- First quarter revenue $107.6 million, approximately 66%
recurring
- Gross margin of 45.8%; non-GAAP gross margin of 46.0%
- Sense+ system with µ-sense selected for testing next-generation
high fidelity microphones
Cohu, Inc. (NASDAQ: COHU), a global supplier of equipment and
services optimizing semiconductor manufacturing yield and
productivity, today reported fiscal 2024 first quarter net sales of
$107.6 million and GAAP loss of $14.6 million or $0.31 per share.
Cohu also reported first quarter 2024 non-GAAP income of $0.6
million or $0.01 per share.
GAAP Results
(in millions, except per share
amounts)
Q1 FY 2024
Q4 FY 2023
Q1 FY 2023
Net sales
$107.6
$137.2
$179.4
Net income (loss)
$(14.6)
$(2.0)
$15.7
Net income (loss) per share
$(0.31)
$(0.04)
$0.33
Non-GAAP Results
(in millions, except per share
amounts)
Q1 FY 2024
Q4 FY 2023
Q1 FY 2023
Net income
$0.6
$11.1
$26.9
Net income per share
$0.01
$0.23
$0.56
Total cash and investments at the end of first quarter 2024 were
$271.3 million. On February 9, 2024, the Company made a cash
payment of $29.3 million to repay the remaining outstanding amounts
owed under our Term Loan B. Cohu repurchased 333,504 shares of its
common stock in the first quarter for an aggregate amount of
approximately $10.7 million.
“Recurring revenue continued to deliver stable profitability
during the trough of this Semicap cycle when customers typically
limit capital expenditures and focus on reducing semiconductor
inventory,” said Cohu President and CEO Luis Müller. “We remain
focused on developing core technologies and were pleased to receive
initial orders from a leading U.S. fabless semiconductor
manufacturer for our new high fidelity microphone tester integrated
with Cohu’s Sense+ automation platform.”
Cohu expects second quarter 2024 sales to be in a range of $105
million +/- $6 million.
Conference Call Information:
The Company will host a live conference call and webcast with
slides to discuss first quarter 2024 results at 1:30 p.m. Pacific
Time/4:30 p.m. Eastern Time on May 2, 2024. Interested parties may
listen live via webcast on Cohu’s investor relations website at
https://edge.media-server.com/mmc/p/vsirqt8u.
To participate via telephone and join the call live, please
register in advance at
https://register.vevent.com/register/BI003a2b1f29c5421891e1b2448a42a390
to receive the dial-in number along with a unique PIN number that
can be used to access the call.
About Cohu:
Cohu (NASDAQ: COHU) is a global technology leader supplying
test, automation, inspection and metrology products and services to
the semiconductor industry. Cohu’s differentiated and broad product
portfolio enables optimized yield and productivity, accelerating
customers’ manufacturing time-to-market. Additional information can
be found at www.cohu.com.
Use of Non-GAAP Financial Information:
Included within this press release and accompanying materials
are non-GAAP financial measures, including non-GAAP Gross
Margin/Profit, Income and Income (adjusted earnings) per share,
Operating Income, Operating Expense, effective tax rate, free cash
flow, net cash per share and Adjusted EBITDA that supplement the
Company’s Condensed Consolidated Statements of Operations prepared
under generally accepted accounting principles (GAAP). These
non-GAAP financial measures adjust the Company’s actual results
prepared under GAAP to exclude charges and the related income tax
effect for: share-based compensation, the amortization of purchased
intangible assets, manufacturing transition and severance costs,
acquisition-related costs and associated professional fees,
restructuring costs, impairments, inventory step-up, depreciation
of purchase accounting adjustments to property, plant and
equipment, amortization of cloud-based software implementation
costs (Adjusted EBITDA only) and loss
on extinguishment of debt (Adjusted EBITDA only). Reconciliations of GAAP to non-GAAP amounts
for the periods presented herein are provided in schedules
accompanying this release and should be considered together with
the Condensed Consolidated Statements of Operations. With respect
to any forward-looking non-GAAP figures, we are unable to provide
without unreasonable efforts, at this time, a GAAP to non-GAAP
reconciliation of any forward-looking figures due to their inherent
uncertainty.
These non-GAAP measures are not meant as a substitute for GAAP,
but are included solely for informational and comparative purposes.
The Company’s management believes that this information can assist
investors in evaluating the Company’s operational trends, financial
performance, and cash generating capacity. Management uses non-GAAP
measures for a variety of reasons, including to make operational
decisions, to determine executive compensation in part, to forecast
future operational results, and for comparison to our annual
operating plan. However, the non-GAAP financial measures should not
be regarded as a replacement for (or superior to) corresponding,
similarly captioned, GAAP measures.
Forward Looking Statements:
Certain statements contained in this release and accompanying
materials may be considered forward-looking statements within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995, including statements regarding expectations related to our
FY2024 outlook, including quarterly projections; planned technology
development and growth expected from customer adoption; and any
other statements that are predictive in nature and depend upon or
refer to future events or conditions; and/or include words such as
“may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,”
“likely,” “believe,” “estimate,” “project,” “intend,” and/or other
similar expressions among others. Statements that are not
historical facts are forward-looking statements. Forward-looking
statements are based on current beliefs and assumptions that are
subject to risks and uncertainties and are not guarantees of future
performance. Any third-party industry analyst forecasts quoted are
for reference only and Cohu does not adopt or affirm any such
forecasts.
Actual results and future business conditions could differ
materially from those contained in any forward-looking statement as
a result of various factors, including, without limitation: new
product investments and product enhancements which may not be
commercially successful; the semiconductor industry is seasonal,
cyclical, volatile and unpredictable; recent erosion in mobile,
automotive and industrial market sales; our ability to manage and
deliver high quality products and services; failure of sole source
contract manufacturer or our ability to manage third-party raw
material, component and/or service providers; ongoing inflationary
pressures on material and operational costs coupled with rising
interest rates; economic recession; the semiconductor industry is
intensely competitive, subject to rapid technological changes, and
experiences consolidation of key customers for semiconductor test
equipment; a limited number of customers account for a substantial
percentage of net sales; significant exports to foreign countries
with economic and political instability and competition from a
number of Asia-based manufacturers; our relationships with
customers may deteriorate; loss of key personnel; risks of using
artificial intelligence within Cohu’s product developments and
business; reliance on foreign locations and geopolitical
instability in such locations critical to Cohu and its customers;
natural disasters, war and climate-related changes, including
related economic impacts; levels of debt; access to sufficient
capital on reasonable or favorable terms; foreign operations and
related currency fluctuations; required or desired accounting
charges and the cost or effectiveness of accounting controls;
instability of financial institutions where we maintain cash
deposits and potential loss of uninsured cash deposits; significant
goodwill and other intangibles as percentage of our total assets;
increasingly restrictive trade and export regulations impacting our
ability to sell products, specifically within China; risks
associated with acquisitions, investments and divestitures such as
integration and synergies; constraints related to corporate
governance structures; share repurchases and related impacts;
financial or operating results that are below forecast or credit
rating changes impacting our stock price or financing ability;
law/regulatory changes and including environmental or tax law
changes; significant volatility in our stock price; the risk of
cybersecurity breaches; enforcing or defending intellectual
property claims or other litigation.
These and other risks and uncertainties are discussed more fully
in Cohu’s filings with the SEC, including our most recent Form 10-K
and Form 10-Q, and the other filings made by Cohu with the SEC from
time to time, which are available via the SEC’s website at
www.sec.gov. Except as required by applicable law, Cohu does not
undertake any obligation to revise or update any forward-looking
statement, or to make any other forward-looking statements, whether
as a result of new information, future events or otherwise.
For press releases and other information of interest to
investors, please visit Cohu’s website at www.cohu.com.
COHU, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
(in thousands, except per share
amounts)
Three Months Ended (1)
March 30,
April 1,
2024 (2)
2023
Net sales
$
107,614
$
179,371
Cost and expenses:
Cost of sales (excluding amortization)
58,365
93,153
Research and development
22,336
22,510
Selling, general and administrative
35,082
34,189
Amortization of purchased intangible
assets
9,795
8,754
Restructuring charges
9
888
125,587
159,494
Income (loss) from operations
(17,973
)
19,877
Other (expense) income:
Interest expense
(289
)
(1,128
)
Interest income
2,709
2,718
Foreign transaction loss
(541
)
(440
)
Loss on extinguishment of debt
(241
)
(369
)
Income (loss) from operations before
taxes
(16,335
)
20,658
Income tax provision (benefit)
(1,700
)
4,973
Net income (loss)
$
(14,635
)
$
15,685
Income (loss) per share:
Basic:
$
(0.31
)
$
0.33
Diluted:
$
(0.31
)
$
0.33
Weighted average shares used in
computing income (loss) per share: (3)
Basic
47,134
47,343
Diluted
47,134
48,171
(1)
The three- month periods ended
March 30, 2024 and April 1, 2023 were both comprised of 13
weeks.
(2)
On January 30, 2023 the Company
completed the acquisition of MCT Worldwide, LLC (“MCT”) and October
2, 2023 the Company completed the acquisition of Equiptest
Engineering Pte. Ltd. (“EQT”) the results of MCT’s and EQT’s
operations have been included since those dates.
(3)
For the three-month period ended March 30,
2024, potentially dilutive securities were excluded from the per
share computations due to their antidilutive effect.
COHU, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(in thousands)
March 30,
December 30,
2024
2023
Assets:
Current assets:
Cash and investments (1)
$
271,322
$
335,698
Accounts receivable
115,994
124,624
Inventories
151,587
155,793
Other current assets
34,014
22,703
Total current assets
572,917
638,818
Property, plant & equipment, net
76,414
69,085
Goodwill
238,322
241,658
Intangible assets, net
140,932
151,770
Operating lease right of use assets
15,935
16,778
Other assets
29,928
32,243
Total assets
$
1,074,448
$
1,150,352
Liabilities & Stockholders’
Equity:
Current liabilities:
Short-term borrowings
$
1,652
$
1,773
Current installments of long-term debt
1,151
4,551
Deferred profit
3,021
3,586
Other current liabilities
85,271
93,511
Total current liabilities
91,095
103,421
Long-term debt (1)
8,024
34,303
Non-current operating lease
liabilities
12,520
13,175
Other noncurrent liabilities
47,452
49,283
Cohu stockholders’ equity
915,357
950,170
Total liabilities & stockholders’
equity
$
1,074,448
$
1,150,352
(1)
On February 9, 2024, the Company
made a cash payment of $29.3 million to repay the remaining
outstanding amounts owed under our Term Loan B.
COHU, INC.
Supplemental Reconciliation of GAAP
Results to Non-GAAP Financial Measures (Unaudited)
(in thousands, except per share
amounts)
Three Months Ended
March 30,
December 30,
April 1,
2024
2023
2023
Income (loss) from operations - GAAP basis
(a)
$
(17,973
)
$
334
$
19,877
Non-GAAP adjustments:
Share-based compensation included in
(b):
Cost of sales (COS)
227
226
180
Research and development (R&D)
834
860
866
Selling, general and administrative
(SG&A)
3,567
3,471
2,868
4,628
4,557
3,914
Amortization of purchased intangible
assets (c)
9,795
9,738
8,754
Restructuring charges related to inventory
adjustments in COS (d)
(4
)
(3
)
(28
)
Restructuring charges (d)
9
375
888
Manufacturing and sales transition costs
included in (e):
COS
-
7
18
R&D
14
-
-
SG&A
1,640
527
253
1,654
534
271
Impairment charge included in SG&A
(f)
966
-
-
Inventory step-up included in COS (g)
-
868
124
Acquisition costs included in SG&A
(h)
174
288
385
Depreciation of PP&E step-up included
in SG&A (i)
12
30
9
Income (loss) from operations - non-GAAP
basis (j)
$
(739
)
$
16,721
$
34,194
Net income (loss) - GAAP basis
$
(14,635
)
$
(2,028
)
$
15,685
Non-GAAP adjustments (as scheduled
above)
17,234
16,387
14,317
Tax effect of non-GAAP adjustments (k)
(1,999
)
(3,239
)
(3,057
)
Net income - non-GAAP basis
$
600
$
11,120
$
26,945
GAAP net income (loss) per share -
diluted
$
(0.31
)
$
(0.04
)
$
0.33
Non-GAAP net income per share - diluted
(l)
$
0.01
$
0.23
$
0.56
Management believes the presentation of these non-GAAP financial
measures, when taken together with the corresponding GAAP financial
measures, provides meaningful supplemental information regarding
the Company’s operating performance. Our management uses these
non-GAAP financial measures in assessing the Company's operating
results, as well as when planning, forecasting and analyzing future
periods and these non-GAAP measures allow investors to evaluate the
Company’s financial performance using some of the same measures as
management. Management views share-based compensation as an expense
that is unrelated to the Company’s operational performance as it
does not require cash payments and can vary in amount from period
to period and the elimination of amortization charges provides
better comparability of pre- and post-acquisition operating results
and to results of businesses utilizing internally developed
intangible assets. Management initiated certain restructuring
activities including employee headcount reductions and other
organizational changes to align our business strategies in light of
the merger with Xcerra and the acquisitions of MCT and EQT.
Restructuring costs have been excluded because such expense is not
used by Management to assess the core profitability of Cohu’s
business operations. Impairment charges have been excluded as these
amounts are infrequent and are unrelated to the operational
performance of Cohu. PP&E and inventory step-up costs have been
excluded by management as they are unrelated to the core operating
activities of the Company. Acquisition costs have been excluded by
management as they are unrelated to the core operating activities
of the Company and the frequency and variability in the nature of
the charges can vary significantly from period to period. Excluding
this data provides investors with a basis to compare Cohu’s
performance against the performance of other companies without this
variability. However, the non-GAAP financial measures should not be
regarded as a replacement for (or superior to) corresponding,
similarly captioned, GAAP measures. The presentation of non-GAAP
financial measures above may not be comparable to similarly titled
measures reported by other companies and investors should be
careful when comparing our non-GAAP financial measures to those of
other companies.
(a)
(16.7)%, 0.2% and 11.1% of net sales,
respectively.
(b)
To eliminate compensation expense for
employee stock options, stock units and our employee stock purchase
plan.
(c)
To eliminate the amortization of acquired
intangible assets.
(d)
To eliminate restructuring costs incurred
related to the integration of MCT and Xcerra.
(e)
To eliminate the manufacturing transition
and severance costs.
(f)
To eliminate impact of the impairment of
our investment in Fraes-und Technologiezentrum GmbH Frasdorf, a
company based in Germany.
(g)
To eliminate amortization of inventory
step up charges related to the acquisition of MCT and EQT.
(h)
To eliminate professional fees and other
direct incremental expenses incurred related to acquisitions.
(i)
To eliminate depreciation of PP&E step
up charges related to the acquisition of MCT and EQT.
(j)
(0.7)%, 12.2% and 19.1% of net sales,
respectively.
(k)
To adjust the provision for income taxes
related to the adjustments described above based on applicable tax
rates.
(l)
The three months ended March 30, 2024 and
December 30, 2023 were computed using 47,606 and 47,795 shares
outstanding, respectively, as the effect of dilutive securities was
excluded from GAAP diluted common shares due to the reported net
loss under GAAP, but are included for non-GAAP diluted common
shares since the Company has non-GAAP net income. All other periods
presented were calculated using the number of GAAP diluted shares
outstanding.
COHU, INC.
Supplemental Reconciliation of GAAP
Results to Non-GAAP Financial Measures (Unaudited)
(in thousands)
Three Months Ended
March 30,
December 30,
April 1,
2024
2023
2023
Gross Profit Reconciliation
Gross profit - GAAP basis (excluding
amortization) (1)
$
49,249
$
65,410
$
86,218
Non-GAAP adjustments to cost of sales (as
scheduled above)
223
1,098
294
Gross profit - Non-GAAP basis
$
49,472
$
66,508
$
86,512
As a percentage of net sales:
GAAP gross profit
45.8
%
47.7
%
48.1
%
Non-GAAP gross profit
46.0
%
48.5
%
48.2
%
Adjusted EBITDA Reconciliation
Net income - GAAP Basis
$
(14,635
)
$
(2,028
)
$
15,685
Income tax provision (benefit)
(1,700
)
1,531
4,973
Interest expense
289
754
1,128
Interest income
(2,709
)
(2,847
)
(2,718
)
Amortization of purchased intangible
assets
9,795
9,738
8,754
Depreciation
3,429
3,372
3,337
Amortization of cloud-based software
implementation costs (2)
709
700
700
Loss on extinguishment of debt
241
-
369
Other non-GAAP adjustments (as scheduled
above)
7,427
6,619
5,554
Adjusted EBITDA
$
2,846
$
17,839
$
37,782
As a percentage of net sales:
Net income - GAAP Basis
(13.6
)%
(1.5
)%
8.7
%
Adjusted EBITDA
2.6
%
13.0
%
21.1
%
Operating Expense
Reconciliation
Operating Expense - GAAP basis
$
67,222
$
65,076
$
66,341
Non-GAAP adjustments to operating expenses
(as scheduled above)
(17,011
)
(15,289
)
(14,023
)
Operating Expenses - Non-GAAP basis
$
50,211
$
49,787
$
52,318
(1)
Excludes amortization of $7,522, $7,476
and $6,891 for the three months ending March 30, 2024, December 30,
2023 and April 01, 2023, respectively.
(2)
Represents amortization of capitalized
implementation costs related to cloud-based software arrangements
that are included within SG&A.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240502363566/en/
Cohu, Inc. Jeffrey D. Jones - Investor Relations
858-848-8106
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