Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Inficon Holding AG (IFCNF, Financial) reported steady profitable growth with record sales in semiconductor and vacuum coating, as well as security and energy sectors.
- Sales increased to $172 million, marking a 3% growth compared to the previous quarter and a 1% year-on-year increase.
- The company achieved an improved operating income of $35 million, with an operating margin of 20.3%, up from 19.9% in Q3 2023.
- Gross margin strengthened by 1 percentage point, reflecting improved supply chain quality and systematic cost management.
- Inficon continues to invest in R&D, allocating 8% of sales, and is preparing production capacity for anticipated semiconductor demand.
Negative Points
- General vacuum market experienced slower momentum, with a significant backlog from the previous year now normalized.
- The book-to-bill ratio fell below one, indicating a potential slowdown in future orders.
- Sales in the automotive, refrigeration, and air conditioning markets decreased by 11%, reflecting a challenging market environment.
- The general vacuum market saw a 29% sales drop, primarily due to weaker sales in Asia and the Americas.
- Global uncertainties, particularly regarding the timing and extent of the semiconductor market ramp, pose challenges for future growth projections.
Q & A Highlights
Q: With all the innovations in semiconductor markets, how does Inficon position itself for the capex split between lithography, deposition, and etch? Does it matter for you?
A: Oliver Wyrsch, CEO: Our product portfolio is ready for innovations across these semi processes. Products like the Apex family are adaptable to different applications, ensuring we are prepared for the next ramp. We work closely with customers on future technology steps, so our products are ready for upcoming demands.
Q: Can you clarify China's growth for Inficon in Q3, particularly in semiconductors, and how do you view the demand risk for 2025?
A: Oliver Wyrsch, CEO: China and Asia showed positive dynamics, with growth not limited to China alone. We receive positive signals from customers in China, indicating aggressive plans for next year, despite some companies facing challenges. We remain cautiously optimistic about China's semiconductor industry.
Q: How much visibility does Inficon have on 2025, especially in semiconductors, regarding the ramp across logic and memory markets?
A: Oliver Wyrsch, CEO: The semiconductor ramp is a key industry topic. We are ready for it, focusing on capacity and product readiness. The consensus suggests a mid-2025 ramp, with leading edge showing good development and memory seeing gradual improvement. However, the exact timing remains uncertain.
Q: How does Inficon view the potential impact of a major lithography customer's reduced EUV shipment forecast on its 2025 business?
A: Oliver Wyrsch, CEO: While this customer is significant, Inficon has diversified its customer base. The short-term slowdown is manageable, and we are prepared for when they accelerate again. Our focus remains on long-term partnerships and readiness for future growth.
Q: What is Inficon doing to help customers reduce complexity, especially with the trend towards more modular solutions?
A: Oliver Wyrsch, CEO: Inficon is evolving from a sensor hardware supplier to a data analytics provider, offering sophisticated software that creates digital twins of factories. This helps improve productivity and reduce complexity, aligning with customer needs for smart manufacturing solutions.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
