- Earnings call transcript Q4 2022

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Operator

Greeting and welcome to the Kulicke & Soffa 2022 Fourth Quarter Fiscal Results 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 is now my pleasure to introduce your host, Joseph Elgindy, Senior Director of Investor Relations for Kulicke & Soffa. begin. may you Joseph,

Joseph Elgindy

also everyone call. & Chief Fusen Wong, are and Welcome call. quarter Executive fiscal XXXX Lester both Officer Financial conference Chen, Chief on to you. today's Soffa's Kulicke fourth Officer; joining Thank President and

have you at our the Relations as received the earnings section the investor.kns.com. Investor presentation, are of For earnings who recent as website release, those not of in our well supplemental results, both available

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

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

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

Fusen Chen

you, Thank Joe.

is our more the a more dramatically within the parallel industry’s value In evolved internal past a semiconductor have by fundamental established significant effort, now profitable markets and strengthening chain. more culture, high-volume into assembly company both served five focusing and growth-oriented Over available market. our resilient, years contributor and on to positions, corporate our we expanding to the leading-edge this

XXXX. expansion. we Lester gradual the by a look followed fiscal and we revenue are Based development our increased XXXX by represented half dynamic in to improvements seasonal although fiscal dynamics will display on these market to second chain recently well-known rapid unit impact level again expansion increased secular general end this through advanced Expected inventory expect typical and advanced resilient. industry currently fiscal on semiconductor, a automotive revenue lines. have shortly. by this exceed digestion This fiscal provide supported revenue. be to addition we Considering in and to XXXX, suggests more markets. detailed outlook with pattern revenue our individual previous fiscal XXXX. peak fiscal ongoing environment, business feedback, this across a or across planning the scenario demand levels meet we cyclical memory additional LED conducted in on weighting display, packaging continued Over tensions, first year, of projects generated executed details the half. same trends and increased outlook This packaging environment, in heavier macro demand billion second-half advanced are improvements $X.X XXXX, in our Despite related dynamic of our and very advanced seasonal capacity results. strategy. global in and clearly continued XX%, increases supply supply-chain we industry negatively and which fiscal industry multiple disruptions have higher period. parallel, Through lowered base forecasters to we rates, to efforts share the overcame customers flexed due non-GAAP and our fiscal financial trade performance our of In over and and Collectively, level advanced our past our earnings of through broad interest period support semiconductor months, into disruptions, per line XXXX, uncertainty with as both leaders of over and recent revenue, WFE ongoing in the resiliency our outlooks Over

improved. our two times of prior of over more billion year, we performance prior non-GAAP an Over of year, and the generated our which representing helps cyclical peak highlight than XXXX $X.X to $X.XX EPS how increase revenue has

consistent acquisition, period provides expanded years. the and adoption solutions fundamental Despite engagements path partnerships, which This for contributed, Fiscal Packaging, portfolio increasingly underway. critical higher-growth and approximately our initiatives solutions the market shortly. I transitions our going sustainable softer excludes $X.X a over interest acquisitions to aggressive and already change, technology is has to an prudent key available our growth are environment, for with billion. supporting strategy update Advanced We our coming long-term and remain these semiconductor XXXX growing to our focused aligned served Advanced on long-term, While expand. growth pending by outlook development Display, Automotive which will provide customer growth continues since XXXX, a and forward. XX%, for of more

acquire ongoing AJA. expand that to In materially further been market our efforts, we seeking portfolio micro our announced increasing the available competency-based Jet Xth, an development access opportunity. accelerate can we and to mini organic LED our technology growth Automation, On served evolving AJA’s while have September addition acquisitions our further Advanced agreement also to potential. will

are AJA’s address three providing opportunity. the advanced and growth. has sizeable advanced including the positioned past broad to complimentary with new already electronics dispense placement supplement additional our organic years, competencies impressive market billion total, the market. assembly. addressable layer high-accuracy Assembleon semiconductor access roughly the which provides repeatability, In of offered opportunity market-leading display access Display This an solutions address us are consumer our allowed also Over emerging emerging, needs AJA this Advanced and This the total supporting to K&S growth space initiatives. unique who enter with and success the $X and and acquisition high-growth of of provide of display engage growing in with in market providers, to AJA, access and complexity innovative accuracy dispense, identify,

new accelerate help AJA existing Our commercialize distribution network and competencies, technical strength sales and growth potential. operational and solutions can better

businesses we $XXX.X the our five-year represents XX% in million our quarter, which a average. equipment to increase over sales of our capital generated September from Turning end-markets,

lower new market, trade also general semiconductor outlook is the Within of and levels a expected due to softer indirect restrictions. effects consumer spending

share However, continue the soon gains assembly. on market, semi Packaging and electronics we also power in Advanced execute to within

million our Our XX advanced Advanced display our revenue. exceeded revenue than Display LED business nearly expected total represented $XX Display significantly is target. and progressing Advanced XX% of better we

development of expansion, capacity a execute expect level drive our After we market adoption demand to across have base, we solutions. returned on this reasonable automotive As several and to rapid of customer further a for core-automotive materially. more grow growing we quarters

We the continue many electronics vehicles. customers addressing our to power which and semiconductor, autonomous management, power for solutions, sensing, future of through our are and leading distribution directly battery and growth automotive on while several to automotive current electric closely our trends support plans above to our own and continue are intimate needs semiconductor assembly supporting we supporting These significant expansion storage and engagements. customer Today, the long-term. continue strength delivering product expected extend by fundamental initiatives capacity average new and over power

execution Allow XX. provide to brief progress and increase optimism Our a FY into ongoing me update.

needed lab First, trends expansion which that demand and in multiple for space programs facility the our packaging renovation better display metrology our and clean-room, solutions. we enhance and will support now manufacturing and Pennsylvania efforts development new advanced growing providing and advanced critically capabilities. and expansion are have These Singapore

Our in quarter dedicated systems semiconductor over feedback pitch. the coming expect past in is grown year. chip majority the growing materially key over assembly coming the and continue a to multiple process Advanced new increased XX% our We wafer the heterogeneous chip have we for promising position XXXX years. needs to will to process to Packaging has over fluxless-thermocompression industry micron leadership by process fiscal over projected customers of and Customer this continue have currently XX substrate Business and interest and to opportunities have an address down with

specific photonics signal, emerging In emerging silicon of are reach to examples heterogeneous also logic, addition TCB to focus mixed expanded provides for and on System-In-Package market the we base-level processor, This of opportunities, access applications. our raising supports and our our integration new high-growth, business. opportunities how high-volume, high-growth market sensing

have increased. semiconductor multiple fabless assembly engagements companies As value also our the of with increases,

grew solutions are our these and X becoming clearly of foundry, momentum, base continues the provide design Demand factor the customers over is anticipate for and in nearly years. Considering are thermo-compression growth past. end-customers, significant year working our our we not traditional While to than thermo-compression across business support improve engagements. OSAT this fabless, meaningful by more broadening we to the highlight new to a growing times, in this IDM To over momentum, process IC coming assembly aggressively year. new customer

specific over through million, We $XXX XXXX. cumulatively, identified TCB of have customer opportunities recently also

the In addition strategically on market through focused share our extending are of release latest Packaging, pending we to Advanced system. assembly electronics

provided access success LED space expanding in within for targeting Looking these market efforts positions into acquisition opportunities have assembly electronics markets which access Assembleon of new emerging to ongoing After securing expand we served gains available several a and excess of Recent and market the including additional our also of us mini well access back, the positioned the share system-in-package billion. flip-chip the into our micro adjacent into the through XXXX represents K&S automotive are access development and electronics market, PIXALUX. $X in also market. market assembly, core within new

a year, XXXX. the be the to and past and accuracy of interest technologies success image display addresses second applications. officially we production life backlighting markets. XXXX. trends longer to To cost/performance a image, long-term. Alternatively, larger-format growing which backlighting and into and significantly thinner, address which half have offers track the production our At alternative and supported from our further for also system clear, than PIXALUX, which of well in display the advanced although in growing requirements look Initial display which the majority over has lower programs, a received, solutions, OLED. current displays, and adoption forward with efforts limited fiscal OLED as technology, needs technology, have releasing regarding portfolio close system cost fiscal advanced LUMINEX the vast we customer placement broad assembly. update next-generation PIXALUX smaller-format of Over expectations feedback represents with a electronics such trends comprehensively supporting throughput the technology, Sustained and high-volume, the costs displays. latest LCD developed provides in is technology solutions, high specifically LCD of have emerging relative by The optimize OLED multiple share of benefit customer high-level, larger-format, higher-quality display to architecture LCD created display been Emerging will new backlighting direct-emissive development production growing degradation continues of LUMINEX development LED emerging last tradeoff useful

the LUMINEX through a out potential small have technology we customer only success challenge to dense Over participate and over the also only beginning well and to is OLED quarters. coming play of development years, This the standpoint. and of positioned from trend coming displays, performance the close power to very are direct-emissive our efficiency a using LED’s matrix initiatives

backlighting is to to market driving lowering and advanced adopted, both important be direct-emissive production critically costs approaches For adoption.

on will mini LED we which long-term most production are solutions micro these improve, While support throughput of and of costs higher focused trends. both delivering

with largest PIXALUX This success over and method. has provided position LUMINEX, performance tools advanced the for Our of place ultra-high-speed three of the us to base laser-based are pick transfer benefits the of months. improves first-mover with and we on achieve PIXALUX, with track installed display. coming With LUMINEX the times productivity level

LUMINEX supporting for milestone. Our this several R&D qualifications as teams ongoing parallel they reach in are actively new

We our strong. latest LUMINEX continue and multiple engagements to customer installed across progress LUMINEX Customer consistent several pursue system base display remains advanced expand for development making initiatives. our while interest

We new technology increases these have specific also further solution shipped and recently advanced long-term optimism potential trends. our that customer with display a broad

who Through our routinely fundamentally future AJA, better further markets. secular financial adoption, positions our change call I our have strength advanced customer with rates semiconductor said, now are our across packaging, and growth over market industry the advanced over near-term. of near-term discuss to turn integration correlate market, access, growth fundamental performance ongoing well of the and automotive will will programs, enhance the shaping prospects and that display development and Lester Lester? outlook. With driving and trends execution improved positioned to we While the

Lester Wong

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

in to like I regulations, the Chinese solution and ability First, involved recent to U.S. to ship front-end changes impacted trade which fabrication. IC companies address many support to tools providers’ clearly many production have would existing

majority impacts to we restricted. not still are direct are The we vast any from of into simply confirmations ship demand. China receiving the anticipate systems we do customers, While material not

Additionally, none support fabrication. of our products IC

Our assembly IC products which new the only excluded is from restrictions. support

likely will indirectly While chain we disruptions which rules our demand for may near-term don’t new products. supply anticipate direct impacts, the impact create

and macro-environment remain way. and a detail, fundamental, in product current committed long-term explained dynamic Fusen portfolio to in and remains our As we expanding market access sustainable the

engagements, which technology qualifications, customer – Our strategic sustainably path many includes facets, our development and programs, partnerships, enhance growth. technology-oriented acquisitions highly-selective

As will and we our strategically operating improve. access product free-cash through-cycle expand leverage market diversification, to flow continue and generation

demand of and our of flexed quickly we $X.XX. share unprecedented our business, for generating $X.X an year, million billion, meet net of fiscal of manufacturing non-GAAP $XXX.X past non-GAAP earnings the to income revenues high-volume Over level per bonder ball over

non-GAAP due level individual point mentioned by To gross the directly XXX is As margin and process growing in assembly leading this largest year-over-year, XX% to clear, to revenue. Fusen of increased value solutions. similar during driver fiscal capital-intensity proposition EPS semiconductor basis our long-term bonding growth The be XXXX. despite a rates benefiting the of actually improvement benefit of our the was ball

advanced positions strengthening Our assembly packaging, bonder also investors ball easier to may advanced in although high-volume optimized we and for business. display, automotive digest, be electronics the core, have

run high-performance bonder basis bonding systems applications. ball been underappreciated, historically points, our underlying business Since more multi-die increased due capable stronger XXXX, has which to margins by has largely to the improved. our fiscal demand XXX ball While fundamentally are for gross have

most Specifically, units XXXX in the in XX% of total ball representing from bonder architecture, XX% only Ball advanced our to Rapid fiscal total units grew fiscal bonders, bonder XXXX. series of ball representing of

New leadership position within our enhance this packaging process. rates complex and trends longer-term well-established existing the large, growth

in recent EPS below of efforts. quarter gross associated above margins accounting operating our to XX%, during related came dollar. foreign September expectations non-GAAP the to cost Gross to margins customer-related range and exchange a U.S. of better hiring, gains million control slightly during Non-GAAP reduced the $XXX.X due efforts, strengthening non-GAAP pace development revenues generated with a to than of due largely income $X.XX. immediate of quarter expenses $XX.X came Turning and million, we net in our guidance results,

better Finally, came slightly for expectations. in than tax the quarter $X.X million, at expense

repurchase fiscal decline the revenue, inventory our in we investors collective to days million position increased reduction generated representing quarter, in XXXX, $XXX million longer-term or September $XX.X we quarter, of At end the fiscal of Working to Over our million, our share $XX.X activities. by an we our potential. remaining of million in Through a which earnings and our continue increased cash, diluted open-market past to million X.X highlighting shares, increase additional represents accounts total cash year, XXXX accounts after of September share repurchase sequential average. under capital shares quarter, year strategy. adjusted bringing $XXX.X weighted days nearly receivable, sequential XXX the the dividends and an and XX% $XXX.X Through committing a flow, total million repurchased fiscal to nearly manage September authorization active, had million and through $XXX.X repurchase in payable. free-cash the

annual activity repurchase a expansion our consecutive repurchase competitive valuation on have and growing our and annually The also a optimizing maintaining the to addition we yield. our basis. In dividend, just announced total steadily raise, program bringing share while [ph] efforts per dividend dividend share our per market ongoing dividends $X.XX third fundamental stabilize help to

our near-term initiatives, is mix, than X%, plus to customer expansion fees, are we basis with Gross XX% [ph] product industry to facility margins expected development in due Fusen’s revenue or to softening approximately effects XX environments, and due million. be plus the or quarter, addition points, anticipate efforts to ongoing inflation. to and operating expected minus higher accounting minus to For approximately plus inflation. December or line in to also million, comments expediting of $XXX million, anticipated macro $XX $XX additional expense re-sizing minus regarding Non-GAAP related reduce

Section the effective expenses considers Jobs mix reduced $X.XX, of as Corporate R&D to XXX of capitalization affect or Over Non-GAAP or related last expected of This is to repealed soft is over in the of which limited hiring increase tax broadly rate expected we periods. an Unless be is month income the prior beginning activity. to and provision mandatory XXXX. EPS Cuts rate just R&D minus plus U.S. although primarily to this demand and modified, our under Tax fiscal of partially we have with during taxpayers XX%, due expenses is non-critical regional XX%. XXXX all have Act

distinct we remains electronics March our change have seasonality in exciting second the fundamental fiscal half. needs a as through with across alignment capacity to capacity driving typical semiconductor, the It to XXXX, advanced assembly, automotive and extend anticipate continue technology time quarter, the look period As digestion Company we broadened display, of we markets. with significantly out for trends a the more further into fiscal very

industry and the of positioned we recovers levels are performance new As execute, well beyond continue XXXX. to we to reach financial

the position transitions several While allow and there active long-term company. stronger Operator, are enviable entire open near-term please financial an improvements, prepared enabling more This the questions. challenges industry, technology comments. our will concludes to us even and emerge call profitable as our fundamental roles for for

Operator

[Operator questions Krish proceed of line the from Please with you. Cowen. come with Thank Sankar Our Instructions] first questions. your

Krish Sankar

I for a Thanks my few hi. taking Yes, of have questions. them.

into segments like First there pretty one march, them the is in look fair assume when is or memory, are into and to LED semi, March, in into December it down of the general and subsequently trend Fusen, December quarter any you all then auto quarter? and the December much sequentially

Fusen Chen

what Well, perspective quarters, our mixed we other the our than revenue I up feel think related [indiscernible]. actually of and products are revenue unit growth we seeing, of

like So period And QX [indiscernible]. probably just, QX [indiscernible]. and we expect we are of feel

I yes I your think, wish question. answered I

Krish Sankar

And from your you half gives what the that the kind onwards? of it. recover, of fiscal then just comfort Got i.e. curiosity, June demand second out quarter will

Fusen Chen

with there our customer. So, course customer things. the few of feedback are One continue is,

probably, market inventory few our like forecasts, Packaging, be also second and second that in has we actually think, much will better. quarter also I few think weighted second the the are people view, of have after they think, Advanced Display more our they way our same half, from a I situation I point been Advanced And half. of fewer open, feel think more digestion maybe I [indiscernible] are and And half.

Krish Sankar

right. it. two In the percentage questions. then Got to your quarter, what your September just I it. All Got other have sales was And quick China?

Lester Wong

just XX% It's Krish. around

Krish Sankar

XX.

range now, been of a right? kind same while it's the though So for in

Lester Wong

Yes, international China. XX% it's customers, but is of not, factories the that in but what's actually their

Krish Sankar

Advanced I Got of the Display in expect in XXXX mentioned to it. the now, that would past, Advanced final think you year-over-year look, for decline XXXX in then Display question, grow? is actually LED kind dollar are given value that Do right FY you revenues of XX% a total sales. And Advanced revenues you think FY FY Display LED XXXX or about

Lester Wong

anticipate We roughly to XXXX million. about or higher will XXXX, for Display $XXX that Advanced be similar FY about FY

Fusen Chen

So, Advanced script in will in my an area of area I continue think [indiscernible]. I enlarged It actually with mentioned Display this XXXX open further project.

[indiscernible]. So lot for multiple specific of big we of customer are actually piece products actually also product a also XXXX and we are and for just, both [indiscernible]. in this all [indiscernible] because this Display on is we Advanced the a ship [indiscernible] direct that multiple [indiscernible] together actually little bit And [indiscernible] impact it initiative target But really because also is revenue

Krish Sankar

Got you it. it. Got Thank very much.

Operator

Thank you.

come questions questions. your Securities. next the proceed with Steelhead line with our from Please of Duley Now David

David Duley

in I with provider. about Thanks opportunity. dollars the the who efforts what markets your market bonding about my AMD is your about for all, working And conference was I on thermal elaborate you are, a just their a in on your you what compression your an call first share was talked you one, Could think on competitor, in? annual I lot size or little making of logic that guess of are and big key bit what taking more think questions. you deal basis customers talk wondering a on could market then if is?

Fusen Chen

Okay.

free some actually the think I a of transfer just in chip to think advance think I lot. that, I people also compression. recently, TCB the Part So advance recent, prospect increased

call, my mentioned in So backlog $XX million. think of have previous we I we

customer. PO ship our time. So to also we've delivery new we requirement the get I PO. the order, think have to course we have In not meantime, a only of we our specific got But is

like customers, promising backlog the actually think, conduct a market. best not customers. or visit a study feel is is design many from We foundry So and judgment. We this of house a actually lot sometimes after I actually many, very [indiscernible] we

So let clarification. make me a

particularly when because [indiscernible]. about enter have talking I TCB, process think [indiscernible] process a we're the micron, TCB [indiscernible] we a become TCB XX into of, about

a proprietary, also have technology. special We

able We to are silicon [indiscernible]. very make a clean

actually when is the at So microns. moment between biggest actually XX XX volume this to

Number continue on think below TGB one, hybrid process hybrid are a deeper to on micron. I And our focus bounding in So from, I XX bounding to is up microns. two focused pitch say ways. we XX

at really is these is focus And two right? difference, the market, at XX between at this large moment, our XX actually So is overlap. actually first moment this that's a moment this technology microns. very not are So to

backend our with TCB The second process, a is difference fluxless process. bounding is hybrid but just front pure actually end is some

it know. this really investment So end moment, moment, have this did it later some we don't shares but right? We at front is market not [indiscernible]. needed, they will at So not all. Maybe overlap, is from any overlap will at claim

to hope questions. they And actually So I And the actually and substrate. chip-to-wafer, are chip-to-wafer we process. expect will chip a of We a Right? gain are chip-to-wafer yes few And a at answered large. system shipping TCB market customers. leader equally dealing within One I are we for TCB, to a So actually I your chip-to-substrate. with are that chip-to-wafer think moment, shares chip-to-substrate, the we one this do two is our process. significant is

David Duley

Yes.

your Just a as are talked other as is success And is logic the where there on a -- that your markets follow segment, that bonding, there about process the seeing technology? it. providers? thermal competitors used with compression that's other right adopting this logic be Are would to is you're in this with mark mainly

Fusen Chen

[indiscernible] that. course with about, bonding, are people we don't also talking memory, hybrid think our a on have thermal Yes, Well, some right? you mean compression, I of comment

go me let So back.

[indiscernible]. those high $XXX identify which much call, over majority we backlog. we in pretty This the Previous should potential XXXX. And $XXX $XX said about million talked, mentioned we million of be actually million. think will within be I shipped

David Duley

think then something your your comparing you And didn't to said that. XXXX. clarify, in hear just what wanted Could just I prepared levels current I business remarks, said? just repeat you Okay. I you to

Fusen Chen

Sure.

me let this make So comment.

starts I business the think from cycle to actually XXXX. XXXX that given upturn in our

our So million. revenue if end right. recall is with I we $X.X XXXX XXXX I XXX think, And

gross up XXX%. actually the actually rate is So

China, downturn So a second I think up dialed in expansion, to XX%. the lot the XX% have actually down to wafer people the of this, the restriction about trade to roughly set

the So also impact for back will this end. the indirectly demand

we down. really So are in unit of think revised And that. I also addition, positive the gross

is is Actually this million. we $XXX achievable feel It's therefore very side least up our the which So precise to difficult around like or annual be meet study how difficult But predict We it's like than pick to comfortably do it's internally, we of and better we FY XXXX, the can XXXX to a quite feel that. that ended. QX predict we is it's difficult. actually the at going million. And previous can $XXX we from quite like more was feel guess. to cycle

I what think. that's So

like case So XXX% we the are month. brought probably worst it's will about up. the probably sum, us XXX% highest something like, down, feel bring seeing, us down actually about about next is And, scenario we XXX, will probably be upturn the but

David Duley

mentioned you'd bonded seen from the years. how improvement question over gross Final me, margin in Okay. last the core Lester two you wire

that? year should more a that gross robust very you bit Could have help XXX new improve I'm also wrong, elaborate next basis think on calendar number. little wire don't if me a correct a it you bonder coming But points, was margins? out I

Lester Wong

to Yes, new products our business. introduce we into core continue

the core gross well as for will that So to ball we continue ways we'll bonder. high bonder margin wedge remain ball business in as margin believe continue the look to to on bonder increase our and

Fusen Chen

and the the and also is some So David correlation. the price share in have actually, demand downturn market

So while we'll sure margin we market the get increase gross share. to the do enough best also make

David Duley

And XXX going the Yes, being to overall by kind improve what was level. is, into think you're talked margins downturn, I in doesn't improve about or XXX you think during improvement realized guess a do XX% from to guess, past of back at you to you've point can that gross and able basis we points, referring a period, another, is, margins level? I I was levels when gross that happen. so that overall I still or margin But to, normal one the I get

Lester Wong

Yes.

XX% has we gross higher. in Our beyond, And reach we been target XXXX always go believe and that margins non-downturn can that right? a in and year, goal

David Duley

Thank you.

Operator

you. Thank

with Our line questions. come Craig Please Ellis next with from Riley. B. proceed of questions the your

Craig Ellis

taking And Hey, congratulations cash share dividend focused and some question. the thanks on for team, used the increase check buybacks and to M&A.

by commentary. So Fusen, of to some seeing color XXXX fiscal wanted start if some could you provide around the I just

the and back to reasonable helpful you be that as have, hear very is, XX%. seems So that interaction customer it about from question company's comments to view for of and those trends look back that and can The memory? conviction XX% sales to advanced how hearing might we down at auto the at industrial you're going they general Which that things customers? weaker based semi, be stronger from relatively should next year, half your would relatively display, look the which of up what in on the move year, and that

Fusen Chen

but is you memory a know everybody the we little think the at of some think I the have XXXX, I might later XXXX, looking this chance. probably I weak. memory, part at Well think moment know, is But

For the very to actually focus display always think display, is in actually unless, consumer why The we and a that's throughput. not also our market. high easy I on market, need a

activity mini and of the the we micro consumer to but qualification for with that the deliver that think impact we stay. bit, customers. LED LED I for going And little formally a part, to long-term, are here So a lot is be is also have

it's not of so new like lot a project. there's a really only And related, volume

the display, are we the was quarter, $XX quarter, slightly advanced think I after $XX million, $XXX of million ended actually over last we terms year But think full XXXX, million. display. I looking at in for revenue So we this the are a XXXX, our quarter advanced last at

For at the this to be moment. to XXXX, we actually $XX $XXX have a million target million

for opportunity lot a products. So we think is developed have customer weakness. qualification, But little a I is advanced it of display use

and and our another your the issue, we So hope our actually actually bonder growth quite again ship advanced two, our significantly feel this The like our the increase actually already only think bonder. bonder. wedge low million. try the for questions. very we this Right? lot first actually But of is customers answered more I enough packaging, I customer. actually, And one with in cannot close quarter I is are million. moment requests actually than actually to So And level unit I XXXX ball to actually EV are we at meet We have products, we Wedge capacity think the qualified at a are we demand. $X $XXX inventory already. revenue looking one is related

So the this color some gave So wish our I I trend, like about right? you customers. auto is in

Craig Ellis

that's understand expense operating Fusen. to Lester, Thank helpful, about that. Yes, for control. I with you more what happening really wanted was

tactically I talked then slowing about few I and and think hiring things there you happened other that a FX benefit. some, was think,

into fiscal operating savings and the but given we're structural model quarter-on-quarter? we the I'm with there incremental down cost that are model, So you can FX coming the benefit variable are expense what we XQ? or look sure at should just quantify expect as cost tactical

Lester Wong

Craig. Yes, so thanks

we have for down. did I OpEx that positive $X helped ForEx about bring million QX think

we always is have thing critical on cost projects. other we we but the think our implementing control, I are focus as done,

critical think projects. is projects tight, bit hires of personnel critical continue certain little did R&D. and those market budgeted we happen. in I in still The to hiring invest We so some a And not QX, in labor in our

that expect in to happen We QX.

it invest Packaging, or course that continue XXXX. to will will to recovery out controllable half FY the way in ramp Advanced throughout XXXX. to put and us But all We and it the projects if of the look advantage noncritical So, second for XXXX very of at critical costs. we We'll FY take Advanced Display QX in the can really and a continue to that. in in position push we believe will delay we to that when comes strong

Craig Ellis

elaborate just hoping and was you're you're helpful. in that the part in lastly, what XXXX? deck talked and could some expect seeing I on That's what the And fiscal positives of the Thanks, compound could then Lester. business, investors seeing semi about you

Fusen Chen

power I always power. misunderstanding. sorry, I a So that's semiconductor, it's I'm about is really was right? talking probably, high high

Craig Ellis

that are carbide? So about you Fusen silicon IGBT talking or is

Fusen Chen

It is yes. IGBT,

Craig Ellis

yep. Yep,

Okay. I And think that related. then auto that's

Fusen Chen

I'm sorry? yes, auto. yes, Oh,

Craig Ellis

related that application? Is auto an

Lester Wong

Yes.

Fusen Chen

control. Power correct. That's

Craig Ellis

Thank I appreciate Okay. very help. much. the you

Fusen Chen

you. thank Yes,

Operator

you. Thank

Our with the and next from Please of Needham Charles questions line proceed Company. with Shi come questions. your

Charles Shi

quarter. first growth September $XXX $XXX the get full to you in million How of bottom that make rate and guided quarter to thank meet on my up quarter, run fiscal taking June you. fiscal $XXX million? something run number somewhere comment the XXXX bit, for the going like little per I second like I closer, you back That's would million we to for quarter more half to roughly expect first below guidance like provided also quarter. that quarter, your something or you expect half? the you half XXX, do well a more million March for like roughly quarter your go Hey, do Thank to But You in quarter already to want close But revenue require think $XXX closer level between a to fiscal is fiscal $XXX year. to XXXX question. million and my questions. you or the the first second mean number, to roughly be bridge exceed be second rate second to you

Lester Wong

the Charles. Hi, for question. Thanks

So, traditionally half has us than much been half. the the second for stronger first

just And factors, that the terms also, we which again, be about, historically did will the more XX% would But of little half on or up semiconductor of within start revenue half he talked it's is macroeconomic half. of maybe in yes, year's second some plus QX, first The based macroeconomic have is as either a softer. little and bit as the second flat. bit, a in QX second also say drop right, we projects revenue meaningful XXXX, of fact, fiscal in improving probably, In been half the Fusen new in the general of providing indicated, factors we the the XXXX.

that will FY the half, stronger it to So be XXXX a XXXX. the for provide factors, FY exceed do second we I than all think between us believe those path first does half and

Charles Shi

this down different about do last probably actually lasted cycle, if going down least only be years. I think mentioned last basically digestion. brief couple think is you but How you two digestion the cycle, a XXXX-XXXX to yes That's But relatively capacity Yes. you a I the are for about going cycle, this look you cycle of you like from are to historically, quarters digestion the it at assuming assuming, capacity if at here?

Fusen Chen

it's going very I level. are so not we be a think that to very, Yes, saying high at Charles

you the already. product, very this related it's at if at probably So I look moment, low think very, evenly

have So comment. two make So that's so XXX? right? XXX, of this, about what So we if quarters let's a

XXX. I right? say half about million, I think that's think XX%, So historically, comes at is XX% about $XXX our second

So second roughly it $XXX on actually like And compared $XXX peak you quarter, half. we a so million. probably about And up, at to, we $XXX even some in we million million. [ph] have this the the also add feel was strength upturn, I actually think was product reached

because very So, and is up, things a actually inventory strange I to go XXXX of we lot China. pension start about a with think, up pandemic. cycle. in started It higher to a was this trade And our then when expect there's is

achieve is coupling that. our think XXXX believe cycle. difficult business I it I with So achieve. not able And before, not, cycle. high for do little momentum, million But super explain is to $XXX to the us very products, I bit pick for the think think it's a just for difficult of product up I to orientative If the is we achievable should be [indiscernible] think our That's with feeling. unit us

Charles Shi

it. Got it. Got

annual stopped this you disclosing your what Can So disclose backlog, fiscal number, backlog I still you is? quarterly obligated number think you the are your year but is have since provide end. to

Lester Wong

XXX.

Charles Shi

How again? much Sorry…

Lester Wong

XXX.

Charles Shi

XXX.

Lester Wong

XXX million.

Charles Shi

Got it, got it, got Thank it. you.

next So run Can that talked us there? about rate you much number AJA annualized of is you give revenue question, business? some How acquisition.

Lester Wong

FY and market, in XXXX dispense I forward the as FY for think we XXXX FY looking we entire not probably as But the north And size have we're for given right? for think significant the right? for mentioned, growth only the little I move will have for probably bit Charles, second business, of Fusen so, integrating just Well the obviously beyond, million I XXXX, we AJA of there's think but fiscal a at we year AJA, we're half. $XX it think

Charles Shi

Got it, it. got

for you to of be the may really I time, sake ask So OpEx. my about last question want and

guided, guiding math million. your December right. off OpEx $XX quarter But You've my you September for if well, somewhere quarter million, non-GAAP OpEx first are non-GAAP is about $XX was

a I of quarter big optics amount from the September still that's think level.

Given we environment the cost Thank control should about little your than bit what macro a implies? think you. that, of more guidance

Lester Wong

in question, exciting to my in very earlier did carefully as have expenses, will Display, we in Advanced business, I very remarks as control, that continue the answer mentioned, cost particularly very to we're interests, Charles, do right? But critical projects, a opportunities. For believe we because I've or core assembly, our as and we so. we continue the we'll quarter, as previous soft Packaging, sorry, stringent Well, Advanced are invest controllable electronic non-critical as already watching to those indicated well in do

take comes additional back, in when think, core Dave, beyond. we mentioned I think Packaging well Display to as, can I recovery our Advanced in able responded the in And be this, and that to margins, as market XXXX we'd Advanced believe positions also, share. both what I we've increase gain investments the the and we business, with already as

cost also invest in been. to very and what to are the grow always on future the in our be So to philosophy business you but understand we that's able that, has we order control, need careful

Charles Shi

Thank you.

Fusen Chen

Thank you, Charles.

Operator

Thank you.

Please the with D.A. from your Our next of proceed questions questions. with [indiscernible] come Davidson. line

Unidentified Analyst

Thank I you for couple. questions, a taking my have

given unit nearly let's semi-unit What's the for XXXX both. or XXX underlying the assumption something assumption on for your growth commentary say nearly for semi You've what's like that? First, for growth fiscal XXXX?

Lester Wong

FY assume to to be semi flat minus for plus We X%. XXXX or unit about growth

Unidentified Analyst

for then it. top also it far we million given on that, think continue to it. I and Got we so seems in Got that $XXX And XXXX line can that so beyond. do invest and label think, we XXXX,

number XXXX? provide color in or XXXX line -- guess perspective So it the probably I can regarding those fiscal a any from would for the label bottom seems you and the like bottom [indiscernible] be the line

Lester Wong

we beyond we we right? than as [ph] for we the don't net can do XXXX. EPS the I revenue provided quarter, Hans But at guide Well, income XXXX, as FY think or GAAP think least the better far

year. increase OpEx into to around the margin should the gross the we going the to think half given And of think moved be. better indication XX%, sort for is as year an what we've I I probably be of second number XX% to

and So I on then tax. of we'll color think on that, based provide terms some also that in

I think EPS you So be should those, your what I on think would able based be. generate to think the model

Unidentified Analyst

allow story story opportunity half something if about And that XXXX? you a advantage think then the Okay. gain Got then competitive talked are I kind -- would is like lastly, And tool. seems in XXXX share it of there be the that of talking more to so last like wonder it. on And then, then wondering you you SMT second time just about likely generation or that like achieve kind I there and new the I and think, a update? what is any just that? And

Fusen Chen

new innovation electronics multiple is we the a SMT fast, new because so are lot probably head, of There this is, head to competitors here. going XXXX. half per officially our assembly. it this, of the our Hans, very, believe read We over is actually Yes, second right, is are a system, do very

I very all existing data, of very, actually quite think probably will at So, impact, be we a have in are compared and to But confident we the throughput probably terms competitive. right? our revenue looking reliability XXXX,

test actually market officially but we So it will that's can very good update. only feedback, second We XXXX. and of be the have half the

Unidentified Analyst

Thank you. it. That's helpful. Got

Operator

to at further over back the questions are no any closing now Thank Elgindy turn like Joe There comments. you. time. I call this to would for

Joseph Elgindy

you Darrell, you, for and joining all thank call. today's Thank

months, Susquehanna we at in Over hosted by Group, York coming Financial Needham, Summit. the investor Annual will presenting conferences New several addition the City to the be

any feel a always, concludes to additional follow directly today's great day This everyone. please free As call. questions. up Have with

Kulicke and Soffa Industries (KLIC) 17 Nov 222022 Q4 Earnings call transcript