Q1 2024 Ichor Holdings Ltd Earnings Call Transcript
Key Points
- Ichor Holdings Ltd (ICHR) reported Q1 revenues of $201 million, maintaining stability from Q4 and aligning with expectations.
- Gross margin improved by 180 basis points sequentially to 12.2% in Q1, driven by improved factory efficiencies.
- The company successfully completed an equity offering in early March, raising net proceeds of $137 million, which was used to pay down the entire balance of their revolver, improving their leverage ratio.
- Ichor Holdings Ltd (ICHR) is making progress with proprietary products, including initial shipments of next-generation gas panels, which are expected to significantly expand gross margin profiles.
- The company remains optimistic about revenue growth and industry recovery, projecting a ramp towards $250 million to $300 million levels in 2025.
- Q1 earnings came in below guidance due to a combination of gross profit impacts and a change in the tax provision.
- The product and customer mix in Q1 was less favorable than forecast, contributing to gross margin being approximately 100 basis points shy of expectations.
- Visibility remains limited to approximately three months, with current visibility not showing a meaningful uptick in demand for new systems.
- There is isolated softness in certain business areas, such as the silicon carbide gas panel business and a slower than expected EUV system build rate.
- Inventory levels in certain components still need to be burned off, which could affect revenue and margin performance in the short term.
Good day, ladies and gentlemen, and welcome to Ichor's first-quarter 2024 earnings conference call. (Operator Instructions) As a reminder, this call is being recorded.
I'd now like to introduce your host for today's conference, Claire McAdams, Investor Relations. Please go ahead.
Thank you, operator, and good afternoon, and thank you for joining today's first quarter 2024 conference call. As you read their 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, 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 2023 and those described in subsequent filings
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