Camtek(US:CAMT)2023-07-31 16:50Financial Data and Key Metrics Changes - The company reported Q2 2023 revenues of $73.8 million, an increase from the lower revenue in Q1 2023 [28][32] - Gross margin improved to 48% from 47.3% in the previous quarter, with expectations for further improvement [28][32] - Net income for Q2 2023 was $21.9 million, slightly down from $22.1 million in Q2 2022 [15][32] - Operating expenses increased to $17.1 million from $16.7 million in Q2 2022 [14][32] - Cash and cash equivalents as of June 30, 2023, were $506.3 million, up from $492.7 million at the end of Q1 2023 [34] Business Line Data and Key Metrics Changes - Approximately 60% of revenues came from Advanced Interconnect Packaging applications, with the remaining 40% from compound semiconductors, CIS, and process control applications [28] - The company expects chiplet modules and HBM to account for over 30% of business in 2024 [31] Market Data and Key Metrics Changes - Geographic revenue split for Q2 2023 was 83% from Asia and 17% from the U.S. and Europe, a slight shift from 90% Asia and 10% U.S. and Europe in the previous quarter [66] - The company noted solid business in China, with continued investments and no decline in business compared to 2022 [38] Company Strategy and Development Direction - The company aims to reach $500 million in revenue, with 2024 expected to be a record year [12][9] - Focus on new packaging technologies such as Heterogeneous Integration (HI) and High Bandwidth Memory (HBM) to drive growth [9][10] - The company is investing in R&D to comply with technological roadmaps and meet customer requirements [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the second half of 2023 being stronger than the first half, driven by major investments in AI [11] - The semiconductor industry is expected to grow significantly, with the company aiming to outpace industry growth due to its focus on high-growth segments [113] Other Important Information - The company has received orders for 42 systems, primarily for chiplet modules and HBM, with expectations for more orders [10][31] - Management is optimistic about maintaining a strong market position and high customer retention due to excellent support and understanding of customer requirements [42][63] Q&A Session Summary Question: Visibility into calendar '24 - Management noted increased customer readiness to place orders and higher conversion from pipeline to backlog, indicating good visibility for 2024 [20] Question: Business in China - Management confirmed solid business in China with continued investments and no decline compared to 2022 [38] Question: Competition in HBM-related inspection metrology - Management stated that they hold a strong market position and believe barriers to entry have increased, making it difficult for competitors to catch up [42] Question: Gross margin implications for 2024 - Management expects a positive trend in gross margins, aiming to exceed 50% as revenues increase [52][95] Question: Target for $500 million revenue - Management expressed confidence in achieving the $500 million target, contingent on continued industry growth and maintaining customer relationships [101][113] Question: Order details and delivery schedule - Management indicated that most of the machines ordered would be shipped in the third and fourth quarters of 2023, with a small portion in early 2024 [115]