erent (US:COHR)2022-05-10 20:01Financial Data and Key Metrics Changes - The company reported revenue of $828 million, a 6% increase year-over-year, exceeding guidance [9] - New orders reached a record $1.2 billion, representing a 48% increase compared to the previous year [9] - The backlog grew to $2.1 billion, an 88% increase year-over-year [9][33] - Non-GAAP earnings per share were $0.95, with GAAP earnings per share at $0.28 [35] Business Line Data and Key Metrics Changes - Photonic Solutions revenue increased to $568 million, a 12% year-over-year growth, driven primarily by datacom, which constituted 40% of the business [10] - Datacom revenue grew 15% sequentially and 26% year-over-year, with a significant portion coming from transceivers [10] - Semiconductor capital equipment revenue grew 34% year-over-year, driven by increased demand for immersion lithography tools [18] - Industrial revenue grew 13% year-over-year, supported by silicon carbide applications [19] Market Data and Key Metrics Changes - The company noted strong demand in the datacom and telecom markets, with significant contributions to the backlog from these sectors [33] - The industrial market showed robust growth, particularly in laser-driven applications and silicon carbide [19][85] Company Strategy and Development Direction - The company is focused on operational excellence and participating in markets driven by large mega trends for sustainable growth [8] - There is a commitment to expanding manufacturing capacity and investing in technology to mitigate supply chain constraints [13][18] - The company anticipates continued growth in the semiconductor capital equipment market due to global investments in new fabs [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand despite broader economic challenges, expecting the super cycle to continue [14] - Supply chain constraints are anticipated to ease over time, allowing for improved shipping capabilities [12][20] - The company expects Q4 revenue guidance of $840 million to $880 million, with non-GAAP EPS guidance of $0.85 to $1 [38] Other Important Information - The company is in the process of integrating the Coherent acquisition, with expectations to close the deal by the end of June [22] - Supply chain costs impacted Q3 results by approximately $14.5 million, with expectations for similar or higher costs in June [52][56] Q&A Session Summary Question: Context on surge in demand - Management confirmed that demand was stronger than forecasted and accelerated throughout the quarter [43] Question: Quality of backlog - Management indicated that the backlog quality is high, supported by longer-term orders and customer visibility [45][47] Question: Margin impact from supply chain - Supply chain costs were about $8.5 million, with expectations for similar costs in June [52][56] Question: Components impacted by supply chain - Integrated circuits, particularly in the ROADM area, were identified as the main components affected [61] Question: Growth in automotive backlog - Management noted that automotive represents a smaller portion of the backlog, with significant contributions from datacom and telecom [79] Question: 3D sensing revenue concentration - The leading customer accounts for a majority of 3D sensing revenue, but the market is expanding into broader sensing applications [80] Question: CapEx expectations for next fiscal year - Management expects CapEx to remain at or above current levels, potentially reaching $400 million [81] Question: Booking strength and segment performance - Both segments contributed positively to the increase in book-to-bill ratios, with strong performance in datacom and telecom [84]