TTM TECHNOLOGIES INC Q3 FY2024 earnings call

• TTM delivered strong operating margin performance due to higher revenues, favorable mix, and operational execution. - Revenues were above the midpoint of the guided range, third consecutive quarter of year-on-year growth driven by aerospace and defense and data center computing. - Aerospace and defense demand was strong, with a book to bill of 1.26 and record backlog. - TTM is transforming to be less cyclical, with strategic transactions in aerospace and defense, progress in Penang facility, manufacturing footprint consolidation, and Syracuse expansion. - PCB capacity utilization improved in Asia Pacific, while North America utilization had different dynamics.

Aerospace and Defense: Represented 46% of Q3 2024 revenues, book to bill was 1.26 for the second consecutive quarter, with a record program backlog of approximately $1.49 billion. Data Center Computing: Accounted for 19% of Q3 2024 sales, saw 20% year-on-year growth due to Generative AI, expected to be 21% of Q4 sales. Medical, Industrial, Instrumentation: Contributed 14% of Q3 2024 sales, expected to be 14% of Q4 revenues. Automotive: Made up 14% of Q3 2024 sales, expected to be 12% of Q4 revenues. Networking: Was 7% of Q3 2024 revenue, expected to be 8% of Q4 revenues. Advanced technology and engineered products: Accounted for approximately 49% of Q3 2024 revenue.

• Net sales for Q4 2024 projected in the range of $610 million to $650 million. - Non-GAAP earnings expected in the range of $0.44 to $0.50 per diluted share, inclusive of Penang facility costs. - SG&A expense expected to be about 9.5% of net sales, R&D about 1.3% of net sales. - Interest expense expected to be approximately $12.1 million, interest income about $2.5 million. - Effective tax rate estimated between 10% and 14%.

• Foreign exchange impact from unhedged translation of balance sheets in China and Malaysia. - Automotive market facing challenges with inventory adjustments and soft demand. - Commercial markets, particularly automotive, experiencing turbulence and uncertainty. - Potential minor impact from commercial aerospace strikes, but relatively insignificant to overall revenue.

Q: What impact did the Chippewa Falls fire have?

A: No material impact, back in production a day later.

Q: What's the outlook for automotive program wins and market revival?

A: Automotive market is turbulent, won ~$25M in program value last quarter, year-to-date ~$106M, not expecting growth in near-term.

Q: What's the impact of commercial aerospace strikes?

A: Relatively insignificant, only ~5% of revenue, 787 build unaffected, revenues down but up year-on-year.

Q: Is the Syracuse CapEx figure net of federal and state contributions?

A: No, the $100 million to $130 million range is pre-federal and state contributions.