ENVX - Earnings call 3 2023 | Enovix Corporation

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Operator

Thank you for standing by, and welcome to the Enovix Corporation Third Quarter 2023 Earnings Conference Call. [Operator Instructions]. And now I'd like to introduce your host for today's program, Charlie Anderson, Senior Vice President of Investor Relations and Corporate Strategy. Please go ahead, sir.

Charles Anderson

Thank you. to Third welcome Results XXXX and Call. Conference everyone, Enovix Quarter Corporation's Financial Hello, are Chief President today us With and Executive Dr. Officer, Marathe. Chief Talluri, Operating Financial Farhan Ajay Ahmad; Raj and Officer, Officer, Chief and and then Raj provide will an we'll your questions. Farhan take overview, our After call. the we'll session, Q&A conclude

later release replay continue, will kindly our remind on Please statements note our or results that from and risks website shareholder today statements third XXXX the the we a subject expectations our to you on be let are me due on we It's after available call shareholder the and that Relations forward-looking of at materially of letter letter, quarter that contain Investor based future These call factors. differ forward-looking press page market Before are actual all website. events this available A to video released ir.enovix.com. the variety uncertainties. conference closed today. of that current may

that our the no will made Securities in today, we Commission. to factors and information as of by that on XXXX, update statements, and with today's to can these not filings X, prove law. statements of disclosure discussion our except statements undertake our All could shareholder required based the November results a us. future intend and and please to affect We these to give as do For be currently and letter available refer business, assurance are financial correct, no duty Exchange

accounting prepared principles. also financial not which generally non-GAAP measures, accepted discuss accordance During we in will this call, are with

begin. measures Relations letter, is financial our turn You I page the will call Raj posted measures on can in find non-GAAP GAAP of to Investor to financial which over reconciliation of the now Raj? website. the to shareholder our a the

Raj Talluri

of cover it it with remarks, your and and Farhan and I'm then Charlie, to that, closing to I'll take all going outlook. the few pass then you financials I'm to off and we'll high-level our a you, After to today. some joining going thank for some us kick remarks, questions. make Thank

it, you started that that see the as as acceptance We we've we've in quarter. the can Now we the made call recent or line. And been factory we super our on been in equipment this FAT testing â€“ have to from busy making, announcements go landing remain fast time. track November, fast Malaysia GenX and the in April equipment we with from next on that production batteries into year in we

on our little and today, online a It's is Ajay Gen Now one at new the a go going on. out everything check how of earlier to X of bit vendors. very coming video site Please machines video. we posted see exciting that

we our transition allowed quarter, Now $XX annual in this XX/X our strategic burn. shave to in to This manufacturing focused during more a us [ expensive achieved parallel us FabX objectives center of Fremont it which million this of and qualifications. off in customer allowed to FabX on of R&D converting here ], a in innovation from into

Korea, in the also we acquisition making coating our the quarter, of company vertically packs. a process which all electrode from this battery Now completed to integrates Routejade, manufacturing way

can margins, our new materials a for market to the our that the to is bring manufacturing before, much thing us. earning access products as enhances Now up It increase strategic I faster. new speeds coating, highly CapEx, own reduces capability, our so mentioned we our

the this able opportunities This gained to next And IoT portable an and market, not batteries, we contract, shipped sold before announced pass last the multivital enabled Farhan, drove Walmart products batteries gives some tremendous U.S. comments be Army complementary who picture a least, business also to us I'd cross-selling positioning into up military year. keeping Enovix current how leading technology under those revenue.Now are safe customer which to monitor. opportunity a are approved sign Walgreens to in base. enabled to is We but be in and that proprietary company seize our quarter's we which will we Enovix CVS, silicon for breakthrough that's I this Now FDA product minutes front Enovix, like also sell big customers. us. the few Routejade, batteries on This shipping to in take in make it to from batteries into of

XX how our Enovix really site. products as happened our call exactly to ago their philosophy first my the is months. during This customers, and my to their last what in with many enable mentioned move almost backwards great making products products, that now, months CEO, has I is As it's start management on the products

We have our team. management rebuilt

much with and key We customers, the unique deeper have decision-makers driven understand relationships their product we now at requirements.

life abouts OEMs Now we consistent architecture some the than what matched cycle consumer the it joined is Enovix from energy our the that customers. anything, received a all of I'll talk company. more and the If All care electronics when position and leading little I I noticed in charge. batteries in competitive important actually are bit to fast best here, feedback our is a been the CEO minutes. path time three about density with few to smartphone high-energy density I've even industry's very better offers

associated exactly is Micron. kind Based portable electronics believe going are using. OEMs with I have dollars to billions is strengthening this of we on superior our size over where exceeds here a billion. our multiple similar with capable are and batteries managed smartphone of understand $XX revenue to that product make in currently that Enovix now of our strong the belief, and to is have market, margins, market delivering which the relationship with With businesses the competition of customers Qualcomm Our been what and

want we how live us, to that interest Now we're larger question this we happened to has EV we do show get electronics reason market. from why the efficiently? in today the strong to is where I how XXXX. much And consumer smartphone the than OEMs, the you smartphone promise? the so what first But up to market that from also on slide seeing most the XXXX market. market focused to are do show the I want Now on

I've you Now Instruments say. my was CPU, to time in at from this Micron. close intimately megapixel very modem, hundred-megahertz Qualcomm been And had the single we we a XXX had Texas market like of XXXX, battery mAh smartphones and would and TFT ml, if about XG of involved at display, a X If a which camera. couple look X-inch

right, powerful, and got more there's as has the transition Now CPUs now. to multiple CPUs what you is happened the much

I'll a the XXXX, multiple phones. And you along shipping little the transition the in X more in processors can about X.X Octo-Core in way. a HDR in talk from have today, displays Now gone there's inches, to XG these gigahertz The XX. the bit minute. see displays Multiple cellular. inches cameras,

the Now increasing got phones have themselves capability.

take now can great You pictures.

You can videos. XK watch

make to can units. You maps, innovations smartphone launched other do and your and GPS-based power market helped displays been so almost which the that have purchases processing with grow really and has XXX with the can navigation things, million because cameras the you many of these

battery the same Now has the battery? the capacity. of period can what see the battery, to During you time, happened

devices. in capacity has X,XXX very, battery talk a very XXX of high-end in about the to of If the few from milliampere-hours, gone you milliampere-hours milliampere-hours almost

battery grew, grew, interesting size energy battery the as However, which note increase that thing achieved an in has means to milliampere-hours the bigger of been the the bigger. making is battery this also by and

has most actually capacity is think the if per increase how you grew if look the The liter, little capacity you grew battery X%. battery batteries, of is which X% CAGR. density But energy XX%. the it's So how at battery, grown of This that. much only the recent is the clear grown

in density. a batteries is achieved in increase Now capacity phones bigger problem smartphones because don't fit pocket The This this any now, It's is in the bigger, energy now why a making make any increase is a modest they we the quite the your and you Because by can't phones make bigger. been bigger. anymore. bit problem? in has problem little energy the

problem, much get show all it's and battery? larger much emerging we if new process these multiple chipmakers talked you look stopped. increase look performance of edge, reality displays. memories the at at that have battery about talked supply displays, and demands that bigger. smartphone is from increasing performance applications AI the higher an cannot we the happening and a the without announcement continue machine slide do and Now Now other higher and if you've these increasing you any better not you and are mixed the keeping the to of how if a up seen the at to the even the the I use headsets, But little learning phone displays, going are recently, that cases foldable haven't bit next coming and here, cases use look you about applications phones. And at size

there with That's customers of increasing a the slide battery few growth ones is that of enable because very energy continue at are the smartphones technology. This this to shows you interested can is density. working one by that in our us So why problem. our curve technology [indiscernible] Enovix actually demand

a capacity actually the graphite the show baseline. XXXX. We more shipping batteries, upsell are left On of leading in the conventional as average smartphones that side, I are batteries, which use

over that we have, currently over Our increase EXX, which capacity the is that. product has actually in shipping XX%

goes a it only and at XXX up to standard rate. Now stages cycles

able able you to and So used be applications in it's IoT smartphones. much be faster. to not To in used get need be X,XXX charge in but to cycles to some smartphones,

capability. that Our has EXX

road to Malaysia smartphones That in to of production people an X,XXX we all smartphone received because baseline, percent it that. product when super high-volume exciting but still by get customers, and plan and the So continue the where how used really in fast is millions map, year well technology next will the extremely cycles in to the also will game units. able on the This ramp XX-plus OEMs need that's gave be changes sample this and by this for our in to of area we capacity and EXX charge. actually we is be increase the

on variable six batteries the first focused the This strategy the concentrated how on to form products customers of which were with few in primarily the fit seven a The With to smartphone large and beauty five to happens in customers, be to that need. volume strategy to at that few vertical a majority aligned function made, industry's XX standard-sized is previous means now we Enovix was, customers. changes our customers. a business, OEMs, are horizontal hundreds PC making of customers, vertical our to of a they focused is business few X with contrast Anemic what a we've it's large

meeting performance by to targeted be and business So by delivering this many large less Me, myself team because and need and with being most.Now that relationships well a demands more are markets a high-volume lot of there, have successful a multiple we of OEMs can our for product be in over these expenses have decades. value more but been this and it operational strategy much can the long this portfolio a results forged customers, customer lot the focused tight vertical we time. for working suited very our industry-leading and members our

also type wearable will requirements we well PCs. really Routejade's help PCs us smartphones then, positioned be to of will in and and way, market And a IoT smartphones are from we to able smartphones frame, into a clearly, 'XX, launch we'll lot profitability. the this That because scale in the From in of of solid Along EXX time XX confident technology, I'm with is a going intent acquisition, into the that the and with multiple with to are lines sell will with markets. that models into We that multiple smartphones. 'XX, move path we continue after there.

Now give to will turn discuss I financials quarter. for with next to some that, and guidance Farhan over our

Farhan Ahmad

Thanks, Raj.

found letter I'll my most the the details and in the level. be our of And release. guidance and press And and of So keep comments quarter the the about shareholder guidance. high order at just talk a the can

for about record year, in million our of the strength delivered that. talking We of to the $XXX keep first, quarter. with continue revenue the and the contract spending quarter ended control we Army tightly Army and And and cash quarter manage on So OpEx the on the to Operational $XXX We the as to the our product shipment a million. year. strategic savings tightly. the equivalents. continue for of will about annual to lead result, manage lowering our use the spending FabX we use cash disclosed plan of previously, And cash million. and to we for And $XX as are realignment

revenue of turn closing of to Army continued forecast by be I'll for ahead million driven Raj back contract. looking quarter the partial Routejade's a it $X Now the of And in million, the strength revenues we quarter and to $X range comments. to from fourth to XXXX, now

Raj Talluri

Thank ones a in allow about few a accomplished products. buying industries-leading will closing, to our begin Malaysia we things very bringing to the beginning. had you, We productive in the Farhan. batteries quite customers next we track We In excite and consumers, these remain on quarter. talked manufacturing while who to differentiate third high-volume the year ultimately as be their products to

time, and made our cost significant the enhancing moves we Now, our manufacturability. mentioned, at also structure, lower Farhan our while same development to technology as we're speeding

deliver to to Now promise on go-to-market technology in the place our I market of the feel, right getting efficiently. leading-edge we most put the strategy,

up I'll questions. Operator? that, to with open Now

Operator

We being recorded. call that now the Please begin session. is Q&A this will note

Before questions shareholders most are call the of going we this two registration. highly by to call during the submitted we to read questions, go ahead voted

The first question we is, meaningful Enovix expect when to revenue? start can generating

Raj Talluri

of meaningful question The revenue. Yes.

as to to as to getting the batteries million grow the $X millions our in expect continue nicely. own already fourth is 'XX, grow think from guided and our $X you'll factory 'XX grow to to million we we it revenue we ramp will start next year. in quarter, mentioned, the 'XX, producing that continue I Routejade's see faster. is and with Malaysia And when of acquisition, We

Operator

will how second device question the closing, the medical FabX the satisfy with contracts with and Enovix Army is The maker?

Raj Talluri

the question on FabX. Yes,

continuing mentioned, batteries customer enough we to I quarters. quite have needs current production few we've And the for our contract. as few We've of doubled inventory Army here base. batteries made support So quarter still make the for we a batteries. the last production are every now of the to And

will we next line which a the can to very that continue because our have that batteries us do gives on previous we So do make to line make way through those mostly And a we also good batteries, and quarter. larger we was we small in the are that we'll we meet have to army what's And larger pretty from needed enabled Malaysia, breakthrough also batteries, confident there. feel when batteries make making them. the batteries can transition that And requirements. then

Operator

order Please queue. question Questions go be question will in that received. and they one most. now will are the answered follow-up the at We to ask one

assemble will queue. the pause now We moment to a

first Rusch will be Colin Our of Oppenheimer. question from

Colin Rusch

on Congrats the progress.

As cycle like perspective. what's customers and your we've XC seen introduced technology ] folks with the you CATL breakthrough in the they is other Can what of from how a about terms them you're But keep import to bit market. and obviously, is into life batteries [ and a the competitive want and the with one performance important little seeing talk from environment, continuing volume X,XXX guys? what attributes, you engaged competitive

Raj Talluri

question. for Thanks the

to the increased and with excited customers super the are us work main density we capacity provide. energy our that I think reason is

the batteries if energy even cycles look the there charging, all out that market higher anything much, at is still we our X,XXX take the producing If provide today, that the you can density batteries much actually are market. that the in on than you fast

X,XXX the Now, our hit and it the cycles charge. current doesn't hit need fast that doesn't product they

And three safety on amount safety is important, accomplish density, density, energy to feel see very our that's aspect all hardest from and continue clear we we'll the two That add while course, from products. the get a our differentiation products, thing we where is we of those like those. to also. products to the maintaining features is energy our As work of we and of customer can

Colin Rusch

factory with any positive you're zone of And just then of exception first or negative Okay. that in in testing, terms either surprises, the what seeing testing?

Ajay Marathe

No particular surprises.

ended There No Actually, well. changes, done FAT We X letter, the in quite the going showed we showing are test in is work all up doing particular made, to which begun the said Zone rigorous on. expected the work, which acceptance this on the already surprises. have which that couple all of be had and we a during the video what equipment, I were video. is were typically as

no track. So are particular on surprises. Things

Operator

Derek question of will Soderberg from next be Cantor. Our

Derek Soderberg

you're or for it relates just I be testing, you factory clear what says letter, Gen guys a then Ajay, shareholder And number the yield should yields have to start acceptance about In X given manufacturing that it effectiveness? in it move thinking be with you to what's to like XX%, path what XX% Malaysia. overall want the as as in path industry-leading you. see equipment with commentary, to look specific seeing for high-volume you? we if Curious a

Ajay Marathe

Right.

in So good parts. answer them questions, two and I'll

So Fab of for a I'll X the climb done year, did we that first that X. be nicely. the yields in yield and type Eight the climbed learnings part and and is did where of was have our are here losses and yield significantly happening Fab days the very here all thing more learning or in

a ended can we climb, targeting the for are imagine news from very we in but little it the there. of good bit the to predictable process start and But what And where GenX to that CPK, GenX stop the We are rigorous spec away as the ramp already. we the GenX now mentioned has where of requirements GenX, very chose Raj And yields distance from there. from FAT be. manageable. enough take that climbing begins so there and XXs for the means begins line, are We starting yield and is line capabilities achieving time and you the yes, which high will to are GenX ended. will the is

Derek Soderberg

follow-up, then Raj. as my And

GenX lines demand. match optimize is the to lines You've the said with sort sort the to of of deployment of plan time

is 'XX? seems GenX sizable exactly decision. Have optimal sort lot funnel. know You for? waiting have that I variables track. go It on during if kind revenue how are of you of of you lines a And not, clearly that is what feel you many into like determined to a there's have

to your love be thoughts. would Just

Raj Talluri

looking putting are see mean works. to the of order strong. new example, form customers multiple phone mean, I goes get not I that, lines but exactly customers, of what different it will we variables that now samples slightly Yes. same it capacity smartphone do working takes comments line working to the producing variable I'm time and whole We will we And and order can't when have of and learn are to to as very them, not up watch at line make our mentioned exactly lead the keeping also now and kind are we We all a mind What the them and sure the up more may And of I shape, at I that comment models goes. we to that OEMs. back-end from going example, with in validating do at how in situation. time, them out. multiple more looking for and may is out. And order need to for that we're how their the that may stages the laptop in bottleneck capable and that of at be lasers, once. each look, ramp various line ramp laptops we it the that. be, first is We're get them. of with demand and customers, in made previous the factor these the cell to we're phones into and I've giving putting they're

we holistic want lines to one think So as time. a order at guys of I don't like you to things need

making. ramp customers. So But optimizations 'XX be our the we'll with of kind for in ready are that's we

Ajay Marathe

all lines. X, we Raj And now, built around with facility the the with the have that what and Fab right said have shared with is for details add just of with accept as qualification the lot just we GenX now, four right lines. is we lines, how in have ready goes has That building said, That itself and it's infrastructure, to hand-in-hand building to been way It right? is to sharing up. in all is ready So eight adding terms ready ready equipment. shown to that of itself you, equipment, you consistent power, the expandable what a cycles for has now. which campus come what Raj and four the nearly

Operator

from comes Bill JPMorgan. question of next Our Peterson

William Peterson

the there's even to of mean, going follow you on to I the is, for line Or Kind up to four, Lines be questions of actually pretty I just assume prior additional lines. one before be about to adding through long lead first waiting question you successful times. X line. two guess or want the I adding orders? guess, are place I

two to why So through place let's next the order would subsequent four year? to have you actually be for orders lines, for installed in say, them

Raj Talluri

Yes.

like of they There said, it's pieces time. have that longer are time. lead I I a a have think line are lead not lead pieces this is shorter answer that So line whole simple the time, of a

making sure at time ones wait. covered. we So are time we figuring lead and and we short those The have can long the lead that comes, looking

we're these lines. Now improving also

As improve lines more, making even figured the his Ajay the out we more. start the the how team lines the to of and of cost performance reduce have one,

all into carefully, money that that at coming all take we so too them that are want same time, the to much meet customers soon, the demand 'XX. account of and order spend we So the but too don't in

William Peterson

on And actually follow-up a that.

way $XX million there question about think have to Or go question, a a related EVs. line? there? separate sort a last is to to right that I from the to follow-up full actually lower is of but That's So opportunities

the fast of least of other least believe and by idea about JDA You've least the the at in year. an have past, attributes. the kind team been had maybe some at least at the while, I talking a has for to in at of charging one context of end EVs this

prior the if me team. remind was management it Now

you with when way another with? want many in OEMs to this discussions to, for get you OEMs? to trying can How work partner? really are guess, Just would level take a is And what sense with the I you optimal a

Raj Talluri

our question right? question. first Yes. honestly We prioritize we challenge has talk just on has about I'll one factory been, we the so have which one later, I Look, demand Ajay and the I'll to which here, then strong. one been challenge been mean, had take new the and and the has were line do My do yields. learning

satisfying. are about make line. we that also into with that from lot this them. which work on. we bigger had been we've are of small-sized to EV on customers had signed there, make had how trying samples Then we learned Then already is for we improve to the us. We to them can got we to contract some to the a demand We cells make the get smartphones, up and give still that early cells yields cells Army next-generation the opportunity Then to for in the

the start a and that of able are on to well The facility absolutely are quickly. be we type up lot And that cells as our them in time. they So they making we've high-volume I to we with -- as not been OEMs. materials it's think prioritizing release because at different said manufacturing room, are our and need working do Honestly, things same able in now need going them just press now to is. get EV we where that and to getting should that's so lot We the been a on. Fremont, And Manesar we quickly those now now can. of clean we've discussions

and the get to We the quarter that's absolutely felt we that's have year. I bottleneck been opportunity the just making EV because the first revenue in cells is, prioritize Army and where making short And on me in largest cells the the the smartphone the will because first cells in of them. term we for next

Ajay Marathe

other just how to were many batteries And is which lined. answer question, your

and And XX thinking and should say, continuously on or a I said, out. line. is batteries Raj increasing UPH, cost X are reducing we line which X, You as improving million keep should to the taking universal million

line. be will X X UPH, line copy a line we part, for little most reducing thinking cost So bottlenecks That's exact bit then onwards. are removing but the how and the higher

Raj Talluri

$XX to like to talked million that you get would that we about. And range

the I'm it but... make team to pushing course, less Of even cost,

Operator

question next Gianarikas, Canaccord. from comes Our George

George Gianarikas

Just high very with very watched curious, Ajay. parallelism. video I'm the automated, And I quickly, looked

when I'm at the tilt in full you So assuming that terms operating weren't UPH. of

that happens, you that What's those level things up of the break when automation the confidence continue metrology what's level So start your speed the happening? risk as with with all that process? can that down you to

Ajay Marathe

per Yes, were not just capturing And are what's exactly operating sure that yes, to good full observation. of tilt. videos going wanted near I we we make anywhere on station.

UPH. the slowed will we a had number we run hours X,XXX So quite certain marathon for what line to at run call the down in bit. FAT require of it a

So that's criteria criteria the part of buying qualification or for the line.

to a doing line. continue will give green We we'll ship that. that And only then that, after light

effectiveness, OEE And line between which to my specs equipment the that exactly equal making XX%, the effectiveness. the we equipment sure up runs wrote, which has failures is doing. without between confidence So and assist having mean that to meantime we is that's stop that were climb in MTBA the to meeting the what time means

definitely running the tilt yes, not in video. at So so full

George Gianarikas

you from as discussions get to your business also And continue curious I'm to to recently there have are there? RouteJade. your maybe around long-term that China supplied a business export around follow-up think graphite. been graphite can what How confident and you that existing question, actually restrictions you does to

Raj Talluri

graphite. don't ourselves any use Yes.

So I making. cells silicon we are the that mean

far. RouteJade section the the so graphite on to effect any seen haven't cells We

comment. as we it, So you as have. the just we'll about much know read and as when I I restrictions. haven't seen

Operator

Daoud Gabe Cowen. question of be will Our next from

Gabriel Daoud

just color us we The maybe those maybe Raj, just can off hoping would can lines, give X. coming you around I cells with bit launch. the start Fab was smartphone Hoping, more of only EXX? I a would 'XX second anticipating commercialization half right? multiple And guess with with 'XX period you're that months in if then Is be OEMs. the be a the quality launch, that few

Raj Talluri

Yes.

EXX I get can we map road showed So to a what as to.

and push life we start as and improve doing energy is the charge, to is the but be market. density because in itself between not we'll saw will slides, maybe will shipping what in we to all much the something in EXX EXX energy density to higher need cycle the EXX way where it, the our the fast We the improve you than

the have. confident we're we So actually on pretty technology

get are first. on quickly discussion one That's in what they how So want. we'll which with probably OEMs to want they production we it, our do that the

We programs on running have that.

running EXX. have on programs We

Malaysia get So end and then early as in goal next hands be cells soon ready OEMs 'XX. by get clearly, that we for to smartphone production our the will into of year, as the phones year line from are to our is the so of able

Gabriel Daoud

then I just team. strategy, Could that on previous talk you of guess mentioned guess. now? mentioned. include new that market the Those companies billion follow-up, the that just cap, was noted accounts some as those if strategic focused And Canaccord about Would customers as of maybe are by that agreed $XXX the I a vertical you're you the

field that Just update previously have there? Are Just Samsung? the trying Is Samsung, curious, the ball could again, that there MOU six is sense specifically speak an with anything pushing if on moving? that there's like you down you the there guys to strategics get a mentioned? with those you maybe to of

Raj Talluri

mean, consistent. it is I Yes. very

cap you the and what think is. large units, is first of market strategics of as millions having If shipping strategy that vertical

us of focused cells We not product, who for aggregate. from people actually can buy are each on millions

a cell each certain custom and of important a certain very So needs that's shape product characteristics. because

that we we the that millions it's the and on hundreds ships make top used, have those that the more way very they're that that hundreds and ship the right the not every way, the by and strongly in units, ROI it's that these And pick of customers the funnel same are all the product we the focusing we in been And that so just need the important much talked all on volume. that. on were about. that are ones customers we because to opportunities highest can we get So

Operator

Our be next Gus from Markets. question Capital Richard, Northland will

Auguste Richard

RouteJade's see bit and business guys give quarter of revenue in split RouteJade a Army in how color on and the us you Could you XXXX? of of a sort little fourth

Farhan Ahmad

that. can I Sure. take

And third So similar Army the in should terms of remaining RouteJade. be be should plus quarter some. the to quarter fourth then minus revenue,

year. million So $XX rate we half the have in talked the first about RouteJade, of run annualized

So little so stronger higher to a think fourth a $X.X than of just tends million like month. that, per little quarter be maybe. the bit it And

So million that million maybe $X to it to $X gets of guidance.

So color. give about you expect you from breakup. some should XXXX. quarter we should that the should Talking revenue growth That a and fourth give 'XX,

the So million we run rate first talked the annualized half an in $XX about year. of

in revenue number. that from that should expect growth. should growth 'XX, We we so from some expect more And

structure. talked is As a we with It's very good a have it, this in company part Korea. a cost about of remote

the at So you with level the very the see what paying even large revenue, they're of per to the actually cost And good. structure, that employee is what is space. in companies profitability comparable graphite

so competitive structure And very there. cost

Auguste Richard

and in then production can X, of give out you the the in for what shipped? And you just us terms you of Fab quarter produced numbers what and shipments

Raj Talluri

[indiscernible]. quarter the in produced we number The

inventory quarter. we don't think those talked much in And third any and I I we we're what quite as bit I of know that mentioned, we exactly we kept we because, in But much to need. more about how we make sure have how a making shipped not produced.

So to designed of in. people sure to enough have that we have need the satisfy needs we the us already make

satisfy are So some that market. of holding it to is we

we quite bit. experiments our using for also some are a And

EXX, For need lot of we our that. cells to do EXX.X, a

So that's where majority that of went. sales

Operator

be Baruah, will from Loop Capital question next Our Markets. Ananda

Ananda Baruah

volume is kind of I PCs 'XX. PC So on in rise, mentioned had revenue think you a

so And does expect PCs they in three AI-enabled. well, of years, And the on to like think I how of you then kind volume side? play HP XX% be sampling about? start folks in their like AI as is has talked 'XX it when PCs PC

play And demand PCXX into so for that a I have then does the backdrop? backdrop well follow-up. as And quick demand

Raj Talluri

on Yes. this. question Good

they So go in the is the the through time about smartphones, customer is of takes market much that PC in longer that terms qualify qualification market. the it actually even the key process thing to than longer, just

they 'XX hoping it makers So I'm billions get more But and the of be will 'XX cells. to But we like the time some production using also sampling production, sooner, by meaningful units volume be may to in our of of in actually go production, in 'XX. will them actually, smartphone 'XX. PC production,

there's And a capacity actually higher wanting bit different. as The slide the you But is battery in us OEMs tomorrow. cases that. your a lot because PCs it see of use are when showed, I little just AJI, battery. what tremendously how no are of like hogs been point kind seeing that's exciting why we AI that's saw has for that So you from a the PC on interest clearly I actually the run

charge it, charge. requirement how phone. long how it Fast many not For needs example, like cycles is the in keep they a big to

our So recipes target are optimizing more we actually to precisely. those

give we and them exciting us that's give super AI of But the density, another for into So edge. maybe because less market push more charge this so can of fast on. them energy

Ananda Baruah

mentioned when get it'll And I XXs. think little smartphones? would Do take on the just yields 'XX yields, I XX% think you exact on then to the going be said forgot language you follow-up. in a you're a bit, -- but to the quick at to Ajay, volume you you

Ajay Marathe

so right Yes, tracking, FY the on high Yes, get to before The XX-plus line we good, plan X, ramp we absolutely, high to are nice begins XXs closer in 'XX? yes. to which percent Ananda. absolutely will actual the XXs. the now the

Operator

Chris next question Our B. Souther, be Riley. from will

Christopher Souther

but specific there focusing a kind of the I small are Like, guess might are of customers. as just kind mean little here as Does where you how evaluate that some the you say could miss? volume specific kind of wanted higher-volume far to very more I cutting stuff customer that on color edge, pretty today more get is become do that might of bit of around base? kind you potential subsectors

Raj Talluri

Yes.

we'll years life, customers. kind satisfy those how discharged. with that few able factor, seen of then And are to have may into history all drive sell of density, how customers very Fast ones of at but very But meaningful charge, they exact on energy so I've of PMIC the which scale. the and markets, more a a that. those can them, that and this we compromise have we focus not my they been we willing have what the the optimize will interacts other they that bigger. doing of charge, volume, how customers cells, are them we form markets few cycle and So form of same new that, high those get volume to up, then nailed requirements that few we they they're then company, as take ability ABR now the the Once to chip used, how that those important be on as like the get in factor the drive battery on. cutting-edge I've could XX of is will business those some a And can come other to and it's many this stage electronics consumer

is your those manufacturing So then grow the see markets, ready for pay and them into get then for get markets. get get idea the to the to volume, to use to market this to product vertical deals, scale, right broad our lines,

XX% be time, be XX%, XX% and in expect will large I So market. probably in verticals, will a XX%, business broad in probably our of

first, vertical second a strategy. it's So horizontal

Operator

Moore of be Our will Tim next EF Hutton. question from

Timothy Moore

the for forecast of until be do you beat integrated there? I acquisition. your savings? fully about the The cost the months transaction closing recent to purchase maybe separately, can expect battery to had When just many And question was achieve it your cycle up development you how

Farhan Ahmad

Yes.

cost dependent to we are want that. I talked are is utilizing and we that about clear, how be capacity the on they the savings So quoting have

that the the ramp the cost the savings shift capacity So how from to lines to related manufacturing coating and up. are

as of are a keeping business. and coating we on wanted for is plan. sure in processes executing existing that. their entity you RouteJade all are drive innovation the cost manufacturing their Where also to that and see we will those focused for And primarily So on improvement cost that it separate coating we savings, for towards we XXXX most really and in beyond making pretty yield reductions using that our that in are much

yes, to on like so with are RouteJade our towards there manufacturing execute we going are track the in XXXX. and things And well, in ramping

Timothy Moore

how would many starts the Meditech curiosity Mini, you selling for Walgreens Just months Walmart? maybe advance revenue in in accurate before of it and to start out recognize CVS,

Farhan Ahmad

next So want I after that we like But you and contingent can on that's look, when but to revenue get yes, fulfilling year. that, not recognition paid is don't on will start their it, We all be expect too we know. what ship batteries is our we revenue our them I obligations. do to the recognize to shipments. we tell in those what for sometime selling specific

Timothy Moore

sneak expenditure making. year, the sense, My there this was way year-end? call weeks that last CapEx seven higher strategic be a you maybe next Is a you're about had comment away any than all makes and much maybe expansions to is capital will moves given how question we're higher earnings next give the the year, from by last us be peek that might on year now great the which

Farhan Ahmad

CapEx spending up year at it will Right continue expecting to next tightly. guiding as next point, be and we not and not CapEx are are to now, spending we very are we year, look, year-on-year So tightly this needed. will but we CapEx control manage and

Operator

turn at Talluri, to this further like time. Dr. There questions remarks. for I'd that, are With Raj to closing over no it

Raj Talluri

Yes. all all you listening looking you. for quarter. questions for Thank our great the earnings and you and talking to next call, to thank forward you to Thank

Enovix (ENVX) 7 Nov 232023 Q3 Earnings call transcript