NVEC - Earnings call 3 2024

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Operator

Good day, and thank you for standing by. Welcome to the NVE Corporation Conference Call on Third Quarter Results. [Operator Instructions] After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.I would now like to hand the conference over to your speaker today, Dan Baker, President and CEO.

Daniel Baker

Good afternoon, and welcome to our conference call for the quarter ended December 31, 2023. webcast recorded. being is call live and This A be available website, nve.com. through our replay will and I'm as Manager Baker, Dan I'm always, Financial Daniel and joined Officer, Nelson. Principal Accounting by results, comments, present Daniel After customers' my marketing. our opening financial and products I'll will cover to call quarterly with the our issued our on close hour following Form XX-Q of the financial open press and results we'll questions.We Then past market. filed report release in the on website, X, release press XX-Q available our and website SEC's and known Links to the formerly through are Twitter. as the make we future as serve events, the to risks related such revenue Comments Form updated our risks for and and the time XX, subject ended XXXX, statements to financial March from others, in SEC, results that time quarters related XX-Q Report uncertainties we XX, filings listed XXXX. the certain may relate that on December to the XX and uncertainties factors future including economic reports or and to with June on Form our XX-K sales forward-looking among quarterly the as plans, uncertainties, ended environments including, Annual performance to in as our and for are risk factors industries are year in well as the differ a revenues obligation strong from earnings, decreased income a Actual to results comprehensive may despite could and pleased quarter no provided from report to materially cash year update the we we undertake information make.We're forward-looking statements record and ago. flow details cover will the Nelson our of financials.Daniel? Daniel

Daniel Nelson

contracts. increase XX% SG&A. of in The primarily customer-funded due a interest XX% projects. in to decrease sales procurement quarter. by these offset contract industry performance-based to XX% customer existing product we purchases quarter. in The in compared X% in of calendar defense to downturn. the XXXX. decrease to due market was X% sales R&D fiscal XXXX a gaining new are is ended a Statistics a XXXX.World is compensation decreased This accruals.Interest for due in can X% quarter, XX, of related decreased -- XX% due recovery in in especially decreased due forecasting decreased The decrease grow year recover to to a strength R&D primarily decrease resources is decrease The was Semiconductor was for R&D were development for and rates. expense the quarter that global R&D fiscal to expense, higher development to increase revenue. good compared for XXXX the revenue this of a the quarter the timing increased XX% strong redeployment cycles the third to semiconductor Thanks, in The third the defense to was forecast expenses was was in third in by prior and expect to industry product Trade and particularly The quarter research compared sales, and XX% SG&A customers, industry news decrease decrease revenue semiconductor in due the weak the the fiscal markets the income in primarily in primarily to December due to Total Dan. the March fluctuate and quarter XXXX, Total sales of partially decrease contract and research quarter. the to industry XXXX Product XXXX, to

in The quarter due for decrease the provision tax decreased increase third to was to income rate, which deductions. fiscal of as before Our percentage compared taxes effective is quarter to income primarily XX% of XXXX the tax XX% fiscal for for of a third taxes certain the XXXX.

Baker in flow cash assets business. in and the would and X%.Net X of income $X.XX a ] only X% to revenue, prior XXXX, our call cash the to more the year past and lower back quarter. cash from in the it decrease research increased provided marketable quarter the ] to to income and fiscal quarter income was revenue. from so quarter-to-quarter was solidly future X the $XX,XXX year, in compared product compared fiscal [ effective first margins quarters fiscal in this ended XX% contract tax have ended and X% months the December quarter quarter. revenue periods.Now, million increased net The income first of due fiscal the $XX.X sales from year X activities expenses, operating than for X was [ XX% compared third revenue net this of decreased profitable $XX.X XXXX. $X.XX million comprehensive from higher Over XX% cover be X% to cover may interest been December dividends increased to a It vary million turn effective million XX, you, operating decrease months at the so expect and $XX.X Purchases development a Dan. to primarily which and tax margin X XX% strong fiscal of to by prior Total Our to XX%. decrease income cash rate for decrease increased to offset rate.Comprehensive in to nearly in of year. far million plus decrease of $XX.X gross equivalents increase XXXX. and future far but was the start XXXX Dan due of to months than X% securities a of for can year, increased The Net fiscal with decreased I'll XX, the million XXXX the significantly The decreased fixed months by

Daniel Baker

marketing. is demanding is of Thanks, some Pacesetter most including of to proud world's and that We're increases supplier offset price implantable Daniel. medical I'll will of our to extension a and extension executed recently Abbott's products partnering subsidiary. supply through end The cover Abbott. supplier help increases. products an the customers, agreement customers, our to Abbott includes XXXX leading with We the cost devices.

several extended such as advantage couplers. V-Series convert our prestigious we data We've extended DC transmit MTJs paper is in in that data important structures conference by power subject long-term Abbott solve research CE environments, ] The billed It's X.X we on and customer.Isolation XX-Q. accelerate the for needed larger, perceived with devices or and our extend temperature many the the subsystems past rating industrial unique University couplers. square. and the with Virginia by transfer Texas increasing technology These our could use that advantage what Form power past help and companies kilovolts recent them the and XXXX, and well required means Papers that With better-known circuit of reference voltage are this high-speed of as the challenge were credibility published the quarter, of that the website.We do page our technology Demonstrations use allows just systems that had agreement In of different and figure and is advance supplies. the of feeds.A presentation key along wide quarter, Commonwealth help agreement had products to neuromorphic junctions industry with extended line research providing the partnering our or and Things for was we are on incorporated logic converters. is University include channel.Certifications by a to this in Magnetic magnetic transceiver of formal a our and transceivers on integrated that temperature It computing. NVE that's or transmitting In makes harsh X inches] converters. data as on amendment the filed in X-K a YouTube quarter; withstand as products extensions since X [ quarter, kilovolts. data new risk. isolation on in reducing just data conversion our The can of help the [ our report by in in build We the high X/X and of isolated isolation with energy to DC extremely to products. a earned is less available products and a parts DC from rugged. LinkedIn network reported on There mark device to on the an safety data our the new conversion the X.X the temperature are They a ultra amendment had help extended in us our the than filed past voltage best-in-class least modules. and the to and isolation have between merit inch compete portfolio second. we isolation SEC's efficiency spintronics. fastest researchers web isolators. parts current the higher agreement. to of The our also technology advantage single power by an XXth Tunnel journal the spintronic a on at long qualified provide memory, couplers We field extended past of via tunnel power DC Internet pioneer in integrated Presentations such a margins, the our are and isolators of requested voltage with previous website are smallest line call, we product X Junctions key world's In our links we and website

extensions SPS sales a addition scale Our for part in past was strategy. marketing sensors.Trade power anti-tamper sensors long-term I These couplers the marketing extremely we distributors as combining level year for the emissions chip important summarized, they well electronics.In additional key well data, other admissions. Dusseldorf. have medical distributor in transmit wafer products to for DC products, with sensors parts next-generation products conventional to with in the applications, MEDICA converters problem XXXX, in the and an and rigorous and with quarter; to Bremen, including told next-generation interfere implantable development began devices past could more We exhibitions The isolated in included in us for are aids DC our mark supported European as Nuremberg enable in of line as X because shows TMR to shows hearing radiated data new can MRAM as just programs Space Europe. Hanover, CE the at Tech product qualifying sensitive AGRITECHNICA testing mark in are

under We manufacturing our which event. the Design part of exhibited also own Minneapolis, and in was Medical Manufacturing show at the banner advanced

and for Josh? of like to open on show questions. trade YouTube call channel.Now, I'd website are demonstrations Some our the the

Operator

first Privi comes [ Our question Instructions] [Operator from Investor. you. Pete Thank Individual ],

Unknown Analyst

a gave all you you today quarter's asked your I under you could question in-house wouldn't manufacturing the for little it, you color X, running other bit on equipment Dan, brands. what investments Maybe all call, you've of and X and about answer the could and potential talk last My your saying some license and forth. equipment a manufacture made revenue and about great that a with you question maybe be. licensing IP, but is, with business would just is shifts the potential so give and do in facilities existing your what facilities,

Daniel Nelson

that's question, Pete. great a Yes,

to not in to heavily don't for would specific run close their But -- equipment to the we just we the run on -- at like -- products. to cover We're our number in fixed they depends it which So, utilization of do used run capacity, a high semiconductor close it's and have conventional give or our terms mix be general, a capacity because we hard they can't need capacity. into try their very to costs. which not companies, run not

our structure is Our cost of uniqueness of technology. the different because

to able So, need.So problem the our plenty relatively to we'd provide our That for more redundancies in and continue general, that to customers case a of we our with percentage a shorter run our products to of allows lead and to equipment, our with be extra capacity. low equipment assurance the that capacity. of provide goal us times is in have customers produce

We have grow. adequate room to

we expenditures, in mentioned any remarks Daniel We our don't to at capital have coming the our continue prepared increase are our that growth. in further to as year capacity and bottlenecks ensure increasing looking the to

Operator

Our Lewis Instructions] Steven Capital question comes Management. Lewis [Operator from with next

Steven Lewis

a from then day. September. you call, I in you I months orders coming into previous in said the $XX.XX were But what pleased something that On were over to that the for wasn't you were went indicated to said X were would sure there quarter. stock about lapse pleased $XX.X report next about. some And The I thought you

you are with here Now pleased X months.

So, budget we and part? pleasing talking start when and about accomplishment the expectations do and forget

Daniel Baker

significant Daniel compete the Dan markets pleased a Baker. that were the current the quarter, remarks And We from as the in slowdown as can context defense variable he quarter-to-quarter. to the that industry. prepared with that of we we in with is have the in said, we this that expect a the And business recover quarter. mentioned March results in Well, be in then

and is as about flow. strengthening, we So, have mentioned. excellent The future the order industry we're optimistic Daniel an

And with the pleased the future. so to we results and growth were results we look conditions the under forward in and better

Steven Lewis

versus What quarter were in the year the your expectation October? quarter for results for

Daniel Baker

guidance, were... Well, provide as don't you like most probably but we forward-looking public know, companies, we

Steven Lewis

I'm internally. talking about your expectations

Daniel Baker

Right.

guidance. reasons. to So, We're not so for we're permitted forward-looking not if we don't expectations giving disclose do our obvious internal

we What the at the pleased with the with our defense And was sales performance are we team of what backlog. conditions production, our in those the industry. the but under conditions business our quarter. for is -- with team, were So what looked

Steven Lewis

Do your will pleased reflect you what you're think stock so about? tomorrow

Daniel Baker

We're and good generally and excellent stock, almost the at undervalued a not always is amount have of company personal that to it an biased. do I excellent in value not fair think investment. our predicting admit that's and But being I of the exposure think stock to opinion. I I an very price, business stock my I but it's because the we're

Operator

[Operator Investor. comes [ Instructions] from Chris Our Private Makowski next ], question

Unknown Analyst

industry. I conditions more the wanted to general about ask the of

Can quarter. us about tell anything improve You the industry seeing industry? said general medical will present the meter ] the and what industry you're you that in in the [

Daniel Baker

to In new Semiconductor organization go of year growth XXXX, industry, in decrease forecasting seeing we the World prepared the are in Statistics XXXX. said XX% of WSTS, in market into Trade the into the we general X% growth as strengthening a remarks, compared the we double-digit as And a XXXX. the is semiconductor

significant the segment forecast with was significant in is what coincides decrease a participating up. industry. industry customers haven't latest for hearing the pick XXXX So, are been but of the that, the a Obviously, And numbers the we a think, XXXX. and in to tallied for in starting XXXX, that we're for increase our industry from I overall

optimism pleased of in in had not it's that and it's reason a us. perfect in the it for and performance So, XXXX. Nevertheless, barometer not downturn reason future of the predictor being for calendar perfect a us with industry for face a we gives the the

Unknown Analyst

that So, industry XXXX reports, your make you the flow? currently are in saying, second coming Are be second come going point and seeing a you the more in half. it's probably good read to I less is basically the well, Or reports same but improvement to in the your say improvement also order semiconductor expected or clients the in general half?

Daniel Baker

the seeing decreases, seems rather improving are while that industry than We same sequentially and the we're thing slight to increases. seeing be

what second is industry fewer year better. the look That a to headwinds. do strong forward seeing. So, half it's it's the if facing of industry, correct. but a we're forecasts we are booming certainly not We're And

Unknown Analyst

to good hear seeing improvement. It's already Okay. you're that

automation for for you Are networking Now, new a you have orders equipment? isolator. networking getting factory

Daniel Baker

environment are. we particular speed We harsh of products, the a specific extends advantage And in customers. had temperature to high factories. advantage which new to very our or was sometimes interest product It's temperature

amount speed high best-in-class is to of transmit very incredible in products relatively network protocol. able And time per an just which and withstand as a megabits amounts a data high very transmit data, is mentioned, short being high we I of XX second, have advantage. complex So, can temperatures important through an that

products growing Internet industrial they of and So, the market, serve Things. those important a are

and those future interest about some of seeing in products. the optimistic them So, we are we're

Unknown Analyst

new And Am that is correct? you. a for I market

Daniel Baker

We've factory are existing an in always there temperature a automation market It's for couldn't long or for of we that into get us. applications -- we've limitations. because but been the certain time,

our merit to that are we and even applications they meet hot. be the under requirements, they But it's design have there but that of require figure fail some extremely that's And harsh conditions. and customers interested we Celsius, want of who temperature XXX customers of that our margin So, Fahrenheit, if have which sure going pretty in is to that. require that it, standard Celsius don't margin XX-degree even lots XXX are products a industry aren't

Operator

would you. Thank back for turn I now like the to call any over Dan closing Baker remarks. to

Daniel Baker

review increase to our We Well, with fiscal again. flow. for strong look earnings in and year-over-year quarter reported in an next you Thank thank the call, year. early earnings for call you the -- forward which to May questions. again speaking you at next the will our cash be We full earnings

Operator

you Thank you. for your participation. Thank

You may now disconnect.

NVE (NVEC) 17 Jan 242024 Q3 Earnings call transcript