CCMP - Earnings call transcript Q4 2020

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by and welcome to the CMC Materials' Fourth Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that Today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to one of your speakers for today, Colleen Mumford, Vice President of Communication and Marketing. Ms. ahead, go Please Mumford.

Colleen Mumford

our and Relations you're President everyone. Beamer, and Last the September results and Carol year we full are which phone, us XXXX, Vice me online David CFO. ended for reported we Li, CEO; XXXX. night, quarter good Thanks and With fiscal Whether morning XX, today section President fourth joining Great. and over Scott script center or call we've to our made slide available our of after live review the will Quarterly the and morning's website you A Investor encourage cmcmaterials.com. this on comments presentation conference Results on conference website, be webcast of the under today's available call. also shortly prepared investor of this the

information include to actual forward-looking uncertainties Form that file including XXXX. assume ended September reference of statements. for this of no discussed our this XXXX, non-GAAP These request our Please SEC and to that risk of in Also, ended calling factors other XXX-XXX-XXXX. remarks are June at number cause from may expect fiscal our and Investor XX, statements morning Form certain may filings, that results the office any our XX-K today for factors XX, differ measures. the we which any forward-looking update XX, risks, by year XX-Q remember November our to XXXX quarter materially the by these obligation We involve forward-looking a discussions Relations You could information. financial

comparable financial slide GAAP a measure nearest the each and of include non-GAAP presentation release earnings Our financial measure. to reconciliation

Dave. in over values slide throughout accompanying now I Additionally, these to turn presentation. the the rounded discussion will this and call reflect

David Li

we Thanks XXXX. Colleen. and Good fiscal full everyone. fourth year quarter night, announced results our Last for morning,

COVID-XX that our solutions, I'm first record challenging and teams company has our our excited to as following report Before highlight efforts customers to by date. to my X. during support environment, results, impacted employees safe the meaningfully as this also and for again October express globally well for deliver manufacturer CMC our innovate, name change to keep I'd and time our as gratitude and on rebranding our materials like ability their to not discussing been appreciation to results

As celebrate company. being year our XXth we of a public

brand and advanced that Our to materials reinforces businesses our technology quality, new Microelectronics and high KMG corporate resolve customers our supplying identity Cabot technologies our enable challenges. and commitment unifies value leadership, most high operating and heritage, specialty help

homage semiconductor focus pays to heritage, on remains support our unchanged. materials to proud Our our including new electronic the name industry, which

performance full CMP Turning this quarter. to we strong pleased slurries our fourth in quarter with are and our electronic and results, and chemicals year growth

lower products, total primarily prior to to the due performance was impact to compared of revenue continued Our to the due down in company pipeline softer pandemic. year, experience which our the slightly for quarter demand conditions the industry

compared node This I for We year revenue home customers. than by believe full as most Moving which wood strong we forma benefited work memory, solutions and as to year advanced revenue. from challenging foundry slurries demand slurries delivered Revenue due consecutive transition for our our the dielectric fiscal and also full growth, exposure pipeline on tungsten resiliency the and advanced progress X% revenue businesses no which industrial CMP its in our e-learning best-in-class and advanced robustness, the applications. well various stabilized driven automotive logic with was results demand by adjusted income the results, transition. assumes to in continues customer higher CMP supported cycles. sectors. in CMP and and from of of with environments, strong demand chemicals our expanding and demand year, for across and migration XXXX. year made owned pads This positions our more execution new business performance industry advanced to X% be increase by last KMG up EBITDA and record reduced advanced from to environments, and strong applications year, this net lower fifth offset weakness our our legacy within also legacy in higher business, slurries the hallmarks to Electronic resilience, by prices from and pro treatment continued was technology offset profitability benefited customer revenue revenue, company. of and for and our of record versus the positions won was our demonstrating growth customers one revenue increasing prior But again businesses environments. the we and of is primarily record some and to

ramp by pads offset partially headwinds we Our to experienced year, pad business customer these up and years. next the this that over new were several expect slurry including consumable sets but wins,

be product the to prospects for area about We opportunities. pipeline and in continue recent of this our given future new excited the active growth wins

EBITDA offset segment an Materials our for demand which the from to EBITDA from synergies higher unprecedented and of up in due primarily Our X% higher the the KMG primarily drop of was the wood efficiencies fiscal affected year, oil revenue improved also impacted Full drag agents, selling adjusted reducing in second due prices. $XXX by and million by significantly half Performance transport year, year but or acquisition. adjusted DRAs, margin by to prior negatively was XX%, operating demand and was treatment in business,

again specialty in peers. level We of best amongst materials which are our demonstrates our this of class profitability strong proud continued achievement,

conditions provide industry additional thoughts let outlook. on me and Now some

sectors. transitions strong, applications high-performance industrial and demand improvement foundry and customers for as to Looking and from we year technology demand growth into result of as and XG logic in fiscal computing, remain as continue demand as to XXXX, memory emerging from such to customers and a expect in automotive well recover

expect to up compared of flat approximately digits to result, single this the Materials results. quarter's first low a revenue we segment for our to As be fiscal Electronic XXXX, quarter for

our the we in and this quarter, advanced positions extremely logic, believe given grow well positioned Beyond we foundry, to are industry memory. with

in to Materials, lower crude our the turn, Turning for of DRAs in and impacted customers. XXXX fiscal volume of of pipeline due half pandemic, as oil dropped which, the demand in products to by negatively Performance second a gasoline the result needed our revenue

are expected During in the DRAs further the provided quarter had quarter, for an we last September on not fourth did when as we August outlook in demand July, see saw improvement during in been increases details but and demand environment changes uncertain as and earnings the related call. We pandemic. for monitoring recover believe global open The and following closely gradually to the any we industry will stabilize lockdowns. demand economies situation that remains

expectations is point calendar a for and which oil some still should there gradual current levels through DRA sector, to XXXX, translate risks While demand gas consumption. pre-pandemic in calendar and crude returning and into in oil to higher uncertainty XXXX global demand the recovery oil analyst

existing In customers. addition, is focused our with on team and winning new opportunities business both new

first Finally, be end currently on performance we with as expect our from wood this revenue Performance strong the continued to approximately transition XXXX. our this our exit calendar year, business treatment we around customers the outlook, quarter. Based planned and of stable we sequentially and expect in on flat Materials work closely

environment our a approximately total we on company expectations up and dependent Electronic single year stable currently of represent the of to resilience macroeconomic be these environment summary, flat our both expect operating Performance low segments, fiscal to strength digits improving revenue Materials this overall and for continued in of first and macroeconomic factors, proud Given to they In in we the our Materials XXXX. the quarter and are unprecedented results given believe portfolio.

are for given we semiconductor new about our ahead, Looking trends growth long-term the excited opportunities in the technologies. by driven industry company favorable

and broad more beyond technology fiscal continued driven and positioned the internationally excellence. US in on growth stabilized our we both addition, DRAs to call financial are In operational our details believe adoption growth provide quality and the our Materials turn and to for Performance XXXX portfolio, to and I well leadership, With expect of by that, Scott over drive segment. We for will results. product innovative in we

Scott Beamer

hello and Dave Thanks, everyone.

we our mentioned, business. record adjusted EPS generated fiscal record facing XXXX revenue, while record record income, DRA EBITDA in challenging in particularly Dave As net and conditions,

stock. flow future million our capital of free year CapEx strategically flow We in support including cash while investing paying met of this cash and priorities million in growth from record in our $XX expected repurchasing our million also $XXX all operations we CapEx, and record deployment businesses. common to still reported $XX investing worth again, Once in dividends

best-in-class generation, and stated what sheet. our and This two de-levered with The sheet net remain debt we balance in also fundamentals cash businesses ongoing to has our less control. adjusted we of than resulted strong EBITDA a and target continue of to consistent our We flow times. manage can balance strong achieved profitability,

company financial value. shareholder generate growth and confident our ability our drive are strength to We the in to to future continue of and

benefited global our revenue let the saw website my Now, impacted wood provides Overall, pandemic. North on press we our high-level fewer for X Slide and about particularly a summary about of slide last X%. results. from being in posted with with decline shows me our night, electronic in by year Conversely, net continued Slide our demand quarter. results, presentation and driven year-over-year, of to comments about revenue performance will along release. DRA generally related growth speak X softer revenue chemicals in follow quarterly slurries and consolidated to be our financial declined a treatment. for the DRAs in XX% of we the America, higher full CMP oil, resulting miles

increased over pro So for synergies. by the selling our control, strong wood KMG provides lower some even offset that adjusted indicative EBITDA our of Gross EPS which cost P&L increased of ability forma the These and assumes both results. full to diluted we prices margin mix revenue in was X% and year XX%. in grow overall the to higher slurries we prior increased were metrics our treatment in and reported gross challenging information, volume pipeline leverage, may impact adjusted operating quarterly performance. year. environment, of year margin this, owned Using including XXXX. in adjusted comparable as grew X%, a adjusted comparisons Slide Adjusted comparable delivering all report improved XXXX revenue information, the discuss are we prior and for X

was XX% of up EPS tax higher revenue. million, was expense expense benefited income last $X.XX. EPS to related Adjusted the EBITDA was lower One due impairments was end margin carrying quarter from pre-tax by treatment million, same quarter. year. we was operating compared non-cash reported Adjusted Diluted Overall, essentially adjustment income exit quarter XX.X%, impairment business the to business adjusted each is remaining a and XX% year. future is Adjusted lower diluted EBITDA with the down and lower charge business $XX driven $X.XX, $XX closure wood to plan was million which business last million, of related announced to the net calendar the is that Adjusted primarily in quarter income value approximately X%, $XX than $XX in XXXX. net of date. expenses, we the our quarter Our previously lower the as approach The same flat. the net approximately this our around expect $X interest million.

reference, million adjusted this approximately the the segment. in with For business above this margins for contributed EBITDA $XX Performance average Materials year level revenue

primarily stronger advanced year-over-year, and slurries revenue up on to our quarterly was CMP for our to and are which compared X%. X% was business XX% this our Electronic revenue, slurries, the revenue by with revenue and revenue compared we last revenue shown in continue logic Sequentially, up December increased down tungsten increased applications. XX% represent discuss for X. pads Electronic business, growth expect CMP the return from growth same due for of in orders, revenue Electronic year to last primarily let's was results to timing was quarter. period due a which higher which of company. X%, chemicals area segment Now to the X% stabilized demand to year. Materials memory demand by Materials, driven segment Slide

revenue over XX% DRA products. declined performance treatment. sequentially, the in by prior for Moving which wood year pipeline primarily and offset partially to X% softer year, was demand Performance compared to prior declined Materials, higher revenue driven by the XX% sales

adjusted delivered X As quarter, $XX which revenue was of which was revenue. was revenue. of million of EBITDA, by the Slide million point DRA adjusted delivered EBITDA revenue low adjusted of far. June Electronic mentioned XX% segment. segment and Materials for segment Performance XX% Materials so shows last EBITDA, $XX

million $XXX million X, hand with Now $XXX balance refer provides sheet of please total We and the quarter flow ended Slide to and which of some on cash debt. cash highlights. gross

in During of we drew down funds simply balance draw using We million abundance March sheet of them. on facility. the funds repaid caution our our the $XXX quarter, these credit and held an from without the out down revolving

operations generated fiscal and million. was this we million, year For XXX CapEx cash our of flow from $XXX

a cash flow $XXX As result, free was our million.

net times timing the Our EBITDA, which acquisition our completed the below when we we target adjusted debt established was is ahead two of currently XXXX. slightly in KMG

provide Slide caution some our pandemic and that serve. the of our forward-looking be we on We ongoing guidance the by based is estimates, X, nature we Finally, would on industries current these impact the expectations. could impacted volatile and its on

the to to up flat XXXX, be the approximately revenue fiscal single quarter. total For company of we fourth first quarter expect compared digits currently to low

slightly to as flat to For single up expected quarter demand Materials environment. we segment, our be forecast digits low approximately is versus stable fourth the increasing a Electronic revenue to

the in the We quarter. approximately expect be revenue to flat segment in Performance first Materials

For and be currently adjusted we between million. XXXX, $XXX fiscal to EBITDA expect $XXX

believe to and XX% the assumption EBITDA continue short term. adjusted margin is an We an for medium XX% that between to appropriate

with our P&L. full continue for expectations Let's some year

We million $XX $XX and between interest expense to be expect our full-year million.

between between Our for year, full XX% be full to the XX% for $XX expected and we year. CapEx our million is tax rate $XXX expect the million be and and to

factors illustrative results and we is have exit been our the the wood posted investor generally on which model has other treatment XXXX our long-term various to Overall, future to Additionally, previous but with is the impacted provided our updated expectations, in that an fiscal model consistent business. have including actual updated, include for decision website. it presentation,

long-term XXXX, revenue a of compares trajectory for previously to growth total aspiration the average expect the expectations, This challenges Specifically, revenue company primary Materials' DRAs, the between X%. in be fiscal we and same X% business. for this to of lower Performance while optimistic the this growth to total driver is and we X% now grow between we the remain range. recognize XXXX company in on fiscal communicated and and for The X% change about short-term through

continue term record ability is further to We Overall, environment. the margins, long priorities, demand net financial margins. adjusted expect very to and free record deliver upon believe improve investing fiscal best-in-class reflects strong results the than best-in-class our our flow compelling XXXX, upon we delivered our EPS. profitability and we future faster to stated revenue, EBITDA our strength this EBITDA grow of model growth. With despite and over met already adjusted an generation, including EBITDA a to cash revenue and our uneven back of Reflecting we businesses company record our income support and all deployment capital in that

enabling to allow our like reliably continued continue would their focus, for hard work, our us to to we tireless thank Lastly, team customers. global energy to and to safely our members and critical, deliver materials

call the questions. we back take the as I'll turn Now to your prepare to operator,

Operator

Instructions]. [Operator you Thank

Sachs. go Goldman Toshiya Our from ahead. Please Hari first question from comes today

Colleen Mumford

Hi, Toshiya.

Toshiya Hari

Thanks Hi, question. had the I guys. taking Good for two. morning Colleen.

your focused business Dave, DRA? dare also could for And you First, I new speak hoping customers. with customers you again winning as in to as quarter, was on December well the for expectations business, of both that mentioned terms you're current your

helpful. Thank going If internationally remind your upside you. that and us the share where both the you would shared see business can a you perspective from market be and forward domestically DRA in

David Li

Yeah, you're thanks well. Toshiya and hope

as our prepared that DRAs, to PM comments, indicated of up regarding approximately flat we versus predominant Scott our amount quarter. be Just business the make I DRAs for and this in business. guided

macro comments, but significant fair, side his as that stabilization. things be would what of And of interpret for there of kind prepared in is guide is quarter, we can terms we essentially this what a mentioned Scott the saw a thought seen recovery is, directional more that you in So we've DRAs. instead,

stabilized in just of the Obviously, So definitely sort oil I kind to it But things that have a we past Instead, that's see think what And controlling of out. environment picked macro terms where us. that's recovery is a things - we lot strong up. transport from see really see July. we And days. didn't in of that going. these bottom started

You domestically to we mentioned make, of control, gains we've are that we by encouraged and both things terms able - internationally. can the in been

We significant in during slow and improve soft continue that to differentiated we'd but other of continue for thing either, business. are And encouraging, our we about a to to was haven't is I position pick to whether product our environment, secure, opportunity pretty took because grow, what or of the up, period time, expect product talked back this innovate regardless offering. offering, share the we a to the it's see environment, we things expect we that think

So not or a talked about, we've of up copy similar new just of we a piece as brought capacity. current. the That's

In it. fact, upgraded we've

it's also as there's We've benefits. product the So productivity product well. performance improved -

sort strong an our So And And, offering. this from longer as seeing in encouraging we're results growth continues business and a be internationally. opportunity we're this and customers, to both to taking really of expectation our domestically our softer term. mid from period to the improve

Toshiya Hari

I December with and a to spoke in the to to in follow your it think business growth you on quarter. up Scott, CMP question pads a wanted I Got the business. return

a to relative thinking a DRA you CMP slightly how your terms growth Thank your then are But revenue about at if so wanted And on this business. more or about you what's you statement medium-term long-term, if guys target or presented both? about intact? timing you. your guess that $XXX growth of revenue you're Analyst of to growth sort trajectory what thinking lower importantly, pads the still Day? sort sequential was of business. for I of I'm used Just how million a in statement that's you talked to clarify, curious have for And that? the business

David Li

in I I'll in as what chime pads don't this think On was pads, predominantly we really inventory. well. and Toshiya why start Yeah, let then saw I on Scott quarter

was a customers we the to more has had for it that this have And quarter build lumpy saw as - growth you has business did last little up quarter. us. But high had a business. So few know, It we be can this line effect a and a we also bit we growth bottom and is headwinds. high But sales be pad that been this some some inventory the quarter. expect so

moving parts about some there's think we've I the remind. I'll talked just that and in business

faced, have of a pads gradual had terms legacy of the of we've foundry headwinds a we the, working that kind at through. In decline some we're customer

also - talked out customer, about is not We quarters they a ago several business Korean that, they're a proven. of local where piece at trying out lost well solution trying pad were frankly, a

more both think I previously we've have behind able to us. we are recently we're secure discussed, are is I of about and the most think set. those - of really wins What those encouraged been consumable those been

validation a think both our have slurry optimized. So been capability I that's great unique and provide that pad of together to

we of advanced Both this with as quarter, were those producer memory wins producer. secured a major major past well logic Just as a consumable sets.

we as going So we that forward. some - wins, business. in obviously was year continue to we I we more regain that the wanted. think again, not this a but parts to fully But still expect long-term, business, we're pads overcoming there's headwinds some that But result moving think strong this growth trajectory of the with

Toshiya Hari

Thank the details. you for

Colleen Mumford

Thanks Toshiya.

Operator

Please ahead. Global Securities. Our next Harrison Mike from from question go Seaport comes

Colleen Mumford

Mike. morning Good

Mike Harrison

good your I and bit customers, in business, little if levels wondering advanced side or amid morning. their back you pull that global, well of of environment, to you maybe are the need terms work of both Are levels? some on in sluggish, the the that as inventory what seeing could as legacy of rates. going rates customers inventory maybe you're some production macro talk production any down was to seeing Hi, a about signs

David Li

you're well. Yeah. And Mike hope thanks.

is what really in that we've on by semiconductor I think of demand in stable, really about the And an logic the encouraged strength and we fully that historic from foundry build advanced recovered and we macro the XXXX. but is industry our seen way. continue to not comments be, to yet from side, in sort Memory the leading customers. talked standpoint prepared are the

I So it's you full demand at if the be utilization look memory. they healthy. in stable, to but drivers, to But not continue quite think back underlying

systems the We've are a of for pandemic lot is driving there's also I launched about obviously, and been think devices, that as that demand number this also in role devices that. as recently, tablets. XG for new So demand. a But of connectivity, have gaming that technology important, driving playing PCs well talked newer really then so smartphones,

from see don't appear to demand our customers chip So quite that channel we that healthy. any problematic. is be see inventories dynamic or We inventories

like looks healthy now. things it are right So pretty

little of comments talking If on you Samsung, bit from softer for them. calendar to side perhaps are listen the QX memory a they about a

fully their that stronger on side, to this pads in not as you headwinds we've been past some if in recovery kind grow haven't to memory recovered, XXXX. seen able fiscal and then And well a into of We even our comments. was achieve despite what year, business. having our as we're That about able think

So a but resilience it this in strong year, and to for strength electronic strong overall alongside that environment. slurries, pretty and industry especially portfolio, speaks think chemicals was just our particularly I of the us

Mike Harrison

center I then Do the dynamics? have Intel, of about high relatively Intel, dynamics terms and I weakness. some some your on ask right also has on you of going the going of to commentary forward wanted chemicals sale concerns believe the any around of those exposure there All data memory in business to business, electronic their

David Li

advanced is, the obviously, I a given so a publicized. nanometer. us. edge, the Intel, been what fairly the now think say XXX I it's would They're we've the the certain Yeah, customer an is with most bit so who's to well Intel on right our we're struggling to chips, producers. edge, leading Specific extent important participation agnostic and manufacturing as To to seen leading

there. them programs, with with they're behind working those are the - leader on those We but

quite hard high the manufacturing on is and strong. what is outlook processes running really right so yield their them we And continued pretty see now, high-volume doing

having seen pretty the fact, challenges in the while I So affect they're with now. And newest leading-edge technologies, we right that demand. hard think, haven't they're running

Mike Harrison

right, thanks much. very All

Colleen Mumford

Mike. Thanks

David Li

Thanks Mike.

Operator

Our next King. from David ahead. from question comes go Silver Please CL

Colleen Mumford

good David. morning Hey,

David Silver

Hey good so in punch morning. I fast. didn't

off So you're little here. catching me a

a questions. I couple Just of had

just me Let find here.

the just a treatment all, assume of relating operating maybe I'm but of - 'XX your that first business we couple 'XX? wood and on to second full the it Scott, off adjusted and And all guidance for lower end So fiscal lining thing treatment quarter just normally guidance. you. first straight EBITDA, fourth year just of of an for is up wood a that the lower the company that of be effect full expected we of tax adjusted of level in Should a year forward. assume tax year be does due XX months would year rate of whether 'XX going your to things just like true was item should tax rate a or bunch for than kind that discrete then Thank

Scott Beamer

mentioned wood mentioned unpacked above in there little fiscal We XX for bit the comments. the XXXX, business, revenue million David. we in returns we Sure, and were prepared Yeah. that average And are a segment. the that the for that of

the that's I I'd pretty there. being business consistent in wood and you for as But return the of amount of treatment FY that for understand good the And 'XX. there. you thinking revenue the all And business projection. think said, that EBITDA has the the So well business both a full for be

that Our business. plans to continue to are run

the $X down. write Now million mentioned we

approximately And comment probably we worth the mentioned So here. $XX that value left. business of a it's million, has

we it'll earnings out that item, and will upcoming We that an that basically And down over be writing as adjusted we be the business a quarters, item. we'll one that of as non-cash It's down, revenue be run time. and business. earn writing

So we're are throughout for business, this with business the because profit period have of you the it's secured the time situation, rich, volume typically our customers. we different when so in exiting a

tax is of David the to a have business. mentioned balance on terms the we've of year-end business, But part and rate. 'XX the mentioned, that there was of in value bit that as different in terms you're of all sheet, We're the KMG, has of to provided Then optimization. there's in tax kind time with And opportunities plan and a EBITDA entities, the run so you're some but for past. - complexity on, quarter also the true is that legal of as The acquisition a right, of ups. in align company that's the that passes rate, and noisy So were the couple our us to today we fourth a our continue after FY right. much of for you've

XX. to of of XXXX. gives price, year of And for FY record particularly some in run about our well that we think So second share 'XX stock XX% benefit, that the FY be as activity were onetime the you able guidance XX I had to that about was benefited benefits rate next that items. of from a next GAAP in some us XX 'XX, to would XX the fourth XX%, year providing quarter half non-GAAP tax if But discrete for were the full that about rate as rate we're nice non-GAAP option our that using XX guide year additional fiscal because your up a we in as extra of and

don't we so into FY assume of type And level that 'XX.

expectation But tax there's are rate. FY continue comfortable a 'XX. at an going little XX% to why more for look the optimize XX% that find ways to increase that's to to bit that in we're of to So

David Silver

that. for thank you Okay,

the I earlier clearly did wondering You about into business, about very was comments so those just make wood how 'XX. it flowed

you the for So thank clarification.

quarter highest kind about was of three, up spend year-over-year, was your fourth the four the it in R&D sequentially so years. spend spend, R&D Okay, and in up quarterly

fourth we think more was you the fiscal about both particular and if quarter line led wondering on in on importantly what increase in 'XX? just should in maybe So for terms the comment what of that could that I to you. year Thank

Scott Beamer

into Yeah, XX% right. invested at variance as We've of in that I the R&D side, supplies structure bit and rate, year, revenue - area. CMP have of on quarter-to-quarter on about right been little kind first our worked And the organization the R&D unchanged. is David, terms the back particularly so a looking off, on businesses, spending I about have of mostly we think that's for been I'd businesses. There R&D in full in our think historically you those the on some think of underlying our of

revenue. I the be sort So full of approximation R&D next assumptions an to relative appropriate thinking for would level your for year of year as

spending So about maybe of that of piece, to revenue the ratio a thinking little be but bit forward. same just discretionary noise from sort going quarter-over-quarter,

David Silver

you're parts about EUV just side manufacturing aspects are the layers applicable some memory how certain Okay more and if how to did more, And that company could you about your the more process, business had you and you. picture evolution impact on about the development. thinking I'm seems that there's And are of the levels. at indication on just logic more we're some the chips like the but lower I for ask that mind, has pace of and accelerating which width. other things and positioning EUV think. it maybe and chip comment there's the wondering on more Dave of the one may the I shrinking shifting to bigger of Maybe of question. process, want the And EUV don't talk Thank making into chip line be DRAM date? even the to light But materials, kind it cobalt

David Li

getting as both And and and allowing Thanks the better more would always a chips. smaller look we to them cobalt UV, for way David. say, industry finds industry. The I powerful Yeah. continue and at

without a UV, don't logic using five-nanometer UV. chip produce think a you on I side without so And example, could for

ourselves when something and excited our a from technology related So leaders, of CMP demanding. feature an certainly we're customers can we getting nanometer consider enable smaller sizes. leadership continue technology are standpoint, The challenges and extremely to like chip also that smaller five for EUV on to cadence

that is it's I something closely path because work miniaturization. EUV, that five that using plays customers our a you solutions chip. the - feel into but really think is to challenging and to a but if time nanometer And material it you continue on is want obviously, like so logic have have we do Cobalt we And sub bit a Without with cobalt that challenge. are spot. make definitely EUV cobalt, sweet like a working different, might

really on only the You I way. right think going get other cannot to powerful that they're and smaller pretty it's and the memory Again, chips use more mentioned side, now. limited they if the

it's So I - those see CMP especially focused CMP the impacting notes. very significantly a done from we don't it CMP, more or has importantly, think the because we standpoint, on of TAM of niche guess it way and

So It for our the get forward. we a to amount. fair that a it's plays see like technology we to But us, move strength. question

So thanks.

David Silver

Thank much. very you

Colleen Mumford

Dave. Thanks

Operator

Loop from question Please next the And from comes Kapsch Chris Instructions] [Operator Capital ahead. go Markets.

Colleen Mumford

Chris. morning Good

Chris Kapsch

Thanks. Yeah. Good morning.

- question outlook expectation. line about is comments just for then EBITDA the my provided take a your into margin, the top generally that you range, you So of about and you back wondering if that XXXX. I'm kind EBITDA

- And maybe expectation that if about you this are memory. starts. there by year your industry get general about and Just in if calendar expectations what the wondering you node bucket, PORs? about And or do to you need then on in participation of terms some boundary get wafer year different those fiscal excited talk there those though, along lines, in from transitions based any this particular logic, there is you're

David Li

you're Hope Chris. Hi, Yes. well.

oil in recovery memory it's factor the semiconductor estimates have memory of strong wafer kind sort sort there, the recovery, middle of many is it's there demand a side, that just if which assumed of the for on we - mid environment positive the on there. growth. for What I'd And a that. macro upside, what right PM of the to low memory conservative In some to terms guidance could on side recovery dependent year, of doesn't so be the talked fiscal be did top starts We've made assumptions improves. into say of sort well. as That of single digit you're But in provide out - of range is should stable macro then for obviously, we've so the is back can about, line we a environment. would the kind fairway, there

secured and both advanced technology we've excited. little logic were in slurries, question a also talked with comments bit nodes a We You about about advanced nodes our memory. we dielectrics more positions in prepared about asked our and tungsten

segments. layers, side go about, see So positions as excited because the to on nanometers. key foundry advanced secured makers the XXXx logic side on you within the Those we've five, three that memory then NAND both and get to we're those are positions

the I we're plays forward, question, in strengths. excited that our moves technology So whenever previous mentioned to the again, as

about would logic see on And you'd of we think as memory so side. continued XXXX, we the progression and assume

Chris Kapsch

a on another your if have - processes me - on And also their manufacturing are have it's grocery yields seems the obviously, on more and HTCC, you where had comments your about expressed that high-volume disproportionate of though, to they've you response advanced up known then the And their running node. on the curious, big in sort node, really indicated to Dave, that into processes. had just would biggest high-volume that yields. leading-edge that your - on customer. or translated I was the they're from I'm And pushing challenged Okay. follow hard well It for question share. Intel, so challenges where more they're have demand they

comments So observations? just could you those reconcile maybe or

David Li

by somewhat out we again, EC. muted and what Yeah, in was some But customers see specific did did is we didn't it Europe. and HPVC. of call But talk in about softness we some growth

and America Europe. we're where So Europe, those In on tend about focused if in automotive. and you - be strong we're think customers industrial North more to

sector a really And that recovered. that is hasn't so

have For running they running been continue and hard. hard, Intel, they

it's changed the of that's So not sort quarter. over last something

break in trying be So that to helpful may make dynamic that [ph].

Chris Kapsch

tend of can HPVC those mature on to be run more nodes. of technology the inventories rates fabs it, some of those the at of - Got depending sort that of some there more maybe

David Li

think that something be, they're they - inventory - when the could it's going about similar there's side. it's that way but significant build. see if to not more I consumable utilization, But we're down a the to probably slurry, There to think in - turn it's more

Chris Kapsch

and a last were loss Pads at more - you little you sales Got foundry I tied and mentioned then on it guess to there's bit down, around think up the maybe it and the customer. discussion a some business of competition some one the or I follow

So legacy. you mentioned

pads think not I said node. you legacy legacy

with there? products So been why product able I'm next on just offerings better and wondering of if a suite business, I'm And that versus little - of DXXX the to a under wondering displace cleaner neck vulnerable wouldn't offering. your if planar piece what's trying you've the that the understand was just bit one that to just of referencing going dynamics with

David Li

while a there Of I I that a It course, family won It to finer it's And fair think refer in always replacement next legacy and say out it It's to replace obviously business hasn't prefer we at would have we've could that did the using we pad for the competitive. had some kind. question. with customer, and technology. foundry ourselves. been just

of there in obviously will And those we've some both to advanced about sometimes ramp that memory talked technology. it. that's take logic so at think some how time phasing but wins And it'll the play out. is and out legacy player We up, do dynamics

Chris Kapsch

record you offer presumably, if a of the is future are is more at the for advanced those what fair Right, really wins weren't to you've David been of process of through and pushing you that haven't technology node? industry sort as a that loss mature - ring say this POR, at presumably so is been it product definition also the by nodes the advanced

David Li

Yeah, that's correct.

that'd advanced think winning on be at a we're assumption. the I good And technologies. focused

situation, side. legacy in that We have more as had well. we're winning on of the But some particular displacements advanced

Chris Kapsch

it. All the color. appreciate right, thank I additional you for

David Li

Thanks Chris

Operator

to comments. back I it the Colleen would final concludes This Q&A Mumford to call. portion turn for like of our

Colleen Mumford

Thanks. have you your Materials. CMC Thank is for time for the questions we all in your this and morning. That interest

Operator

this call. today's disconnect. and again and Ladies gentlemen, Thank may you concludes now for participating conference once you

CMC Materials (CCMP) 12 Nov 202020 Q4 Earnings call transcript