Ultra Clean (US:UCTT)2025-10-29 20:12Revenue Performance - For the three months ended September 26, 2025, total revenues decreased by 5.6% to $510.0 million compared to $540.4 million in the same period of 2024[120] - Products revenue decreased by 7.1% to $445.0 million for the three months ended September 26, 2025, primarily due to lower customer demand[120] - Services revenue increased by 5.9% to $65.0 million for the three months ended September 26, 2025, driven by higher demand across the customer base[120] - U.S. revenues decreased by 17.2% to $120.6 million for the three months ended September 26, 2025, while international revenues decreased by 1.4% to $389.4 million[122] - For the nine months ended September 26, 2025, total revenues increased by 0.8% to $1,547.3 million compared to $1,534.3 million in the same period of 2024[120] Cost and Profitability - Cost of revenues decreased by 4.3% to $427.8 million for the three months ended September 26, 2025, compared to $447.0 million in the same period of 2024[124] - Products gross profit decreased by 14.7% to $64.6 million for the three months ended September 26, 2025, and by 7.7% to $193.0 million for the nine months[130] - Services gross profit decreased by 0.6% to $17.6 million for the three months ended September 26, 2025, and by 5.2% to $52.6 million for the nine months[132] - Total company gross profit decreased by 12.0% to $82.2 million for the three months ended September 26, 2025, and by 7.1% to $245.6 million for the nine months[130] - Operating profit for Products decreased by 64.7% to $7.9 million for the three months ended September 26, 2025, and by 194.5% to $(52.8) million for the nine months[133] - Operating profit for Services decreased by 3.6% to $2.7 million for the three months ended September 26, 2025, and by 796.8% to $(65.5) million for the nine months[133] Expenses - Research and development expenses increased by 9.9% to $7.8 million for the three months ended September 26, 2025, and by 9.4% to $23.2 million for the nine months[136] - Sales and marketing expenses increased by 4.9% to $15.1 million for the three months ended September 26, 2025, and by 6.1% to $45.5 million for the nine months[137] - General and administrative expenses increased by 4.3% to $48.7 million for the three months ended September 26, 2025, and by 6.7% to $144.1 million for the nine months[138] Goodwill and Impairment - The company recorded goodwill impairment charges of $151.1 million related to the Fluid Solutions and Services reporting units in the second quarter of 2025[116] - A non-cash goodwill impairment charge of $151.1 million was recorded in the second quarter of 2025[140] - The fair value of the Fluid Delivery Systems reporting unit was substantially in excess of its carrying value, indicating a strong market position[118] Cash and Financing - Cash and cash equivalents increased slightly to $314.1 million as of September 26, 2025, compared to $313.9 million as of December 27, 2024[148] - In Q3 2025, the company sold accounts receivable totaling $21.5 million and $39.3 million for the three and nine-month periods, respectively, under a non-recourse factoring agreement[151] - The company anticipates that existing cash and cash equivalents, along with operating cash flow, will be sufficient to meet its indebtedness and working capital requirements for at least the next twelve months[153] - As of September 26, 2025, the company had cash of approximately $250.3 million in foreign subsidiaries, with intentions to reinvest earnings from non-U.S. subsidiaries[155] - Total bank debt stood at $476.4 million as of September 26, 2025, net of unamortized debt issuance costs[160] - Cash used in financing activities during the nine-month period ended September 26, 2025, was $22.3 million, compared to $8.8 million cash provided in the same period the previous year[156] - The company had $146.6 million available under its revolving credit facility as of September 26, 2025[158] - The company maintains credit agreements providing for revolving credit facilities of up to approximately $13.2 million, with no borrowings outstanding under these facilities as of September 26, 2025[159] - The company may need to raise additional funds through equity or debt financing to expand its business or acquire complementary businesses or technologies[154] Market Outlook - The company anticipates continued growth in the semiconductor market driven by demand for new process architectures and memory devices[113] Capital Expenditures - Capital expenditures for the nine months ended September 26, 2025, were $40.2 million, primarily for manufacturing facilities[161] - The company had commitments to purchase inventories totaling approximately $463.0 million as of September 26, 2025[162]