Diodes(US:DIOD)2025-05-08 22:02Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $332.1 million, a 10% increase year-over-year compared to $302 million in Q1 2024, but a decrease of 2.1% sequentially from $339.3 million in Q4 2024 [12][19] - Gross profit for Q1 2025 was $104.7 million, representing 31.5% of revenue, down from 33% in the prior year quarter and 32.7% in the previous quarter [12] - GAAP net loss for Q1 2025 was $4.4 million, or a loss per share of $0.10, compared to net income of $14 million or $0.30 per diluted share in the prior year quarter [14] Business Line Data and Key Metrics Changes - Automotive and industrial markets accounted for 42% of Q1 product revenue, maintaining the same level as the previous quarter [8][20] - The computing market showed strong performance, particularly in AI-related applications, contributing significantly to revenue growth [8][26] Market Data and Key Metrics Changes - Asia represented 78% of revenue, Europe 13%, and North America 9% in Q1 2025, with improvements noted across all regions [19] - Channel inventory levels decreased, indicating a better alignment with actual demand [9][19] Company Strategy and Development Direction - The company announced a $100 million stock repurchase program, reflecting confidence in future growth prospects [10] - The hybrid manufacturing model allows the company to adapt to changing market conditions and customer needs, mitigating tariff impacts [10][29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued growth, expecting Q2 2025 to show both year-over-year and sequential growth [9][30] - The company is closely monitoring the impact of tariffs and adjusting its strategies accordingly [29] Other Important Information - Cash flow from operations was $56.7 million for Q1 2025, with free cash flow of $40.8 million [16] - Total inventory days decreased to approximately 187 days, down from 193 days in the previous quarter [17] Q&A Session Summary Question: Demand Pull Forward and Stability - Management noted that while tariffs create uncertainty, they do not see significant demand pull forward but rather an improvement in channel inventory and backlog [35][38] Question: Manufacturing Footprint and Tariff Impact - The hybrid manufacturing model remains a priority, and the company will continue to port products from external to internal manufacturing without changing its strategy due to tariffs [40][41] Question: AI CapEx Trends - Demand for AI-related products is strong, particularly in data centers and edge computing, with ongoing design wins expected to drive future growth [43][45] Question: Gross Margin Catalysts - Management highlighted that while there are pressures on margins, improvements in internal loading and product mix are expected to drive margin expansion in the second half of the year [48][51] Question: Inventory Normalization - Current inventory levels are slightly above the target range of 11 to 14 weeks, but management is comfortable with the levels supporting anticipated growth [59][60]