Intevac (IVAC) 1 Feb 232022 Q4 Earnings call transcript

Hello and welcome to Intevac’s Fourth Quarter and Fiscal Year 2022 Financial Results Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded today, February 1, 2023.

It’s now pleasure to turn the call over to Claire McAdams, Investor Relations for Intevac. Please go ahead, Claire.

afternoon, good and you, everyone. Thank joining Thank financial which to XX. Intevac's today for you ended the December XXXX, for results year fourth discuss full us quarter on and

financial company’s and XXXX outlook looking we the quarter our discussing to the first addition will In provide guidance forward. for of results,

will and outlook. of Financial call fourth me will Officer. before review Joining President start today's Then our and discuss Officer; with outlook are call Executive on review business over Nigel our and Jim Jim Hunton, the and financial results Nigel Chief Moniz, Q&A. quarter to Chief our the turning

completed like statements, quarter remains which to that including, comments I'd regarding XX-K and today's adjustment forward-looking limited subject with events the as future well in not Form contains Intevac. regarding recently financial to, projections our statements certain future the everyone preparation and fiscal remind performance but the of as for of financial year, conference to results connection call most about company's

These risks by are materially of in risk filed results discussed result actual as to a current could various our forward-looking factors expectations based uncertainties comments and differ relating documents these other statements us our annual and and projections as quarterly of the Securities and contents statements represent our on X forward-looking that Exchange Commission, on call Form today. XX-K February with and Form this report including reports of The XX-Q. include time-sensitive upon

made forward-looking this call will the We call. update to turn statements during over undertake obligation no to the now conference Nigel. I

we significant been how to strides have out change with bold XXXX. this new Intevac of for transformed quite with tasked growth. we we and new refer in are past the we have only immensely with goal of there's to year vision momentum. this the you as XX past Intevac. already was The creating to a to the strong customers. vast XXXX. Intevac company. company. built now Intevac have return huge with they have months, I'm for rapid operates transforming momentum they of change taken results our say ambition afternoon. a future feels that and I've very and not clear is but of our The and We the value today, of journey latest journey laid we excited out I'm a Thanks our I'm company. the the delivering profitable achievements towards vision the made team XXXX pleased and through will earnings a shareholder set progress had a year to and over the the Intevac year proud good embraced with internally of in a of on share Claire, and aims, in ago, we highlight year. this business all the into And over entire ambitious sustained company to for continue this the differently

that first with commitments our that call the pleased one of year out team one As I'm upon, to share our reflect executed our XXXX. single ago. my to laid started I every for has on shareholders, we earnings mandates

into growth return a team out a built disk drive streamlined around of refocused profitability, laid and new plan We've existing wider portfolio, excitedly and business We and whole. leaner and a our the the diversified product Intevac’s strategic expansion as business is the partnership strengthened in have most a have business leadership clear a to developed strong hard position market. that supporting our market to on all critical the

financial targets commitments for XXXX. each on quarter's delivered We our also and

energy to out XXXX, set the you. has Each at and of around direction, a of of with and company our these significant focus momentum highlights I'm Intevac reestablishing on A contributor needed pace, to end the to Intevac. gained intent following been specific a its first markets. recently Looking and a achievements portfolio. start with change last all share briefly momentum back pleased each with for has year of refocus growth Intevac goal primary assess leaner of tenure business in the my product potential the was the to

business correct potential As the key reopening critical meet future. priorities forward. our to going quarter extensively and I'm direction it traveled vaccines I customer to the for determine rollout. for of gradual each that in and And with pleased the each travel, year COVID order that continued with stakeholders every with impact share have to Intevac personally opportunity I've the all the global personally today, of touch to met took in the and and greatly

only trajectory, This led relationships, platform. emergence to portfolio. of in changing future of energy pattern begins not company's and order an shifted and the and Intevac changed game to be led a but company, our the innovation decision its and only broadening our financial early cease XXX momentum key the submitted, achievements as toward platform, that the applications TRIO decision potential. initiatives, development strengthen been efforts to nine TRIO multiple the efforts but proved These of to IP growth a also our enable It process has on further Lean has and have resulted and also to development strengthening in for to not its patent focus has equipment also flagship

bar the raise so performance, structure at doing committed of growth to organization. the XXXX development program business, capability and enhance align XXXX, introduced source for high to and the recruited of business dramatically the we of the within internal streamlining and start We employee revenue action internal the to an talent. resource caliber genuine also took source internally, the Looking prospects.

and repeatedly of strengthen on taken of assess having measure talent have under comprised unify and we today, the company We team our heightened the and cohesive both and strength the best organizational emphasis diversify steps values accountability. organization our US teams. group innovation Asian senior and culture, Further still one the to leadership the leadership from significantly of

for feel metrics also in, energized culture, measurements organizational the invested the are evidence and our and and that validates have strength of internal plays outstanding team deliver customers engineering. our showing ability the partners excited employees in our Our future and strong to already global

changing made Intevac turn environment has This in and development. professional the to only has not past momentous XXXX importance an the And of was platform. development a that something in building in collaboration led encourages enables to from dedicated too. year, perspective. the creation know seen personal greater business, also TRIO organizational game enabler and We rapid an collaboration, of space a been our We've physical the key of invested cohesion the throughout of having innovation. changes space to our that our

enhancing same been world continued I we expressed company strong dozens this to sheet. a performing in have which the in our positive personally profitability and And and have investors, the balance believe their of a of return poised remain fully committed ahead. year. on execution this I've have developing the preference investments. In are protection class for team and process part preserving relation year measured Today, Our these firmly teams. XXXX we are developing strength In to products, year XXXX. commercial of culture engaged our people, invested to are track team. balance each have all change. our we of met strength in profitability, R&D, to begun for Intevac in of on engineering also and showing beginning the we our preferences high seen sheets, the and how are we date. with are with returning Whilst for I do to teams And maintain and have into of reassurance full the balance And cash of and and customers the the to executed operational XXXX, of XXXX.

product, be drive to flagship existing media will that through which the business believe the in our that and market is upgrade over customer increasing four have worldwide Turning years. we're securing million orders opportunities Lean XXX share HAMR hard Lean advancing initiatives, $XX our in of delivered And firmly resulted we and capacity. our next rapidly of disk partnerships XXX

to position continue in business. us forefront its XXXX be kept the and at We the in And our believe prime to market drive of development. future continue hard the have the to of a in efforts

now source the deliver that potential line since to away XX Finally, and category. future. craft opportunities launch is important consumer Lean a revenue on XXXX total recently product runway development Intevac’s XXX years highly achieved key dramatically changing Intevac with and of growth a It to Intevac milestone on applications is regarded term in into our can the internally well is ago. far sustainable and the new partnership growth in compelling what a provide a the our The new by we our development, company, It for product long game of as increases the development and meaningful commitment develop electronics addressable to the strategy. has and most of TRIO platform, now A other as product markets the as far reach. by a announced the externally relating partnership XX December broadens product supports

we team, the of in today, and we're have sit class markets delivering products stronger, leaner, diverse more a forefront to we pursuing. the As operating world

in past to stakeholders this ensure year investors, and of our years the analysts, achievements employees, objective and come. that recognize deliver of commitment suppliers, to our and growth our strategy call strong financial to all Our today is the customers competence and on the performance

glass December, definitive the in for a this for TRIO. million applications. glass agreement exclusive minimum and access a electronics $XXX maintain includes maintain leading we also completion revenue the completed over customer approximately to The agreement ceramic provider was includes requirement agreement a Now TRIO development joint late minimal of materials. for The annual order transformational to commitment of platform turning to event with exclusivity. of In years, our The five Intevac. agreement towards our consumer a

this the at to purchase receive At for two systems deliver additional are system which unit. later the completing We will qualification. will first TRIO we qualification, TRIO are begin quarter. the of first qualification anticipate We that least we time, completes XX qualified within a once order this months TRIO currently planning

out forward to additional We advance support building several with our will partner. going tools would communicate point we this about this for some be to can like time be be ready to that upside so what it'd work year customer. in XXXX our limited of will we this I at key shipments,

a well be next in this to also which excess we the see years. And partnership $XXX seek five of granted. over bit for and platform glass why you However, we manufacturing is I can what this to of electronic devices, share TRIO which excited such customer a the of what a compelling for coating consumer the makes with us engage with of it the share on can exclusivity, level million potential

over The TRIO advantages offers three primary coating current options.

it and accommodate device coating tremendous equipment, flexibility both existing compared offers platform XD as First, form configurations factors, shapes. the of to limitless XD can almost including

drive the executed XX-year our leadership for a record films highly our highest the precision footprint. from and of over market, in very history And building operating Second, lastly, to with hard standards productivity, yield customer proven its uniform and of systems competitive a our track and compact cost free critical TRIO of defect durability throughput disk high depositing quality have long of also is a life. in ownership

of platform TRIO different for So cost one flexibility, the advantages and platform applications. the compelling are providing competitiveness, many

working be focused ramp and thin with technologies field. film to system our by initial for the the mid-year, customers XXXX qualifying for will in TRIO customers our delivering initial plans the Our systems on

making returns during gains value volume will in exclusivity. beyond the months. of be The our many customers, support XX the strength the more worth also It systems. investments but profitable expect capital is inventory investments short and HDD which deployed deliver confidence on we're ship earnest minimum balance in TRIO not to making systems the term, invested the in In to year the our just that these each important business. year. of set the sheet the is our in expect the to systems TRIO not that include investments and today, And year, up cash balance. strong by additional potentially QX. and or for for noting this systems consistent of will critically customer next XXXX we our will but began us These flows required we our we're maintain enabled in beginning positive be contract partnership for a multiple TRIO, only that to XXXX As build in cash substantially following of

in is of we As will successful with few revenue consumer QX to TRIO upgrades I the we mentioned industry's a ahead additional and growth the tool of customer, focus devices. technology collaboration a HAMR to revenues million level to continue in merely level continue the earlier, as deployments, minimum pursue which be setting expect $XXX make datacenter to partner up investments outside transition In is technology discussed quarter customers in of our our be A our and drive. Which a Once encouraging seeing our factory to key reduced first growth of to maintain our We're part the greater return required upgrade with in mass-capacity period first we another business. new schedule, exclusivity of with to to to the proceeding indicates summary, to QX. fundamental strong In and significant. we're on very significant in TRIO opportunity this innovation maintain plans. development in update will of ahead is innovative on during game critical contribution expected a Recent horizon, me partners. quarter, meantime, strategy will news an very testament and platform the the signs in investments a HDD changing last customer our strong proud this utilization. on brings

them. As with roadmaps our aligned are such

Our consistent for the as as well five-year remains forecast XXXX quarter. what last HDD communicated we guidance revenue with

That investment technology at We least XXXX visibility is revenues continue in of capacity for upgrades. $XXX extended cycle and an XXXX. HDD to to see both from million providing

that a $XX strong will upgrades of few process about over next today We modules capable, as of expect well systems HAMR install backlog as be of driven revenue additional support XXX system this base be the require years by will in to the growth million.

In XXXX Intevac. transformational a was summary, for year

value, position and the TRIO new will moment very take its We the I into of are That a balance completes of stockholder company markets. key a remarks. emphasize just as how business a into our we partnership and increasing strength the we in this year excited consistently protecting generating about grow with transform to company are and the leading ahead cash sheet committed growing platform. and as back profitable prepared my to each

the now to And with Jim. will I that, call over turn

Nigel. you, Thank

our than to a quarter forecast of First, compared stronger came results. $XX.X I will briefly summarize guidance Revenues bit at $XX in our fourth million. million,

customers of upside investments in which resulted in a XX.X%, As gross This revenues was of QX margin our for upgrades, QX XX% service. quarter. pooling QX mix was is were across business to prioritization certain well spares of expected full above and favorable expected XXXX comprised the reason of in in margins HDD of now in guidance XX%. lower QX forecast. the more our and spread The that The revenue upgrade our primary mix of year resulted

high an to The our backlog TRIO in for due increase to We executing or to So exceptional $X.XX result yearend. QX quarters. diluted maintain than due XXXX. new team $X.X of XX% $X.X our $X.XX quarterly of as the million net profile diluted margins forthcoming before of expenses share, $X.XX better the prioritization operating of record with our was the QX of total compensation guidance well the favorable year orders continue spending we and and the primarily million gross more XX-year slightly or were million, With million, share, million. milestones ended in in above key to quarter. for revenue of as work R&D of expect per the to per certain $XXX $X a guidance as of variable the $XXX loss

XXX backlog order Lean increases upgrades XXXX, We systems deliver and to and the equivalent $X.XX each and following HDD yearend. cash one shares million, XX.X in throughout restricted the investments both expect QX on year in cash including three Leans of strong in XXXX for As quarter we of backlog during every have in resulted of multiple years. XX, the to $XXX share, based at per of we in activity ended with million communicated the quarterly approximately level of systems

was close our million XXXX. used down for the purchases, at to cash quarter the during than residing inventory was since $XXX to Cash $XX.X operations balance fiscal year. still forecast AP of million $X.X QX’s that $XXX yearend stronger and we million, year-to-date. have AP primarily And the of TRIO paid in flow Our due million by

and $XX.X the inventory we million shipments quarter. XXXX. were backlog of in $XXX,XXX During for QX, $XXX,XXX added growing in anticipated the support were and and TRIO to depreciation systems capital expenditures QX amortization

million until revenues But of last to field half first is between XXXX. XXXX with million, QX not we revenues Now of upgrades projecting consistent the for XXXX $XX.X half a service than indicated system expect we $XX.X guidance, our bit we level of the be last moving to commentary the quarter, second quarter. and and do are stronger

year operating We expect are our margin million, the million between rate first timing some investments be expected due be to remainder full million development, increases. XX%. expected XXXX. the with $X quarterly run quarter OpEx we typical expect QX After of research be along than $X.X seasonal and $X for to in XX% to and gross between around expenses the QX, of for level higher and to slightly

$XXX,XXX and expense about interest the income of quarter. expect tax We of $XXX,XXX about GAAP in

in loss million XX net per a shares based outstanding. the projecting cents share, are to of on $X.XX range $X.XX We

from Nigel's ahead to financial As remarks. results, I'll some the we look year's full recap highlights

upgrades in qualification unit. the purchase system. We system expect half in expect build production we on weighted order QX will half half. which work the for we second with activity qualification, initial and revenue to system the pass revenue -- to be our driving second pass revenue to the evenly of TRIO the first million most After customer receive expected and continue will The relatively to $XX with first in approximately that be one and the half first between the XXXX, in HDD to in half,

planning are two within deliver systems months least XX We of currently to qualification. TRIO at additional successful

well approximately include we but the in OpEx as which some process, XX%. revenue gross also mentioned to of profile, this around With expect to we a be once $XX should able year level many be XXXX. HDD driven, systems million how systems TRIO of And provide call our largely of On range May margins revenue I qualification earlier, could is we into to are revenue, expect million. full $XX to

to the million range to both interest in $X income be expect We $X XXXX. and million of in taxes

continue strategy. formal part the cash questions. manage presentation. our for the Finally, of business we're This we to to will completes support closely Kevin, ready

[Operator Instructions]

from Our question coming from Funds. today is first Hendi Susanto Gabelli

Nigel let’s TRIO up, like resembles one should James. Yes, to a on profile? so, afternoon, will Good colors once a inquire kind I congratulation for Or sales profile the another? of let's say that it more we on Nigel, customer and like step like linear the profiles partnership. up ramp let’s say expect, the system say TRIO can more from expect May like we period what

advantage, critical Yes, mean, question. clearly are Hendi, tool couple qualification the take first on tool, that was to to that of people have we I on excited is of for me that's is and a say, beyond as cautious hope said, it's very this thing the If into said, And production focus me maintain build our qualified very Because which the call, me, is delivering out enthusiastic going maintain think maintain is we and that's quarters our we're mean, a market completing this qualification. And opportunity. tool. the the to compelling. across we're and profile, a then way maintain process thanks strength, the with too we're move absolutely going next is entering, now really, to very be process, of on a opportunity, we've for moving and the to to that look that, think partner of testbed that and It's for moved it technology the through and focus a has is the of I calls pretty I the the on early be qualification the one plan. production on tool. the was on on and organization's going forward. to and us the actually it's about executing what And different forward. month tool, this and significant to are I key for I to coming I confidentiality, we going share mean, these the then move why optimistic level It's

we're for that absolutely on So qualify. this with with partners that to first on unit, really, call, it's track much we're our about track get very

early view once opportunity we it's five a say get think million too have into is that completed that that, what is from thing for market, years or through the I $XXX the the for me success market commitment And linear the me some better I potential But think on that's orders. the is. and building else, the partner much anything first period. that to we'll to securing excitement get the a great start think as minimum a I and for tool for over actually

So going absolute be focus. to my that's

really so is So and about that potential excited it's the early, huge. we're too

be So think I anything say to say. don't let's that's probably linear, it'll

And for meaning say, that when a like production also rate And some that's rate. regard ramp range, system, then say they on that? like to early let's you like, there know, like then that what produce? color would whether from, there's it's is production units fixed, the the like the somewhat rate? no, latest big estimate is estimate how window, semi I will And big like up, let's Nigel, TRIO would full the to there's a it's of be many like, run Yes, share like can into with

really product exciting is different platform, this to anything new which about very the is done we've I one Yes, things probably I mean, think of the before.

is step the actually multiple But coating, segregating their flexibility, forward. it business but also this the to has do are huge to three-dimensional this traditional So coating, it a platform ability minds, can-do new thinking has structures about start to the in phenomenal size machine. going do only it two-dimensional which through people not platform, can

through, HDD disk, machine of and is to just billions we're like key I back And our of partner. the its out, a go not attracted design day this has of one it's to that platform So the putting the concept. in, things on business, that day if technology the so us one flexibility size

the sizes can running programs. multiple on have be it. so machine can on It And running different

So really to you fixed can't say be it's a number. going

that the a capabilities hopefully think changer is is one the the flexibility therefore of why of this I flavor the some consumer technology. is questions, machine one huge, I into it been but unique answers market, we've that it I So probably level gives your flexibility that can it. is electronics has going it. you probably And do the tool of fundamentally game different by this And of and of hope mean, within again, partner. selected that market components

So is this entering. we're machine that about isn't actually supporting one to it about going multiple a large industry start machines very

exclusivity will later Like the minimum met, potential to partnership. minimum of the with start met you other commitment the for when got in timing now annual is commitment when like like with or minimum sometime whether annual the be customers -- while like waiting sales was -- XXXX. commitment is Nigel, it regard of that And, to can annual explore the

restrict announced other does us clear agreements, when The it not from market pretty we're opportunities. at I looking we think

exclusivity the within So is that substrates. consumer devices, is glass and for the electronic glass

announcement. the in was and documented clearly very is that So

the look of point from that opportunities agreement. the other can we starting So for outside of

me, the qualified, in start That's the agreement. announced with first that is partner. that unit it's agreement unit, then date the we was executed move production for signed real strategic So But finished December. first on that forward the we get and focus today sure the making for

James, be can Intevac able why needs you cash And share systems. build $XX consumption is boosted James. And to balance like that on the And expenses $XX TRIO how to especially it. the we prior sheet. the cash on also the got there Got cash XXXX, balance much million. questions by balance then that that considering then whether in notice I a is would of for that's higher sheet I'm estimates? million wondering long-term customer the than expect

questions. answer can couple I Sure, a of

million, is those placed question down of let deposits, use quarters customary your secure ago. cash, who not answer that customers customer for $XXX influenced $XX the deposits are one our million large second payments our customer me that of give inventory. known cash was First, customer first. cash necessarily to was that ending by that orders in or to backlog, us we The

if you through year, not inventory the up the went majority of of growth fourth $XX So earnest the of end look about the at to the quarter. by to year in inventory that from TRIO, in beginning The year. inventory was the million the TRIO started build

payments, estimations $XX the $XXX ended did came the slightly $XXX expected above $XXX had and been we it quarter. the inventory we of buy So million But and reflected the of we in at backlog were last the to call million guidance but down using to customer inventory our as higher when security the customers payment, our for TRIO the requested. we to support down million that that number million the in cash $XXX million, was later

the drawn since was So that was It not made payment down. payable we cash. down did the accounts not it's draw still in

order far as strategically. beyond the minimum And cash, prepared inventory As the especially cash think is for XXXX, we'll years, the over cash the as we've number business, the of XXXX. said whatever you for and building being his used the in stewards we're last to continue excellent been remarks, I quantity Nigel if use in of look

So right $XX an we $XX won't million you cash still go to manage you'll likely to continue will or see go inventory cash, away. we go down, as up let's see through but the year, million say level

there'll building you be a inventory normally with corresponding If customer go to increase support see requirements. down, cash less

with Next Miller Mark question from Benchmark.

listening sensed the demand, over you as of the future. optimistic of progress for week, the least now drives is a last the looking in year. starting that capacity more inventories a they're indicating the that Congratulations are result, or about for on they at come Digital inventory deplete. maybe Western After last to drives the terms drives in for And your Have to forward hard anything to of more year improvements remainder [inaudible] and customer and thing expected outlook, hard kind the terms down? utilization of of customer hard

think seen say, calls, is, and of and listening HAMR. indicator, the particular, as you Q&A level some we've Yes, emphasis in one the first and of is other excitement the I really to around the what

readiness last we're that's HAMR performance. to And well, ensure Jim we technologies supplying equipment think the in through is and be seeing maintained be focus the HAMR the last And year I that think launch, of our HAMR the QX. enabled I capable would been come that actually done that has maintained. quarter's to and we've a their have of for said part into the equipment key

we're we come to focus you, And around continued optimistic upgrades. So technology back. again, starting those are that is seeing like demand

maximize add you them. Jim? in is make And Some key be HAMR we're in under well in markets to technology actually start I positive change And really, on significant will of think, this Asia we're additional shift confident our to those want positioned to is industry. a to to for get fundamentally, business start of sort But are going to the through. that outlooks Anything that, to going to that. also that sector

see the I results as can mentioned, in in Nigel think No, you QX. been, that it's of some

that drivers on half as of of trying they call earnings you their to stronger to will key a able in them And implied remarks capacity why the first will actually be as And we revenue lower as we're to that build being guidance. improve that's you see year most my advantage taking that. continue, and and will shipments Mark, said the of technology. in half above QX, helping, prepared as it was they're inventory last the some the the our of linearity upgrades. be component than half, of And mentioned, that And second main do are customers of what of the I one to relates really calls first

quarter shipping, about in new tool you I There's year, from cash cash think Lean some will you're going believe the But flow later gleaned about from I XXXX. you build you’re comments positive? your drawdown fourth by -- to tools. one just do Okay, you talking be as be in the what

which once I biggest on TRIO the of what the really of of support cashflow for us, build. building at linearity TRIO. to use qualification you But think in going that think positive revenue happen be issue timing be to cash the with depends on be all we QX. backlog is the it should pass to look That's I the a is going what is of large to just driver happens combination going when a

be of you'll in such year Lean these features These tools tools. prior any beyond. Terms new or this than later more have tools shipping the late as and chambers technology more deposition tools,

module. has technology that'll much of some don't one the some that process capability. ship than additional other additional an it think has I But enabled there's think I HAMR

to that's enabled HAMR customers install a ready are ensuring roadmaps. that's I putting HAMR is mean, is their the focus done needs a we've the the customers. and our major technology, we've key enabling are for and really and execute roadmaps absolutely that tools, talked that and thing generation in been is actually making on base, those upgrades last And on to those the we're aligned actually helping to their success over of move key meeting our XX months key having ensuring our regular meetings, enabling technology. them actually And sure is review next with

year. been So it's exciting an

these If TRIO delivering all think revenue with in qualification early more of after you goes the tools about When that. the well, tool, you're TRIO first two be talking could XXXX?

think couple think the customer off tool everybody and to XXXX to remember of be said, Nigel our is customary field once shipment, but should fourth We they go that's do take the qualification, signs expect the do is that call. to revenue reg of responsibility we've we'll I I in a qualification that, that. And take and time on And third our tool revenue right then emphasizes, the that through full with installed we'll on the after as we revenue, tools on have site. qualified need rules, we first and as and focus at pass now. or can the probably as first

we after that in through to into take they'll tools in TRIO. trying off, any qualification have revenue we get can now field, after see take happen XXXX. they that it's then getting then Once XXXX Our revenue will time and in we qualification production revenue, the and focus off there from signed we can and installed, probably then we building sign that we tool and to get at see But get to shipment but QX. go can is likely will revenue that right tool that offs qualified point sign a ship revenue at take to and qualification if shipment is

yes. Absolutely,

Next question Sundar Srini today from from Partner is Capital. coming

My Hi, first for that accounts why the fantastic guys. is payable Congratulation postponed?[Multiple was Speakers] quarter. question

postponed. payable Accounts

payables? accounts Why were the Yes.

the payable question year? not if end your why the I'm is of at Yes. accounts is higher sure

Yes.

Is question? that your

Yes.

understand it timing, the year hard accounts of of higher payable end to if at mostly of TRIO the question, the question, of So inventories. I the because understand the was delivery your the although that was

but those in came to their pay received, payment it see in around quarter December since so sitting in December, which went accounts cash us September accounts the our it was you'll in was And has it it the up payable, pay inventory TRIO paid, essentially, of not payment required it coincided we in because growth quarter. January, it the quarter. million. accounts terms the vendors, and payable the So to been when roughly was terms payable, this helped was with $X But that from the vendors to have of

Thanks.

with be that will HAMR As next a shipping in be two three new XXX years, going will out you they the updates, right? follow up or all systems the

around Those time this year. last were ordered

that tools, technology of and of innovation be so in be some that sort those upgrade not, will post some them further there'll we included that's for install. And

level be latest executed HAMR and readiness, not XXXX. of there'll and developed the in So we've HAMR but some on delivered upgrades that actually

cannot to or the can else. subject could to on means somebody that you exclusivity, meaning exactly explain what it it of somebody sell else sell it you you Also

devices clearly electronic very for consumer is exclusivity the So, for substrate. glass and glass ceramic

very definition substrates. clear a is it market and of the the So

Okay, understood.

we I exclusivity again, that, in that those applications. what sell mean to for So means cannot anyone is

that's exclusive to what that's So -- why absolutely that for is the it application. them exclusivity, the

want market? this what TRIO actually is is But And my your partner to know of ignorance. the in market of cellphone I show share the a

from mean sector. in of they are us clearly market really to the our that our market website leader number are share in not market share partner so for leader absolute partner’s is You one, they is comment market on, probably their but the on

five has four what months doing. the to And over paid attention that Yes. as say last I would we're or anybody

Okay. is top towards a glass trend stick Would that the glass to film? There display. putting on tempered your of temper

the substrate and substrates, in we mean, ceramic at I press I glass and glass for the look think release, covered coating agreement. TRIO ceramic glass that in and announced glass if is you what is any

matter given and that's it it doesn't a tempered cover we're think not it's exclusivity. -- has that is our I And it will about the So technology substrate. if or the it why it so covers partner changing tempered, why and mean I everything really game why is any flexibility is about excited

Gabelli is today follow a Funds. Susanto question Next Hendi from from up

Operator, hear that's can't hear We Hendi? your Hendi? just can you me. No,

Yes, again, Nigel hi, and James.

And year like But first of assumptions TRIO? away. what still say regard the disk Do level? have into profitable hard HAMR what the of XXXX with among and mix market far underlying to kind is full revenue XXX, insight drive you results. let’s think is I revenue Lean

said this look but revenue look million And $XX million. to Yes, and could investments, make prepared remarks how talk OpEx our be at this time, the internally we're what an somewhere would prepared say we R&D you our at two, is if mix we'll we between at between what year. not being as much in the I the about $XX

need gross million margin, around breakeven. to If somewhere be you just did simple math $XX revenue and to in you assumed a XX%

James. is is I like And that of you hanging that encouraging, the your outside question ballistic let’s the any electronic commercial applications? products. name website consumer is see say second do TRIO on fruit end for very low coating, saw then So And devices,

I Yes, as potential ballistic technology. coating the first. that as a joined you a and the just know, cover mean, you year a to route when I Intevac we ago, said, potential and had forward as IBC

been tool. has that TRIO into this some of And developed

address and the actually So to business fundamentals correct. platform, it's you're on But technology says XXXX get time upgraded, in some material there bring about to about trying that in getting the things the is under a development. TRIO the creating onto put My been right it website, we XXXX. new additional a will put this absolutely focus nice website life as this year website. on is And to been has not website, actually

current this future for But year be we was my say But focused to getting will change IBC. actions you're that last under about much the So making launched, of year. company very website that one technology TRIO and the right, this growth. will does success. And development on still and platform the for

And, see. about potential TRIO. devices for I of Nigel, like electronic application my consumer questions second outside target

success. the moment, getting and the focus there out making said this and we've that tool qualified as mean built, I is much very Yes, at

Beyond I that other see opportunities.

this and keep I think what into get is saying and what story are done. I other updating and me by thing keep of that market at for quarter we talked next we're but automotive This the is sectors. let's about mean in one is quarter built, the use of this single There and market to the around moment opportunities, it building potential this going do success. announcements the every building we've that qualified

focus to think of I do So first. market got devices exciting enough that electronic one I've to on opportunity

you, all winning production Thank then Nigel, -- environment. the and TRIO for best into

from is Next question coming Management. WestCap Dan from Weston

more, been for questions, progress. few mind. the on hi, good Thanks answered the questions just don't congratulations and guys. afternoon, have a all Most the of if taking you Yes,

share product? you In terms year internal your the for and that of with us capacity could what for TRIO, is you think ship per build

highly confidential. I that's mean,

around really going we're whatever the on we're what qualification done. imagine, capacity full to to the get can we're you it, plan builds, the As ensure is now is to executing meet we're doing we demand then out there. first And have building going

and scaling mean, and that So to And plans. against market to for and we're and internal we're deliver planning we it's, are I do, building what going is success. within going clearly size the how

capacity with some like sheet do help saying be our challenges. successful. we inventory. We've to to balance way You the have don't supply still able us need chain with enter strength to what we're be actually we of without we to do, actually some going know to the leverage to the something have We this industry through got manage it,

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are, forward it. to looking we So

get think I your No, point. Okay.

Yes, to got we build. first to run just

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we're But it's, it’s to then one. going great. be it's this forward to with and forward, moving about move we successfully It's first And one going are our No, qualified, successful. getting first partner.

roundabout year figure me Thank assumes of And understood. units commitments let way, you Nigel. it particular and for using given per and minimum build just about TRIO, I'm on ask Totally for the that, customer a this revenue. ship guessing this to four

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not but Yes, any to committed we needs, And success. we I'm whatever saying planning for number, customer deliver. are I'm will our

into what that read you So can doing, we're if yes.

fine. okay, enough, Fair

end that Let you platform? have did on in Corning well? their any was they of Did, a doing that terms evaluation ask TRIO of evaluations the initially the customers question me in as involved

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customer have And on a quarters that in a the they products. experience success. years samples. some had wanted and a my and And come feeding why has samples they've working of performance real superb. you're you We've of and adaptability different run other your and producing applications, development and call and you. we them It's talked its in, many own of we couple So -- multiple when came potential for on. We've is back is who coupons been qualification gave on different done in that's TRIO with they working And ago, And with people exclusivity. XX ran so their companies, the of teams. they the flexibility

are you to read what we've doing. that, if So into able been

Thank I that's have all questions. for you, for answering you. So I Nigel, appreciate that.

I'd end like question-and-answer to reached back closing over turn any to the session. of the our for floor comments. We further or management

you. Thank

earnings first created we company. the achievement. look As where compared complete one a my We've executed on call are at of transformation I we've to year I today, new a ago, Intevac, feel an outstanding

investors institutional as TRIO the our the HDD with for HAMR. continue platform, hard positioned new collective me, revenue will consistent for investor progress is squarely now path sheets it's meeting outlook and industry well all round. flow cash been employees are We've I extremely our many outreach about their for revenue last on growth well with company partnership towards a the as I significant as And And annual as to leverage been a And Overall, we with of to up supporting and We into enthusiastic finally, from to to want expertise to company. steadily the partners, strong over fantastic our for well growth year. and our growth, the also I'm XXXX profitable as And all industry possible. positive been achievement dedication, operations ramping continue the their with transition a we're the eager ensure our as the Intevac. balance as thank counterparts future. and of that's work future year

So please reach Claire, we'll that, follow with if us. organize to conclude today's out call. do ups will to directly. And wants anyone I that with And

you. thank So

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a have line this today. wonderful your thank you You participation your at for may disconnect time. And day. We