PresentationDennis, I don't know if you wanted to open up with any prepared comments or we can get right into it, however you want to do it.All right. I think we're live. All right. Great. So welcome to the afternoon session. Really excited today to have Cognex' Dennis Fehr here with us today, CFO of Cognex.Dennis FehrSenior VP of Finance & CFO Maybe a few words. So thanks of all -- first of all, for everyone being here, your interest in Cognex. Thanks for following us. Excited to be here. I think maybe for ...

Cognex (NasdaqGS:CGNX) 2025 Conference Summary Company Overview - Cognex positions itself as a technology leader in machine vision, a subsegment of factory automation, focusing on complex use cases and direct sales approaches to broaden its customer base [2][4] Financial Performance - Cognex has historically maintained gross margins around 70% and EBITDA margins above 30% [3] - The company has seen five consecutive quarters of double-digit Adjusted EPS growth [4] - A new financial framework targets 13%-14% revenue growth, with 10%-11% organic growth and 20%-30% EBITDA margins [7][10] Strategic Priorities 1. **Profitability**: Focus on driving profitability, with a goal to return to historical margin levels [4] 2. **Capital Efficiency**: Achieved over 100% free cash flow conversion rate, with significant share buybacks and dividends [5] 3. **Investor Communication**: Enhanced communication regarding strategic objectives and financial frameworks [5] Growth Projections - Cognex aims for a sustainable EBITDA margin of 25% by 2026, with a focus on achieving this even during economic downturns [10][11] - The company anticipates mid-single-digit organic growth, with potential for 20% Adjusted EPS growth in a stable macro environment [12][26] Market Insights Logistics - The logistics sector has experienced double-digit growth, driven by increased automation and cost optimization [30] - Future growth may moderate due to base effects and market absorption after two years of outsized growth [31] Consumer Electronics - After three years of stagnation, the consumer electronics market is showing signs of recovery, with potential for accelerated growth driven by supply chain shifts and a refresh cycle [34][36] Consumer Packaging - The packaging market, while stable, is expected to grow at high single digits annually, providing a steady revenue stream [41][42] Automotive - The automotive sector saw a decline of 14% last year, but signs of stabilization are emerging, particularly in the Americas [44][45] - Future growth is uncertain, with expectations of flat performance in 2026, influenced by consumer behavior and economic conditions [46] Gross Margin Analysis - Recent gross margin decline of 170 basis points attributed to a mix effect, including the Moritex acquisition and competitive pricing pressures in China [52][53] - The company expects gross margins to stabilize rather than decline further, with improvements anticipated from pricing and operational efficiencies [57][58] M&A Strategy - Cognex is open to opportunistic M&A as part of its growth strategy, aiming for synergies and strategic fit rather than offsetting core growth [63][64] Conclusion - Cognex is focused on enhancing profitability, capital efficiency, and investor communication while navigating market dynamics across various sectors. The company is optimistic about future growth, particularly in logistics and consumer electronics, while maintaining a cautious outlook on automotive and packaging markets.

Fanuc shares rose after the company said it’s partnering with Nvidia in real-world factory lines as well as in production simulations https://t.co/PMcoqTVjrX ...

Cognex FY Conference Summary Company Overview - **Company**: Cognex (NasdaqGS:CGNX) - **Industry**: Machine Vision - **Date of Conference**: November 19, 2025 Key Points Company and Industry Insights - Cognex operates primarily in factory and warehouse automation, providing machine vision solutions that enhance production processes [4][5] - The company serves various verticals including packaging, logistics, automotive, consumer electronics, and semiconductor manufacturing [7][8] Applications of Machine Vision - Cognex's technology includes applications for guiding robotic arms, inspecting product quality, serializing products, and gauging dimensions [5][6] - The company emphasizes the importance of high precision, speed, scalability, and ease of use in its machine vision systems [14][15][17] AI Integration - AI is viewed as a significant opportunity for Cognex, enhancing the ease of use and expanding the range of applications [10][12] - The proprietary vision model allows customers to train systems with minimal examples, improving accuracy and enabling new use cases [11][12] Competitive Landscape - Cognex faces competition primarily from Keyence in factory automation and SICK in logistics, with a fragmented market where no single player dominates [43][44] - The emergence of Chinese competitors like Hikvision is noted, but the overall competitive landscape remains stable [43][44] Financial Performance and Strategy - Cognex aims for low double-digit compound sales growth over the next few years, with a strategy to double its customer count [18][19] - The company is transitioning from serving large-scale customers to targeting a broader market, including smaller customers [20][21] - Cognex is focusing on operational efficiency, particularly in R&D and OPEX management, to drive profitability [25][26][27] Market Outlook - The automotive market is recovering, particularly in North America, while Europe remains challenging due to various economic factors [46][47][48] - Consumer electronics are showing signs of growth, driven by supply chain changes and potential new technologies [50][51][52] - The logistics sector has experienced solid growth, but future growth rates may moderate after two strong years [54][59] Future Growth Opportunities - Cognex sees potential in existing verticals with low automation penetration and identifies aerospace and defense as a nascent market for machine vision applications [61] Financial Metrics - Cognex's historical adjusted EBITDA margin has been around 28%, with a goal to return to this level after a dip to 17% in 2024 [29] - The company is targeting a gross margin in the high 60% range, focusing on OPEX efficiency as a key driver for profitability [25][26] Conclusion - Cognex is positioned to leverage AI and expand its market reach while focusing on operational efficiencies to enhance profitability and drive growth in various sectors [12][18][19][20]

Summary of Key Points from the Conference Call Industry Overview - The conference call focuses on the **China Industrial Automation** market, with a revised outlook indicating slight improvements in corporate confidence and market growth expectations for 2025E/26E/27E at **0%/-1%/0%** year-over-year, compared to previous estimates of **-1%/-3%/-2%** [2][6]. Core Insights - **Improved Corporate Confidence**: The increase in confidence is attributed to favorable end-markets, overseas expansion, and industry consolidation benefiting leading companies [2][3]. - **Investment Recommendations**: - **Buy-rated stocks**: Inovance, Han's Laser, Yiheda, Shuanghuan. - **Sell-rated stocks**: Baosight, Raycus, Estun, HCFA [2][9]. - **Target Price Adjustments**: Target prices (TP) and earnings per share (EPS) for eight factory automation (FA) stocks have been raised by **5-12%** [9]. Key Drivers of Growth - **Favorable End-Markets**: - Growth in AI-related hardware production and consumer electronics is expected to stimulate demand [5]. - AI is driving new product development, including quality inspection and predictive maintenance [5]. - **Overseas Expansion**: Companies like Inovance and Yiheda are benefiting from both direct and indirect overseas expansion [5]. Risks and Challenges - **Battery Equipment Orders**: The recovery in battery capital expenditures is not expected to be sustainable, with a moderation anticipated in 2025 and stability through 2026E-30E [8]. - **Anti-Involution**: This trend may lead to consolidation in certain end-markets, limiting capital expenditure growth [8]. - **Competitive Landscape**: Smaller players in the FA sector are facing challenges, with recommendations to sell on companies like Estun and HCFA due to their weaker positioning [8]. Company-Specific Insights - **Inovance**: Positioned well with a strong growth outlook, benefiting from domestic substitution and overseas expansion. The company is rated as a Buy [10][12]. - **Yiheda Automation**: Positive outlook due to its modernization efforts in the manufacturing supply chain, rated as a Buy with attractive valuation [13][14]. - **Shuanghuan Driveline**: Expected to grow market share significantly, particularly in the EV segment, rated as a Buy [15][16]. - **Estun Automation**: Despite being a leader in industrial robots, the company faces significant downside risks due to high exposure to unfavorable end-markets and margin stagnation, rated as a Sell [25][26]. - **HCFA**: Concerns over slow R&D expansion and missed guidance lead to a Sell rating [27][28]. Conclusion - The China Industrial Automation market is showing signs of recovery, with select companies positioned favorably for growth. However, challenges remain, particularly for smaller players and those heavily reliant on specific end-markets. The investment landscape is characterized by a mix of Buy and Sell recommendations based on company performance and market conditions.

Summary of CIIF 2025 Conference Call Industry Overview - **Industry**: Factory Automation in Japan - **Event**: China International Industry Fair (CIIF) 2025 held in Shanghai from September 23-27, 2025 - **Participants**: Included Japanese companies such as SMC, Misumi Group, Yaskawa Electric, Nabtesco, Mitsubishi Electric, NSK, Amada, and Greater China companies like Inovance, Airtac, Hiwin [2][6] Key Points Demand Environment - **Current Demand**: Demand remains steady, particularly in semiconductor and battery-related sectors, as well as medical-related businesses [3][11] - **Capex Recovery**: Capital expenditure-related demand has shown a steady recovery from low levels in the first half of the year, but no further recovery is expected in the latter half [3][4] - **General Outlook**: Most industry participants believe that current demand levels will hold steady without significant changes [3][4] Competitive Landscape - **Competition Intensity**: The competitive environment remains harsh, especially in middle- and low-end markets, with many companies struggling due to intensified competition [4][5] - **High-End Market Stability**: Conditions in high-end markets are largely unchanged, although local parts are increasingly adopted due to Chinese government onshoring policies [4][5] - **Company-Specific Insights**: - **Omron, Yaskawa Electric, SMC**: Facing stiff local competition and struggling somewhat [5] - **Fanuc and Nabtesco**: Competitive conditions appear stable due to strong product technologies [5] - **Misumi Group**: Has improved competitiveness through successful economy product launches and innovative products tailored for the Chinese market [5] Company Strategies - **Mitsubishi Electric**: Launched a second brand (Lingling) for the Chinese market, focusing on local development and manufacturing to reduce costs [9] - **Omron**: Plans to introduce new products tailored to the Chinese market, though these are not yet released [9] - **Yaskawa Electric**: Continues to focus on high-end markets and value-added products, avoiding low- and medium-end markets due to competition [12] - **Amada**: Reduced its Chinese business significantly over the past decade but sees future opportunities due to local manufacturers shifting to overseas production [13] - **NSK**: Focused on high-end applications with no significant changes in competitive environment [14] Additional Insights - **SMC's Focus**: Plans to concentrate on high-growth potential areas like semiconductors and medical equipment, despite tough competition in midrange markets [10] - **Misumi Group's Innovations**: Showcased new products including a small SCARA robot and AI agent for customer inquiries, with steady demand in semiconductor and medical sectors [11] Conclusion The factory automation industry in Japan is currently experiencing stable demand, particularly in high-tech sectors. However, competition remains fierce, especially in lower-end markets. Companies are adapting their strategies to enhance competitiveness and cater to local market needs, with a focus on innovation and local production.