HAYWARD, Calif., March 5, 2025 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT) announced today that Jim Scholhamer has resigned effective immediately as Chief Executive Officer for personal health reasons. Clarence Granger, Chairman of the Board and founding CEO of UCT, will assume the role of interim CEO. The board is in the process of forming a search committee to find a permanent replacement for Mr. Scholhamer.Mr. Granger has served as a member of UCT's Board of Directors since May 2002 and as ...

Revenue Composition - International revenues accounted for 73.0%, 69.6%, and 68.9% of total revenues for fiscal years 2024, 2023, and 2022, respectively[13]. - Approximately 94.9% of total revenues for fiscal year 2024 came from multiple segments of the semiconductor industry, including IDM, Foundry, OEM, and sub-tier suppliers[25]. - The two largest revenue customers, Applied Materials, Inc. and Lam Research Corporation, accounted for over 10% of total revenues, with the top two customers collectively representing 54.5%, 57.4%, and 62.7% of revenues for fiscal years 2024, 2023, and 2022, respectively[24]. - The company's top two customers accounted for 54.5%, 57.4%, and 62.7% of revenues for fiscal years 2024, 2023, and 2022, respectively[73]. - Approximately 73.0% and 69.6% of revenues were generated in international markets for fiscal years 2024 and 2023, respectively[82]. - U.S. revenues increased by 7.5% to $566.5 million, while international revenues grew by 26.8% to $1,531.1 million in fiscal year 2024[192]. Business Strategy and Operations - The company aims to expand its solutions and service market share with semiconductor OEMs and IDMs, leveraging equipment outsourcing opportunities[16]. - The company continues to selectively pursue strategic acquisitions to improve its financial model and expand its geographic presence[19]. - The company has a vertically integrated business model, focusing on cost competitiveness and efficiency across global operations[19]. - The company has established plans to expand operations globally, particularly in Asia Pacific and EMEA markets[82]. - The company operates primarily through subsidiaries and has manufacturing and service operations in the U.S., Asia Pacific, Europe, and the Middle East[174]. Technology and Innovation - The company is committed to ongoing technology development to remain a leader in gas delivery systems and critical subsystems[32]. - The company is actively developing new technology and processes to maintain its leadership in the cleaning, coating, and analytical markets, with significant operations in Hillsboro, Oregon, and Phoenix, Arizona[34]. - The company has invested significantly in advanced analytical and automated test equipment to enhance testing capabilities for fluid delivery products[16]. - Rapid technological innovation, particularly in artificial intelligence, necessitates timely adaptation to customer requirements to avoid obsolescence of current offerings[94]. Financial Performance - Total revenues for fiscal year 2024 were $2,097.6 million, an increase of 20.9% compared to $1,734.5 million in fiscal year 2023[190]. - Products revenue increased by $352.1 million to $1,853.7 million in fiscal year 2024, driven by higher customer demand and the acquisition of HIS[190]. - Services revenue rose by $11.0 million to $243.9 million in fiscal year 2024, primarily due to increased demand across the customer base[191]. - Total cost of revenues increased by $284.1 million to $1,741.3 million in fiscal year 2024, reflecting higher demand in the semiconductor industry[195]. - Gross profit for fiscal year 2024 was $356.3 million, a 28.5% increase from $277.3 million in fiscal year 2023[198]. - Operating profit surged by 159.1% to $91.2 million in fiscal year 2024, with an operating margin of 4.3%[201]. Risks and Challenges - The company faces competition from major players such as Ichor Systems, Flex Ltd., and Jabil, which have greater financial and technical resources[39]. - The company anticipates increased competitive pressures leading to intensified price-based competition, potentially requiring price reductions for its products[40]. - The company relies heavily on OEM customers, which could lead to significant revenue loss if any major customer reduces or cancels orders[73]. - The company faces risks associated with volatility in the global economy, which may impact customer orders and capital expenditures[81]. - The company is exposed to various risks related to acquisitions, including integration difficulties and potential dilution of equity[77]. - The lengthy qualification process for customers can limit the company's ability to quickly add new customers, impacting sales[114]. - The company is vulnerable to cybersecurity incidents, which could disrupt operations and lead to financial losses and reputational harm[118]. - Ongoing trade tensions between the U.S. and China have created uncertainties that could negatively impact the company's operations and sales[126]. Employee and Organizational Development - The company emphasizes the importance of employee development and offers competitive rewards, including an Employee Stock Purchase Plan and healthcare benefits[51]. - The company has established a dedicated global field service team to provide 24/7 customer support through on-site installation and servicing[31]. - The company relies heavily on the expertise of a limited number of engineers, and the loss of key personnel could adversely affect its business[122]. Compliance and Governance - The company must navigate complex U.S. export regulations, which could expose it to fines and penalties if not adhered to[86]. - The company is subject to evolving foreign laws and regulations, which may conflict and pose compliance challenges[88]. - Environmental compliance failures could result in significant liabilities and operational disruptions for the company[130]. - The company has significant cybersecurity risk management processes in place, led by a Chief Information Security Officer, to protect against evolving threats[151]. Capital and Financing - The company holds gross debt of $499.7 million as of December 27, 2024, consisting of a $493.8 million term loan and $5.9 million under credit facilities[132]. - The company may need to raise additional funds through public or private equity or debt financing to finance capital expenditures or strategic acquisitions, which may not be available on satisfactory terms[137]. - The company has implemented a stock repurchase program, but it may not enhance long-term stockholder value and could be suspended or terminated at any time[140]. - The company does not currently intend to pay dividends on its common stock, meaning returns for shareholders will depend on capital appreciation[148]. Internal Controls and Reporting - The company has identified material weaknesses in internal controls over financial reporting, which could affect the accuracy and reliability of financial reports[104]. - The company evaluates goodwill and intangible assets for impairment annually, considering factors such as long-term revenue growth projections and market conditions[186]. - The company maintains a full valuation allowance on deferred tax assets amounting to $96.3 million, indicating it is more likely than not that these assets will not be realized[181].

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $563.3 million, up from $540.4 million in the prior quarter, and for the full year, total revenue reached $2.1 billion compared to $1.7 billion in 2023 [16][22] - Total gross margin for Q4 was 16.8%, down from 17.8% in Q3, while the full year gross margin increased to 17.5% from 16.6% [16][18] - Earnings per share for Q4 was $0.51 on net income of $22.9 million, compared to $0.35 on net income of $15.9 million in the prior quarter, and for the full year, EPS was $1.44 on net income of $65.2 million compared to $0.56 on net income of $25.2 million in 2023 [21] Business Line Data and Key Metrics Changes - Revenue from Products increased to $503.5 million from $479 million in the previous quarter, driven by demand for advanced packaging applications and AI-related processes [16] - Services revenue decreased to $59.8 million from $61.4 million in Q3 [16] - Products gross margin was 15.2% compared to 16.1% in Q3, while Services gross margin was 29.8% compared to 30.5% in Q3 [17] Market Data and Key Metrics Changes - Sales to China semiconductor customers were approximately $40 million for Q4 and about $215 million for the full year [27][66] - The company is experiencing unexpected demand softness from its China for China business due to extended qualification timelines and inventory digestion [14][23] Company Strategy and Development Direction - The company is focused on driving efficiencies and maintaining profitability amid short-term headwinds, while also conducting a comprehensive review of its expense structure [14][23] - The company anticipates that AI will play a significant role in transforming the industry, with expectations of mass adoption leading to increased demand for chips and manufacturing equipment [9][10] Management's Comments on Operating Environment and Future Outlook - Management noted that the semiconductor industry is experiencing some air pockets after a strong growth year, with expectations of recovery in the second half of 2025 [13][36] - The company projects total revenue for Q1 2025 to be between $505 million and $555 million, with EPS expected in the range of $0.22 to $0.42 [24] Other Important Information - The company is exploring balance sheet alternatives to optimize financial performance and increase cash flow [63][64] - The tax rate for Q4 was 14.5%, with an expected range of low to mid-20s for 2025 [20][21] Q&A Session Summary Question: Sales to China semiconductor customers in Q4 and for the full year - Sales to China semiconductor customers were approximately $40 million for Q4 and about $215 million for the full year [27][28] Question: Impact of export restrictions on guidance - The export restrictions were not factored into the guidance, and the company continues to ship to customers in China due to local manufacturing [32][39] Question: Ranking of issues affecting near-term performance - The customer-specific ramp issue is the most significant, followed by inventory corrections and demand softening [45] Question: Guidance for non-China business - The non-China business is expected to be flattish, with no sequential growth anticipated [49] Question: Gross margin weakness in Products division - The weakness in gross margin was attributed to the mix of products shipped and additional year-end expenses [51][52] Question: Balance sheet alternatives - The company is exploring options to enhance its capital structure and increase cash flow [63][64] Question: Sustainability of revenue run rate from China - The revenue run rate is expected to be lower going into Q1, with hopes for recovery in the second half of the year [66] Question: Updated WFE growth outlook - The company expects about five points of growth in WFE for 2025, aiming to outperform by 5% to 10% [68][69]

Group 1 - Ultra Clean Holdings (UCTT) reported quarterly earnings of $0.51 per share, exceeding the Zacks Consensus Estimate of $0.44 per share, and showing a significant increase from $0.19 per share a year ago, resulting in an earnings surprise of 15.91% [1] - The company achieved revenues of $563.3 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.90%, and up from $444.8 million in the same quarter last year [2] - Ultra Clean has outperformed the S&P 500 with a 3.9% increase in shares since the beginning of the year, compared to the S&P 500's gain of 2.2% [3] Group 2 - The current consensus EPS estimate for the upcoming quarter is $0.46 on revenues of $558 million, while the estimate for the current fiscal year is $2.48 on revenues of $2.32 billion [7] - The Zacks Industry Rank for Electronics - Manufacturing Machinery is currently in the bottom 4% of over 250 Zacks industries, indicating potential challenges for the sector [8]

Revenue Performance - Total revenue for Q4 2024 was $563.3 million, a 21% increase compared to the prior year[2] - Full year 2024 total revenue reached $2,097.6 million, up from $1,734.5 million in 2023, representing a growth of 20.9%[5] - The company expects Q1 2025 revenue to be in the range of $505 million to $555 million[7] - Total revenues for the three months ended December 27, 2024, were $563.3 million, with product revenues at $503.5 million and service revenues at $59.8 million[23] Net Income and Earnings - Q4 2024 GAAP net income was $16.3 million, or $0.36 per diluted share, compared to a net loss of $(2.3) million or $(0.05) per diluted share in the prior quarter[3] - Non-GAAP net income for Q4 2024 was $22.9 million, or $0.51 per diluted share, compared to $15.9 million or $0.35 per diluted share in the prior quarter[4] - Full year 2024 non-GAAP net income was $65.2 million, or $1.44 per diluted share, compared to $25.2 million or $0.56 per diluted share in the prior year[6] - Net income for the twelve months ended December 27, 2024, was $34.5 million, a significant improvement from a net loss of $22.2 million in the previous year[20] - Non-GAAP net income attributable to UCT for the twelve months ended December 27, 2024, was $65.2 million, significantly up from $25.2 million in 2023, representing a year-over-year increase of 158%[26] - Non-GAAP earnings per diluted share for the twelve months ended December 27, 2024, was $1.44, compared to $0.56 in 2023, marking a 157% increase[28] Margins - Total gross margin for Q4 2024 was 16.3%, down from 17.3% in the prior quarter[3] - Operating margin for Q4 2024 was 4.6%, compared to 4.7% in the prior quarter[3] - Non-GAAP gross margin improved to 16.8% for the three months ended December 27, 2024, compared to 16.3% on a GAAP basis[23] - Non-GAAP operating margin for the three months ended December 27, 2024, was 7.0%, compared to 5.2% for the same period in 2023, indicating a 34.6% improvement[26] - Reported gross profit on a GAAP basis for the three months ended December 27, 2024, was $91.8 million, up from $71.1 million in the same period last year, reflecting a 29% increase[27] - Non-GAAP gross margin for the three months ended December 27, 2024, was 16.8%, compared to 16.7% for the same period in 2023, showing a slight improvement[27] Cash Flow and Financial Position - Cash and cash equivalents as of December 27, 2024, were $313.9 million, an increase from $307.0 million in the prior year[18] - Operating cash flow for the twelve months was $65.0 million, down from $135.9 million year-over-year[20] - Cash used in investing activities was $63.5 million, a decrease from $119.7 million in the previous year[20] - The company raised $67.7 million from bank borrowings during the financing activities[20] Other Financial Metrics - The company has a global manufacturing capacity to support a $4 billion revenue run rate[2] - The company reported a decrease in accounts receivable by $60.3 million, while accounts payable increased by $26.4 million[20] - Stock-based compensation expense for the twelve months ended December 27, 2024, was $17.8 million, up from $12.5 million in 2023, indicating a 42.4% increase[26] - The company reported a significant increase in stock-based compensation from $12.1 million to $17.4 million year-over-year[20] - Effective income tax rate on a GAAP basis for the three months ended December 27, 2024, was 18.4%, while the non-GAAP effective income tax rate was 14.5%[30] - Reported income from operations on a GAAP basis for the twelve months ended December 27, 2024, was $91.2 million, compared to $35.2 million in 2023, representing a 158% increase[26] - The company reported a significant increase in non-GAAP income before income taxes for the twelve months ended December 27, 2024, at $96.3 million, compared to $43.8 million in 2023, reflecting a 119% growth[30]

Core Viewpoint - Ultra Clean Holdings, Inc. reported strong financial results for Q4 and the full year 2024, with significant revenue growth and improved profitability metrics, positioning the company favorably for future growth in the semiconductor industry driven by advancements in technology such as artificial intelligence [2][5][6]. Financial Performance Summary Fourth Quarter 2024 - Total revenue reached $563.3 million, up from $540.4 million in the previous quarter, marking a 4.9% increase [3]. - Product revenue was $503.5 million, while service revenue was $59.8 million [3]. - GAAP gross margin was 16.3%, down from 17.3% in the prior quarter, and operating margin was 4.6%, slightly down from 4.7% [3]. - Net income was $16.3 million, or $0.36 per diluted share, compared to a net loss of $(2.3) million, or $(0.05) per diluted share, in the previous quarter [3]. Full Year 2024 - Total revenue for the year was $2,097.6 million, a 20.9% increase from $1,734.5 million in 2023 [5]. - Product revenue was $1,853.7 million, and service revenue was $243.9 million [5]. - GAAP gross margin improved to 17.0% from 16.0% in the prior year, and operating margin increased to 4.3% from 2.0% [5]. - Net income for the year was $23.7 million, or $0.52 per diluted share, compared to a net loss of $(31.1) million, or $(0.70) per diluted share, in 2023 [5]. Non-GAAP Financial Results - For Q4 2024, non-GAAP gross margin was 16.8%, and operating margin was 7.0%, with net income of $22.9 million, or $0.51 per diluted share [4]. - For the full year 2024, non-GAAP gross margin was 17.5%, operating margin was 6.9%, and net income was $65.2 million, or $1.44 per diluted share [6]. Future Outlook - The company anticipates Q1 2025 revenue in the range of $505 million to $555 million, with GAAP diluted net income per share expected to be between $(0.11) and $0.09, and non-GAAP diluted net income per share projected between $0.22 and $0.42 [7]. Company Overview - Ultra Clean Holdings, Inc. specializes in developing and supplying critical subsystems, components, and ultra-high purity cleaning services primarily for the semiconductor industry, with a focus on supporting semiconductor innovation [9].

HAYWARD, Calif., Jan. 30, 2025 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT), today announced the appointment of Joanne Solomon to serve on its Board of Directors, effective February 3, 2025.    "Joanne brings a great combination of global financial expertise and deep technology industry knowledge, and I'm confident that her perspective will deliver meaningful value as we continue to advance our growth strategy," said Clarence Granger, Chairman of the Board. Ms. Solomon possesses more than 35 ye ...

Company Overview - Ultra Clean Holdings, Inc. is a leading developer and supplier of critical subsystems, components, parts, and ultra-high purity cleaning and analytical services, primarily for the semiconductor industry [3] - The company offers an integrated outsourced solution for major subassemblies, improved design-to-delivery cycle times, design for manufacturability, prototyping, and high-precision manufacturing under its Products division [3] - Under its Services Division, Ultra Clean provides tool chamber parts cleaning and coating, as well as micro-contamination analytical services [3] - The company is headquartered in Hayward, California [3] Upcoming Financial Results - Ultra Clean Holdings, Inc. will release its fourth quarter and full year 2024 financial results on February 24, 2025, after market close [1] - A conference call and webcast will be hosted on the same day at 1:45 p.m. PT [2] - The call can be accessed by dialing 1-800-836-8184 or 1-646-357-8785, with no passcode required [2]

Group 1 - Ultra Clean Holdings (NASDAQ: UCTT) has achieved revenue growth over the past 10 years through acquisitions and securing deals with major end-market leaders [1] - The stock has underperformed compared to broader markets over the last 5 years, but there are signs of a margin recovery [1] Group 2 - The analyst emphasizes a medium to long-term investment horizon, focusing on value opportunities both within and outside the US [1]

Company Overview - Ultra Clean Holdings, Inc. is a leading developer and supplier of critical subsystems, components, parts, and ultra-high purity cleaning and analytical services primarily for the semiconductor industry [2] - The company offers an integrated outsourced solution for major subassemblies, improved design-to-delivery cycle times, design for manufacturability, prototyping, and high-precision manufacturing under its Products division [2] - In its Services Division, Ultra Clean provides tool chamber parts cleaning and coating, as well as micro-contamination analytical services [2] - The company is headquartered in Hayward, California [2] Upcoming Events - Ultra Clean Holdings will participate in the 27th Annual Needham Growth Conference in New York on January 14 and 15, 2025 [1] - The company will host one-on-one meetings and participate in a Fireside Chat, which will be available for live viewing via webcast on January 14, 2025, at 10:15 am Eastern time [1] - The live webcast and replay can be accessed through the company's investor relations page [1]