Q2 2024 Ichor Holdings Ltd Earnings Call Transcript
Key Points
- Ichor Holdings Ltd (ICHR) reported solid second-quarter results with $203 million in sales, near the top end of their forecast.
- The company achieved an 85% improvement in operating income compared to the first quarter, driven by stronger gross margin performance.
- Ichor Holdings Ltd (ICHR) is seeing early signs of recovery in the wafer fab equipment market, with expectations for a stronger second half.
- The company is making progress with its next-generation gas panel, which contains about 80% proprietary content, expected to significantly expand gross margins.
- Ichor Holdings Ltd (ICHR) generated $17.5 million in cash flow from operations, with a free cash flow of $14.6 million after capital expenditures.
- The emerging silicon carbide gas panel business is expected to be lower in the second half compared to the first half.
- Gross margin improvement initiatives are necessary to drive profitability, indicating current margins are not optimal.
- The company faces uncertainties in the timing of NAND WFE recovery, which is not expected to inflect until mid to late 2025.
- Ichor Holdings Ltd (ICHR) has not yet seen a surge in its component business, which remains muted compared to expectations.
- The company is cautious about the impact of Intel's reduced CapEx guidance for 2025, which could affect growth projections.
Good afternoon and thank you for joining today's second-quarter 2024 conference call. As you read our earnings press release and as you listen to this conference call, please recognize that both contain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control and which could cause actual results to differ materially from such statements. These risks and uncertainties include those spelled out in our earnings press release, those described in our annual report on Form 10-K for fiscal year 2023, and those described in subsequent filings with the SEC.
You should consider all forward-looking statements in light of those and other risks and uncertainties. And additionally, we will be providing certain non-GAAP financial measures during this conference call. Our earnings press release and the financial supplement posted to our IR website each provide a reconciliation of these non-GAAP financial measures to their most comparable GAAP financial measures.
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