Release Date: July 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Chroma Ate Inc (TPE:2360, Financial) reported a 25% year-over-year growth in net sales for the second quarter of 2024, reaching approximately TWD5.5 billion.
- The company's testing equipment business saw a 23% growth compared to the previous quarter and a 25% growth year-over-year.
- Gross margin for the second quarter was 59%, with a 27% growth in absolute numbers compared to the first quarter of 2024.
- Net income for the second quarter was TWD1.4 billion, marking a 47% increase from the previous quarter and a 36% increase year-over-year.
- The semiconductor sector showed significant growth, with sales in the first half of 2024 already surpassing total sales from the previous year, indicating a 200% increase.
Negative Points
- Operating expenses increased alongside sales revenue, which could impact future profitability if not managed carefully.
- The ATS segment is expected to remain flat or slightly decline in 2024 due to a slowdown in the EV market.
- The overall EV and battery business is experiencing a down year, with no significant recovery expected until 2025.
- The company's power business, while recurring, is not expected to perform better than last year due to the EV market slowdown.
- There is uncertainty regarding the future contribution of the metrology segment, as it is still in the final stages of development and customer adoption.
Q & A Highlights
Q: Are you seeing any pickup in EV downstream, particularly in the European market, and what are your expectations for the ATS segment in 2024?
A: Jennifer Chien, IR: Our power business has become recurring sales, and due to the EV slowdown this year, we expect the overall ATS segment to remain flat or slightly decline compared to last year.
Q: Regarding the semiconductor and photonics segment, can you provide insights on SLT orders and expectations for asset return bookings this year and next?
A: Jennifer Chien, IR: We are dealing with global Tier 1 customers, and the SLT orders are being consumed as expected. We anticipate the second half to be driven by compensation level testers and photonics orders, with potential order increases after shipments start.
Q: How do you see the metrology segment contributing moving forward, especially with the adoption of 3D packaging by smartphone and high-performance compute customers?
A: Jennifer Chien, IR: We are progressing well and expect increased metrology tester needs due to future trends in advanced packaging. We foresee meaningful contributions in the coming years.
Q: Can you provide insights into the revenue mix of the metrology business and its significance in 2025 or 2026?
A: Jennifer Chien, IR: The metrology business is expected to be meaningful in the coming years, driven by advanced packaging trends and customer projections.
Q: Regarding the EV battery and power testing business, do you anticipate a recovery in ATS in 2025, considering the transition of battery plant building from China to Southeast Asia?
A: Jennifer Chien, IR: ATS is a broad growth factor, not solely dependent on EV factors. We expect some meaningful contributions from battery cell projects in Southeast Asia and other automation plans, but overall, ATS will remain stable.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
