COHU - Earnings call transcript Q2 2019

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Cohu Incorporated Second Quarter 2019 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded.

I’d now like to turn the conference over to your host, Mr. Financial of Chief Jones, Officer. Jeff

You may begin.

Jeffrey Jones

and and call to you quarter I’m our good results afternoon, conference our outlook. President by today to welcome joined Luis discuss third Müller. and and Thank CEO, Cohu’s quarter second

also of need by call you or may earnings you presentation today’s be is as link Replays after on the Investor Cohu Cohu’s in accessed may Investor Relations. a same concludes. be from If the the also our website and in PDF a with it through webcast slide our release, of that website this copy available page posted a Relations section. cohu.com, call call the contacting access will There is conjunction via

earnings Jefferies in next with a on be now the if contact Chicago in request at and Semiconductor, Summit August would this call, the XX. Tuesday, Please meeting company you us our participating we’ll to Hardware like Between event.

Harbor. to Now Safe the

to make and management’s we current today’s statements These presentation have Form review abrupt that are to the based XX-Q. and its as XX-K is encourage Statements We the Exchange Forward-Looking Commission, rapid current slide and Securities changes. future you as Cohu’s of Cohu’s subject assessed, forward-looking recently business. most we nature, During expectations and Form information which on concerning filed even section by statements call, will but release earnings with the the well filings including the reflecting

call. today, statements developments assumes obligation these no as for only Cohu of this to after speak August X, comments and XXXX, Our occurring update

slide comparable for our non-GAAP financial GAAP earnings reconciliations discuss to Finally, during release Please measures. certain most this refer call, measures. the will to presentation and we

Müller, the call like Cohu’s CEO. to Luis I’d Now President to over and turn

Luis Müller

dynamics and QX will environment. afternoon. financial Cohu Today, our discussing cover the on business then plan and guidance. at sharing Jeff perspective current second quarter detailed I on Good results

supporting at end an first initial started three desktop May XX% mobility quarter. Our market, dropped the improving in recovery utilization, points the of in the of which to internal in quarter, late measure June and

orders business quarter near-term. conditions recurring, XX% and the indicate the soft to Second systems mix were continuing XX% in with

Second sales of to our Huawei softness to in restrictions guidance were due customers of at quarter $XXX impact the export and of on the low-end continued million mobility.

direct our less affiliated HiSilicon, business X% annual with Although sales. Huawei than company, of is

part Some are of chain imposed. the were after supply lowered when of their abruptly our customers the export U.S. Huawei mid-May, forecasts restrictions that

a smartphone forecast whether In the other parallel, unclear Huawei in of announced of growth GDP It the a export or second-half restrictions is reduction this sharp direct is for unit sales of this consequence year. a of lower reflection more compounded the was and a subcontractors in pushing and pivoting quarter in and effect some China reduction quarters. Panel Display forecast the in driver globally. region The to later RF to tester late business sales, with out Flat customers

multiple extended still a detection. Micro devices. comprising we testers segment mobile was and next-generation platform, and scale sold XX% orders. include units for also and of largest system Still, capabilities process received our for testing handlers of infrared recently qualified volume inspection Mobility order processors, that handlers defect a integration vision RF mobility, thermal in and featuring third We shipped

of management ICs. semiconductor continue foreign benefit of weak, for automotive to from and sale remains the Although market testers production we the handlers the thermal

growth these the impact While communications remained a that on ADAS, fundamentals of vehicle our for automotive the deployment muted industrial positive automation, customers’ are near-term, will in significant markets. and electrification, strong forecasts increasing XG have moreover, in the

needs network. delivering in expertise for RF global of that of supports complex point, for a for last the this On the satellite solution is Cohu applications second cross-functional ramps. quarter a next-generation devices the was the initial customers’ highlight complete of shipment used rapid testing volume value

the of the in ground not higher-volume business ramping second-half for units only also but year the some with infrastructure. in this and in forecast volume satellites, XXXX, We

for amplifiers see differentiation a requirements, high-performance in the them integrating solution our value testers deployed utilized Customers fidelity power are RF mobile contactors production across RF testers base who high-performance unique volume the device Our signal and our new that in ensure installed XG enables for to Cohu’s in to test of RF products. upgrade optimized of XG devices XG require large being while for to coming interface. out initial

see infrastructure XXXX. RF to ramp in build We volume production production expect Cohu is it of year starting transitions amplifier substantially, the power mobile well-positioned products the in to from this sales early to maintain XG leadership test. grow and of as second-half

business telecommunications applications test server, Europe. and customers, see automotive across demand customers equipment from mainly PCB continues supporting and strong in network to industrial China, Our conditions and soft in

We and Philippines our factory integrating agreement our handler operation the to to consolidate our finalize and handler recently to manufacturing this of the made to the an contactors reaching Cohu Xcerra, works Malaysia quarter. good the in on business local transition kits progress operation completing Germany, of acquired, and downsize transfer with council track the device with

for investments $XX taking actions of in to and drive volume our profitability, improve reduce light to on the manufacturing, the million. rate this equipment track $XX that expenses delivering additional semiconductor run million quarter growth critical exit all, maintaining of annualized year test would businesses. contactor at In and second In in we’re cost and market while soft approximately synergies environment

that XG early well-positioned from capitalize With opportunity, that, about infrastructure it as we’re optimistic on our build transitions to products. to volume high characterization future and the device I remain

our industrial Additionally, customers we will continue resume growth. to their in and enjoy when strong business automotive markets

Now, second quarter to third our quarter over guidance. I’d review Jeff provide it and to like results to turn

Jeffrey Jones

QX higher of the Luis. the delivered model, our reviewing financial revenue Thanks, guidance, profitability with supporting start our realization results, costs I’ll Okay. but of acquisition-related non-GAAP strength at including anticipated, low-end of which the synergies. our by than

different for our and which our in from at non-GAAP the our XXXX model revenue includes progress comment beyond, Xcerra levels. acquisition business review also and estimated I’ll accelerating synergies planned EPS amounts of on

guidance. third our quarter provide I’ll Finally,

Please also all that comments that my follow non-GAAP figures. refer to note

For and see investor release disclosure, non-GAAP GAAP to accompany reconciliations earnings the and presentation.

of expense; approximately primarily acquisition include driven amortization restructuring million $XX to million intangible related net GAAP expense; GAAP the include employee to property, costs. Xcerra compensation adjustments, The equipment purchased plant stock-based million these $X.X of $X.X $X.X adjustments primarily million, and impact million of is QX costs; $X the by of non-GAAP & QX, of non-GAAP cash step-up to items approximately severance. For

One QX sales for QX, the in our customer sales revenue or cloud to $XXX our XX% quarter. Huawei and million impacted and and mobility. by AI XX% at in data other of of customers export the accounted of center, low-end no in the for range continued customer accounted softness more restrictions on was in

guidance than costs tight to In expected a spending. recurring control as margin a we generated labor than revenue. XXX than expenses came Operating better gross on QX, contribution result XX.X%, basis points which from is forecast and in of of due higher lower discretionary

the sales. currency was provision, the quarter, realized of of had of loss approximately sales. with generated After $XX.X million, During line acquisition we EBITDA of the non-GAAP X% the interest the is Cohu In million operating we approximately quarter, Adjusted income which EPS second expense, $X.X forecast. cost X.X% million, non-GAAP quarter synergies, of in tax of about $X.X XXX,XXX or in or $X.XX. foreign and

not As as meaningful rate break-even. I earnings call, prior pre-tax stated the levels on our effective is near tax

operations outside and Cohu’s the As related most generated U.S. of and reminder, of profits taxed a have

Additionally, loss, did there’s offset when foreign benefit the of deferred QX, allowance. tax in generated no valuation U.S. operation to because a it asset our the tax expense as tax

meaningful profits on QX, any result, and foreign not recorded without in a in expense the from we tax As tax resulting effective rate. U.S. loss, a high benefit

cost Now and to turning business our synergies model.

our will annual in business of million of impact goods $XX synergies to cost the savings. and on cost earnings forward rate the $XX XXXX. run five $XX original QX into million XXXX, favorably ahead expense The is of approximately that in calendar we’ve this by announced deliver of results taken pulling is action the to target As of in $XX approximately years. sold in expect into result synergy annual cost call, end million going The that split operating cost model million that three year, synergies we

$XX calendar when to Our model estimated revenue impact anticipated profitability, various including million inclusive synergies the we business this provides at of achieve levels. the and expect EPS cost is year exiting non-GAAP of that

reference, about $XXX As or the $XXX revenue XXXX and The million of cash level pro savings forma Cohu, in a point was place. model per are million, approximately for shows generation this quarter. once business strong combined synergy Xcerra, profit with all at for opportunity

required excess and strategy business the allocation be subject capital down the the support long-term continues to and the ramp. use and eventual of to business delever $XXX to cash achieve million debt to conditions Our company synergies an cash pay

in million of order synergies. achieve XXXX, projecting we’re For of the payments the cash $XX approximately targeted to balance

the our During on cash XX, from approximately quarterly August million Directors Cohu’s XX, $XXX at share of $X.X end approved XXXX per $X.XX cash and balance XXXX. approximately record a dividend was QX, shareholders of of to payable Board quarter. on October million of of cash used Cohu operations, the

PCB expecting distribution semiconductor is test. – be quarter X% approximately Revenue third XX% and we’re expected XXXX and guidance, million. For be to sales to inspection test $XXX expect and

Operating an expected approximately guidance. included million, the synergies or QX Cost Gross annualized be million. $XX are to million are approximately XX%. basis is approximately of on expenses $XX to about expected $X margin in be

forecasted synergies QX to the further We’re of approximately benefit also $X taking a reduce measures operating to in with cost million. expenses addition acquisition

EBITDA expect We X%. quarter to approximately third the in adjusted be

non provision We’re total similar in to the non-GAAP projecting the – non-GAAP the to QX be amount. QX tax to

we or approximately profits QX with and purposes, The diluted shares. million tax effective of in be XX.X the approximately to modeling more on million expected expect for of count rate share For model. revenue business is a $XXX normalized XX% line

open remarks. the now, to prepared our And concludes that we’ll questions. And call

Operator

Instructions] the from line from [Operator of question Brian Chin Stifel. Your first comes

now open. line Your is

Brian Chin

just Good little few question on ask focus first in letting Hi. the a a near-term Thanks and bit your for outlook. hone QX questions. to – afternoon. bit us My a little

the a down than QX. sales little were they at end mobility little softer. strong bit and maybe not think, your data a guidance bookings, in curious, IoT sequential, by trends looking overall maybe kind system would center better were the bit orders I have I little markets, a Your bit order thought, But of

outlook? perspective, curious where are weakness So a seeing into terms quarter quarter-to-quarter in from maybe third market revenue more you the of your just

Luis Müller

Oh, hi, Brian, is this Luis.

talks end only system about slide here on QX point that markets, one orders. is that the Just

we a AI. cloud mentioned we As data on have in strong do business recurring have the center, and past,

expect. a little would weaker a perspective, maybe for business you’re us. still a than systems from So you But it is right, recurring strong

On industrial that the particular, created we pretty to the to a here we have various continues also quarter basis, off stronger. during we is reasons, negatively Huawei, that market And of I Automotive one expected third be to in for drop weigh talked a automotive think quarter-on-quarter. mobility call, quarter-to-quarter taken in be much the the does sort guidance. – and soft, on continues soft the so

Brian Chin

which when Maybe, you year what could the the talking impact about of perhaps, in Do calendar seasonality, into to December late but quarters? cost Okay. and normal, business into Thanks move of year. but weaker hit model. your anyway March for you fluid kind have of next and more if seasonality than this probably, about the sort on tends calibrating think expect that the early be Luis. first you as to most we the pull here, year This in color, of your we Jeff call is want

in revenue your terms standpoint a you where March think and in quarter? the secondly, EBITDA of starting from break-even EPS might be And levels

Jeffrey Jones

starting Brian, next of last that… that March of because year, your part in

Brian Chin

from when on the break-even you what have of basis? – synergies, an level EPS what EBITDA the cost full also you the do like, basis realization you revenue Yes, and think Jeff, at

Jeffrey Jones

Right.

margin XX%, me just, that down just range. we’ll At with once So XX% at gross in the level all are synergies $XXX a with I’ll revenue million XX% – let start P&L, break-even, about included that. be at in

see QX? Now given regards to other QX. million. with perhaps to about say, with we’ve mean, impacting guidance QX We at it the and question that’s for right, how $XXX I seasonality and that’s tough

as QX tend past You’re Year. be weaker, QX Chinese would the get a until we right, well to little New

we’re as So in hold expecting to mean, past. point, has that the this at I it

Luis Müller

level is to year This semiconductor talk macro supply chain. with impacting so and a a the difficult seasonality, about especially much very on changing

Brian Chin

a the especially large RF in? market large how growing. Can it you us remind how was we is that’s yet market further. sort one as Yes, bit about be of is Maybe $XXX the contactor out think portion to could as $XXX question millimeter years several million, million-ish wave from fair. a this of walk I just curious, Perhaps test market the last little era today? ushered now,

And sort broader, cell did for of sort larger these bit full then to that’s standout solutions, and obviously, a, even a maybe, Luis, if of you about you maybe test a want opportunity little talk you. dollar because

upon that Thanks. even So to you more? expand want

Luis Müller

Brian. Sure. Yes, Sure.

both kind you our the which $XXX about of the the signal asked. It’s million on of So part the analog, is bundle year. actually little be and $XX market. up a high-performance up, since It’s to broaden the bit million RF precision a contactor

We had sale of IC quarter a characterization a RF and in have that I and engineering contactor a high-performance was mostly for record that for announced new lab quarter QX, products. ago,

in off expect with for that device devices, characterization. projected got XG QX not for production, design in more sales in mobile until Now really to all, to of when all initial we XXXX. off have customer for volume and had that second-half is contactors takes for follow-on – orders RF in take But we which one really we

we of acquired the XXXX. really pin Japan the traction the market, also outside of pins, good Kita beginning gained Kita in some business RF Now being with we

our So and in tried the rate implementation the And I is to of handlers. our attachment contactors what’s of we before, as installed of track Kita base mentioned our contactors. pins

capture that, our more incremental rate up the the XXX%, market, to want with does at million XX% cycle opportunity in to of And $XXX because a to five we’re handlers. opportunity obviously, next approximately get fewer create attachment that a are years. it equipments But we approximately estimating, there which contactors XX%, bit to revenue down about we’re a difficult getting out about little A the now is door. over

Brian Chin

you. Thank right. All

Operator

you. Thank

Next from D.A. Davidson. Tom question from the comes line of Diffely

is line Your now open.

Thomas Diffely

Yes, good afternoon.

is entail? just slowed of question you’ve over you’re there couple are you’ve next or additions $XX additional you $XX the down taken million that quarter, spending that going pull announced in that on discretionary to Is First measures cost-cutting would post all last this to million to where quarters the on, year. that

Jeffrey Jones

spending it from with and replacement has forth. delaying $XX the discretionary sort as of Tom, you things as labor, mentioned that million, aside well so travel it’s of No, to particular like positions, particularly the do

Thomas Diffely

Okay.

would then, though, And view so, cuts picture, I more big delayed new as that create opposed long-term spending those as to you guess, a spending model?

Jeffrey Jones

point, they’re are the improve. this in model. They At not Yes. not conditions until They’re temporary business long-term.

Thomas Diffely

crystal between and of think look you at and your Okay, difference I’m mobility? two you is poised sense. that recover – ball, make All two strength? can bigger is which then markets end those you relative quicker, to markets, to automotive What right. as And looking if far handsets point there do at the of to your or any kind as

Luis Müller

hi, question is that answer. tough this crystal ball Luis. – That’s Tom, Well, to a

combination that now. Cohu’s in the it for and here and and be decline You And right, a for is markets, vehicle segments auto XX% largest right? – that market, the both at not right largest to exposure year-over-year is sales �� the know largest Cohu our is for comes will be there right the sales, we now I larger mean, this weaker of historically, business, Europe in then auto and industrial automotive the handler U.S., about right, down only China. with should

the so Now all of vehicles. activity of of we management in or the I with still and aligns in really mentioned as that prepared do this, more semiconductors see electrification remarks for midst power here,

thermal processors Assist Automated for handlers, tests. that – on Driver progress seen have during and processors, these also are We testing energy ADAS, dissipate

but electrification pretty semiconductors, top greater compounds need ADAS, in I in electrification on So adoption volume so of the the of of well like and particular. automotives growing, that said, overall, we’re aligned ADAS, we it

waiting networks. right really the to going think deploying be I is XG side, is and mobile for XG deployment. now much now tied right mobile the telecom for of On

you of semiconductors or RF will, testers So build. the of which are the drive then some will digital, the today smartphones, RF in it’s content is high-end road to aligned and large – power starting Cohu are this if amplifiers. to, exactly not the the mobility of essentially majority part the the infrastructure where Most down with that’s a going of or digital come

in going our of based second-half to starting the customers. that’s from happen the we’ve XXXX and on We all seen forecasts predictions believe

But going capability. will go was Now volumes with surpasses naturally, some on volume of that. few it to from early really a XXXX, XG there years before start be will smartphones ahead second-half of

put all market Now you say, it we together which know. don’t and I just comes first?

think quickly. than I well-defined has the that could but automotive, XG more a now change path right the

Thomas Diffely

since been months sense. acquisition It’s makes gears. now has That finalized. Okay. been six Maybe switching the

Just wonder for seeding contactor perhaps growth? can to any you – if you’ve on success the the talk got future business stories

Luis Müller

– quite have Kita The been lot contactors has was gaining our We contactor a record the that sort in few volume. in We high-end answering pins a getting in quite the had we question. really for RF pins of have quarter that had traction I the – these digital, actually. was in our are we xWave of wave applications. Kita a mixed-signal Yes, contactors, bit both quarter Deploying great for a called millimeter of a prior QX.

As launch product this – of I labs. the was is before, early this said characterization

satellite selling Now big next second as able handler in starts the highlights year, work one the expecting going towards the as contactor of see where to and end it’s for of winning we’re the quarter network. an through the rolling volume well the out. beginning to application, XG tester, this was of pull And year, and we the of are then

the it’s of ensuring fidelity critical the I signal and XG, and production, stages the we’re right way really early there, the – contactor the more on contactor volume said, test. pair really but tester the And signal performance. now. all of the early more the those of the device to seeing And to cases, tester of the are you sort right can solves particularly see XG and with not stage XG Like that

Thomas Diffely

Okay.

still sounds few with over it So next you’re the contactors years. like in growth the comfortable potential

Luis Müller

Yes.

Thomas Diffely

about finally, a as or then talked Huawei X% your a describes for customer less of you is how customers your HiSilicon? to us that to exposure Silicon than you And Huawei, – for Okay. number have HiSilicon Huawei business. But was do what indirect your of

Luis Müller

of We exposure. than the direct indirect exposure the have more

tester that mobility supply affiliated And So have our direct of we us, customers pointed as you the its Huawei in triangulate out, we businesses of X% really display the this not or right? have for less nevertheless, driver do power and to sales companies, exposure our right? what’s But the side, amplifier than to Huawei, the is market business hard impacting it’s the on indirect is to only but RF customers. several also

Because RF both the year. that out talk I we’re to export second the in seeing other driver ICs push Huawei’s The think sales about, about net-net this in you one in about decline display it frankly, and, importantly, and most to tune talk from forecast the of smartphone and the the of the we you a forecast, in quantified the million side, of can restrictions side is second-half is quarter. $X

Thomas Diffely

Thanks your today. time Okay, for great.

Luis Müller

Thank you.

Operator

Thank you.

the comes Riley of Next from Craig line question Ellis from B. FBR.

may now ask your You question.

Craig Ellis

taking for thanks Yes, question. the

My you it opportunity that pins close that Just drive and see XXXX? Luis, it’s items. of the gap like a contactor in to attach to do getting much and What’s solutions. the for opportunity. think question Kita – looks see trajectory you on with to some $XXX how on you into XXXX successes attach that here? we’re million of higher the couple rates could Cohu’s follow-up of From today nice slope what can

Luis Müller

Craig. a at looking – We’re hi,

sort a the at our contactor mid-teen the years. over and now, that’s a rate in our right growth growth plan that of mid-teen – next rate, few looking We’re business

Craig Ellis

come recurring that gain just so includes And natural the sales your shared and both of the part out that business? the of would

Luis Müller

That’s right. right. That’s

Craig Ellis

of Okay. like that satellite Can opportunity test material. And one about for financial sounded would to was had what go wanted – for global it network you that then be talked the you for win I talked that pretty next year? you the to back scope just wins and about RF

Luis Müller

shipping that first of we in all, started QX. Well, late Yes.

that matter. in And – could is it really million a call this order is, so expectation not So material $XX year. the was of QX next it, this the generate, for or

Craig Ellis

I’m XX? sorry,

Luis Müller

XX, correct.

Craig Ellis

then obviously And number more last week. a great. seen just Thank things couple the we’ve Yes, of geopolitically items, you. change within just a

that in last company Just we so approaching into the incorporate for How is today that since for if does guidance, guidance? the tone, does third the late you tariff What that the guidance see understand we all how change will, quarter? week. mean given company abrupt the

Jeffrey Jones

Craig, Jeff Yes. here.

visibility than months. It isn’t out our three fantastic. about doesn’t So more go

we our forecast, And in and on that customer. And as the orders it expect backlog from the we book to – base immediate feedback the the based so ship. always to we do we near-term, in once base on quarter, then scheduled on bill

And lot geopolitical so, the as we noise a of noted. you within do landscape, have

that to as However, times. recent our similar, ensure for lead customer know, is equipment. approach try get last most to they possible, you the best get as have demand shortened close They just information. wait to minute the as the have Customers, till the information, the

we’ve how of quarters from is have would certainly And it. ago. impacted have I or than expected us any that’s numbers $XXX So two three think the it. been lower million approached

through to the impacted. as So process to And as it’s the close we possible. really customer definitely is go stay that’s

Craig Ellis

my touched something I that that. question for on. thanks Then Okay, follow-up last think is on a Tom

those that market split shows that, But mentioned, end of there’s there’s the question growth as in drivers well, and cases, headwind that, mobility, underneath unit XX% or there’s businesses. the Luis, and that in transitions I are secular in both favorable. automotive think no both some So XX% and year-on-year splits, technology a you

be secular right significant and are so, a question drivers, the things legacy and can end XG or that in where would markets aggregate application there’s that has ADAS when possible book of is two a to you areas if is, it is The that, application? how type now more And like businesses for to order your are EB? customer growth related distinguish automotive in ordering EB, it versus ADAS there whether those or – work like of that stronger across

Luis Müller

Yes. We actually can’t segregate.

could power months of over yes, the that but seen hybrid, last weak when potentially I more is as easy-related, guess, six months has that been or have up I power management forecast say is the of been automotive We ICs. orders in have for in six a the ICs majority the And majority, the EB management coming certainly ADAS the ADAS much coming over not alive last or quarters.

so of of both we for lot And the year. see and more from an this balance are evaluation devices that handlers, our activity, said, new ADAS-related a like as well I forecasting as for, of here

we both. So them yes, can see

Craig Ellis

helpful. then that’s me. And Okay, for perhaps last

You mentioned of XG a number times.

were As vis-à-vis see you we’ve compare the interface those can other air early air how could we XG of at be and been transitions this from look now, And we next interface what [ph] XG two to at through? if significant transition. Cohu, it part XG to that

Luis Müller

Xcerra power of former of million that us for the of testing $XX acquired is – in which – about talk the in segment of the okay? exposure the we so mean, this the are XG. XG, with aligned So today, market, I remember, form really the is sort those where XG Xcerra acquisition, testers leader Xcerra And this right? us amplifiers, exposure But for let the AT products come Cohu me sort of the XG, than I’ll RF XG approximately more testers. to

infrastructure, we ICs, cycle that working is quantities to really test are have testers XG degree lesser smartphones, greater using which content. suited network and really don’t network today, is require in where amplifiers the on a digital, are networks, RF which RF greater smaller for really right? in So These

economical today. installed we hand, And RF in testing largest be are will XG we new for that have the the deployed semiconductors other most the these On focused do base believe phones. using these solution

volume. when come mean, these out, in things low still I they’re So,

still next over We that that phones phones XG initial run, from using few roadmap a the they’re of in on publish that have actually, teardowns coming these of have are sub or of tested that XG out millimeter with quarters six amplifiers developing our testers. gigahertz do some And frequencies been know sort these soon. frequency, the devices

to market was so take years and bound on, it is power significance, and volume that amplifiers, start terms drive again XG not think a XG year, XX% only drive the bit won’t RF phones RFPAs, this produced volume, to about the XXXX all tester $XX attachment ramping in when right? opportunity of the and case, to then together happen million this we’re about next an more but of it to into I talking Now handlers, size should would on and believe sales, are year, or the se. rate surpass it’s that but XX% put for grow in is which going do a we for market it there, of to is out contactor But quite to going of sales, It into of in there. smartphones testers couple per second-half

Craig Ellis

helpful. real Luis. That’s Thanks,

Operator

you. Thank

is the David coming of Securities. question line from Next Steelhead from Duley

line open. is now Your

David Duley

Yes.

Just one clarification.

the in impact I of the of size think, the the impact Luis, repeat again? estimated you reported. quarter Huawei just you Could the mentioned that size,

Luis Müller

triangulated we here. both have – expected would we and triangulate been million on should our Hi. sales direct in the I otherwise and that $X about indirect being QX. indirect impact a Yes, and mentioned one QX harder, Huawei of to what million, I $X – bought the decline so Dave. if The

David Duley

the quarterly Okay. and different mentioned, your think, levels that $XXX of rate all those And business different any in like And when quarterly markets or million for run losses metrics these also might revenue a been rate? I there recover? Is quarter you your XXXX reason that to or so. business revenue presentation, run back there the was to level. at the anything think getting to that each get can’t back Has any you revenue share impact you the level have

Luis Müller

months any been contactor nine last customer that we hasn’t the in other gained than six, some traction there No, over changes the front.

– As mixed-signal for I mentioned, an it from from market. the our the a Kita where change in of we really quarter the in a pins QX, the xWave, record applications. digital, in been had contactors side, hasn’t RF integration equipment no contactor, But

David Duley

a that one second-half Okay. an expected in programs I strong you couple think give those what update initially Could and next and I that think And the two of just year, you be this calendar was now? year. of programs or there expect us were about them you pushed into to of

Luis Müller

to positive business in second it’s the and third with Sure. late was actually, initial acquisition program just quarter. working ship bear quarter starting communication starting on Yes, I That since that was one satellite the mentioned. with we’ve a finally been the fruits that the into here

The programs got with had in since which the new dynamics RF pushed mid-May, the other two Huawei for XG actually bit. on mid-May, one do to XG, restrictions that little a export the out you’ve changed

one an And impacting panel is Actually, in penetration and well. flat also for revenues such, that the that the starting was would in smartphones forecast quarter, be the was we’ll out. doing. of But a market, really which – got here in increasing the the in demand see pushed third really is the we in decline this we’re execution second-half of year as projection from the one display third perspective, doing

David Duley

up picked the customers display frankly, that stopped buying? further just flat you on they And panel you

Luis Müller

right. That’s Right.

David Duley

all was That you. Thank my Okay. questions.

Luis Müller

Thanks, All David. right.

Operator

back no showing would conference this time. the speakers. like to I’m at to further you. turn Thank our questions I

Jeffrey Jones

Thank call you today’s speaking to on us Okay. with for you soon. look forward we joining and

Operator

Thank concludes wonderful this Thank a participation, your day. conference. and have you. Ladies today’s and you for gentlemen,

disconnect. all may You

Cohu (COHU) 5 Aug 192019 Q2 Earnings call transcript