Earnings call transcript Q2 2023

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Operator

Good afternoon, ladies and gentlemen. Welcome to the SkyWater Technology Second Quarter 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode and please be advised that this call is being recorded. After the speakers' prepared remarks, there will be a question-and-answer session. [Operator Instructions]

turn to I'll time, this things Ms. over At SkyWater. McAdams, Investor for Relations Claire Ms. McAdams, please go ahead.

Claire McAdams

Good welcome Officer. the afternoon quarter Operator. Steve President you, Thank and Officer; Executive conference SkyWater Thomas and With and from Chief fiscal Chief to call. me today on Financial call Manko, are Sonderman, XXXX second SkyWater's

concludes. will on Relations website call at I'd like our our that after Investor you On for call is shortly The today's we Skywater's posted webcast be website, to remind being available replay webcast presentation have live investor an IR ir.skywatertechnology.com. call. to the also accompany slide

cause any During actual materially. differ forward-looking call, and are results business our forward-looking statements the could future statements financial and results our made about risks subject to These statements. to are that uncertainties

of filed March these including Exchange and and X-K today fiscal risks the refer and filed Form uncertainties, last Commission, with filings to on on a our For XXth XX-K discussion of our year. Securities our release earnings please XXXX

All and to we as statements. assume of today forward-looking any such obligation update no made statements are

we call, measures. this During discuss non-GAAP will financial

release can QX well Investor reconciliation find non-GAAP earnings these measures as GAAP available website. You Relations financial of our in in of to our which both earnings measures our presentation, financial are a as on

turn that, I'll the With call over to Tom.

Thomas Sonderman

and Thank everyone call. afternoon you, the good Claire, on to

set Revenues revenues and higher million. second unprecedented sequential strong the $XX.X the report grew of were growth. another results quarterly from an and into as for QX financial record year. expectations than QX marked quarter to four last quarter XX% pleased are We X% of previous revenues at quarter exceeded going quarterly in set record straight QX our we

to development one recognized in This new in of and QX our $X.X our a due our certain of with existing going million The commercial over with expected contract to forward. previously this resulted the terms strong revenue of aspects entered time. chiefly customers. of ATS into restructuring work concluded customer be that of an We revenue forecast was pull-in performance exceeded

were this our Even our ATS a strong positive absent generation. upper fourth to at we demonstrate demand rapidly straight gross to execute momentum of our strong our forecast the to growing and pull-in on customers. QX EBITDA QX end continued on continued multiple ability revenues margin performance programs, due where adjusted of marked quarter from

XX-month Our revenue trailing $XXX period. XX-month XX% million growth prior over demonstrates of of the

above these target We revenues are our achieving well gross progress and towards through financial flow model. incremental XX% on making solid margin are

of to million last adjusted total over EBITDA quarters $XX generated four have equal revenues. the We XX% of

and and us softening long-term strong XX% is semiconductor Our and clarity confidence the the annual performance overall achievable also despite our macro year-to-date whole for concerns growth year objective increased greater XXXX provides of with in demand. that worldwide

profile year positioning growth strong unique semiconductor this is our SkyWater's within the Underlying ecosystem.

Our through company due customer is challenging and our market macro diversified this model to business portfolio. end growing and environment rapidly differentiated

critical A&D and the innovation, to new A&D strong advancements markets. that with the support in place drive well component advanced a funding forward a particularly programs commercial within includes of number This computing continue bio-health to as as for technology

two strong our on IPO, the leverage over we progress little SkyWater's performance years quarters, and are significant in operational four achieving demonstrating towards communicated since execution Reflecting objectives ago. the operational past financial the important growth improvements a revenue over and

the to government's semiconductor the investments. our this component continued the trajectory is evident strategic macro decoupled a relatively with SkyWater it revenue year, is Rad-Hard of halfway our industry. be revenue that itself affecting ATS proving overall is from weakness through strong vital A than Now, growth more little the growth U.S. commitment to

The for the in revenue help increased the drive XX-nanometer momentum QX. and Rad-Hard in In are XXXX. record on initiatives platform we on of qualification production and quarter progress we prepare productization another achieving government QX, made to other SkyWater's ramp this additional strategic plan

increased an and but accelerate not programs. announced urgency multiple we defense on quarter, milestones, sense for desire of of Last only to Rad-Hard, key the development delivery

increased and through with QX, and of our customers increased scope trends multiple objectives. quarter, growth key clarity the second again programs A&D the confidence greater revenue Our overall in continuing have in we these

to Furthermore, Economic to government growth the the of we accelerate major at positions specialized semiconductor Development with better impending the cluster us Administration to Neo a of City federal believe build our XXXX akin DoD successful partnership funding be back beneficiary award Florida. the

We us this that In to with of are long overall the for programs positioned allowing prioritize the believe succeed investments run, opportunity us an period commercial space, to to specific customer continue these best through is accordingly. industry partner customers this R&D tightening. in the

markets commercial are we investment strong Two end markets. bio-health particularly advanced where and receive and urgency the computing

contribute in We technologies device programs that have each multiple addressing In ATS of applications millions bio-health, XXXX. in of dollars underway customers of each and revenue could we areas. have several multiple these

These services market and programs emerging strong pursuing need in exciting sequencing, proposition for are microfabrication to have for a is wearable These rapid demonstrating technologies genetic demand strong services of value growing a and are that innovation diagnostics, enable large the for enhancing there outcomes. fields opportunities a areas devices. and healthcare health where

millimeter photonic towards next superconducting a and have volume While and year. a as computing proposition in accelerating value fab small, a high as production flows applications SkyWater's for technology today, XXX strong production leadership nascent quantum the remains industry. these supporting early path

additional these programs and in in kick programs to existing expand off Numerous the are quarters. to expected next two continue categories

films, those which computing blocks for bits the are building seeing are AI technologies, qbits, enabled are as incorporating funding artificial the quantum intelligence future of for We systems. are increased interest and advanced superconducting silicon photonics in such

remind programs early have us expressed business profile to important exceed computing reflects our In could that of that ATS customers, of model. the dollars advanced who very these of of this backed everyone response for over revenue and is Some year. in the SkyWater's to venture nature the stage commercial concern it's majority those multimillions this

are business to continues as long Our TAM with attract technology applications model tail large service addressing a task opportunities. innovators

means We next low a and high business are foundry. about foundry generation volume. relatively specialty our are is This technologies or and value that a developing technology not conventional

not are not mix conventional business SkyWater. foundry chip the We That's volume, established chasing large the foundry from companies. model, low high

to our leverage, business achieve programs XX%. chiefly and for through As continue momentum through accelerate play to these gain flow commercial to their the as our believe and overall strengths growth gross uniqueness solutions, and time ATS the strong by of market strongest revenue, exceeding operational will and margin market we deliver ability foundry customers position to the efforts best the outpacing their model out driven

differentiated truly to up doubling the option two potential. outgrow investible and SkyWater our as that an approach, what foundry over high with three believe years, earnings growth of industry margins us sets within next the apart to sets We gross particularly the potentially near delivery space

require demand in a expectations to the are and This two software are for growth ever variety of through and and opportunities our aggressively modernization driving expanding increasing productivity yields course, the metrology which installation efforts. of gains, Of fabs. online accelerate improvements bringing strong capabilities we we of new of includes and efficiency our automation that

with is to consultants further to model. support third-party engaged operational business resources long-term efficiency in significant future. a craft our from execution the today the gains are to are help our expectation which the outside making optimize We key gains, of drive SkyWater task investment we enlisting help has

our start applying in the we us that growth gives the industry margin future By of and more ability foundation from efforts expansion. to the operational turn expect will as to excellence selectively corner practices, revenue we confidence strong result profitability. extract margin best to operational these and business drive The build other to

require will flow generation generating revenue above we cash through remarks, level, the of As capital. We free cash investments working significant any strengthen influx growth new do operational also objectives and adjusted flow our to detail means thus mid execution. and $XX the profile Steve that excluding positive in on our intend further strong his capital, balance are sheet EBITDA million not

expected expand Florida, forward, the in our institutionalizing position while for funding our capabilities remain to Indiana. with in in grow now partnership profile. of us we believe with revenue including continue the we the gross and at transforming expand we State to as secure We gains our momentum year XXXX industry build ability our confident will are fabs efficiency and strong SkyWater CHIPS margin another to in sites the continues XXXX, and Minnesota Purdue Looking in existing to unique the our

in on enhancing we We anticipate services strengthen long-term and the year. ongoing that to next Furthermore, in to business. contracts secure business capabilities market expect further services differentiated the expect improvements emphasize wafer our will active our also continue productivity several new transition and improve programs focusing drive we and initiatives to will and in to will our pricing wafer ATS production XXXX,

of continue greater to our in of higher by we as anticipate XXXX. volumes, the revenue SkyWater level acceleration nearing target margin positioning gross result margin be of We fixed expect low-XXs margin to driving gross and in gross XX% XXXX, absorption objective to costs, a high-XXs our

is weakness our positioned above we independent strong macro years SkyWater belief the a currently pipeline of the of operating for believe In of This customer distinction summary, and industry. the model business semiconductor leverage. facing several industry strong and growth

revenue we accelerated the confident company critical objective be to part onshoring towards pure-play growth the CHIPS a investments in billion the device our towards being that due to drive We aggressively foundry our strategic semiconductor decade. long-term ignite remain a will within semiconductor as manufacturing, made of $X Act, technology in

it CHIPS an we the we be do aggressively pursue do funding it to unfolds. model, since intend to our be long-term our require we believe growth to clear, as but will not decade accelerant To achieve

over turn now Steve. call I'll to the

Steve Manko

which XXXX total than for the from was higher Tom. you, up expectations of second for $XX.X year. million, record XX% Revenues and the of last us second another exceeding quarter our achieved X% QX quarter to Thank

and of also XX% ATS primarily stronger of by year. ATS compared the QX due from our aerospace resulted in With commercial $XX of of XX%, These the QX programs. last revenue million to upside million QX from contract, and in we restructuring $X.X to defense saw demand ATS revenue and record strategic pull a driven up

year-over-year. $XX.X X% was was sequentially and X% revenue the gross Non-gap margin services XX.X%. quarter million, Wafer for down

$X.X approximately had the gross pull-in no margin XXX points. revenue recognition this million event basis that by cost, Given associated benefited revenue

quarter that was gross low to well strong XXs performance our expectations model we we through gross the will shared margins our through flow our last margin XX% teens with progress high exceeding expect as as Therefore, XXXX. in as of consistent

to we contribution expect revenue of half ATS a a which year, tool lower will for received second do pass and compared core a margin component reminder, to our through occur in revenues have the services. As the of

GAAP operating operating basis, expenses. Moving now expenses On to a million. $XX.X were

non-cash, that either cost of included several non-recurring, costs not are these underlying reflective structure. or However, our

a and compensation operating Our management portion of small excluded $X.X expenses million equity-based non-GAAP million expense. of $XX.X our of transition

As of QX, expenses in are are changes leadership our during the of to technology however, incurred we quarter; over and our which operating not $X in reflective expenses manufacturing implemented non-GAAP additional included cost underlying structure. our million

Similar and in the basis expense to additional expect bad accounting accruing debt to QX, recent related change to do going $X.X added forward. on an repeat a of prospective million this the quarter, we not

The term other longer of $X.X third-party significant million forecast of support factor that consulting operating expenses above was growth initiatives. drove fees in

execution mentioned and earlier, fab to enable ATS capacity. efficiency transformation we programs, and throughput and related quicker making our a expand Tom also in increased on automation are improvements and long-term As program operational investments continuing to our

Ultimately, a were have In similar growth to expect we at fees significant QX. consulting revenue on believe $X.X we as these see we and QX, early million investments QX. will impact a fees the our and impact these begin as incur may to level in management additional

XXXX of funding to this earnings. program be will the transformation expect fully We accretive

programs high will while greater pull-in. our the ATS pace, also for multiple the execute services at wafer transformation on ability in in our pipeline, have optimize We ATS growth entire scale positioning business to revenue and

incurred consulting $X.X to CHIPS have fees of Act project-based the support application million the engaged related specialists we Additionally, we process. to

future be expect Act payments not securing do the relating to fees CHIPS in made could there quarter, the we additional these funding. to third While continue in

the underlying the reflected second net the for quarter, was expenses by summarize business expense was basis offset more just which X.X% believe excluding additional expense revenues. in or resulted these million benefit negative was of of the impact by a operating of of expenses the the XXX million EBITDA net $X.X of EBITDA $X.X our margin to we $XX.X operating $X.X approximately for structure quarter million on pull-in The of million So amount than operating items. revenue of profile Adjusted additional the points.

loss $X.XX Interest $X and was non-GAAP loss in expense was the and tax, net was the net million quarter per $X.XX GAAP per with the share, nominal share.

As we to free to flow. quarter, related presentation non-GAAP approach we metric breakeven, cash another our last begin added to

cash listening operations of to those in P&L downs in to any result on are and emphasize the call mid working our either capital above cash revenue a today XX that decline the are to generating the pay level to our million like We'd revolving quarter typically quarter credit line. changes from or

flow to both business brings changes million and generated debt view repayments, interest QX, EBITDA $X.X In by to adjusted way In and cases, expense generation cash is the million, $X.X subtract to simplest the reflects free to to compared The the the capital which expense business being prior adjusted the in cash flow QX. take sheet. grew calculation balance then in this our CapEx EBITDA us less to and CapEx. of positive interest working and ongoing

equity cash $X.X equivalents in million additional approximately million ATM program, from over and investment ongoing of QX. We as flow million higher from cash revolver a in capital reflects ended cash result with proceeds of million million by to receivable. in of $X $XX just $XX.X cash a the of QX which $X plus The generated a were $X.X offset and by our amount of balance about increases net mostly the a up P&L small CapEx draw a positive on million, working accounts net quarter compared

increased million entity, $XX revolver, on tool and million interest Total slightly variable outstanding, debt $X included our on million to for $XX financing. our and $XX million

of models, our the for color various SkyWater quarters. your forthcoming P&L additional update for following you components some is As the

expect We After to in $XX be million or revenues roughly excluding $X.X pull the level. upper similar QX QX. to the mid to million

to tool of Within X% component we XX% outlook, this expect revenue the increase to revenues. approximately to

little XXX QX to which a compared a carry margins range, XX% impact, the high-teens quarter basis revenues about normalized no in gross the margin, to tool third we for As be to expect to is level. point the

QX. expect we look revenue as ahead We growth component continuing sequential to and the tool

and anticipated to range are to expenses $XX remain SG&A stock-based $X.X to $X.X $XX research stock-based million the Quarterly to compensation. excluding million development in quarterly of the excluding expenses million range are in compensation. Ongoing million expected remain

consulting for million party being to million million. fees That QX $X per quarter. expect incur we $X.X the stock-based from specifically, to to said, We third to in range $X.X approximately compensation of anticipate million range $X.X

through the in and amount million We range this to of $X.X expect is our the XXXX, expense program. $X.X quarter the first continue related quarterly million approximately of to depreciation amortization between Rad-Hard $X.X million to

million from cost range we our After QX our of accounting XXXX, between to of approximately $X.X of Total million in of $X.X out by will these $X.X revenue, reducing through million investments will QX, of revenue expect were total expense Florida quarterly purchase XXXX. half. in quarter and $X.X cost of depreciation depreciation million remainder per the fade about that

XXXX. neutral assets We continue in to tax from to a expect our benefit no

that, With the turn to I'll back call Claire.

Claire McAdams

you, Thank Steve.

visit and Please directly reach on feel Our please a meeting. or website XXth. upcoming other August of presentations, for Investor include as Summit the to free activities always, Semiconductor me Jefferies upcoming the out arrange section to Chicago our in call investor to Relations

Operator, questions. please open for the line

Operator

Instructions] comes Thank Your the of Cowen. from you. with question line Krish [Operator TD Sankar first

Your line is open.

Unidentified Analyst

Steven is the Krish. for calling on This Tom, of behalf you. first maybe question

currently. In Florida cross-selling wondering the design the your win Packaging Advanced pipeline, operations with about ATS how customer opportunities are terms was I of

future ATS be metrics existing of have for That'd that any or to to cross-selling regarding talk Packaging you penetration expectations helpful. If you rates services customers? maybe might Advanced the current

Thomas Sonderman

around recognizing have are their you are There customers very lot How SkyWater. doing Florida supply I the chains why that interested astute Steven? think we of in a and exactly consolidating very Great in Yes. question facility.

and is fabrication same not wafer within company having allowing to packaging but course, with only us advanced existing customers capabilities engagements. that, future the as pursue secure Of we

year a kind us So, that coming underway, of say intent. today, site should and and to with as we many year would I are unfolds, customers have come more next see to expect these but of multiple of interactions this cross lot you to

Unidentified Analyst

was China, recent is, regarding the the policy kind semis headlines your And and exports also question I currently, in could germanium of impact of is helpful. be about on regards germanium how wondering future? if and and from given just it That's business policy the compound might you supply changes? more talk long-term what if in gallium some just China's any follow-up towards processes, your your to gallium manufacturing shifting future

Steve Manko

we're we that that. think a Hey, done world, the was we chemicals a coming good, with ago procurement all when industry. in our just was Manco it materials our Steve upon concern on continuing impact good We're a the handle like from not Based for to Obviously analysis components a from near-term on big evening. It's we that. lot what various announced do supply coming in through. upon watch or see month we've closely, here. Yes, we currently on have out in an was the that but that doing, our a coming of would based and significant SkyWater so

Thomas Sonderman

I'll that Yes, companies, levels than just a impact add big and are other not germanium this probably and time. our lower on us so gallium at

Operator

Your of from Needham. line Doyle the Nick question next with comes

line Your open. is

Nick Doyle

just bit piggybacking packaging, about Steven's the the off curious little interposer Just question, a program. I'm advanced of

those from talked the are any in three stemming in think technologies expand and you about new quarter? past just that. the I on update you've Could what

Thomas Sonderman

for Yes, IMEC. I Interposer. the One the that we're good question the really joining way Florida positioning technology platforms. call. three AP with is via Yes, to is Nick. came the Thanks different That's facility

a from hybrid wafer bonding then from coming third a have wafer technology, We technology wafer fan-out bonding Adeia. we also And Deca. have coming

bonding interposer and as putting at on the that, capability And fan-out that engaged fab talking we've a say would about Florida We're been the is that year then, are technology. so expect we pace. actively the hybrid unfolds. with moving fairly be furthest and a those customers implemented, is to on the I for All And enabling technology. couple our being more good along

targeted is that the compute technology does towards in clearly fan-out exist the not market U.S. to allow us a This high-performance have would currently

it about in excited also that getting what's the X, X one up and very here we're running only called platform all Gen So the based and exists moving U.S. today, but Gen Deca the not beyond, and to

Nick Doyle

any advanced if any really, you customers? a about headlines then related from was just to of driving, opening anything computing remarks. called superconducting you out anything, lot sort of interest in And I the this LK-XX, curious

Thomas Sonderman

Yes.

So, clearly, discovery been was in LK-XX. very will with be I going call so years, think to industry a we'll it work exciting initial it's to into that something many the But speak. to opportunity, that turn having hitting for it lot take of a this market,

you at photonics quantum momentum AI platforms I and look a made computing, of is think if being day. towards other geared every lot superconducting

many So, we're AI course quantum you the all reaching of SkyWater avenues we're different capability, the is that. really benefits to our enable And going to customers excited like we're quantum. begin see feels of are be about elements. to very That's at attention heart and pay positioned and help uniquely really right There a to where that. computing to to

Operator

Your the question of next Jeffries. Winkler Instructions] with line [Operator Natalia comes from

open. Your line is

Natalia Winkler

kind consulting you bit of maybe I fees. on follow going and this Steve, as forward on beyond wanted year? think well a up them explaining about mind those we more little should to how the would

Steve Manko

which high had had the Tom a year, well perfected model, the focusing we fees and talking in on Like mix at the to call of to course market. in that bringing million been model our $X.X been I as as over ramp we've our have ATS, through model about the more mix of this we with volume the mentioned trying came earlier, looking business quarter, that

quarter. fees of So, were incurred this fees, X.X million during transformation

opportunities I incur advantage as I There's we XXXX quarter us. of would leading where full expect in this million progressing from before As we incurred take $X.X that mentioned, Company another keep similar would fees. that to with are for we of fees that the also component separate third the the transformation into

in We expect Those as generalize million the CHIPS what don't fees processing. that were $X.X third to quarter. going application occur towards, again I'll

is the process process However, a application all us. of new CHIPS for

quarter questions more get 'XX. that recurring not applications we we expect that well various through may coming coming but additional we follow-up the incur As there, in with of through, as to potentially fees do be information the in future, the as are out third

Thomas Sonderman

add. Let me just

Natalia Winkler

Thank you.

Thomas Sonderman

CapEx. having of X.X time Just a one look I we're industry, looking in in about you spent at if think at comment, again, Steve's the lot comment, to X.X

If you quarterly X% that this for $X business underway, overall is add another revenue. that's That's of million. X.X our transformation that

have level of look continue business when to by semiconductor companies a model getting position only we light to ATS given our the customers. very investments And we're in this nice CapEx component, this our strong at investment transform to ATS not other that I you think leveraging the exploit especially from are model, but

have differentiate million we relatively the in momentum really of. capture SkyWater that outgrow So, create we're SkyWater, capability think to that really the X something the very speaking, the is at we irreversible believe spending to we that I certainly proud at and industry have continue to industry,

Natalia Winkler

as And wanted ask more advanced follow-up, question on then a just that to computing. one I

the what also your the like options Would If SkyWater, would are relate If possibly of us pursuing is customers for help not what lucrative AI? market competition? that the using you if or developed the this in-house customers? that would foundries kind to those larger or nature you not could giving opportunities the are be be using somebody understand, be of

Thomas Sonderman

I'm to call a the the concept. there's not the of but The are out there, there to companies comes certainly solutions. out smaller internal quantum going level it in what lab And, see as doing on fab quantum you're in going lab think, types are there there I at a SkyWater it. mean, I ones, activity doing. that's to different of off really Yes, I'll lot competition going rattle where there companies we're certainly doing space.

we're nanometer very and photonic together. can build quantum XXX then we're look coming into And example, because platforms. just unique proposition solid value real us that top years. been an solutions these a these What not that we CMOs makes as commercial again doing working of. That lab forms there's level and for with on platform have D-Wave they've that Again, gives turning a are us viable we various at us development again, XX if many is you

being they're systems solution as and a as quantum in selling put are that service. platforms These

there's So, many the platforms. certainly experience types a people solutions of We going of think these that's And different are SkyWater that have capability we photonics differentiated for multiple of avenues I and what in believe quantum-based makes pursue. running and superconducting a years types center the excellence to leader, space. clearly a of

Operator

the comes question Shannon next Your from Craig Richard line of with Hallum.

Your line open. is

Richard Shannon

on Tom taking my and well. questions as possibly the for guess topic first is transformation efficiency and as My I Hi, Thanks of well. one Steve.

or goals here you analogy, how you're transformation consulting these efficiency the you efficiency? talked down And great how focus terms like then a progress these fees business sales today transformation. can -- well. on and the benefits gains. here couple, about I This road the degree baseball We've seen quarter some related about of To a hoping business we or are And you've talked, of to these far are helping in past in are gross and both you've getting for? margins efficiency certainly if gains have characterize what think also then as

Thomas Sonderman

Yes.

the not activities software, bringing also I've metrology customers, relative increase not and modernized the the but capabilities in, as our would about we but to overall, of talking can only to the I clearly automation us small. And extract compared of value of it's terms the just that value, of capabilities, we for terms say, way in we run more we of our fab. we've do of before the inside multiple we them been activities, new percent ATS percent quarters the talked that in about are So, out opportunity is business, number run business. whole more our efficiencies an only from ATS now if for a

in that to today volume preparing this course, next to of ATS also, customers the as move year are year We're unfolds. manufacturing and have

what able we we being needs. multiple their institutionalizing how of task run so, only the this a the processes parallel, of to day is all just what not associated programs in Natalia how It but basis running day business to the is goes with the about. capture terms to be all I And manage want manufacturing serve to by was speaking complicated to able in about. on and efficiencies we dynamics lot a We're model model, this back

We something have here. unique

So are steroids we're it putting investing, growth. think our accelerate business of the to we as into

But always be steroids. long-term, to we expect don't on

And all this irreversible that is be just are injection Certainly, to capture, the the semis, and CHIPS We know we funding, demand about business is as coming. we in this using and upcycle next that, which we want other all about as into as believe really capture position the able think all business an very strong is fast getting certainly momentum you want possible. injecting again I to there have. we as ourselves for to opportunities, to the

into accelerant again, think So an of the it as business.

Richard Shannon

my flattish traditional Seeing you year? business contributions quarters, that to Not this business kind wafer the seeing see year. semiconductor wafer characterize just at biggest but today, only can of services that ATS second My what of services the specifically. over later cycle the rest the the maybe exists correctly I'm looking in at you're can may and customer and you last few question transition if from even maybe customers the perhaps seeing services numbers your some thinking looking wafer is it impact here here of any

Thomas Sonderman

flat wafer Yes, on been running very services. Richard. so We've again, somewhat astute,

There's Obviously course, I alluded possible prioritizing which to. soft. where have ATS, And to a a ATS. desire those. been are have on semis DoD environment We as dealing we're within programs, in we move lot our macro quickly of of

able output it maintain quarter services or plus level we've X believe on minus basis. a And wafer million been call of so, to we consistent a by quarter

we're the is doing in growth in accelerating ATS. what the But meantime

demand that the link our and prior board back your with to recovery together goes when the it that so, does ability And come can question, all that we across the to really so the take to portion do all. and grow advantage that the in scale business, it it's and down which volume of isn't of ATS at where business, our slowing complimentary but way a

The demand services never for ATS our higher. been has

investing we the and is some the of help advantage exactly ensure both before why, us. do take that so, ability capabilities we to the that we're opportunities of outside And to with can have those

Operator

There call to no this I will questions Sonderman. time. turn further are at Thomas the

Thomas Sonderman

all today's growth ability and profitability by towards Thank you, execute of objectives. confidence successfully our to call at have the strong conveying our and operator. close I want to us SkyWater long-term

Our delivered to your several We you early November. build call amazing as again in on forward with continue now for QX employees quarters. to well, execution have consistent confidence talking to and look our intend

I'll conclude QX our that, earnings XXXX with And call.

Operator

conference We thank concludes you This today's for joining. call.

may now lines. disconnect your You

SkyWater Technology (SKYT) 7 Aug 232023 Q2 Earnings call transcript