Financial Data and Key Metrics Changes - For the fiscal second quarter of 2025, net revenue was $15.6 million, representing a decrease of 36% from fiscal Q1 and a decrease of 39% from the second quarter of fiscal 2024, primarily due to a customer dispute that delayed shipment of a $4.9 million order [17] - The GAAP net loss for the second quarter was $31.8 million or $2.23 per share, compared to a GAAP net income of $0.3 million or $0.02 per share for the preceding quarter [20] - Adjusted EBITDA was negative $1.4 million for fiscal Q2 2025, compared to $1.9 million for the preceding quarter [21] Business Line Data and Key Metrics Changes - The Thermal Processing Solutions segment experienced a shipment delay due to a customer dispute, impacting revenue [5] - The Semiconductor Fabrication Solutions segment saw stabilization with a book-to-bill ratio slightly above one, while demand for mature node applications remained weak [17][18] - Advanced packaging equipment bookings exceeded total bookings for all of fiscal 2024, driven by strong demand in AI applications [9] Market Data and Key Metrics Changes - There was a broader softening in demand within the mature node semiconductor market, affecting both equipment and consumables [6][7] - Orders for reflow equipment in the U.S. were weak due to high tariffs, but this was offset by strength in Asia for AI-related advanced packaging equipment [10] Company Strategy and Development Direction - The company is focusing on expanding recurring revenue streams, including consumables, parts, and services, which offer higher margins and more stable revenue [10][11] - Strategic optimization efforts are expected to yield incremental EBITDA savings of $1 million per quarter starting in Q4 2025, with total annualized savings anticipated to be $11 million [12][23] - The company aims to leverage its technologies to address challenges in adjacent applications and expand its customer base [11][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term growth despite near-term challenges, emphasizing the importance of operational efficiency and cost structure optimization [12][14] - The company is closely monitoring the evolving tariff and macroeconomic landscape, expecting potential benefits from U.S. manufacturing repatriation [9][33] Other Important Information - The company recorded an impairment charge of $22.9 million and an inventory write-off of $6 million in the second fiscal quarter due to prolonged weakness in the mature node semiconductor market [8][18] - Unrestricted cash and cash equivalents at the end of the quarter were $13.4 million, providing financial flexibility for strategic initiatives [21][23] Q&A Session Summary Question: Impact of U.S.-China trade disputes on business activity - Management noted that the impact of tariffs on the Semiconductor Fabrication Solutions business was minimal, as most products are produced in the U.S. [31] - For back-end equipment, weak orders were observed due to tariffs, but strong demand in Asia was noted [32][34] Question: Insights on R&D spending and technology contributions - Management highlighted the importance of advanced packaging and thermal management challenges, indicating a potential expansion of the addressable market for their technologies [36][37] - The company is actively engaged with customers to solve leading-edge problems, which could drive new growth opportunities [38] Question: Current margin profile of existing backlog - Management confirmed that the current margin profile of the existing backlog is above recent levels, with improved margins expected as volume increases [42][43] Question: Specific products driving strong demand for advanced packaging - The primary demand is for reflow equipment used in advanced packaging, particularly for AI applications [44][45] Question: Revenue from spares and service - Approximately 25% of the Thermal Process Solutions segment revenue comes from parts and service [46][47]

Financial Data and Key Metrics Changes - For the fiscal second quarter of 2025, net revenue was $15.6 million, representing a decrease of 36% from fiscal Q1 and a decrease of 39% from the second quarter of fiscal 2024, primarily due to a customer dispute that delayed shipment of a $4.9 million order [16][19] - GAAP net loss for the second quarter was $31.8 million or $2.23 per share, compared to a GAAP net income of $0.3 million or $0.02 per share for the preceding quarter [19] - Adjusted EBITDA was negative $1.4 million for fiscal Q2 2025, compared to $1.9 million for the preceding quarter [20] Business Line Data and Key Metrics Changes - The Thermal Processing Solutions segment experienced a shipment delay due to a customer dispute, impacting revenue [5] - The Semiconductor Fabrication Solutions segment saw stabilization with a book-to-bill ratio slightly above one, indicating improved order intake [16] - Advanced packaging equipment bookings exceeded total bookings for all of fiscal 2024, driven by strong demand in AI applications [9][16] Market Data and Key Metrics Changes - There was a broader softening in demand within the mature node semiconductor market, affecting both equipment and consumables [6] - Orders for reflow equipment in the U.S. were weak due to high tariffs, but this was offset by strength in Asia for AI-related advanced packaging equipment [10][31] - The company noted a sustained downturn in capital investment across industrial and automotive sectors [6] Company Strategy and Development Direction - The company is focusing on operational efficiency and broadening its customer and application base to navigate the current demand headwinds [6][11] - There is an emphasis on expanding recurring revenue streams, including consumables, parts, and services, which offer higher margins and more stable revenue [10][14] - The company is pursuing a semi fabless operating model, including headcount reductions and optimized manufacturing resources [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term growth despite near-term challenges, citing a strong cash position of $13.4 million and a disciplined financial strategy [12][20] - The company anticipates total annualized savings of $11 million on a run rate basis as it exits the fiscal year [12] - Management highlighted the potential benefits of U.S. policies aimed at repatriating semiconductor manufacturing, which could provide tailwinds for the business [32] Other Important Information - The company recorded an impairment charge of $22.9 million and an inventory write-off of $6 million in the second fiscal quarter due to prolonged weakness in the mature node semiconductor market [7][17] - Non-GAAP gross margin for the second quarter was 36%, compared to 34% in the same prior year period, driven by fixed cost reductions and product mix [17] Q&A Session Summary Question: Impact of U.S.-China trade disputes on business activity - Management noted that the impact of tariffs on the Semiconductor Fabrication Solutions segment was minimal, as most products are produced in the U.S. for the U.S. market [30] - There is hope for positive tailwinds from repatriating manufacturing to the U.S., which could benefit the company [32] Question: Insights on silicon carbide power semiconductor industry - Management discussed the potential for advanced packaging technologies to drive growth, particularly in thermal management challenges for AI GPUs [36][37] Question: Current margin profile of existing backlog - Management confirmed that the current margin profile of the existing backlog is near historic levels, indicating improved profitability potential [40][41] Question: Specific products driving strong demand for advanced packaging - The primary demand is for reflow equipment used in advanced packaging, particularly for AI applications [43] Question: Revenue from spares and service - Approximately 25% of the Thermal Process Solutions segment revenue comes from parts and service [45]