Ichor (US:ICHR)2025-11-03 22:16Financial Performance - Net sales for the three months ended September 26, 2025, were $239,296,000, representing a 13.3% increase from $211,139,000 for the same period in 2024[71] - The company reported a net loss of $22,853,000 for the three months ended September 26, 2025, compared to a net loss of $2,776,000 for the same period in 2024[71] - Non-GAAP net income for the three months ended September 26, 2025, was $2,302,000, down from $4,020,000 in the same period of 2024[71] - Operating margin for the three months ended September 26, 2025, was (8.1)%, compared to (0.2)% for the same period in 2024[71] - The increase in net sales for the nine months ended September 26, 2025, was $108,297,000, or 17.6%, compared to the same period in 2024[78] - Non-GAAP operating income for the nine months ended September 26, 2025, was $17,867 thousand, up from $13,291 thousand in the same period of 2024[96] - U.S. GAAP net loss for the three months ended September 26, 2025, was $22,853 thousand, compared to a loss of $2,776 thousand for the same period in 2024[98] - Non-GAAP net income for the nine months ended September 26, 2025, was $7,635 thousand, compared to $3,127 thousand in the same period of 2024[98] Margins and Expenses - Gross margin decreased to 4.6% for the three months ended September 26, 2025, down from 13.2% in the same period of 2024, primarily due to increased inventory write-off costs of $16.7 million[79] - Gross margin decreased due to inventory write-off costs of $18.3 million related to the Consolidation Restructuring Plan and exit from Scotland operations[80] - Total operating expenses for the three months ended September 26, 2025, were $30,494,000, compared to $28,176,000 for the same period in 2024[75] - Research and development expenses increased by 1.8% from $17.168 million to $17.482 million for the nine months ended September 26, 2025, primarily due to fluctuations in material and service costs[81] - Selling, general, and administrative expenses rose by 15.6% from $59.253 million to $68.515 million for the nine months ended September 26, 2025, driven by increased exit disposal costs and employee-related expenses[83] - The company incurred restructuring plan costs of $17,586 thousand for the three months ended September 26, 2025[98] Cash Flow and Investments - Cash provided by operating activities for the nine months ended September 26, 2025, was $20,716 thousand, down from $30,368 thousand for the same period in 2024[104] - Cash used in investing activities for the nine months ended September 26, 2025, was $32,920 thousand, compared to $13,238 thousand in the same period of 2024[104] - The company ended the third quarter of 2025 with cash and cash equivalents of $92.5 million, a decrease of $16.2 million from the prior year[103] - The company believes that its cash and cash equivalents, along with available credit facilities, will be sufficient to fund its business for at least the next 12 months[101] Industry Outlook - The semiconductor capital equipment industry is expected to see growth in spending in 2025, particularly in etch and deposition markets, despite ongoing geopolitical uncertainties[72] - The company anticipates that long-term demand for semiconductors and semiconductor capital equipment will continue to grow, driven by the need for expanded manufacturing capacity[73] Debt and Taxation - Interest expense, net decreased by 35.0% from $7.592 million to $4.934 million for the nine months ended September 26, 2025, due to lower average borrowings and borrowing rates[86] - Income tax expense increased by 151.5% from $2.021 million to $5.083 million for the nine months ended September 26, 2025, primarily due to additional tax provisions in Singapore[89] - The effective income tax rate increased by 330 basis points to -16.0% for the nine months ended September 26, 2025[89] - Weighted average borrowings outstanding decreased by 25.8% from $169.430 million to $125.678 million for the nine months ended September 26, 2025[86] Inventory Management - The company incurred $16.7 million in inventory impairment as part of the Consolidation Restructuring Plan[93] - The company reported an increase in inventory of $8.3 million for the nine months ended September 26, 2025[105]