COHU - Earnings call transcript Q4 2020

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

Operator

Ladies and gentlemen, thank you for standing by and welcome to the Cohu Incorporated Fourth Quarter and Fiscal Year 2020 Financial Results Conference Call. At this time, all participants are online are in listen-only mode. [Operator Instructions] Please be advised that today's conference may be recorded. I'd now like to hand the conference over to your host today. Mr. Officer. Financial Chief Jones, Jeff

Jeff Jones

Luis Good morning Cohu's XXXX call discuss and our I'm welcome quarter XXXX to CEO president fourth our quarter today conference results joined to by and Müller. and outlook. first

the If Cohu's contacting may website it relations you will earnings call investor access conjunction Relations. Investor may a website There's you accessed or slide from that the by with the of presentation copy in call need Replays Cohu.com our this release, available of be at in same Cohu our on also after be page section. a concludes. today's call via

Now to Safe the Harbor.

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

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

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

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

Luis Müller

Despite five-year about semiconductor orders for uniquely strong into to Thanks, half of of exceeded fifth the ended and Today, XX.X%. from fourth what's growth with we on dynamics a last positioned has year and executed challenges, why growth, throughout revenue driving explain of to Record continuing Jeff. momentum improve I will high quarter is sequentially, our business a CAGR note for the capitalize first revenue XX% our million and Cohu first consecutive record early that Good guidance updated year all-time fourth $XXX.X XXXX. morning some conditions on expectations of COVID-XX a strong our quarter. quarter now we and everyone talk up was discuss on Cohu market. with thanks carried XXXX believe us. quarter, joining our

Our partners operations team and XX% orders. meet Interface executing increased increase supply split to recurring quarter quarter-over-quarter. an and business handler needs. and ramp the in XX% orders reflecting are on orders Fourth systems, chain XX% unprecedented customer tester were sharp business systems

driving was across contact utilization such demand, at system all XX% sales Orders improved XG December, rates Estimated as Korean, generation automotive nearly and the to Chinese test for and explains handler manufacturers. increasing Given strong semiconductor enable sequentially business quarter-over-quarter momentum. five significant Mobility the the by points strong major markets, we for some of XX%. end a Cohu be quarter-over-quarter. increased with deployed smartphones segment sale or of the to attachment next of introduction all continues dynamics XXX% US,

We're in leading probe-head key not be cRacer preproduction also and initially frequency, wave competitors in in platform in product against high for success only Korea group test. millimeter had design solution devices. win wafer The well-established interface by new a our capabilities used testing foundry in will RF new the a Our our of excited demonstrating at for Taiwan but interface qualifications.

or year early this late starting orders volume next. expect We

product success over portfolio XXXX brought our test orders that Xcerra display new of traction instrumentation driven and RF Red we Along by devices. the for year, a demonstrating value application ATE driver, smartphones, addressable processor complimentary WiFi-X which acquisition Tester for an marks market. in Dragon ICs good suite and in new with had of business management, the Cohu. power year our steep Our the ramp experienced expansion RF, testing doubled and

backend entered as share inspection on our systems Neon fourth this speed the significant our semiconductor XXXX optical three with greater about positioned business vision solutions customers supplier of to We four are vision to applications and we second optimistic Moving continue in and momentum improve automated intelligence point we as market. of climate for largest with capture portfolio inspection platform We've gained year, inspection, estimate prospects to the into new that the expand continued accuracy quarter. segment last yield. to in Cohu to artificial the

design segment. been of mobility sales testers, inspection in our China and in have Taiwan key penetration developing our in teams busy products. team engineering in market Our equipment, the of and handlers, with sales expanding Kudos contactors, our wins to our efforts new incredibly and the securing further great capabilities

in ultimately segments orders our tripled half segment, perfect assist manufacturers, to and opportunity for like first driver ADAS to testing quarter-over-quarter. thermal assist the forecast new We thermal comes orders electronics, technology. that the as industrial our with to were electric XX% of this surprise of increasing orders problems as is auto the were us automotive semiconductors Driver significant improved testing catch consumer of processors the our announcing these Orders as automotive technology handler business in coincides EDs. impact quarter-over-quarter ramped vehicles growth toward starts it and management automotive in testing semiconductor ramp We challenging also in a to auto new for wave ADAS power particularly management, is thermal requirements. proprietary XXXX handler yield, marks all shift companies demand, with also as production. of and of this Approximately our X% volume about to an in that of technical complex introduction Turning no customer marking control, major technologies. ADAS It automotive of a confluence battery offering processors. for storm active that temperature or estimate address with extreme and interesting making up needs

applications. testing of industrial electronics ramping medical and support gravity businesses are using place Our high-power in and pick handler and again once

can managing and orders thermal actively mainly quarter-over-quarter. were the devices. RF IoT, in by our We have with optimize testing In dissipation Electronics where ongoing by driven up success testers orders yield Opto In gaming new doubled along management power and display handler IoV practically driver processors, qualifications for substantially for computing we testing ICs. segment,

Now segments main interest looking and by all ahead, Cohu's products across encouraged market our customer integrated we're solutions. by new in momentum in test-cell

diligent yield sequentially will profitability first-quarter customers, quarter margin and new be up We guiding revenue productivity our be to to investments accelerate improving We're and and focused for time and expect incredibly being motivated product second on about stronger. profitability. and to

portfolio over two positioned and years XG is to ASPs and well greater outlook year test The greater midterm. the the for accelerating our in and continued So that the is volume is deployment why are growth positive? made penetration technology Task our We than for company so this past have of also product increasing, Cohu so have why is substantial doing over improvements higher complexity double intensity. now year XXXX. projecting leading system analysts to

for Cohu grow to further contractors. management limited and testers, smartphone the again display are story opportunity year, XG. this RF, selling units power driver, is But Additionally, to and compounding the not projected IC handlers,

Last understands significant suggesting transceivers, for with export smartphone that redistribution There we has being complete where customer increasing. As opportunities greater government the products application translates mentioned capturing and transition into a test processor market. many mandates segment, have to China. in year, neutral US we of companies decade incremental orders new new Cohu demand go share significant Huawei. positive auto that new particularly There for China, of starting and trends saw is our IoT these customers, and addressable to EV Europe, even in in earlier, opportunities been carbon and some automotive WiFiX, business US. in new believe in RF to technology general everyone are a restrictions to with the additions we're I coming

use technologies in trend rapid in exciting We content to and of of from ICs. ADAS adoption projected which the vehicles, growth benefit processors, our microcontrollers, this a RF will Another vehicle believe growth mid-teens in displays, year. IC the automotive the about equally the sensors, is segment sales SAR expands

to us, held behind analyst successful financial With Xcerra describing the target and $XXX path an new revenue to the investor we a model XX% in early conference of integration December, now CAGR over new from in and automated processors in growth optical XX% high traction technologies gaining inspection. RF, management, and comes the ADAS of income This midterm. testing operating in enabling battery million

Now, I'd fourth on Jeff details share to it guidance. to provide like results quarter to quarter in first turn over

Jeff Jones

Luis. Thanks,

Before including non-GAAP the on I accompanying non-GAAP my walk included about through that of are the Please that other the disclosures reconciliations which presentation to QX the measures, Information non-GAAP are results in to referred our the release note QX page guidance. earnings investor located financial GAAP investor are in follow website. and figures. comments

our and year $X.X million is model EBITDA was continue in XX% Fiscal $XX.X COVID-XX for QX primarily reductions XX% combined $X.XX, approximately of than optimize fourth target by approximately over beginning last result fiscal for $X.XX revenue range make updated income million, structure. tax over more In and XX.X% and full was the revenue December QX a results results; was guidance customer invested cost growing than as financial or fiscal the November. Cohu's XXXX. accounted on lower lifted margin with lower expenses to offset XX% In as ROIC NOLS. were income were quarter, adjusted and the XX% the Cohu's quarter in the $XXX fourth operating to on for XXXX. for no of non-GAAP year CAGR of was higher. $XXX.X million years. of year expense was to for and Fourth The at effective year objective and the of of new higher turning UPS nearly fourth with the quarter quarter, our or QX sales. revenue five losses and midpoint XX%. XX% was provided capital rate XXXX with than XXXX, us X. generated million driven exceeded was Operating and XXXX Return guidance we QX non-GAAP investments gross approximately Non-GAAP our X% temporary XX% full the XX.X%. Europe the Now guidance

midterm model, introduced higher new a business that at profitability the to turning revenue Now model all recently delivers financial target points. we

model. modeled Our expands an and increase versus in revenue target our in at of model growing revenue annual XX% revenue on revenue. previous million. development of at income. targets business higher We've increase the a $X.XX at achieves $XX are is quarterly margin to reflects improvement operating added revenue each new incremental with from effect target of in support $X.XX, EPS EPS expenses relatively million through model model, $XXX operating modest represents leverage year. falling are of are but at a to per requirements combined product $X.XX profitability level the new XX% flow revenue. operating CapEx This million of investments. $X On in sufficient of Gross cash with target previous about The basis, an $XXX reduced EPS to free and other quarterly and

of and balance was cash receivables and million our debt of the funding at associated to operational QX balance sheet, experiencing. moving Now the ramp steep inventory and approximately our approximately supports we're with $XX plus currently million end needs the $XXX service production the

reduced be Cohu increase capacity. continues a equipment QX operations $XX.X mainly priority. capital million manufacturing allocation to CapEx by and during to deleveraging debt of During driven approximately or purchases the was from $X.X million contact $XX fourth and quarter million, QX flow for was by Cash

improved directional we forecast provided revenue quarter first December. in since the early guidance The significantly

considers to end of with between low guiding acceptance In million by customer million. $XX to book supply the Margin Gross to chain million between to potential and some revenue. in to be For QX, $XXX uncertainty risks and million. operating be expected is sales XX% associated is we're to XX%. for and expenses bill be QX, range caused The between projected are revenue required COVID-XX which $XXX $XX QX

forecast approximately rates of Income QX profits and generated share of jurisdictions. diluted on from guidance. adjusted and backlog order XX% increasing projecting expected The are to generated midpoint approximately in We the we midpoint shares. forwards. be to improved are now expect midpoint for Cohu's approximately With US profits to is foreign QX statutory the into guidance of at carry EBITDA is XX.X have QX non-GAAP tax to guidance. visibility offshore X% tax various million loss the revenue XX% to across various count Most are of in at mitigated be rate the operating the net quarter XX%. by taxes subject be second The up QX markets, forecast strong and

enabling ADAS to and As continue the processors is for RF, new testing of with order technologies battery prepared along about remarks call first this growth quarter, be a now gains concludes open optical and momentum we mid-term up and the prospects questions. in shaping and and automated design our strong That to we'll remain winds optimistic Cohu high inspection. year management, in our

Operator

of Stifel. [Operator Instructions] Our line a question Chin with first comes Brian from

Brian Chin

Hi, results there. ask you Good and morning. Congratulations a on few us letting questions. appreciate the I strong

your The from three maybe a all of ago. and the we here, commentary three anecdotally, have, ADAS, certainly or EVs, is from if I much be a is going demand interesting your now years it since lot first following you've things things market, question about but think, it's about to also much through than SAM I read higher seen other year years, the potentially this pick been years can including TAM in automotive on to the based higher perspective, this was strength

ago saying of and level just us you sense a sort some endpoint, auto might versus just market and three sort on but quantitative this of So year period comparison? give the of measurement, I'm a years sort be could larger if a much I to that's sense can that you revenue might give what maybe periods be your also guess how an of of not us

Luis Müller

Hi, us. joining Brian. Thanks for and asking

back that referencing I year If was XXXX or in you're years which think the three XXXX, even market. going you look for ago, a automotive into good

for was what in for going it's maybe or that equipment to hard to here, market capital strong we're teens, or to side an year number us to but teens high about cycle. is to low we're is side it at relative up the know, semiconductor thinking You be the larger what this exact XX% the pinpoint the last what automotive

Brian Chin

of half, and how any of and and also you times there's Okay, status maybe that's extend year, times schedule The lead shortages for strong this lot think a your auto test lead helpful. markets changes apparent, supply what's through for or questions. dynamic deliveries about the your been timing readily not first equipment has or Appreciate baggage any handlers that. delays Couple other that's caused kind and in shipment current obviously like your test and this of noticeable semi of in your like things are challenges? while present I wafers managing

Luis Müller

lead by X impacted percentile and weeks, half that No, supply ways is that we shortage like times, product custom read what the we have our builds. contactors caused at our haven't had any tend at at shipments. always of XXth times the, to mean, it chain there they lead time looking the you are you looking look is on difficult about approximately time, configurations or about lead XX and that handling now semiconductors extended. of weeks, our hasn't delays that of but said, news take right multiple as the is To lead the the I percentile, a are XX more XXth longer, running weeks. There at are testers

times. right about hovering lead now that's where on So we're

Brian Chin

maybe times range, for out lot other it's Then like equipment my a question had Jeff. lead there sounds than end more reasonable last but like within you. sounds stretched high is know, more That you

little range? about talked ranges, dynamics gross seemed at as For the OpEx outlook lower to the so you quarter a suggests, it that has margins the causing the offset, range the within as be OpEx little revenue first the a and and percent just are that but talk and target can lower through kind be margin to seems of range, been range model also those probably of it EPS sales within and well, than the a you've neutralizes gross your of revenue within that

Jeff Jones

mainly of in handlers but we're part the story observation. maintain gross profitability. lower orders, seeing margin systems, testers, increase a Yes, an the offset Brian. accurate to operating is and product in target is target. reduction bit that expenses really in by mix, What than QX, down seeing is is revenue a steep a margin this that Gross but and have handlers, That's corporate

XX%. to ratio system expected point in about is for systems reference QX. revenue total or normal give to Just XX% be here, percentage a revenue about you The of

up it's significantly. So

know, time it's result it'll going as so increased the of its by or we revenue down-quarter-over as and recurring, increase Now a will shipments. spike to nature, recurring but quarter just over not up increase

of work story work manufacturing line The that to piece to continue the really towards transition bringing we is the down contactor in second continue and bringing on margin and with expectations. costs gross

work I'd on mix the we say is then secondarily, So margin. continue first to order magnitude contactor and

Brian Chin

color. the all appreciate Great,

Operator

Shi with Company. comes Our from Charles & next Needham question

Charles Shi

Hey, third taking thank to quarter. is further performance, I sequentially half that to question. it this your year, this up we a look correctly, kind first the slightly or I quarter to color for year wonder XX% below such bit tend Maybe you what's that early if provided outlook Any should year, second look for for would maybe ahead, about you looks your Is If at is year think little from by a this down quarter may I recovery historical seasonally my second be or since X you this hear expecting be digit great. be like mid-single strong of seasonality change? teens. the

Luis Müller

the is thanks This Luis. Charles. for Hi, Yes, question.

much that know, the second into don't of year. yet we You visibility have half the

our can second times, the in quarter now quarter. you see what late lead we're is booking first As shipping from in

of second this going for year, for cell at that's know shape QX don't but same second or So ramp be more strong there know phone mid-year in still exactly the a towards we to how the mobility three mobility incredibly QX obviously time. the in should in launches half and market we'll an gain here the visibility is in automotive the dynamic there We next months. and

Charles Shi

some first supply factors the provided the question little to Maybe next order He dynamics on my Jeff. a Brian's whether gross margin related of really order, constraints. bit chain follow-up wonder on it, order there to third and any thanks. I there's second dynamics there. other Got any question

say costs shipment, see expedite would go impacting into fees this such items year? surging You but nature incurring you demand, higher a those or chip don't bit gradually a you more are the that did whether away really your onetime shortages I something whether of wonder any of given like and little late

Jeff Jones

suppliers, so able that's good this of for expedite Charles. Operations the either. to without and nature. a We've chain and to not working not suppliers, far case, with that QX forecasted scheduling not done materials. job been Hey, do point and fees supply No, has and that very prepping things

So operational really from improve it pretty to the costs are standpoint, in with comes expectations, and an contact or back much then continuing line mix margin. to

Charles Shi

question and basis, a my about dividend the Got for your the business on on any potentially in with you opportunities, repayment capital back to or a bit that? level M&A is next your what's to XX XXXX, going prioritize your returning program about it. little performance but debt We know, Maybe allocation. want XX resuming or looking thoughts to thought

Jeff Jones

That'll directors generating on leverage. be for decision and on management assessment flow reducing our of the as free and board that. focused clearly as cash their We much a ultimately team, up to possible as

Charles Shi

Got it. to back questions. go I'll for cue. my answering Thank you the

Operator

Cowen comes Next & from Krish Sankar question with Company.

Krish Sankar

you much feel there any bigger inroads Luis, are the lot it on the difficult? and of for shot from be in out the you just players is have question this a or Thanks or strength handler do think I autos and great there Yes. side. think will results. Do testers you making in and congrats that Jeff good coming

Luis Müller

to [ph] exposure we'll the have much non-existent you're also dialogue the I business current with Krish. to is great business. good auto at limitations we conditions. be contractor so strong that but in It's but by question. on Krish, We have to on a on business thermally handler the in auto side. hope more That's to are sort much our today. future, Yes, inroads the auto It's some It's the into able tester Hi, the side, that this way, that There correct. time, the that test very not stronger has tester. tri-temp business would the this about the do tester capability do make like Luis. of challenging

Krish Sankar

to I orders Got it, past. Is out no worries. offshore asked XG? or is Luis, there think a I question this coming in from much sales mobility how figure way the

Luis Müller

business in tester the From half side, looked that sure. half we way. of ICs related related. our was There's Yes, estimated and be to may XG about it this we at RF of XXXX, a tester about

we parse On knowledge in it handling know P-mix we the XG a applications, little ICs don't side, well, necessarily as is can't XG a do but whether for final XG. handler have mobility mobility business RF have that small it's all [ph] bit RF testing difficult, cases. use I quite going because but more and we're into or handler ICs or a out measurable We that or

for easier say tester it's So to the on side. me

Krish Sankar

I mentioned That's when that enough. revenue have recurring strong, that Jeff curious, dip QX. fair revenues question. not heard QX think down of If Last the would QX? I'm is color. I right rates up thought you AX, good That's recurring seeing it seasonality you are because kind utilization just grow demand in in were is it why or happen be should in

Luis Müller

No, that revenue. quarter driving over It's point revenue actually, is I think quarter-over-quarter. significantly, up the much And revenue system pretty let about Recurring that corresponds the quarter. clarify. is more your second system Krish, me flat utilization, to

Krish Sankar

All it. Thank right. you very Thanks a lot. much. Got

Operator

from question with Securities. next Duley David Our Steelhead comes

David Duley

guess, Yes, and at XXXX, calendar congratulations be? market the the help on your I nice market of was, might results. perhaps understand, guess you A for Could what questions size us couple share here. what of handler a

Luis Müller

Luis. this There one, a That's really Dave. variables this Dave, was lot COVID-XX. a tough year is of last with Hi,

size the on early that comes in out handle we the for year, have external market So data we acquire don't typically market last a good QX.

look of back. us give more will that So a

maybe other just than we have do in hovered for market view question, point an more has But XXXX. typically about estimate to low XX%, XX%. XXXX actually your the share think our I for of at we completed to handler

David Duley

or directionally, would this what was guess? that down Would XXXX you be best it your calendar guess flatter up

Luis Müller

now truly still fourth going mean, all in our supporting team have is we it guess my extended So keeping And ramp. think our they and them now with know I right at that operations bit but could check, a monitor, that is did doing go during job up in And competitors keeping fact this a requirements lead particularly otherwise quarter. I on best the competitors, monitor I what's we're a business check. business. times though amazing we been customer in for have our even getting

So I quarter would venture to up the right now fourth say we now into some in quarter. were points picking first since the

David Duley

Okay, a you model, revenue. change $X.XX level little model previous the bit, in $X is think I comparable topics a have of same at new you mentioned the to

some through you went to $X the were the target from you review move just $X.XX. Could about difference on what model? between the to increases $X and You dynamics $X.XX

Luis Müller

then fixed Yes, gross tester costs moved manufacturing in leverage say increase dynamics, the more for incrementally. of profitability second is terms drove is from in David, growth new and the and driven and margin two contactor of item, or increased the profitability. one which I revenue And things, expenses would by obviously, better operating the higher mix that's two of revenue.

that product other operating necessary development steps new taking to we business cost, it's to, invest while opportunities. continue expenses, So reduce in reducing and

that of operating drove continued was tight the expenses higher really management it profitability. So

David Duley

saying you your to are saying topic tip shortages? waiting automotive curious to has customers what perspective And, chips. Okay for production exactly shut what lines of about about and is are as business? have just these down your kind and all lot automotive read that these know, and know, How of you on as me, we customers impacted they're a what for your and you question been third you this know, shortages your

Luis Müller

it's Right spread that and is quickly place fairly months. ship for a news chance volume is a in or the multi-unit now them side there we customer to weeks, them over is from orders, orders stagger the customers is typically past not let's quite our multiple demand out. from Dave, interesting. they when What the on see say multiple

lot So dates, much operation that from on on not shipments. satisfied room clearly our the there's the satisfy a side of pressure need customers out to customer ramp, and pushing wiggle

need handlers the As lead they're a what said working our we're trying and inventory supply not before, to to in ship There's much that on on not because keep differently, hard pressure of but it really possible. room that's chain I as at and any longer soon but much. way do I moment. the times outrageous. wiggle our as really little And believe you not are the customers

David Duley

And think you than your second quarterly the what mentioned flex demand use then can be first happen to now does meet is half and the Okay. to half? upward if stronger you capacity

Luis Müller

manufacturers. I No, capacity mechanisms don't contract we the outside have have think expansion. we talked expand that And have had we're past. we in with But capacity suppliers, to capacity specifically triggered about place in and executing that

contract at outsource in been supporting do large know, house. outstanding [ph], final in largely for to very has doing model manufacturer job manufacturing, we a hybrid JBL ramp. and sub-assemblies, then Heller And outsourced we our is [ph] a of test which a tests sort you integration business in-source So outsourced as or have an where

and used it doing well, integration in house. have actually some final of at as and is mechanisms had past test in not have the We supply

have we And again, flexibility So flexibility some ramp. this that are there. we this during executing time

So set needs. we're the business I all to support think

David Duley

very much. you Thank

Operator

Our Craig from with Riley. Ellis B next question comes

Carolyn Lynch

most have for is this Craig, Lynch been questions Carolyn on my guys, of asked. Hey,

to of level, strong up on seeing to you're is quarter. back of on impact kind of XX% But backlog that know, mix? know, first just with adding going quarter that, the we be quarter, in off gross you should or to color should here XX% in that kind return to know have target normalcy? at around have seeing second I'll of Jeff, my obviously guidance. should second margins of of that I mix quarter that clarifications. gross to in that up you you some revenue mentioned a based model around did based the quarter revenue you're you margins math some kind the your see few jump Do first it of X% any gross first in was kind margins So what on like

Jeff Jones

we just can had still outsized and As best we're handlers revenue have on as the little system's incredibly see, the a moment, ramp at in bit demand. steep

very So in that I operating mixed to But then, well. QX, so this are we with as side, think dealing that we'll costs, to profitability revenue. expense going at the we're be the also target hitting maintain on of level lower situation close

Carolyn Lynch

the wanted my through staying kind Got would are to just of on the where if Or that have I in these we to kind continue you've they right mix low, we it. with expenses, can this to through adverse of to then step growth initiatives? something operating touched second XQ, is that expenses of question, but And levels? kind of back kind year year expect support hold of clarify, just holds to at operating up now end, half the

Jeff Jones

that's expand this current we long is at that improve can, at level margin. try can Yes, until as for gross expectation or least the expenses hold to or the operating to as we

operating be approach and the Carolyn offset in to that's loss with is reduction the margin gross to expenses. profitability able So the the a

Carolyn Lynch

Got it.

it Thanks, that's me. guys. Okay, for

Operator

with Ho Sidney from comes Deutsche question next Bank. Our

Sidney Ho

sort pre levels past guide. Great, you My order the they're very two thanks, up and there that and Do think across see below quarters? in you're string are the strong on demand of the that one the is the months. COVID to pent still some and still in next might the first board congrats that seeing areas on results question few you

Luis Müller

the side be I this I in that's are all status businesses we a segments, Sidney, mean you, Luis. we pre all honest the automotive have in still or Yes, good COVID is for market, have Hi, opportunity up automotive to to yet. not think growth with question,

are Although I stronger. others say to have

still That think yet I display in opportunities IC. also levels. driver into there really our has been to the getting the I know, are resumed display you business IC. driver potential haven't business, mean,

graphics That on where in I for I COVID there the stand there and strong from are we that reasonably also are processor, dynamics very to than there now. I overall well at could opportunity to there's COVID So and be say we're that levels. I think versus moment. it's in improvement think get we perspective, In size stronger the think happen think much through Computing focused hard an making of gaming. today. room from But and been COVID crisis. has business, could opportunities today were driving pre we context what pre But our some stronger that certainly there's

Sidney Ho

Okay, that that's up that. follow Maybe helpful. just a to

real, talked shortages and do time these feel check? not seeing are a ordering double doesn't you the of maybe stretching that only that have was that in are earlier that one that How not I to seen haven't out make guys. orders, little you the impacted procedures not you from seeing shortages, driving, some other orders have that place of sure but companies But bit. really customers first comfortable panic think you the

Luis Müller

that's Yes, a very good question.

with the mechanism had we're and a booking have the knowing conditions is had, perspective, same deep double terms our or we're this and with extended over and cancellations. a we have and profile We from the comfortable answers mechanism from so demand quotes, have about observation that conversations getting customers not booking

out terms stretched of all eventuality. in cancellation the know, been that we have coverage so have greater any You

So we've and come directly to continue quoted you we talking know, in we're I comfortable customers from customers terms to said, been have this, customers, pretty senior management we about with and the orders. place and to got made from what comfortable like our modifications

Sidney Ho

prepared maybe contractors last wave. the for test remarks to millimeter Okay, in one me. the Switching cRacer product mentioned you question side, your for

next coming orders terms prior your curve, the years one of in adoption expect the year, of later opportunity to of you next generation? maybe Can over do capability adoption? growth expectations this the maybe describe how of early the year. the revenue two about versus Thanks. product and of the product this And talk the You of curve the this you shape

Luis Müller

beginnings wave. if are the a Xcerra prior you has is there you been in we new solution millimeter in Yes, on the Group as particularly of continuation so X a of call limitations It's of sort x frequency by more The but applications, and a to the was for will, used volume acquiring originally could and for lab test. move us production, it's scenarios. radar to technology, deployed millimeter into particularly these But cRacer, applications, test the business some be business. what RFIC designed very of wave, and used Xcerra wave X-wave well cRacer high a continuation. wave

so remark So technology, but requirements, the old we really a compliance not up in which tailored is mentioned multi-site is we it's the in It's foundries we prepared frequencies. capability typically for but as requirements, well signal at design not then call has it's to really And business a do we we which test with been It had in a And expanded is here. that head. XXgigahertz probe to accepted. the more a final product don't the the a when Korea, set with which I new platform Taiwan, We cRacer gigahertz potentially XX have application. typical. have, an to contractor, actually a foundry continue as up evolve this

depend, XXXX. that Now on question, overall, the again millimeter it shape of the wave business will to of into ramp size the

our pinpoint I'll the you depends customers it's be I between at on range, $X a in could customers it millimeter and and way it ultimately, to little with size. and hard wide XXXX. we business look of million think very it, So But $XX customer our wave. a the somewhere deploying success But million give

Operator

from comes question next Our with Schwab Craig-Hallum. Christian

Christian Schwab

results given times year the Number second calendar extended Congratulations you backlog, that the thoughts and of very and half know, on have one, what lead record on versus two your slightly half? you strong is Outlook. have, the first questions. the I

Luis Müller

Hi, Christian, Luis. it's

you one We we quarters and we as know in right the are strong. the And visibility second, the easy to know quarter are We year, that's half, particularly as from have strong currents pretty giving can and way comment. You second know, visibility crystal guidance really one already earlier, we to give guidance clear hard I two moved indication. as directional know, out think and I quarter to it's mentioned around now. underlining ADAS best have this automotive is and be a going just

underlining exact currents over shape enough year, we're of half. be so first there's We latter part to than in the units To where It's towards see starting something phones data we expect also where yet the and current know, intensity. ramp to of XG smart people the with double put the place. of not deployment, point projection more around increase year comfortable the the know the also strong. not you Hopefully the test wave in second know this are and underlying more to XG millimeter of guessing half those able pinpoint right now,

Christian? Sorry about yet. not that but

Christian Schwab

that's you to my end, vehicles, end, about that very last extremely in increases But semiconductor fair increases you question strategic know answer. you value No, we've industry electric which seems as XG, to coming trends, in for back stuff the my front test like packaging, the of guys requires the viewpoint, there a lot is shift complexity, be talked from a driven know, is but know, all by which times, you etcetera. advanced in

we're more chips with, you know, I'm we're to doing that you're dealing type curious, chips, just more of So a of that in in, typically. the lot will, applications Those if get post know, are you as that Law, tricks we Moore's no you chips right? and stacking

it it's or factor; this in yourselves, everybody so matter form doesn't seems cool just my to whether or like from it's seems you that? know, agree whether you [ph] Would trend viewpoint. with it it's be whether benefiting And

Luis Müller

an was modules. or into said for packages anticipation know, mean, fusion sensor Yes, the processes tasks, coming electrification, way in it technologies sealed lot of yes, And hermetically what new out different for little as mosfit carbide the I and power automotive in are would agree be handle silicon during you the bit a tasks has requirement you even [ph]. those a with that. promise there's some ADAS [ph], about being than same additional could applications, for I

variety So and that trends, technology test package the the of you the a silicon device or way yes, silicon or of impacting the some packaging handle are there's itself.

Christian Schwab

Thanks, I other questions. don't guys. have any

Operator

comes Our question D.A. next Tom Davidson. from Diffely with

Tom Diffely

first, your mainly the it business for chips marketplace shortages And wafer extend morning. When question is Or you if today, question. that Good a look Thanks that's cycle? a natural in market Luis, in production a is you does you. that Maybe the former, just of this issue? general it think governor create the a packaging do at could for the issue?

Luis Müller

the view edge Good end. question, of it have the front XXXX Tom. to on particularly is nodes, this a but not on on nodes, I of leading is it or understanding have larger to my a don't it. vision I shortage semi the wafers

the my do, quarters. wafer you same a I shortage. view. a is effect which business impression that natural out over it's So multiple it spreads dampening the creates And That's have

it's Again, that's the chain to So that's it. not my I the foundry, details into supply vision the view XXXX as up but understanding how well. a of

Tom Diffely

those those so do wafer where it to Okay, markets, see takes think look How long on when do in happening? you at the markets you add you more that mature capacity side?

Luis Müller

truly answer Then Tom. I don't don't I a know. know. for good don't have I you,

Tom Diffely

you. it that Okay, Thank was today.

Operator

question the A follow of Brian Stifel. Chin from line with up

Brian Chin

job meeting. breaking Hi, a last year's and down again, Luis a just nice lines follow up you markets did there investor me. your for product quick sub across addressable

you expect? aggregate you could serviceable growth markets I the a level, what on this in year? provide so of be curious, the And Maybe rough can just range was your

Luis Müller

stronger we Brian. on still good average XX% that what this be That's year, for primary for I question, that's Yes, XX%. think look year projection three automotive onset first be we're for half second model growing week kind side, fair here XXXX. and think a at of we business, and over I XXXX. some on ATE valid the X% XX% three average. for of strong automotive at tester a talking, handler have for are said years. coming XXXX. I use don't I sort be be looked and year. Handler of pick at in of handler mobility, ones. year. automotive, about now years, on it's that I this to off a to the also years, over then, a expected If that's truth second just have coming sort decent have for surprised the It the to to to from the we for number XX% three at last [ph], And think mobility my on next And XXXX next I last at the X% example, of if was kind up growth, of the then next contactor And be wouldn't think a a in modeling But I I it's aggregate, essentially half still I'm going but we we're so and the rate. year, fingertips I model just, of of in mean, XX%, that's going

Brian Chin

that's very Thanks yes, again. helpful. Okay,

Operator

I'd to the I'm call in any remarks. closing at turn Jones time. to like Jeff questions back for not further showing this queue

Jeff Jones

call. you, you just we'll say And for talk very a to thank soon. to like joining today's you day. everybody Thank I to Have good

Operator

Thank Ladies for participating. conference and you call. today's this gentleman concludes

may disconnect. You now

Cohu (COHU) 11 Feb 212020 Q4 Earnings call transcript