Veeco(US:VECO)2022-05-10 02:45Financial Data and Key Metrics Changes - The company achieved revenue of $156 million in Q1 2022, driven by record semiconductor shipments, representing a 50% increase from Q1 2021 [10][33] - Non-GAAP operating income was $25 million, with non-GAAP EPS of $0.38 [10][37] - Cash flow from operations was $25 million, with cash and short-term investments totaling $232 million, an increase of $7 million from the previous quarter [10][39] Business Line Data and Key Metrics Changes - Semiconductor revenue accounted for 49% of total revenue, increasing 50% year-over-year, driven by laser annealing, advanced packaging lithography, and EUV mask blank systems [33][34] - The compound semiconductor market contributed 24% of revenue, also up 50% from Q1 2021, driven by RF photonics and power electronics applications [34] - Data storage market represented 14% of total revenue, while the scientific and other market made up 13% [34] Market Data and Key Metrics Changes - The Asia Pacific region (excluding China) accounted for 37% of revenue, the United States for 30%, China for 19%, and EMEA for 14% [35] - Wafer fab equipment spending is forecasted to remain strong at about $100 billion annually in both 2022 and 2023 [15] Company Strategy and Development Direction - The company aims for $800 million in annual revenue, focusing on growth markets such as high-performance computing, mobility, automotive transformation, and cloud technologies [14][29] - The company is committed to improving its environmental, social, and governance (ESG) goals, enhancing transparency, diversity, and environmental responsibility [11][29] Management's Comments on Operating Environment and Future Outlook - Management noted strong demand despite supply chain challenges, maintaining full-year guidance for growth in 2022 [12][31] - The company expects Q2 revenue between $150 million and $170 million, with gross margins projected between 40% and 41% due to supply chain constraints [42][43] Other Important Information - The company is ramping up its new San Jose manufacturing facility, expected to be completed by Q3 2022 [30] - Long-term debt was recorded at $274 million, reflecting the adoption of ASU 2020-06, which changed the accounting for convertible notes [41] Q&A Session Summary Question: Semiconductor business and DRAM opportunities - Management confirmed progress in laser annealing for DRAM, with multiple applications being evaluated [50] Question: Supply chain issues and gross margin impact - Management indicated that lead times remain stretched, with an estimated 200 basis points impact on gross margins due to increased logistics and material costs [53] Question: Margin cadence for the rest of the year - Management expects Q2 to be the lowest gross margin quarter, with a target range of 42% to 44% for the year [57] Question: Supply constraints and component shortages - Management noted ongoing challenges with lead times and component shortages, particularly for older technology components [80][114] Question: Data storage market recovery - Management observed an increase in order discussions and expects order placements to improve over the next one to two quarters [112] Question: EUV mask blank applications - Management highlighted opportunities for Ion Beam deposition technology in front-end semiconductor applications [108] Question: Current lead times for tools - Management reported lead times of approximately nine months for tools [119]