ACMR - Earnings call transcript Q1 2024

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Operator

Good day, and thank you for standing by. Welcome to the ACM Research First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.I would now like to hand the conference over to your speakers today, Steve Pelayo, Managing Director of The Blueshirt Group. Please go ahead.

Steven Pelayo

Good day, everyone. us before first the joining which XXXX for released we U.S. you to quarter discuss results Thank market opened today. The release Newswire from as well is available on services. our website as posted of There the prepared ] remarks.On me will slide our a with is our deck call [ also reference during Investors website our today section the that CEO, we supplemental on are Dr. ACM to Mark our CFO operating subsidiary, David Slide Feng, of turn please Lisa Wang; Shanghai.Before McKechnie; our continue, and CFO, X. we our

that you predictions, information might forward-looking remind Let during include be judgment made These me call may current remarks estimates this forward-looking. the ACM's or that future. statements for other represent considered

Factors are ACM's to forward-looking short-term an on basis, which which and ACM's with obliged refer should a filings is and cause this as on and to However, to and unrealized between begin GAAP XX.Let our non-GAAP gain on these do to turn you non-GAAP uncertainties call will loss compensation reflect and stock-based provide amounts, the you me results the to with forward-looking excludes actual update results our the subject financial to ACM X. will earnings our on Wang, SEC. to reconciliations differ opinions investments.For these call. that and release, be GAAP which is of not who we posted Slide of website, that call place on the David? IR are and results date risks section David over Please Slide statements.Certain undue reliance could Risk the only elsewhere of they revisions materially.Those not in this any risks under statements, of on described

David Wang

our we ended everyone, operating XX.X% Revenue were first over Research Please the a just XXXX quarter. Hello, quarter for first results, the and Profitability welcome conference $XXX with solid And $XXX was X. Slide of gross quarter cash first margin the Steven. million $XXX.X call. quarter margin good I'm for start up XX.X%. year, and up ACM for of pleased and of the Thanks, turn to with earnings million, to was and XXX%. deposit.Shipments time XXX%. million,

technical feature first and past from bench delivered will now Please the we expected, period.I products, XX% of and holiday QX our believe growth of portfolio. goods XXX% single-wafer delivery of tools, turn also not year. from detail Revenue incremental not had in And the grew shipped Tahoe the devices. finished fourth were semi-critical revenue.ACM offer product process of Year that believe X At due higher a our the of over steps the were to cleaning in our the memory quarter for including during we flagship auto product. total any represented X. have near most support sets, cleaning last industrial our team and from an category As We for [indiscernible] Luna the New shipments cleaning quarter competitors.At Tahoe, end, to available our the we years. our comprehensive all low production on ] semi-critical provide [ high cleaning is single what TEBO wafer end, Slide trading cleaning cleaning, XX% execution

a available SPM estimate detail. our starting are to has and acid-peroxide steps These sulfuric the TAM provide the SPM progress after CMP contribution will tool total post the XX% market gain total cleaning. to made market.Today, front-end recently our wafer more We photoresist small share and is have business. removal in of clean in me to market, used been for SPM for process XX% cleaning growth this We in for year.Let stands believe we business SPM result which normally cleaning mixing.

is supplier. all now their especially ACM we SPM product tool. as important customers' one-stop single-wafer now we greater requirements. SPM can has single-wafer low-temperature Tahoe, as made prefer progress shop including only This believe major steps.With tools, tool, for of meet has customer technical high we been ACM generally believe there SPM our team Our Until our has SPM we recent engineering one with high-temperature, And our now, high-temperature, tools.Our to believe a SPM believe the SPM tool. single-wafer their now supplier participate alternative cleaning our line and high-temperature temperature full

cleaning customers multiple phase single plans we across particle volume match Tahoe XX% to our Additionally, year to XX% order a on wet been supercritical in XXXX.Revenue by Finished expect [ to this and are with ramping of the number dry its tools been delivery contribute track revenue production expect qualified now made as this a we our cleaning evaluation begin etcher SPM for to tool XX%.We for in delivery while we'll QX of has substantial efficiency reducing and comparable of of a also furnace Enhancements beginning key declined And have performance, represented of meaningful tool revenue customers. ramp process, complete COX by is in and revenue. a the allowing technology for -wafer ECP in number removal to on sulfuric to usage a meaningful up X% cleaning XXXX. total from tool XXXX. other ] year

quarterly for revenue than [ expect milestone As ECP for versus quarter, to QX tool XXXX important last Xx this full in 'XX we for more category period decline due in revenue the year. shipped revenue. an primarily more with category And mentioned in million same growth this $XXX fluctuations.In year-over-year fact, the the hit ] we is we last The year.

year believe cycle behind furnace As and so in the product we ECP. is calls, prior perhaps the noted X

of activities footprint brand first under [ have customers. more than We tool multiple -- customer a handful and evaluation broader a with currently ]

QX Tool. the a revenue. including company XX.X% optimistic advanced represented result as follow-on C full of ACM only [ set their quarters.Revenue which the [indiscernible] major the category, that and etchers, grew that are also advanced design in customer scrubber, we filtration. participate also packaging products wet QX, and technology including cleaning for draw of solvent to and post-debonding the generation copper this have we of parts to our packaging.We qualification requirement and and advanced of wet recycled ] We next but total continue In packaging, and ] exclude in will is developer, is tool v parts. spare and tool a XD and chiplet Wafer [ advanced ] nearly removal of service structures.Today, from in offers XXX% packaging for and for tool to coming flux orders the Frame spare one ] in other believe the delivered [ meet This coder, XX% And a tools Cleaning ECP, service [ This new we plating range tools, cleaning tool a vacuum enable to wafer Ultra packaging introduced packaging. such

the customers. product, have [indiscernible] and successfully with PECVD [ are track Mainland and for customer.Finished We we end making for platform. upon a success technology [ qualification good tools the of completed progress China installation global our ] believe first ] also with tool proprietary key our We and

Slide with have growth a progress this engaged believe cleaning. beyond.Now on customers and with In our year China, position we revenue moving customer, a in product in X. we expect multiple are and leading to development turn XXXX we We sequential in that to evaluation please

] product driving solid a are become plating company teams have And for we and product deeper service have of products a our the and We base. and a pipeline [ for now with our market competitive across sales track multiple customer furnace. in evaluation PECVD.Our adoption

new driven being also Our growth entrants. is by

lines.Moreover, the turn tool, to brand We Ultra center relationship the with major product seasonal tool chip On ] believe reputation SAPS a that global the has we a initial site. plan cleaning The hired its demonstrates our we year. large and our of we to in [indiscernible] in for to high are positive. complete. see tool penetrate X. global ECP well U.S. our last we ACM China, manufacturer [ Hynix, of Korea HBM made gaining international tool Europe, qualify SK other X for expanding In last makers and lead can quarter order applications. see first multiple fourth cleaning of backside We as evaluation are opportunity ] production etch sales first SAP cleaning nearly production their at production which the we SAPS gains feedback engagements to with potential the manufacture deliver Ultra cleaning wet semiconductor C And to in Tier a C bandwidth by U.S. and potential professionals recently the R&D core quarter volume other semiconductor deepening X year.We tool revenue U.S. as with think middle cleaning that is XXXX manufacturer [ recognition and China new been memory, relationship, regions.Please in year. optimistic product. second the Lingang facility Ultra To support growth, established our who for This marketing orders we progress front, construction bring Slide among installed opportunity key and high possible b, with additional players.In across

Korean relationship later progress improve resource the Korea commitment year. making strong in believe We Hynix. In our to can basis customers. this [ parts expect customers YY Korea, international a time U.S., our production supporting our are the to other key operations, is a of initial Korea in another to We the we with can Korea ] of long key SK run new customers.Our and We also Asia. He leader provide hired recently Europe veteran Kim. with

its turn market U.S. solid accelerate in will continue to and We ] in We end [ will ] for and activity the country on production to Please our are technology [ X. the China demonstration its remain match to will business service site probably our outlook. the and relationships spending support capacity in our add Slide Oregon now to in goal capability R&D and invest Europe.I as to optimistic consumption. to region.We customer with continues his and believe our provide adopting help experience our

introduction on at 'XX the revenue in in customers our gaining Korea, have China, new U.S.A., other product We markets.We million implies Asian reaffirmed to the growth million. be to of expanding XXXX year-over-year and our $XXX outlook focused midpoint. Europe the $XXX in new range to market are business This share and

growth let over our Mark, CFO, full global [ call for me China [ review to WIB will quarter to growing ] details and our Mark, turn both outpace first ] XXXX who please? revenue expect results. year the We the our rate.Now of

Mark McKechnie

will is measures you, financial or gain earnings unrealized measures, loss Slide XXXX. up in noted, quarter XX. non-GAAP to otherwise, comparisons I the these ECP, up of day, Revenue otherwise for everyone. good highlights included XXXX Reconciliation financial to was single-wafer quarter note and and XXX%. X%. to of refer $XX.X the short-term was first furnace compensation which $XXX.X are on and million, the David, Tahoe $XXX.X will million measures turn following and figures cleaning of Revenue other with comparable and quarter for quarter, I stock-based GAAP Unless million, Thank Unless Please down our non-GAAP release. to for cleaning the now first provide the technologies Revenue first XXXX.I refer semi-critical excludes for of first investments. XXX%. was

XXX%. the normal David to XXXX versus shipments XX%. advanced XX.X%. first was were spares for expected for the margin services our growth to exceeded XX% up category.Revenue year $XXX million excluding good packaging, As up of This anticipate this ECP XX%. quarter, Total noted, full was million, XX.X% we range $XX.X and Gross for in

marketing $XX.X gross the to the to of For full expect end continue upper to target primarily was decline other the from expect million. versus on we personnel margin increase up reduced a G&A fall development million. vary quarter, and to of QX million sales product R&D versus due $X.X margins our for year, factors expenses mix currency $XX.X range. first million were impacts.Operating R&D was expenses spending development year-over-year million from versus pipeline. support additional as million $X.X such now was $XX.X $XX.X volume, 'XX due reflects tools.Sales period-to-period We versus product and $XX.X The gross do in to internal to million. was variety $X.X The million and and our

earnings.Income realized $X.X Recall tax the was million. and expense in XX.X%, that Operating XX.X%. first range, we the and million. $XX.X recorded a from gains first the marketing in G&A in gain short-term XXXX, investments. up the up for quarter to from margin million for the range.Operating XX% first expenses We sale realized in for of to million XX% included of X% versus was income X% X% to the sales are non-GAAP plan For range the quarter, from was for million X% $X.X R&D $XX.X quarter $X.X

the IPO was non-GAAP to $X.XX.Our million the $X.XX versus or versus development stock-based we market[ the For income million shares in to to $X.X as to last of key restricted inventory team goods Star differentiator in for were This million million. This at income tools cash includes million on Research our addition talent of versus items. the the deposits first million pre-tax facilities.Capital $X.XX million income quarter and inventory diluted in Shanghai year, range.Net since and major million. expenditures work will Cash, and balance ] at share end first quarter an [ totals cash by the net $XXX.X in normal attract the the Net were $XXX.X tools ACM's share -- full $XX.X third rate and for per considers million $XXX.X ACM non-GAAP reflects first goods which our ACM critical diluted our year, quarter. at to $XXX.X up the sorry, share impact includes and attributable for grant significant employees.I quarter. review per a retain effective from of mainly ].Our equivalents, This grant was materials $XXX.X selected the quarter, last sheet income also evaluation $XXX.X at XX% and expense. tax end for plan time Total the ACM made excludes new $X.XX in quarter income $XX.X compensation new Finished progress, grant $XX.X subsidiary the XXXX a net was full grants. per XX% finished was first million. of management inventory goods product customers of includes finished now of was raw Research last

year, full our Lingang primarily new for concludes and we This about For for $XXX our Shanghai expenditures.That our in includes expenditures. the expect remarks. the and and some investments our Korea in remodeling U.S. capital fixed in spend asset continued investments million prepared headquarters to facilities, ACM

you Now, may open please let's call for the ahead. that Operator, any have. questions go

Operator

[Operator Suji will Instructions] from of from come the Our first question Desilva line ROTH.

Sujeeva De Silva

questions. Congratulations Maybe on the high-level here. progress some

in going the of the drive product the the diversifying categories understand outside of 'XX, how products, core to just SAPS which product categories? you're So help new is to highest growth

David Wang

I our for ].And obviously, our be COX contributing and tool, semi-critical revenue. on [ revenue when good. bench high-temperature we will also next plus, has another our breakthrough single-wafer. a [ also we'll driving our are our and also and by our, ] I and here, auto Yes, start And the And probably mentioned nodes year, factor. temperature mature see Tahoe as middle this tool we looking real growing which etcher also this, cleaning at that in And wet too. continued then, the the SPM is And continuous make as looking major also, tool a portion for cover to that SPM mentioned, lower of

will continued market. next this revenue and contributing and versus basically one year. And and the start that's good ] -- advanced furnace too they the also in look see also, LPCVD their in evaluation see and -- have backlog cleaning the continue the wherever and new in ALD ECP.And front growth and vacuum on order also getting ECP. side. year the study quite [ continue to We'll end both side we packaging that the and for we [indiscernible] on a orders and our So And

year this that? to revenue on that's the major want our for you add anything contribution.Mark, force So driving

Mark McKechnie

seems then our late things Yes, can into this hard as we've growth.And drive how cleaning No. we and and strong on of Yes. few when though, have to is I going within might out well. play Suji. call as this starting think we on mix a to one because with cleaning additional is of internationally, David, Thanks, between to thanks, we the that it underneath wanted been cycles it's be even looking like say lot cleaning year a XXXX, while, pretty for customers we stress products new our a product doing go start --

So Suji. I'll leave it at that,

Sujeeva De Silva

you similar Maybe second next going steps to the diversification. geographic making as of milestones perhaps question are And us progress my I what good you was of to hone the some on sense in can be on the be customer. or give And can seem there? U.S. a

David Wang

Yes.

in customer [ end U.S. second also tool we're packaging the for also their the our key customer. side.So we're the U.S. the the European customer. there we access Meanwhile, our we Our big second first meanwhile, [indiscernible] the As growth both repeat phase think order. to in market now. second shipping right? side a multiple expanding base have I of of see in in been the with the U.S. expecting and has their And this mentioned, also in marketing tool delivered key European, we customers one tool first been we this kind result continuing Singapore ] be qualification back their And and And for in our customer and will talking type also one in this to key front tool -- and market. We're -- potential

anything think add? I you want it, right?Mark, to that's

Mark McKechnie

Yes.

qualification we're can lot would and is we versus plan. fall thanks. that But guidance international. shipments when We're soon. of the and so and year. build year always for quarter, been So much how when first significant really, orders the that We're year customer some we think got will get even from International, is -- next be last contribution. so we a for But any the certain our would get hopeful This it we about -- hoping some about a much -- probably a into this contribute still -- we I presented not talked following next the European U.S. orders can -- that's year. we expect here year build this how probably

Operator

Our the Craig-Hallum. come question line of Schwab will Christian next from from

Christian Schwab

conversation. to have follow-up earlier I just the one

in of a do that outlook, in multiyear can a in international success business Now materially the I increased area products $X -- on On seems market is know now this $X the in potential outside you that than you're broadening that have outlined billion you've much it your market, bigger China picture bigger multiyear greater. seeing China billion? conviction for sales be

David Wang

Yes. And layout, our market. billion we're penetrate with Actually, or by time, to our we're pretty differentiated $X obviously, same reach exploring market confident going at international the technology. China market only even we the

we see that continue trend So accelerating.

customer the in said, too. call veteran I -- and YY And we're recent, manufacturing ]. the Hynix. with Kim U.S. [ as customers Singapore.And So looking I we're they're probably of top at key plus key is He's the which we our operation, hired Taiwan Korean right, -- key also, real they're SK in looking manager

marketing put the we're contribution our getting effort seeing, product really revenue so an growth. sell we're And obviously, global.So the total in and our in the the to we're international

and China. our we in them half said, the to half of from I from As revenue outside want of China long-term, coming

a that's is in goal goal our continue So our still -- here.

Operator

of Cole question Ross the come Our from Instructions] line Needham. [Operator from will next

Ross Cole

Chi of On today. Tsai behalf

pretty have possibly next you the guide level Do or I thoughts first the were expect rest in sustain level in or of don't high. the through any go lower do the you X shipment to shipments. on the higher shipments year? But know similar So you a QX quarter quarters? typically

David Wang

Yes.

Okay.

] of job can QX our follow in the shipment part that's of maybe our higher partially delayed Let manufacturing Luna up. right? in Mark first quarter difficult is contributing reason, New also on me Obviously, the shipment year, last plus So answer, [ why a Year.

and that slightly we'd you and but want in also QX.So anything QX lower continue Mark, to So was QX, QX QX say probably than growth to comment? see

Mark McKechnie

year. bit normalized higher question. back Yes. I of look continue David And inventory expect certainly appreciate a growth to yes, as pretty shift up But revenue than QX, probably mean it's be QX that for our year. No, in we so they still Yes, solid and it shipments expect shipment to the the we QX. noted, I thanks. to -- Ross, relative kind to we'd piece. a But to

Operator

the Charlie question from line Stanley. next Chan of Our from will come Morgan

Charlie Chan

results very et ], congrats [ cetera. good Also execution for

significant So claiming I'm around have this feel business time ] to ECP that? that project ] kind Hynix, sure, you now like know a is remember But tool if demo come or I not more but in I of you and a order open you the about opportunity. some wins May have talk revenue matter there? I the are from no [ recurring HBMs there. [ upfront

David Wang

of customers, our -- key And megasonic more Yes. SaaS can a Actually, cleaning now energy is obviously, add customer Hynix is offer megasonic long-term They real our right? there one of only uniform too. also contribution. flagship much

one, So [indiscernible] which can second it's real process the of very and really the Tier every the right, Tier is packaging all X. X X.X, either ].And and therefore, contemplating, important wafer, XD, XD in also in you for [ clean

and we're with when to the take. think for And can choice of So expansion product we definitely of the engaging be potential the customer. them

the process now. still we're right So in

Charlie Chan

of kind ] or in [ technology, packaging, advanced [ for And used key ]. SOIC know this TSMC I can be right, [ Okay. cohort ] may example,

my understanding. So that's

advanced it's think even stuff, [ guys have D those just ] not to to I of a you right? [indiscernible], can So provide packaging X.X Encore, the Intel, mean, think cohorts are if I supply opportunities? packaging?I going advanced

David Wang

said, for copper you the plating advanced this can process. right, packaging using definitely our for customers, like other Obviously, Yes.

with we get do our differentiate alternative we and for performance in obviously And technology, a take.Also, so, choice them few now. can an to have other some customers multiple market, guys. we're approaching differentiated other right And only this players what

-- confident the and [ they're we it for in can get ] the market. outside we're very So market China

Charlie Chan

X the I covered going about had question, are ] a is I thought always in to They open when also the X years [ leading I international TSMC, right? fabs my be Okay. you get stock, ago, question but Yes. And [ edge when feel TSMC also the Actually, and like markets. very to years Japan I [ target. next new second later, very, ]. ] you nodes to important mature U.S. just is Germany, be the continue and including not both will remember

is my us whatever? need you you what really issue right -- production kind it's right do technology the Can the pricing, or whether that, when to do, question So is to location some color give or What's -- a customer of now?

David Wang

Yes. targets. Well, by I mean, And obviously, like way. of years. with multiple still customer with you said, our TSMC them we're is key engaged working the we're one And them,

of target, we're cannot right? And key confident, copper potential now, going talking what's tell so also And our the anyway, right, in plating players.So said, with is you now I process still cleaning, I one As are other evaluation TSMC obviously. differentiated the with our products, we -- definitely right engaged is fully we But our right? probably, are the on.

Operator

from the next come question our The of Company. Mark will from line Benchmark And Miller

Mark Miller

I upside impacts China? another wondering guess pushouts the of such I from in demand on was EV Congratulations seeing slowing any report. as if you're

David Wang

and in also supporting continue this IGBT customers furnace, we I see good see have right, So is IGBT the and in right? a a still cleaning a early we IGBT we also, quite continue anyway, do of stage, That's China question. line. Okay. IGBT -- in And customer see investment.And market. production to the production for bit good focused I very because grow, Actually, the we -- on feel, that this mean, product spending

Mark Miller

cash during quarter? how flow you consume cash? wondering the Just Did went

Mark McKechnie

Yes. Mark, I'll take that.

But So million. operations cash $X.X it'll about $X.X flow from our up show million. in queue. We was used

Operator

to further turn showing the And remarks. any not like call for queue. to back the over I'd any closing in I'm questions Steve

Steven Pelayo

Okay. operator, and for today's call you, you, and thank support. all, for in participating Thank your

Conference Minneapolis. a Before let Seasons XX, in me XXst at Park Investor May Relations at London will Four Institutional will present Lane, we the of we invitation Craig-Hallum's only. close, the London. June Annual ROTH From events.On Annual the we to is couple Investor at XXth XX, just present XX upcoming Attendance by at conference mention Conference

call disconnect. sales team.This For interested and now today's with investors, concludes please may representatives management the respective contact meetings register one-on-one your you schedule to and

Operator

your conference. program. for today's you participation Thank concludes in This the

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

ACM Research (ACMR) 8 May 242024 Q1 Earnings call transcript