COHU INC Q3 FY2024 earnings call

• Third quarter non-GAAP gross margin was strong at approximately 47% due to new products and lower manufacturing costs.
• Revenue split: 67% recurring in balance systems. Mobile segment was 12% of consolidated revenue and had 13% Y/Y growth.
• Significant test cell design win with a top five automotive semiconductor manufacturer for a combined tester, handler, and interface solution.
• Announced customer order for Neon inspection metrology platform for high bandwidth memory (HBM) and a leading European customer selection for silicon carbide dies burn-in.
• DI-Core software platform saw customer interest, with a key Cohu customer expanding use of AI inspection software.

Revenue for the third quarter was $95.3 million. Recurring revenue, which is more stable, represented 67% of total revenue. The mobile segment was 12% of consolidated revenue and posted 13% year-over-year revenue growth.

• Q4 revenue guided to be in the range of $95 million, plus or minus $7 million, flat to Q3.
• Q4 gross margin forecasted ~44%, lower than Q3 but higher than financial target model.
• Q4 operating expenses projected ~$46 million, up ~$1 million from Q3.
• Q1 revenue expected ~10% higher than Q4.

• Market conditions remain soft across primary segments (automotive and industrial).
• Foreign currency fluctuations impacted results, with a foreign currency loss of ~$1.6 million in Q3.

Q: Craig Ellis asked about mobile business being at a turn and if it's hitting a bottom.

A: Luis Muller said mobile revenue was up Y/Y by 13%, bookings were up sequentially across all market segments except consumer.

Q: Christian Schwab asked about HBM version and silicon carbide die burn-in comparison.

A: Luis Muller said he didn't have info on HBM version and it's a die-level burn-in, not wafer-level, different from existing solutions.

Q: Krish Sankar asked about automotive business discrepancy.

A: Luis Muller said automotive segment had Q/Q and Y/Y improvement in bookings and revenue, showing a climbing trend from a depressed market.

Q: Dennis asked about HBM steps, competition, and silicon carbide die burn-in revenue.

A: Luis Muller said they're not competing with Onto or Camtek, and it's about stacked die inspection metrology, with revenue timing too soon to tell.