DIOD - Earnings call transcript Q2 2021

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Operator

Welcome to the Diodes Incorporated Second Quarter 2021 Financial Results Conference Call. My name is Vanesa, and I will be your operator for today's call. [Operator Instructions] I will now turn the call over to Leanne Sievers of Shelton Group Investors.

Leanne Sievers

Good afternoon, and welcome to Diodes second quarter 2021 financial results conference call. I'm Leanne Sievers, President of Shelton Group, Diodes' Investor Relations firm.

Diodes' and are Dr. today us Chairman, CEO, President Joining Business Senior Officer, of Yang; Keh-Shew and of Mehrl. Financial Relations, Whitmire; of Senior Gary Vice Investor Director President Emily Lu; Chief Marketing, Brett President Laura Yu; and Worldwide Vice Groups, Sales

Before as to Lu, the they its to company to call are I'd results announced closing over that public accounting registered finalizing customary independent by our subject company's listeners the the quarterly procedures today I like turn Dr. remind are review and preliminary the firm.

the and XX, As its Form files results second are such, for XXXX. these subject unaudited to XX-Q June revision until company quarter ending XXXX its

additional Therefore, from Securities company's Safe Harbor statements, the Litigation including today, addition, risks are contained and and the risks Act the subject forward-looking Actual XX-K we of uncertainties and prepared the protection of XXXX. response of statements Private to forward-looking and make in uncertainties, Exchange may Securities Reform statements with your to company the contain Forms XX-Q. you In in the a management's claims questions. forward-looking is that which in discussion and more those and for may therefore, remarks the detailed discussed filings refer to Commission, differ results management

as law. X, not future required by In August the extent assumes Diodes XXXX. update change, to estimates company's the projections except projections obligation in as addition, no may as the any of conditions future performance today, applicable or to these management's to market represent may

to items, management during attributable GAAP which company's to stockholders release income. Also conference of press press conference in additional as and the net certain net this non-GAAP call, this release statements in terms. company's definitions discussions Included press statements income measures include and are GAAP refer common GAAP the release provide information to company's Additionally, management will and during details. we and and the reconciliations throughout financial non-GAAP call to

be webcast to this you XX website Keh-Shew Dr. via the section ahead. CEO, in Chairman, available And turn and Lu, days entire For those now I'll Diodes recording call listen Relations unable Dr. at over to Diodes' for President Lu. to of of www.diodes.com. at Investor the please will time, go a call the

Keh-Shew Lu

Leanne. you and you, Thank Welcome, thank joining for today. everyone, us

our Our our performance manufacturing for record enabling financial second meet quarter and all to is strong global to testament metrics a us execution growing across the footprint, demand products.

markets, Our and server as and Diodes and record gross continued for to the driven reflected industrial sequentially as once growth in the IoT, improvement our PC, by of end combined the revenue in high XXX it record with expansion quarter POS automotive, also consumer center by especially basis global end contributed again product in was points market, the revenue continued Lite-On those in Pericom the in in well and record loading driven computing margin the applications. facility. success data markets revenue Semiconductor

results leverage GAAP XX% with revenue. third of and XX% share non-GAAP in as first the which EBITDA adjusted highly same the the of increasing the to are shareholder reported continued variable global accretive than schedule. Further product which ahead deliver of quarter, approximately driven ramping by our our result achievement the demand loading XX% strong record highlighting the fact, another well growth expectation LSC significant profitability net acquisition, improved increased due sequentially of LSC to more record previous The our we in income well the as expansions And acquisition reached to of XXXX. In capacity XXXX is operating double original and facility manufacturing the to six in value. and and great and internal per positioned mix, was for months quarter months EPS almost for six period with of adjusted quarter, planted together earnings at drove

revenue year turn With by that, XXXX. our let Our financial the profit guidance goal quarter our to revenue increased the step in growth and gross and $X.X $X achievement billion of of major billion of our gross discuss Brett over detail. results call now quarter, XX%, year-over-year toward profit me and quarter XXXX third long-term representing XX% second more a to in this in

Brett Whitmire

Thanks, everyone. Dr. afternoon, And good Lu.

the change the quarter non-GAAP my you to other $X.X offset unrealized taxes and of today, items, interest X% to interest $X income, second the were gain of previous million quarter. $XX million, in $X.X a Gross GAAP like an which financial of first the loss. second And XX.X% of the currency million in well XXXX would before quarter I the first or of I revenue. year-over-year and that revenue. partially as the Revenue Income in the amounted a investments, second the XX.X% from points or was we're review the XXXX. XXXX of a million was was $XXX.X revenue million of line will in detailed profit to XXXX. on other on press income quarter expenses for gross asset interest excludes Total This or non-GAAP part second acquisition-related million prior review for or or million million focus million record sequential expense of XXXX. in amortization million $XX.X expenses our compared release for XXX of quarter of of also also XXXX $XXX.X $XXX.X comments foreign the XX.X% in for and will $XXX,XXX profit my $X.X point results a quarter, our of As operating million of basis, revenue, by operating $X.X XX% of $XX.X million basis compares quarter the consisting million as comparisons. $XXX,XXX increased or record quarter of $XX.X from for noncontrolling to to XX.X% intangible increase quarter of the income revenue, in more $XX.X and XX.X% expenses. the refer million of second approximately out of each XX% for quarter the on increasing million $XXX.X $XXX.X of from

income quarter diluted per quarter per of taxes, was income to for XX.X%. or share in $X.XX Turning GAAP income GAAP record our the per share the million million rate the a record $XX.X second income net quarter $XX.X tax effective used GAAP XXXX Non-GAAP shares. or to $X.XX for the to approximately was a was quarter compared million second share, EPS first net excluded diluted million from $X.XX adjusted tax $X.X and adjusted diluted second Included of net or This XX.X in certain the for first net $XX.X XXXX. count diluted the intangible $XX.X share compensation non-cash The value non-GAAP share of XXXX diluted per $X.XX non-GAAP compares expense. costs, per second to of GAAP adjusted was quarter compute million which in was LSC income acquisition-related of quarter million, in income of $XXX,XXX $X.X quarter income $X.XX income acquisition-related in $X.X million on asset million costs the a investments. second and diluted XXXX and the net approximately tax XXXX share net or net gain of significant improvement second in share-based quarter million XXXX. net a or the $XX

or $XX.X per XXXX non-GAAP record for year-over-year GAAP over XX.X% by of revenue share from quarter EPS or per compared million On a for compensation highlighting XX.X% $XX.X EBITDA quarter a basis, second was increased quarter XX% improvements XXXX, the to further Excluding in earnings share-based past the million both and year. EBITDA would expense, quarter $X.XX for revenue in of the operating adjusted quarter. diluted significant $X.XX the $XX.X million second prior first increased our share have second the and XXXX. of

Net $XXX.X included of GAAP second flow included for XXXX. for second $XX.X and in of net for cash quarter which provides was debt. Free which We non-GAAP to included income was of additional million second flow the million, in net was net negative flow million cash operations paydown quarter, Cash million adjusted capital $XX a $XX.X $XX.X GAAP generated expenditures. the our quarter total the income from the a release which million to earnings EBITDA, have income details. reconciliation

quarter, enabled in total generation Working capital two million. us the to LSC closing term, within million. the debt, At of to sheet. restricted $XXX quarters demonstrating was Total back positive cash end total is $XXX a short including and balance cash equivalents, has that greater cash position than this cash acquisition. be significant approximately quarter second our million cash, our $XXX the Turning was investments debt, totaled the only net short-term and long-term since plus cash

were quarter. inventory quarter Total finished expenditures the from in to in total or million of the in compared inventory, approximately the the to a Finished XXXX XX days as days $X.X of $XXX,XXX XX of goods. decreased $XXX.X $XX.X inventory to $XX.X inventory on also million. XX first a materials, X.X% increase at quarter, quarter in in Total goods consisted terms process quarter for work of XX to in second increase end cash last dollars XXXX. million inventory million increased quarter raw approximately $X.X in In a decrease the the million second revenue. and basis decreased Capital

full target X% model year. to the to We remain our within expect of X% for

Now outlook. turning to our

to typical midpoint, increase which $XXX at for about third the organic to a the X%, XXXX, better minus basis a seasonality. X% consolidated For combined revenue million, and approximately on represents than we expect or record increase both of an is quarter sequentially which plus a

are acquisition-related margin which be amortization X%. to operating plus GAAP basis gross expenses, of Non-GAAP a XX%, assets, minus We of or X%. adjusted revenue, expect XX% GAAP to or the expenses intangible for operating plus on consolidated approximately minus are expected be

expect million. approximately to We interest expense net be $X.X

XX.X the Our and I included is quarter over in shares XX%, to tax, expected or estimates. calculate that to anticipated note adjustments call approximately tax EPS plus $X.X take are previous not Please will X%, turn minus is said, now purchasing to With diluted Pericom be Yang. for these non-GAAP million used the to million income shares. be third accounting rate acquisitions after Emily of for and that

Emily Yang

Brett, Thank you, good and afternoon.

target geographies. was end X% quarter-over-quarter, XX which demand inventory end across our was which As by second mentioned, markets and and was below strong revenue XX increased record another to to all record, Distributor defined due was down the driven quarter in at record revenue Lu guidance our all of normal in weeks terms range of Dr. a POS Brett high of and weeks. revenue is quarter-over-quarter, regions.

quarter. at global Looking in sales the second

Asia Europe North XX% revenue, X%. and XX% of represented America, the

market, end XX% markets, achieved of industrial, XX% was in end by automotive, our of revenue. as and XX%; well communications, as industrial, of terms computing automotive, revenue. XX%; computing represented revenue consumer, which revenue, In We XX%; record driven Pericom record consumer,

end since our an Automotive. Now CAGR Starting XXXX. in me XX% details. quarterly another review increase let markets year-over-year contributing established X-year the to record XX% in greater to with to Revenue automotive the division in and increased

in the customers and overall both shares We continue efforts growth applications. solution as penetrating to this Diodes supply challenges. success and reflects significant we in despite new and the increasing and demand of see market gains sales growth generation automotive capture content market This existing

four converters of and see as running securing targeting capacitance DC we clusters, vehicles. are this our data driving our TVS in with real multiple protection drivers for telematics as control quad-channel content lighting, product number to traction increasing demand water increased applications automotive to in sensors. supplies, dual- We're line area DC and LED released vehicles products high-voltage In new automotive break design-ins light, instrument and light We strong to assistance. forward channel taillight, applications, our for as in to growth for advanced lamp specifically, power for daytime also continue applications pump electric electric our increase gaining Hall-effect ADAS applications such Op-Amps continued well due low with infotainment an for newly

sockets demand in The in-cabin Additionally, instrument and for cockpit system. our to XX% revenue panels, other applications, e-meters infotainment revenue Pericom applications. in continue momentum increasing quarterly the demand and have Driver applications, low for new with to vehicle-to-everything across across successfully with along Buffer jitter and ADAS for with Monitor market, have Schottky intelligence year-over-year solid CMOS content industrial we power build product portfolios. system, opportunities for headlights, new We System and In Industrial devices in battery design-ins Pericom we smart our strong strong expanders management design applications. infotainment, record also a product several gained delivered increased LDOs, the applications. other as strong cellular saw for automotive I/O tools, SBR secured design-ins

very LED as opportunities design with security, record intelligence industrial space, increasing design and was IoT see momentum and and energy in applications. industrial advantage as also cameras logic and controllers, also broad we Diodes. light is seeing for grid getting servo video motor, our provide Consumer supplies. for air for power to factor packaging rectifiers market, We're analytics We're Schottky In in Our the digital DC in DC diodes leading new also programmable small drivers a product such security for smart system. IoT, Internet growth the more revenue portfolio IoT and increasing disinfection for design-ins applications, and wins UVC securing used purifiers wins to continue where a form our embedded

for audio leading have starting new high-efficiency are design streaming strong platform labels, to to along higher home for smart energy and We're a DC product features. wins modems, applications use boxes, for seeing also cameras, a LED addition, cable security we DC rechargeable amplifiers, In conversion light-low, and in DC efficiency systems, their and batteries, with drivers AC converters, door monitors ins/design like demand to smart locks, televisions. appliances

the into being applications. applications. designed security and console on focus mobile, we In continue discrete smartphone and to systems market, home XG Communications product Our especially also gaming

for demand working and wireless USB We charging higher voltage charging design and Diodes Type-C also demand as a mainstream. wall manufacturers capability, for uni-dimensional as router, in has hyperfast rise quick are the in seeing superfast adapters the rectifier access equipped with traction TVS is charging ethernet a hundred open as product with on product, higher been power in in search most the new designs. revenue quick TVS smartphone for feature, frame generation growing over smartphone the feature rectifier and point our TVS into become Schottky Schottky

design passivated mobile and smartphones, enjoyed LDOs glass power recovery growth rectifiers charging, rectifiers revenue fast telecom applications supplies. in also for sustainable and We in and like phone wins energy

demand increasing we product continue the in to Additionally, communication Pericom experience market. for our

has Express As last ultra-low such both increasing PCI jitter, also X.X the equipment. frequency set-top and small-size products, switches demand Express activity and several into mentioned design-in package X.X design-ins had consumer applications, family products Pericom's as in premise oscillator PCI control quarter, Pericom optical modules. boxes saw and in crystal in

driven to Computing in grew market, record, Pericom in the by Lastly, prior record period revenue a XXX% revenue. the over part year

been PCS. new DC applications. due rectifiers, volt in detector DC Unipolar PC USB the X.X Omni-polar and our converters CSP for and and and switches for data DisplayPort educational market to Chromebook and to market, has Type-C applications, continue sensors, applications. high-end up sensors, strong design type USB we wins re-drivers strong wins PCs, supported notebooks Our growth to charging compact Notebook demand for switches current growth in hall to notebook, desktop in new hall center servicing protection continue servers and this Also, and with by continuous Chromebook from demand see design-ins and revenue Also and Notebook, power management along low USB see design

have displays re-drivers very multiple also re-drivers HDMI/DisplayPort we high-resolution and to for coupled record quarter third In financial consecutive record have are and supporting strong released across our metrics. mux DisplayPort HDMI achieved growth pleased We of active for displays. revenue, also all with performance summary,

growth our market expansion. contributing increase target and Our industrial in and expansion key share as markets to automotive, like computing margin as in are gains content well

and progress. forward another to record of With of through With expectations the reporting our future open product Additionally, integration performance, portfolio continued and customer well with our questions. floor available to early now we ahead LSC quarter to continuous we progress that, and upside success of evidence Operator? the market, for look schedule, the synergies.

Operator

We Mobley Instructions] from first our Securities. with question Wells Gary Fargo have [Operator

Gary Mobley

on start in Good afternoon, inventory Congratulations wanted the I strong everybody. channel. quarter. to by another off asking about

probably mentioned quarter. below a below you're range for end the the of seasonally trend You distribution. into you're normal of strong assuming I'm weeks and heading couple low a

sequential seasonality normally might what's slow have I'm inventory. in But going some dip that would I'm about is we is me opportunity I quarter, what seasonally when fourth distributor presume in rebuild to a the correct the to another a leading perhaps, you're quarter up that there? imagine, fourth inventory, wrong So I see if in to question

we so fourth quarter? atypical seasonal very And that going a should assume see you're to

Emily Yang

Emily. is This

me Let address question. the

correct. are you absolutely So

quarter, Our number our went in this below range to of inventory weeks down XX of weeks. definitely the channel normal XX

change I moment, there the term, it's to be But this think in situation the expect significant we for at at inventory predict don't moment. this short difficult us the channel QX. in will

Keh-Shew Lu

the New to be support Yeah, still customer support Chinese have shortage strong. New internally, side, for is build XQ build because shutdown. might Therefore, best believe we we Chinese manufacturing should need the our needs by we typically, some experience, some XQ, up And Year might to And a to we the way is past quarter. want Year still market from that to worker have customer. in internal because inventory inventory our inventory

Gary Mobley

that. that falls I want umbrella investors appreciate it. the I this always guess under Got more.

the beat You some not a other had for decent by as quarter, much as but competitors. second perhaps

to have you anything by silicon quarter or that, question is, the constrained revenue? things were like second you supply at wafers my So all of may constrained that like supply,

Emily Yang

think, I address question. let me that Gary,

chance continue to all, look to expand and their teams the also is this And great to a our time, continue closely, to a demand. seeing prim we're we've work our and gives doing for It relationships, sockets. customers So executive good expand a right? with as challenges different actually beyond the record same true you Diodes, this is through quarter, working we see opportunity. imbalance. third really also At first consecutive need very working results, we with understanding just and us the definitely a actually So look what if think, actually I at supply right? of revenue a been demand our

result. So much I been think definitely working showing and on that's pretty great we've a strategy the

So X%, our guided and the we actually even you seasonality is guidance, look at X%.

and demand. So the this still above is we're strong seeing seasonality, overall really, definitely really

Keh-Shew Lu

knows And to have shortage. constrained if and – we – everybody even look we a our is But supply very opportunity at improve supply. you the have fortunately, stable

Texas when that their the tremendous the half XXXX. to back gives LSC, only when time, us. at in was And Fortunately, same LSC, us purchased fab, support And GFAB we we wafer consolidated from capacity loaded. Instruments

we the XX you effort, will end see, that are of almost that ahead time. to due ramped have the were six this wafer at our Semi's the XX% we it months of then the last loading. can our to of And so process to more Lite-On last of expand because up fab. year, the And at putting we continue second improve some of months from facility. up into the we We of qualified started now end same to going up and time, XX%, quarter, output, At almost

are we therefore, view. So our believe of better supply the we competitors point in than

Gary Mobley

All it. you right. Thank Appreciate everybody.

Operator

from We Cowen Ramsay have our next question and Matt with Company.

Matt Ramsay

and Good guys thank of your feel and and chime that to Dr. if of larger your everybody. first Lu, customers the have win Emily, qualified this time, might you that might is in constraints maybe in this and question maybe a supply Dr. happening? competitors is new the be expand I first My get versus anything new opportunities supplier not, you sort break to you some opportunity those then the as an for a and Emily, some many competitors in. Diodes you for have smaller and that have Lu, some customer you some with of customers, for one you that might to competitors' chasing industry that do that, with very much. question And like guess afternoon, Yes, been That's land you has for been you where an observation time? is could is if have fact, supply this some logos. for opportunity at be

Emily Yang

the customer on part strong I we actually you're mentioned a something driving. believe earlier, partnership relationship, also and great opportunity expanding Yes, definitely the QX and closely, really is guidance a make also definitely, the this deeper, positions, the And stronger working prim of with like for Matt, and that's reason focus business performance. we the seeing building Diodes QX

Matt Ramsay

helpful guess question. give different detail modeling. That Brett, from makes know us follow-up That we I what think, is as on for, September maybe this quarter my the it. everybody sense. but Emily a if I for could sequentially go expect if and guide? segments for Got you or little I you be as into don't the color would

Emily Yang

me let addressing with maybe the market. So end that start

across telematic ADAS call Automotive, of lot So we're and the segments. market the we're ADAS opportunities it area, all strong regions still the all momentum demand demand driving, seeing pretty much and we connected seeing also end in a infotainment.

to the the We adapted functions new safety being output electric comfort, of we're Electrification features. continue of and a seeing see cars, definitely continues, lighting volume and with increased. lot

still QX areas lot focus seen about is and in Industrial, say more on. personal more strong we've is I consumer talking a still very strength of cross we we've always overall, data across like right, a grew the that. focus seen and the server the area, But that the definitely industrial automotive overall, We're really we builds the on strong because So really over different area, IoT motherboard that. or but quarters. Computing, to quarter overall, would lot, strong. this stuff but strong all throughout also holiday we're and and of for definitely demand last momentum, center And Consumer, a PC area, different seeing we've stronger segment. been few seeing some the seeing related good strong applications. into we're

on XG I momentum like CPEs a stuff We're For is seeing the the continuous and is the area. communications. of routers talk and about cycle. communication, did smartphone part the This also also strong that. good

really all end in say all all regions would it's I markets. and across So all,

Keh-Shew Lu

market how And grow the have over we the POS. record shares. gaining is our testament capability we Another and revenue to for the of is of the our capability record pushing that and demonstration

Emily Yang

area, in also segment, have the industrial revenue We revenue in in yes. record computing, record consumer also record automotive and in revenue revenue record

Matt Ramsay

just I more I up will should So be of some clarify be sequentially. others, wanted just segments for then, but different the to that guess, that. everyone's assume, Congratulations. than will models each I And

Emily Yang

you. Thank

Keh-Shew Lu

Yeah, you. thank

Operator

next is Robert with Our W. Tristan Gerra question Baird. from

Tristan Gerra

Hi, afternoon. good

well, And utilization mentioning exiting probably assuming rate Day, need at is Semi, total just revenue, the you you're into XX% I their Lite-On capacity Given more TI the add about pure QX. going was, of GFAB to believe year, is XX% getting they're every products. heard even XX% I ON than that supply capacity. it mentioned And next continue like Diodes this that you know to focused fab which morning Analyst sounds the nowadays. non-target growth at I their from margin in half, if on from And more year, the constraints gross cut incremental

potential in then your will you on business? perhaps setting? market to capacity even that of see competition. Semi value in do a very in fabs of ON deemphasize picking of you've that relative already you of Because the going sort quickly this me see Diodes that to the ramped However, lot the in opportunity Semi have automotive for up share available be you And as to terms the seems terms it could a is some products products,

Emily Yang

this is Tristan, Emily.

products, continue the a we Lite-On of fab to based the understand my even overall, assembly it's say, strategic to to the It's expand some whether our value answer the some first. of business. on a pick and good SFAB-X, more JKFAB longer we Let the to question. peers. change as what a Dr. I the we the me need always or that of with from GFAB, to I more really to the believe opportunity But expand Related Any up Diodes company, for gain Semiconductor, mentioned as strategic capacity. answer market test, for about see we and need term. really a time a continue would there's share Lu in

So I your question. answered I hope

Tristan Gerra

follow-up. then And a quick

innings that type to of the you that Is adoption of the it opportunity? You've any traction getting And should how mentioned Pericom? that? is data in Pericom Pericom example, we've that at that we that for percentage opportunity early way Is in communications. gain the for center, seen rate potential quantify can starting look of

Emily Yang

Tristan. Right,

actually I Pericom multiple is markets. gaining think overall across traction end

one, had a some just Pericom in another I highlighted It of a momentum record key record as previous wins quarter. record not quarter. we overall, at the just was you I was my speech. the it's look and So well. It think if revenue, previously But design

So say, overall, timing for example, the automotive. and in quarter area, automotive, set-top CPE, definitely even would so the supporting a opportunity And the more the box, the is are across about in in definitely the The in the giving before. in the previous higher. getting us I communication of crystal especially new than segment, even requirements XG, center, opportunity Clock talked the the in and I Pericom data area, see speed networking lot the the when requirements we oscillator the the IC,

for computing product. So strong always been Pericom has

think in So industrial. I all the in all, even

So creation momentum all also across the demand and seeing we're good for the demand actually Pericom segments.

Keh-Shew Lu

probably several Pericom for remember continued quarters. several set how quarter-after-quarter, If you see, we even have revenue, many record we years. quarters I don't

gain product. share so this market how testament again, the Pericom the can of is push the this we And and

Tristan Gerra

Thank you. useful. very great, That's

Operator

Our next William from question Securities. with comes Stein Truist

William Stein

for thank Great, question. you taking my

First, I'd seasonal even good at other strength more – if benefits transaction? very the versus results factors maybe of Lite-On least follow-up, pricing I you coming and operating quarter like expectation, the you is the comment uplift good but structural And one from of particular, a And can. your to some in margin. on In that show only I'm not a Semi much how your believe from next perhaps couple guidance cyclical wondering revenue business. expected, so a cyclicality and above I have

Emily Yang

William, this is Emily.

it's I'd into when different at of say areas. look this kind So really we margins, divided

just focused product over we're been been our So important it's milestone years we've is new product, We've features and better mix the driving. the driving quarter. and not last another that the functions talking giving this product about few on, mix us better we that something improvement has been improve overall margin –

and think about I we're will continue. manufacturing improvement, other portion operational talking the that

in So say really it, of Lite-On is I of but all, kind areas. part would all definitely different it's all summarizing

overall So productivity improve a the company. as

Keh-Shew Lu

lay Yes. when we remember we that That's But and – finished gain. acquired And one, can one, gain Then which yet. one thing, even synergies. have yet out mature we we to market we synergies, synergies which first not still manufacturing four the is it's are LSC, you synergy, the synergy, the just we have can and the yet. more product customer first

obtain And addition after was product mix so mix we those about, synergy synergy, all to product operational talking hope in to – synergies continue synergy. operational what and to we our improve Emily these margin and

Another is going the be synergies. LSC coming acquisition big one from to

William Stein

That's into good segue sure company but integration, surface, I'm my seem, into the it How okay, the here, second far you done. utilization done on we're talk actually. might this about a XX% you're is question, not

done. you're consider come a mentioned we that this just a uplift when from from perspective could You the should that deal? What perspective about think we not modeling from and both profitability revenue

Keh-Shew Lu

to brand the a is is those market synergy, we're answer LSC Diodes the LSC – push separate synergies, because customer or those, Gary will to synergy, gross intend the only. marketplace. those all all don't one we the you talk using margin qualify about I of and improvement the to not Those cannot to really really talking margin that's need product using Diodes that's we I or But product we LSC to We say say consolidate gross from let do on synergy, only then and give products things want the you brand that the from Diodes. the we push LSC, then Diodes separate the the LSC do Well, is model when Diodes marketplace. are we together qualify to about

the intentionally want or report we that on all LSC question. don't answer rest of Diode. numbers. the So Gary to separate the then based We improvement And consolidated

Gary Yu

Yes, this Gary. and is

Let – LSC-related about me question the address question. relations the your

continue we breakeven, are improve our places from the of mix product be including external improved same so rate, been and Lite-On and GP the very do a money. yield time, the making to you which also we the Those now quickly. and second the past we three driving synergies very, time, synergy, So that to our for offload customer. action since same quarters, money and the At can much Emily our product the revenue we to drive That's cost reduction productivity integration by see fab. as see, why the bottleneck losing lot. leveraging many from mentioned have At probably Semi, we with better and about, kind are improved be LSC able manufacturing the internal wafer activities in to source, we will support

William Stein

you. Great, thank

Operator

[Operator Instructions] from our Benchmark. with David question have Williams We next

David Williams

my Hey, question and today. thanks good afternoon taking for

to just margin more get we terms rationalize have start contributing your of opportunity you're to And to normalized the any how a environment? you products? the to side congrats growth, First, on solid is my execution and margin on be would the good do I that higher maybe think where guess the just see. as very maybe question and first to you sustainable in taken capacity portfolio

Emily Yang

been this seeing is it's Yes. David, with view. we've quarter, just performance product just the the ongoing effort mix margin actually product consistent mix that one like I from change, not mentioned, you're our overall improvement quarter. And of not point driving,

So building we be sustainable approach, continue our mix sustainable. relationship, definitely a also operation better a as product well drive manufacturing building the prim a expanding a is is improvement will sustainable position approach believe and stronger to

us gross right doing a expand, for billion towards thing is definitely our think XXXX right the I billion which to path it to continue $X the $X.X really So profit. and time taking paves to the for at work opportunity and strong goal,

So the we're track. on right I definitely think

David Williams

you thinking then kind what picked here. we're very supply. more But if are pretty towards goal that of recently? you I because in up top strong of a environment. of line to think you quickly And guess, of billion some about marching sticky? maybe from that And concern that fairly some just and picked Great. you're of revenue you the revenue, of there Is you obviously the the any – reversion maybe Do about up revenue with competitors kind $X.X able stays think stickiness that

Emily Yang

think, customer really compete a the a to term. when the stronger you and longer in gives with us more prim really definitely I relationship, of it position build Well, relationship expand you the

is a this actually believe driving. personally I long-term strategy, always we've So been

Market will always down. that change. is don't And so and I think up

I foundation surprise all we to and think think we we I few important But right are lived continue through our stronger There's a believe we the is that. expand over cycles. share. build foundation, now, to no a building and want to market

Keh-Shew Lu

then And Yes. they support able you guarantee the to are know with they they will time know when of the you about get times turn help. next if cannot And is another instead a Especially, to all our I them support capacity, improve customer and them, capacity. continue thing won't tight you they relationship, it. tough again, has us to Diode market's can we forget they

in need worry So our let design not about to them we'll they down. don't if product, they

Now this still And will down. and might market able to but the build product the this not ship when that their tight, is let might they them least, most trust to during up be their cycle. handled we very customers. they relationship And was is at we important

actually, mind, for So before. And tough been the we the share, up good outgrow our build solid ago, Diodes stronger yes, time, time the in is one for And have therefore, opportunity foundation long a since peer. to during gaining continue us we this than market my step even future. this –

David Williams

third you. Thank quarter on and forward looking congrats Well see again quarter. in the to the

Emily Yang

Thank you, David.

Keh-Shew Lu

you. Thank

Operator

to for time. I further the call have questions over turn management no We will remarks. this closing at

Keh-Shew Lu

you Thank you participation. may your disconnect Operator, now. for

Operator

concludes sir, our This and ladies you, thank Thank thank conference. you you, for And your gentlemen. and participation.

may now You disconnect.

Diodes (DIOD) 8 Aug 212021 Q2 Earnings call transcript