Veeco(US:VECO)2024-02-15 02:03Financial Data and Key Metrics Changes - The company reported revenue of $666 million for 2023, a 3% increase year-over-year, with semiconductor revenue reaching $413 million, up 12% from the prior year [83][98] - Gross margin improved to 43.5% in 2023 from approximately 42% in the prior year, with non-GAAP operating income growing 10% to $110 million and diluted non-GAAP EPS increasing to $1.69 [83][101] - For Q4, revenue totaled $174 million, with a gross margin of approximately 45%, leading to non-GAAP operating income of $32 million and non-GAAP EPS of $0.51 [84][38] Business Line Data and Key Metrics Changes - Semiconductor revenue increased 17% sequentially in Q4, driven by laser annealing systems, comprising 66% of total revenue for the quarter [84][103] - Compound semiconductor revenue was reported at $87 million, a decline from the prior year, representing 13% of total revenue, primarily due to decreased demand for wet processing systems for 5G RF devices [98] - Data storage revenue remained flat at $88 million, also comprising 13% of total revenue, while scientific and other revenue increased 15% to $78 million, making up 12% of revenue [98] Market Data and Key Metrics Changes - Revenue from China increased to 33% of total revenue in 2023, up from 19% in the prior year, driven by mature node semiconductor sales [100] - The Asia-Pacific region, excluding China, accounted for 31% of revenue, with the largest contribution from semiconductor customers, while the United States made up 24% of total revenue [100] - EMEA contributed 12% of revenue for the year [100] Company Strategy and Development Direction - The company is focused on advancing its product roadmaps and investing in growth opportunities, particularly in semiconductor technologies [79][82] - The company plans to ship multiple EVALuation systems in 2024, which are expected to lead to significant market expansion [82][89] - The company is targeting a gross margin of 45% in the future, with ongoing improvements in operational efficiency [101] Management's Comments on Operating Environment and Future Outlook - Management expects semiconductor revenue to grow by 5% to 10% in 2024, with strong demand from both advanced and mature node customers [87][88] - The company anticipates continued strength in the semiconductor market, particularly in laser annealing and ion beam deposition technologies [85][96] - Management noted that while the data storage business is expected to remain flat to up 10% in 2024, the focus is on leveraging ion beam technology for semiconductor applications [90] Other Important Information - The company shipped its first two nanosecond annealing EVALuation systems to leading logic customers in Q4, with potential for high-volume manufacturing orders in 2025 [94] - The company is actively working with Tier 1 customers in silicon carbide and plans to place two EVALuation systems in the field in 2024 [88][89] - The company has seen a significant increase in demand for its ion beam deposition systems, with a reported 20% lower resistance compared to traditional methods [95][96] Q&A Session Summary Question: What is the outlook for semiconductor growth in 2024? - Management guided for semiconductor revenue growth of 5% to 10% in 2024, with strong demand expected from both advanced and mature node customers [87][88] Question: Can you provide details on the backlog for 2024? - The company expects to see strength in the semiconductor business, with the largest portion of the backlog coming from this sector [17] Question: How has the revenue from China changed? - Revenue from China increased to 33% of total revenue in 2023, driven by mature node semiconductor sales, compared to 19% in the prior year [20][100] Question: What are the expectations for the data storage business? - The data storage business is expected to be flat to up 10% in 2024, with a focus on leveraging ion beam technology for semiconductor applications [90] Question: What is the status of the EVALuation systems? - The company plans to ship multiple EVALuation systems in 2024, with a strong focus on turning these into revenue and follow-on production [52][54]