KLIC - Earnings call transcript Q4 2020 | Kulicke and Soffa Industries, Inc.

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Operator

Greetings and welcome to the Kulicke & Soffa Third [sic] [Fourth] Quarter Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It’s now my pleasure to introduce your host, Joe Elgindy, Senior Director of Investor Relations for Kulicke & Soffa. Mr. you, Thank Elgindy.

begin. You may

Joe Elgindy

Welcome fiscal everyone Soffa’s you. Kulicke to conference call. quarter XXXX fourth Thank &

Joining the Chief Chief Executive us President Officer Chen, on and call today Lester Wong, Financial Fusen Officer. are and

results market both supplemental you website who and at of details and the received of well For those earnings the outlook. additional the presentation Investor regarding have as are of release earnings our new presentation in our a provides investor.kns.com. not trends copy This today’s available supplemental section as Relations

addition historical relating Act Reform forward-looking the our These In to will of statements, contain Litigation are to future of today’s statements XXXX. statements statements remarks meaning Securities and within the future events Private results.

is those Our indicated statements. actual and from in condition results forward-looking financial may differ what materially

period with the discussion Soffa XXXX, September the financial condition, XX, complete of & affect future recent associated our XX-K the go for XXXX period to I the Chen the over for now the specifically yesterday. to overview. XX-Q risks the filed business SEC like results ending XX-Q Kulicke that would our a With filings, for please call for ending the X-K XX, to and the and Fusen could that ended June ahead, turn XXXX, Fusan. For the year refer Please March XX, said,

Fusen Chen

Thank Joe. you,

were healthy, they related operations, pace our as global the of end. challenges, pleased supply are COVID-XX that and chain report We remain despite to June development through quarter

and unique workforce operate this to welfare, period. Our global focus efficiently on safety has collaboration our allowed employee through

of dedication flexibility of proud are We resilience, employees. and the our

of core and pace our business. the of pleased improving also product are We traction development, with our state new

with assembly progress fronts, continue Within the alignment significant market, market. and our on semiconductor automotive transitions, technology global development challenges long-term alternative reported to impacting Fundamental and to market display make the Our value the savings adoption new performance. several of extending benefits logic high-accuracy and essentially advanced which assembly such teams with options which significant well as increasing assembly increasing the techniques. thermo-compression. higher node an is solutions. seeking cost semiconductor the as deliver provide and space, memory, businesses heterogeneous solutions packaging integration, density applications flip Customers change and both two-dimensional is more interest adopting assembly, This sensor complex, packaging volume are and path core shrink fundamental multi-chip the the image and chip our meaningful are technology as emerging XD back-end well core our our XD high packaging of and partners for dedicated and are approaches

system, and core heterogeneous we integrations processors dedicated high-volume, complex sensitive need are Here seeing for a the for sensors APAMA, business. our logic our to continue wire which devices see and benefit applications In systems. Katalyst bonder parallel, cost we packaging memory, image general system-in-package advanced mobile for application driving

We this coming anticipate transition and adoption are to actively the and well engaged over ongoing positioned years. to accelerate support

fully the Next, such increasing hybrid market. major plug-in for are as demand semiconductor and electric broad trends, vehicles autonomous, automotive

transition. of automotive and and vehicles. base to high-reliability to fully-electric systems performance-focused progression and for provide with automotive the multiple along products of demand anticipate We insight Our this broad hybrid plug-in the demand for customers our grow

with global production. in distribution has today’s of and success a power solution been representing even initial automotive storage only Our fraction the beneficial, vehicles tiny electric

station applications We electric supporting as have as demand recently increased semiconductor infrastructures. charging vehicles experienced well for power

technology recovery long-term demand remain our and traditional been this has continue positioned to broader gradual expect transition. support below average, Although a automotive well we to

forecasts expected to evolution growing transition is performance This significant. high-volume of ramp unit to new Mini for LED is XXXX a our aggressively annual will unit annual market. billion represents continue we year production can several approach display and the PIXALUX a is units, placement. final system, mixing capital calendar display, and roughly are current a deliver efficiency significant the growth Advanced backlighting. production for continue by half XXX within of opportunity that logical power sorting, production of for forms critical enable solution and which and This years. semiconductor Finally, micro LED equipment to

We are rapid LED broad performance, and that the pleased and PIXALUX market development the are solutions support developing additional this acceptance committed to with advanced of technology transition.

driven anticipate execute supporting unit rate. improving semiconductor toward trends display, more also our these and core long-term we recovery a As growth advanced businesses automotive packaging, by in fundamental we an

through XG, capacity during half, by seasonal we are rate As anticipating is driven be extended although behind consumer and steeply fiscal This our second for in and early need extended us. our reduced anticipate an growth Based recovery. XXXX for is addition, return LED incremental over XXXX. our near-term to feedback fiscal in being demand customer an excluding September anticipated unit the dynamics the recovery XXXX are XXXX. industry’s demand weighted ongoing pattern Historically, smartphone expect These a to first fiscal throughout reminder, equipment declined uncommon years. production production ramp end-market historically more products unit advanced low decline fiscal fiscal the coming capacity. semiconductor period products work-from-home, we of to year which to and results, dramatically and on to After continue recovery unit-driven demand and shift in recent normal be advanced year to LED, is unit outlook half our stronger growth growth, the a seems

XX% increase This the strong, macro visibility, the demand over broad by unit growth, year. XXXX XX% return to assumes annual of fiscal estimate the advanced uncertain within during to are While X% we average and currently Considering environment a historic semiconductor environment approximately year excluding XXXX anticipating revenue will limited LED, our XXXX. X% dynamic. to remains is fiscal fiscal year to

steep point, market. most is performance, Capital largest within fall and OSAT-based increased capital a APS semiconductor of sequentially. near represented an recovery prior to broader utilization rates. semiconductor end-market was increased category. consistently general equipment general X% Turning growth the full additions discussed and into largely base At due see In have output back semiconductor for demand to of capacity for in the been we space. smartphones, has customers XX% this XX% XG, overall triggering September gaming, IoT our wire the strength by the wire-bonded incremental and need this running by We quarter’s equipment is the calls, and revenue semiconductor the installed sequential increasing in General how bonders packages. multi-die

June steepest also sales set market LED While overall of sequential the LED a display although for our advanced LED to semiconductor sizeable the improvements end-market down, the sequentially lighting sequentially. orders our the general experienced within we general increased due sequential market. advanced change, showed was quarter, in

Premier few includes support dedicated a we system adding recovers. to end-market advanced capacity demand semiconductor as the are We expect end-market, advanced and thermo-compression, for market as auto chip, healthy gradual The see a industrial, and this our industrial overall although represents traditional and are general auto sequentially end-market, recovery LED mass-reflow market. both sequentially improved and automotive also applications recover In remain quarters. memory and that system-in-package packaging expect stud AT Within high-accuracy bumping, systems. below we The our and in flip our and as to APAMA well the well their customers packaging beginning and seeing also general average. Katalyst, the over lighting we long-term coming grew advanced memory,

we September dedicated advanced capital memory material multi-die sales, and that this packaging packages LED X% end-markets. becoming our of to assembly note over is packages. estimate it now equipment higher quarter important LED of of just the capital While general equipment represents and during advanced advanced Collectively, advanced our XX% that end-market sales are support components semiconductor,

into through level which primary level of ramping focused will anticipated suggests quarter, historical pattern. the LED Operationally, December quarter, on anticipate to satisfy general for Looking we again strong fiscal be the XXXX to demand anticipate drivers the demand. follow December. are semiconductor near-term We strong December not we production a demand and seasonal the

the display vectors strategy, few challenging, and to balance to strength the the our macro Over the expansion although investors. enhance was overview market and financial in now capital company’s recovery, to the I our industry of automotive, over semiconductor would and in am market like to years, and packaging, allowed Lester? quarter’s advanced general with fundamentally confident I broader opportunities direction Lester create broader positions new business execute return sheet greater years. call the coming in the over a us this new turn model to our cover expect long-term growth Wong detail, past and environment combined will who

Lester Wong

to results, GAAP you, remarks noted. unless today Thank will My refer Fusen.

model’s operating during represented of execute sequential goals. clearly came with a year and full from were on as fiscal XX% potential XXX% Income increase. in revenue at our $XXX.X fiscal million, our XXXX $XX.X challenges, generate increase, highlighting XXXX business came a able and to year-over-year While representing operations we million leverage we strategic

at quarter, favorable favorable have end-of-year much a gross sequentially. generated our and September This came a and this million favorable income was up million, and $X.XX share. generated been adjustment, Gross in would came revenue million, mix Gross net warranty the net better margins expectations. margins we in non-GAAP For Without XX% income due $XXX.X partially diluted than XX%. product On of per XX.X% was EPS. approximately basis, $XX of accrual. or margins $X.XX of to net to $XX.X adjustment also related

of over expenses quarter the came on However, gross end Operating we higher financial around anticipating with range September end stronger year the in be associated long-term our accruals the compensation target are incentive XX% the to margins due of to coming for quarters. performance.

production long-term global continue our initiatives several teams work mentioned, towards operational and Fusen near-term also to capacity. development while we As ramp aggressively

million consistent related delayed expenses to years. several our of past environment softer been to the SG&A that We expenses, $XX to remain to operating tied revenue. have X% demand X% fixed model variable anticipate at GAAP expense also over the projects plus have We of due

jurisdictional side However, million to the came quarters. expense to increased and anticipating coming we in $X over at for component variable quarter the the higher adjustment. are due profitability approach Tax the

of Our total rate tax came just in effective long-term tax our target XX%. the year above for

operating accounts higher a From $XXX.X XXX strong September the accounts from total income up days, XX receivable days. a represented the balance representing $XX.X standpoint, per with efficiency capital book to sequential million by of position payable in days XXX quarter. driven sequentially to quarter improvement. from Days working value generated was September quarter, XX basis, and we and $XX.XX, $XX.X cash by improved of sheet, which with working slight a On the per days September to was quarter Turning a September performance. capital net we to days during from days investment diluted inventory XXX $X.XX and cash and closed the million ended share. increased improved down the XXX of of free we We million, flow of share

to be or minus $XXX revenues guiding the For are approximately million December we quarter, $XX million. plus

We strategy supports margin points, $XX X% mix near-term be XX% non-GAAP plus in business the call income the highlights our transitions gross to plus margins semiconductor, charges. EPS operating by approximately to the This are for we markets. be open prepared expected bonding XX should forecast This or and guiding and a plus our within for approximately is increase to and wedge questions. concludes highlights market higher also $X.XX share minus operating This product over significant be GAAP please expenses largely or comments. This display or as basis recently suggests to the long-term our guidance shareholder to also XX%. business. model’s and million a create meaningful value introduced leverage. Operator, product due minus minus potential automotive XX% support sequentially freight

Operator

Thank Riley. Ellis today B. question Instructions] is from Craig from first you. Our [Operator coming

Your live. line now is

Craig Ellis

on guys. question the and congratulations taking for business the in strong the Thanks recovery

follow-up question, to was high of the the with to Lester, that the typical I OpEx one be things will related of believe mentioned, on I some first guidance. The the wanted model. elements you that on that side of

the OpEx can us insight just the that that some of will play understand us are how you help you into range? models high-end So, towards out? further keeping give the Can long expenses specific

Lester Wong

lower because quarters, we Craig. travel, over obviously mean, I during of due had the a last have the downturn level semi six reduction to we reasons COVID past have and quarters as spending the cost over the fall indicated now. of Sure, initially in couple lower ‘XX

at very expenses. also had was and I expenses, ‘XX, discretionary-related lower year on a have critical certain critical the reduction as We pushed out corporate-wide projects we variable we basically also fiscal during less time. said, that not focused And

these critical. now of new engagement we products And Some customers. actually are also are our being with increasing more technology

be I quarter, would guide X% the So, variable. on for the would the I again, X%, to of the ‘XX say but it think I X% probably rest that of high FY don’t beyond side

Craig Ellis

questions to will if then of I That’s product helpful. a could. I couple And turn

of are traction through with It us back seeing like just and better Fusen, fiscal any broadly. APAMA end-market would good seems on for what an sense First, ‘XX color you PIXALUX, fiscal is go as coming a give specifically And helpful? like ‘XX? those it can demand prospects you But got products. update we fairly and PIXALUX’s Katalyst be you have sounds

Fusen Chen

Sure.

PIXALUX, achieve we $XX a we our ‘XX. call to previously in the for For million have revenue target FY

So very achieved I report we happy the to am that goal.

million is ‘XX guiding quarters, be ‘XX $XX we our of maybe run-rate a to QX, FY ‘XX compared we to For actually FY FY the see growth a $XX are quarter with next FY QX from which between for sequential roughly of couple QX to And going first million. of ‘XX. the

we around So, new product Actually, business we business ‘XX introduce to million we by expect to will million we we conservatively achieve grow for shall this beyond ‘XX/XX $XXX to $XXX and goal grow million show to intend FY faster would market. have ‘XX. currently ‘XX, be above – $XX million comfortably. and and $XX PIXALUX somewhere will a the actually a believe And a for

around is our goal revenue probably related. will XX% display hopefully our K&S So, product XX%, a XX%, be of revenue,

of advanced advanced and particularly we actually ‘XX. we for I expect we design the this ‘XX. is to good packaging, much and in And So, packaging, very very traction we few we group win bigger make that’s important believe In [indiscernible] believe in PIXALUX. be integration PCB, think in a [indiscernible]

other any questions? So,

Craig Ellis

That Yes, back will hop I was more helpful. one then question, into queue.

appreciate I revenue on color potential. the So ‘XX fiscal

right, around unit $XXX So, to that semi that it looks like company revenue if the I in expects and assumes growth. math, million am the X% doing X%

the would in possible in ‘XX noted XX% past, as semi high X ‘XX growth. below growth be think it’s and years of that following have I you as that seasonal

unit to XX% range to about $XXX semi think see upside we more would growth X%. in double-digit in the for XX% if revenue? potential we model’s So, How the versus X% the or versus millionish

Fusen Chen

maybe So, the is we this can about good current recovery. this. answer We sustainable. And feel I business feel

this the plan for XX% moment this sounds and to close $XXX maybe we at million So maybe XX% what is to $XXX mentioned million, to region great. you

half. we in trends plan will a to at [indiscernible], and I So about plan this big moment, but that’s outlook our we have the think the second

that’s are recovery but So, update is looks operating, this it sustainable what like give we that will in and we more you next quarters.

Craig Ellis

And That’s great. will I back Thanks hop so queue. much, guys. into

Operator

you. Thank

coming Davidson. from next Our is D.A. today Tom Diffely question from

now Your line is live.

Tom Diffely

Yes, general thank Maybe versus questioning, is this previous it of or so last follow-up lack sort of truly unusual to of driving just the ahead recovery year seasonality seasonality of Is you. what just the semiconductor the line in expectations? on years?

Fusen Chen

Okay.

So, a Tom, of you color, bit area let me seeing. give are the strengths little we our

wire-bonded SIP, the seeing introduced. advanced are smartphones we also finally, strengths in ongoing after IoT, and So product multi-die we increase also traditional see the LED strength XG, both the just die. our LED package display, we in consumer and in products, And

have I So, our The few this. I can few summarize, invest, reasons number right. mentioned XXXX/XXXX, I times one, customer under behind in

So, over triggering certain by business. rush to when have a are you actually the increase number our

as such in pattern related this So, it’s ongoing the PC And other also number in stay-at-home. That applications, to consumer investment our needs also and is work-from-home change, because our actually more customers. recovery home drives products two right. of gaming and and

significant actually wire-bonded in key investment. number think for another XG complex increasing demand the us. So very is and see a I reason end-market. Actually, we package. module for three multi-die it’s SIP That’s XG

for incremental capacity [indiscernible] these So in the devices the advanced wire-bonded. is actually increasing our driving complexity

we wire-bonded important important part that’s I It’s of seeing. the the also – are So, what investment. is think XG

So, for already, the also this introduced. which strength and I last in we product, mentioned reason upcycle, I LED traditional advanced think ongoing LED I both see

So, current trends these we reasons few are behind are seeing. the

Tom Diffely

pretty looks color. impressive. Okay, the I That appreciate

from follow-up require stronger? a going at an on the to be customers from $XX this itself or $XX tool to million then we does so PIXALUX new year, And market What when it next you? just to drivers require too, that’s is individual million does little are growth to Okay. multiple the just expansion year the it that growth or or look a

Fusen Chen

Okay.

the both, our ongoing own more advanced actually do but X And put that advantage we year to we development as our in years X LED broaden introduce I LED think our portfolio. activity advanced it’s intention actually competitive next portfolio. its our multiple to we also in probably products or sustain will we intend also, broaden expect

beyond ‘XX about this that, need $XX will judge and for I preparing million to So $XX business million, products we we that. ‘XX and are I multiple mentioned think

Tom Diffely

Great.

Okay. quick of ‘XX and are a just And APAMA Thank what as then your finally, in the overview maybe Katalyst for you. well? expectations

Fusen Chen

Okay.

on, I are few, ‘XX but will a think on win to more wins. a working in feel our wins. targets design moving had So, we to our confident we and few try a we all few complete actually We design already

will that ‘XX think I more significant be one. a

I million. So business and That’s goal. our our is ‘XX the display $XXX in mentioned, PIXALUX

We dedicated can $XXX Premier the million also expect We [indiscernible]. reach about maybe also PCB [indiscernible] AT chip together talked and about always flip also packaging. advanced

Tom Diffely

Great.

Okay, thank you.

Operator

you. Thank

next Company. is Cowen from coming & from Sankar Our question Krish

now is live. line Your

Krish Sankar

a question the thanks congrats for very impressive I them. and hi, taking couple my had Yes, on of guidance.

XX% new the quarter First because to like of more in PIXALUX QX FY is ‘XX. LED year midpoint It on just therefore and take secondly, the December if after or ‘XX first will XX% I one, that quarter weighted. is that’s try half highest Fusen, revenue like growing slowdown revenues next going on really FY looks to math to that? and be the check million QX in double year $XXX comments to your of fiscal the if it And out mini with calendar mainly like front-loaded want products is I coming probably true?

Lester Wong

don’t visibility December we has – part the year. front we ‘XX. the better that end And we the to quarter second an of now necessary. will because as again, what your into for revised get the be we answer the did switched and will Fusen well but that’s go time recovery as traditional our by can say front is, we front see, question We of I response earlier further Fusen driven semi are guidance IoT ramp memory ahead fiscal and general And as XX%, is board not quarter me Krish, ramp advanced I the So, in as we fiscal let both again, question, as as for as well. seasonality in I a as in is across display little to XG, said we this if PIXALUX automotive believe at said that think LED sorry, have as that. bit think XX% well the I highest we mean, to see year, is is loaded, the and seeing indicated that

Krish Sankar

Got it. ahead. Yes, go

Fusen Chen

actually our right. remember, you If is ‘XX, QX FY trough

every years. [indiscernible] X from it’s up, the almost it’s And quarter So we we got just point either got trapped.

until to go the seasonality even ‘XX, moment, the So QX in next quarter we right. change this up

highest say be point one, see it’s where we many will going right. years, we So quarter the didn’t many, but for the we every is second be – not didn’t to

we a is the at coming cannot business growth. take every update than we second book, outlook framing, we just we time. we will XX% is already That’s up. of so we provide will big what XX% and decent have for are have half situation that that. next the be of ‘XX going we stronger mentioned So, back plan, quarter, can That current And why at will the to that’s because strong, quarter

Krish Sankar

why the mini shipments But margin remember, of reasons I the very – gross it quarter. it. around Got Yes, around you to might bottom there like do look the September guys – other second the margins relative to PIXALUX more be helpful. understand gave definitely questions. XX%. Couple is of it. December last One quarter, beginning Lester, Got like still you in going some some I be That’s called is, one does year.

trying my way happening pretty should is that you margin PIXALUX be and nice for are through to drop line? We all was just drop-through there to the figure super there the out, because understanding bottom is high

Lester Wong

XX%, drop-through you get good drop-through there very the terms guiding go at Yes, and only in it’s as operation EPS, is of question know. what by up if flow I non-GAAP we I is revenues by meanwhile, mean, $XXX we you through XX%. look mean, at are million, growing

that that I as think the leverage it’s went as is does down, far margin as operating the mix. gross its So, – And I why as indicated happening. us product for show

rather traditional margins also APS business well more LED is because call piece the general. than has And is in freight a demand items wire as there and charges as the bonders a customers. from higher wire get I equipment bonders So, larger great plus unique capital of by our APS quarter like the of

a We freight air unit. as new strategy, bit. margins bonded wedge our introducing cost freight a things penetration And we the little the by in than are increases as as more are business market far are sea product well down and as doing that our

Fusen Chen

Yes.

be So not enough one-time. this It is for you. will

Krish Sankar

Got very it. Got That’s helpful. it.

should basis? have that seasonality not think your it products on question in it’s should typical in we consumer the mode do a a ones think we about whole a will LED quarterly as final still or more mini marketplace, a PIXALUX growth Just embedded because for in assume are lot Fusen, you seasonality

Fusen Chen

side, it’s be Every the not we happy million in we Again, to plan. are very ‘XX PIXALUX Krish, to did even the will actually we million we high actually, So, state the we will so even, side hopefully to would is quite [indiscernible] million for report high between business. just $XX achieved goal that’s year, $XX quarter, our on but last seasonality. business to I and shipment, state the like the million, $XX $XX see our mentioned the be what actually is we

on X quarter a spotty and for after business in you I the initial more December think right we this point base it’s not and hopefully from year many, see in a point, by the So, X our and the customer more advanced. is quarter is will PIXALUX, the some we more product so repeatable and see our now in business didn’t will quarter seasonality penetration maybe see trustable that

Krish Sankar

much, you Lester. Thanks, Thank it. Got Fusen. very

Fusen Chen

Krish. Thanks,

Operator

Thank you.

is next David today from Our question coming Steelhead from Duley Securities.

Your is live. line now

David Duley

having also device. are am seeing these comment into XX% about thanks say bonder wire I Yes, and intensive more between the slowing XX% I your front? what wire-bonded of the first for capacity? you not previous about packages or calendar what I on more now more that? equipment? just as wondering having XXXX taking was just business. huge of want more for stacking question. supply rates per the and about needing increases just question large sort I Are in more are you bonders I my how and have also a could do talking difference wire is or your wires the between you down guess to because The move And Taiwan then core to talked comment packages OSAT wire wires somewhere XX% they connect on and bit, intensity guess than And are to on a XX% like bonder are demand utilization

Fusen Chen

Okay.

first the into and answer the will I So part of question. the then second Lester [indiscernible] part

We also long. business continue solutions. be that very and wire that we this will believe we and to [indiscernible] the So, people this in bonder Dave, – part And let after is technologies. important packaging of me long above say improved many come

is a together [indiscernible]. to type And and because of whole infrastructures a waiting so only XX% and a for use feel product and and trillion a then is and seeing to is far, [indiscernible] XG or X wire-bonded multi-die because the only module. that yearly our multi-die not not station of did dedicated, [indiscernible] bring have packaged process actually only mix as wonder, more in additional that complex devices very our smartphone our be need SIP additional to is increasing devices actually pull and of complex and semiconductor our packaging drive be requirement, production the I is are to – before more about we complexity there there And they devices capacity lot because a a that of also will interconnected.

know I not, answered question give a don’t if me your I you So, color. let or but

board we the special is technology. under very, very So, believe bank’s a of part

XD, do can our [indiscernible]. some packaging for our You

if every company a of So, advanced have different actually, I could, packaging. definition

I packing as So think APAMA, We right. and should dedicated K&S the for [indiscernible] advanced our AT following, PCB, defined mentioned last, packaging, chip Premier. above flip advanced be

our be in X% So, present our actually quarter, will equipment this part September of right. capital total sales,

the I think it capability, looping within not Actually, think is die-to-die you would in requirement, multi-die XD complex be because capability, die. possible. very, I our know special and very advanced packaging, are and because of connect this our can packaging XD we that these

packaging, and that advanced think should by XD our packaging. XD be using categorized advanced multi-die have I we as So, bundle

and not And XD advanced also able sales IP, think achieve follow our I very love multi-die spec as X%, our equipment right. September for memory final placement. capital So about of we should be high will we assembly, our system, LED XD then package think is [indiscernible] about include very, I X% is to September,

above of advanced So, September LED is assembly sales. XX% our quarter

all So products advanced XX% is believe together, [indiscernible] our packaging. of we

So know your answered don’t I I question. if

David Duley

bonder are connect was down, more do talking conference leads the bonders they to I having customers that slowing literally it was about one more per call wire guess in on and their more of intensity, are wire your because having Taiwan to about device seems just my question large loop.

bonding intensity is So, of increasing. wire you so or need wire device more per the bonders

by metric of you I you just some wondering So have sort – am if are XX%, it XX%, if XX%? is increasing

Fusen Chen

only multi-die packaging call. bringing at – highly number right that on precise are are we we you, will a under. and tell give huge we next of event very, a the we you we this complex and the Well, I And in moment beginning very only constraint covered because believe, but can maybe more capacity we know have

increase. will demand We percentage give you the

Lester Wong

right. question, utilization the answer me let Dave, So,

quarter, and North also So, of capacity, China Obviously, now and from around have Europe lagging XX%, at has significantly utilization still America are improved, September Southeast above is so. other improved XX% full significantly and Taiwan the almost or China XX%, XX% over are was Asia about actually but markets. they they

Fusen Chen

and know, part as sustainable of that. [indiscernible] you [indiscernible] But the also big is

in the in it would we I the again product this the we as be with about the portfolio advanced and ramp future participates board, obstacle. new along in new think big in mentioned packaging, also So PIXALUX talk current introduction, product for display, this

David Duley

Thank you.

Operator

Instructions] Capital coming [Operator is Group. Christian Schwab from next from Our question you. Thank Craig-Hallum

is Your now live. line

Christian Schwab

Great, thank nice recovery you. on Congrats here. starting the

you So, capital would previous you say us stated in of for you to keep the complexity outgrow over is the at slightly XX% XG more continued electrical math next into in unit give years? different, to an year some the generation increased to to potential expect? the as you general vehicles idea when a automobile your facility few the to QX electrification you we silicon easy just see addition, expect in forward, needs and you continued these growth as percentage of time, growth what chips. the content business and XG contents Can movement of general Would semiconductor if saw semiconductor look and applications follow-up question unit well going can next

Fusen Chen

industry more rate, dynamic ‘XX to trends, is think think think, market, at trends our this unit I and I hear business have sorry ‘XX the little going Christian, forecast. asked growth so change. for question be I I positive, your is X% actually it But [indiscernible]. bit and now, is around think I to X% And about but I the a moment the am different right, your voice a

update maybe you But, at what in think, two we quarters. We this one planning. that’s moment, are are I to going or

forecast to of life see seeing going are the long see X revise as but are going We years, to it very, [indiscernible] we very and change. we X% X% next are to our

Christian Schwab

great. questions. Okay, other Thank No you.

Operator

you. Thank

is today Craig question Ellis coming from next B. Our Riley. from

now is line Your live.

Craig Ellis

business and effect? So those say strength that first the strength would is be that, the levels back are with correlation impact to for follow-up questions. Asia, fair to the really just coming more see America, that that North the I’ll you is would by different utilization levels? Lester, you that dynamic geographies we fair the in ahead given utilization than fiscal look provided, fiscal in order taking the to to thanks one-to-one there. or the be for China the led thanks Southeast did XQ color in of Yes, we granularity and seeing Europe we think quarter it from utilization Would one with start a goes as incremental in it just be the that what if

Lester Wong

that Craig and than is actually say, would QX China Asia. Southeast more for Taiwan I

not Southeast Asia to is as is. that China but utilization levels the improving, and where Taiwan

I think very utilization lagging Taiwan high. very, growth Taiwan, the behind going China already forward further is they the from continued will I come also think but are

continued Asia strength can the two they we and catch over and COVID from And see up solve Europe, So Southeast so. North Taiwan they will America quarters or hopefully then the issue. next as assuming

continued see that two, in Southeast probably quarters, sequence. the strength in and three it’s say the we in would Taiwan Asia. But I So next

Craig Ellis

And housekeeping the really next question. a just Great. one then is

around gross have margin. fiscal color the XQ On you provided

you shipping because what margin. about or wedge clearly, you is increased of impacting cost new order intensity talked the of and quantify So four? impact those combined product with gross there Can two then customers the

Lester Wong

maybe points I would say probably around so. basis or XXX

Craig Ellis

And that be should for That’s tax the year, then quarter Great. rate very XX%? and helpful. Yes.

Lester Wong

are I Yes, XX%. we still think forecasting

Craig Ellis

to very gaining plus look smartphone was question $X not end And revenues times, on a some on SAR ‘XX? into unfolding that. this, share semi And multiyear at that dynamics articulated the as basis, of recovery. you business as cyclical it’s billion and to see the how a so, you a is target ramps Okay. some multiple general visibility at low question, The the multiyear model, we and yet in as $X.XX like have you basis, things and look encouraging level by you business lastly, numerous is then earnings rebound are ‘XX you the gain secular recovery have visibility led have new long-term to you starting in that out clearly do clear per or product is into which a visibility Fusen, that to are a

Fusen Chen

industry, unit the fact, this actually look We Craig, growth, ‘XX, happen I this. uncommon, considerably mentioned, in this at group, so right, must especially to very we have It ‘XX probably and question let’s is really Okay, on but legacies. this we really, uncommon be about close negative million and year yes, should the answer have then me is XX XXX and let $XX [indiscernible] of [indiscernible] just also. finished XXX is

add Australia additional year. upcoming you X X the if So and in have we in one together,

it’s million. actually So $XXX about if add you

and is very unit So can we I already, And strong represent very very, we this this uncommon, have the growth. right, how way acquisitions, [indiscernible] because war, low. in this of in a year can are we strong very, can how negative very mentioned too long believe very I

– feel run-rate as be a I for this, like sustainable business. should million base we core $XXX to relative the So,

already So maybe I XX, already, years, in guide display XXXX, we – right. but [indiscernible] X we reach in X think, years, ‘XX, mentioned we XX,

very end So close XX is on to already high the XXX.

goal. can display, So, we can we believe XXXX can at – million I we feel it. it, sit say XXXX touch $XXX we

you actually about that’s dedicated. think $XXX Advanced paid packaging available. are dedicated, we know we packaging offering [indiscernible] get I we our advanced million feel

$XX advanced also in And from it million. grow more million, We achievable dedicated are the our we can is like looks $XXX APS that so bee think I this will together, fact. view another is all a [indiscernible] packaging

crazy. reach million a we So goals we beautiful almost with business water, the very current are $XXX then but in I if are lucky your think runway, business

business higher we little core – sustainable than want million than, want think to the probably even higher or that $XXX overrun, or I also it bit to be even $XXX we can will above but we but believe was this be believe we $XXX see million really million. a don’t our higher like

I overall, to goals. making are feel to a And and we not think luck, achieve [indiscernible] good possibility XXXX, objection. The by is good. be general our [indiscernible] hopefully we we we our want hopefully, XXXX, XXXX product So believe have that we by recovering and and also

Craig Ellis

That’s very helpful. Thanks everybody, and good luck.

Operator

Thank you.

We session. over would the or turn I back have closing reached to the any end floor management of to further question-and-answer comment. for like our

Joe Elgindy

Kevin. time Thanks, you for today. all Thank the

also at the the over and will months. CEO Needham, Sidoti, coming conferences Summit We D.A. Davidson be presenting

directly questions. this our Have additional a As follow-up concludes call. day everyone. any to always, please Thanks. great with Kevin, feel free

Operator

teleconference and webinar. Thank you. That today’s does conclude

You and your a wonderful time thank your participation for you may today. have lines disconnect at day. this We

Kulicke and Soffa Industries (KLIC) 19 Nov 202020 Q4 Earnings call transcript