, so, low understanding digits is flexible the base? if Jerry, X% completely of ESI And under and any on Thanks, that or they correct; and ESI. it. HDI, a, PCB was on the HDI almost a or on My side, PCB: flexible is all very Got cross-selling there had helpful. are opportunities maybe

John Lee

Yes. is John. Krish, this

numbers those I was right. So number are older the HDI say But would even tools. for the lower

at There HDI, who who and of are -- So only who both only some HDI. and our customers flex flex low do we're do some many starting PCB customers a base. do

and can then leverage course, that. are you're relationship, there the factory know cross-selling you the already of in And with flex. you opportunities So because

Gerald Colella

were okay, now. similar. there are we've conversations. The some ESI, QX. ESI Then minute what the meetings term, had over, have, Very bought already other end-users with those discussions roadmap happened potential of about, within But that there to we longer and to could you we I we're need to opportunities we Very those. talking come us users similar already about semi think, and that end with in

Operator

[Operator Instructions].

Our next of question Tom D.A. come from Davidson. the line Diffely with

Thomas Diffely

it ESI. just question that months. X control? Chinese of essentially of is which when the the quarter, was business reflective million $XX somehow Or New on First for roughly was Is trends the you assumed The X because Year skewed there?

Seth Bagshaw

right, Yes. they million couple Tom, of the obviously, revenue you're next, months. that which And Yes, $XX only a Seth. have things. down. got it's partial quarter, One, a bring so X also it's accounting purchasing revenue adjustments, it's some

if be would million the high say more was up revenue would the a QX. trending ESI range, that obviously I $XX company, standalone So like is this

a -- a have kind of that's better You whole metric. comp

Thomas Diffely

And besides of creating else a talked there What Seth, category ESI, new solutions. then, and good. in Okay, you going is about equipment forward?

Seth Bagshaw

division point. It's at be this just ESI. just that It'll

Gerald Colella

have divisions was going solutions, which to with equipment going Newport. the three and ESI, and We're standalone MKS was Motion with was Light forward. Yes. And that Tom. business. analysis Vacuum

Thomas Diffely

Okay, we've time, in appear been can How technology Jerry, they've some ESI think long of you products? your bench it'll long utilize and you for a to just deep before technology. be got do then great. very of other And core ready obviously, a that

Gerald Colella

to we've ESI released. I incumbent year Well, the opportunity we with had will and a that a weeks. few a collaboration. holding better technology for we're and over mean, in We on the more an flex talk or be of technology, all displaced have capable. came had lot conference tool There Newport of lot collaboration we next the actually people latest divisions between already from And a in about last two the

CTO. We the also have the of office

we're So My we'll is, how that comes out. already already. expectation in engaged see that

over a designs two. total those like year or see You

because competitor Advanced Markets probably to some displace exactly cases, a semi. other you in in do in you like don't can have copy the Although, already you

on Markets technology to on within own So share more is then take in semi -- the systems utilize our little is opportunity a our the the side. easier Advanced or it

want you anything? do John, add So to

John Lee

had dual side. tool meetings the think Motion Motion capability both surprising to Light group. that and and And though had the capability a to side, was ESI little and modeling Tom, group I some and we capability ESI the many between was the to the unknown sides I Light assistance Yes. many, on to add the of each roadmap

-- ESI capability underappreciated laser and the the unappreciated motion of Some by capability folks. was

mentioned. had just of a So they in as joint customer, there's forward, of lot held the request ideas. going really Asia good TRM that And a Jerry at together been

you a of can whole show that. customer when else come no ESI, do to of Newport can whole the portfolio the and so one and And portfolio

was well. really as for And customers event great so our that a

Gerald Colella

other's has. solutions And developing fact their incredibly And understand -- integrated the technology. -- be to see the they problems. each more engaged other and helping can the talked in that in number in And, systems going Tom, their in I I these how glad for I amount this capable firepower they was What about don't is technical just of business decades. each -- solve and the that technology much technical can absolutely all incredible. and help as company CEO, I obviously, that [indiscernible] multiple how of has. blown sound me monthly me away this is is is reviews And from I company now on self-promotion, by because I but what impressed am I'm a should, divisions know PhD and just people the understand John MIT understand. but he map And to from sit sat like incredible last was now this I with more It the horsepower

incredibly really So impressive. that's

Thomas Diffely

Yes.

of on Seth, ESI the been that behind guidance. Okay, it question range because EPS the Is The is has business there wider the or that? is something more strictly great. of than volatility else one little recently.

Seth Bagshaw

No. the range. you like own revenue? simple both for got he was how our what Tom, their talked It said, ESI we that. like, then as just was And midpoint. was have your add probably we if math we and on sides team, $X our to And to were at range million you it. That range And have MKS. would standalone, range we

Thomas Diffely

And the big And more that you're station. like assume base talked handset And leveraged part the more of XXXX as the the driver. being then, seems -- about I to you versus John. episode. rollout finally, XXXX, XG handset's a When it

of great. the kind just -- through just, that'd on it you So near-term of what what go opportunity be couple you is a a be versus in of kind could basis think years if could

John Lee

Tom. Sure, Yes.

near-term new stations that's So base lot driving basis, on a technology. of chip the a

going to market. headsets, kind capabilities materials starting being where for forward seeing help what start And of of that's when a those core ESI you the that's though, business. would And new that So affect MKS handsets. our then that's are enabling the adopted

ENS of the is side. more the more then near-term So side VNA is longer-term of and

Thomas Diffely

be is say is the bigger to much a But opportunity to the for roll that out Okay. it handset fair going longer you? term,

John Lee

the that the as has as side. Yes. Because well both side VNA flexible PCB

Operator

today's I remarks. Officer, further for that does Executive session. the call you. back to And question-and-answer conclude Thank turn would now like Jerry any Chief to Colella,

Gerald Colella

pleased XXXX. We our results with are of first the quarter for

Thanks And position interested financial put to more for will you're us has end outperformance operational that we that strategy you ever on growth. the in and quarter progress semiconductor exposure a on today. place excellence and our market, forward focus that our results. our XXXX I within the in than when financial second on positioned we we diverse Thank we us updating leadership sustainable markets, drive to our am and the global the serve. MKS, if confident We look continue for markets profitable in to you. long-term joining report call expect

Operator

does gentlemen, in thank today's and today's conclude for participating This Ladies program. conference. you

may Everyone, You day. all disconnect. great a have

MKS Instruments (MKSI) 30 Apr 192019 Q1 Earnings call transcript