Onto Innovation (ONTO) 8 Aug 242024 Q2 Earnings call transcript

Good day, and welcome to the Onto Innovation Second Quarter Earnings Release Conference Call. Today's conference is being recorded.

At this time, I'd like to turn the conference over to Sidney Ho. Please go ahead.

Thank you, Justin, and good afternoon, everyone. XXXX market financial closed. its shortly this issued the after Innovation second results quarter afternoon Onto

where the If of refer website the did release, copy you not please to receive the is posted. release a copy a of company's

Michael the Mark Officer; Financial are Chief Chief Executive Joining us today Plisinski, on Officer. call and Slicer,

a remind the the will to statements to statements within of federal forward-looking are contain laws. range the by statements management like and can I'd of risks made you that meaning securities Those to call uncertainties on actual cause changes, this vary subject that materially. results

more undertake encourage that may you the these forward-looking obligation For Onto light and impact would our risk review filings. I release to new events. earnings update results, regarding future information in information or to our statements the not Onto of does factors SEC Innovation's Innovation

will our basis otherwise of specified. financial discussions Today's presented results financial non-GAAP on unless a be

reminder, be a reconciliation a and today's GAAP between in release. found As results can detailed non-GAAP earnings

let Now call CEO, our to Plisinski. over Mike? Mike turn me the

you, and for call our earnings thank afternoon. everyone, Sidney. Good joining this you Thank afternoon,

supporting systems Our the also improve packaging and quarter, from shortly. a generating to $XX record, the the high revenue exceeded improved systems third our resulting quarter, million expect AI we quarterly from from will progress which in of see range, for cash advanced by for operations. are Iris gate-all-around inventory quarter address in management Margins efforts our Financially, better-than-expected and investments of again Atlas nodes. Dragonfly in Mark it first we end and driven devices, demand to second guidance the advanced in pleased

see era enabler packaging devices we commented attracting key which into in and suppliers, accounted to highlights, to the another Advanced specialty our these revenue markets, record well consecutive a record, broadly wafer quarter. has new a markets. bringing for AI driven AI, will quarter highly fourth sizes packaging, second and By review supply of starting each recently half in the as platform for densities. and be over the AI market it this revenue that quarterly expects for We demand outstrip of achieved packaging where by with these Dragon achieved now proven the we versatile additional revenue needs, substrates requirements interconnect as well Nvidia the and year, second next addressing unique advanced

will we In year. on expand business current grow visibility, this our capabilities. based fact, over continue we And our XX% project inspection to by our

new response, we interconnects in and sensor new yield-critical pitch denser less will based measurements this ultra-thin expect smaller on are the delivered they memory defects with announced to need year. next bonding the through a systems over address bump-type and size for More And recently, in metrology to quarter, we detect applications to high-bandwidth be of than released bump be today. where hybrid future subsurface capability a XD the of wafers. bump market sensor used heights and Last we end already XX half

to meet X systems us new preliminary, expect throughputs for and Our to still alternatives. new than these over has we Though positive, several the feedback allows production which customer we at technology, sensor evaluations challenges proprietary been believe next ship uses higher initial months.

globe. of sizes, around in to In in tool. with a technologies larger packaging we interconnects XX which shipped market. for applications to will early And glass larger the lithography many support automated panel on packaging support customers across date, allow we our added our we've quarter, new road to leaders smaller fully sizes. customer single in substrate technologies, shipped a maps. the to glass stability customers' to addition to list this first when believe the wafer-level package panel engaged new XXXX We over we of is interest systems and growing this We see critical In packaging to package architectures chiplet JetStep

set revenue -- Finally, record last year. from nearly achieving record power customers significantly, a quarterly a grew

to process semiconductor the continue remain expect control to for the this of year throughout strong market. demand We for power rest

Now picking customers and advanced from quarter, continuing node second advanced year. nearly to revenue from growth of into represented of through are we turning seeing nodes. the In is the Spending half next and XXXX the half orders up, customers. the logic

metrology adoption of applications, gate-all-around addition OCD an seeing leading are For films' in our to our we in metrology. increase Iris Atlas

will quarter, X IMPULSE. metrology our we platform closed Atlas, the optical out, from greater the volume X is for logic successfully second are at speed combined we agreements where X-nanometer in qualified integrated which top multiple XX% and our accounts. than In share gate-all-around systems stability also of Rounding increasing. these suite for believe of Aspect Iris represent below requirements applications and We've manufacturers,

call the over guidance. provide turn Mark financial to I'll Now our third quarter highlights to review and

Mike, Thanks, everyone. good and afternoon,

flow and cash of operating $XX Operating EPS to while flow ranges, points revenue revenues, doubling of increased quarter percentage second a generating exceeded representing cash same during we the cash year. highlighted, guidance last Mike of X yield XX% operating million. As record period

million revenue first X% year. versus the $XXX quarter prior the was quarter XX% versus up Second and of up

guidance versus the AI our packaging Second demand better-than-expected EPS Both year. due and $X.XX in EPS quarter. XX% and for software within advanced the up increased investments sequentially prior quarter and gate-all-around to ranges the and services to nodes advanced stronger revenue devices, for exceeded XX%

revenue by the quarterly markets. at Looking

record packaging, grew $XXX a and revenue. of biggest and our specialty device to remains Our which sequentially represents XX% of advanced X% million quarterly revenue market

million, revenue. increased QX revenue Our over XX% biggest sequential increase of nodes, of had was and represents XX% advanced $XX which

representing of with of QX, increased X% $XX million, revenue. over and XX% services, revenue Software

of driving second basis our for first in line the the We of to midpoint XXX guidance over gross achieved the with quarter, improvement point XX% quarter. than margin XX%, range XX% more

$XX Second quarter range. at million, end were our high guidance the just of operating expenses

hybrid to inspection. expand and our in bonding differentiation within future We service make technology our continue as metrology to and R&D XD additional extending product markets metrology quarter, for investments well as the capabilities

of ability leveraged a revenue income XX% was of operating for quarter, quarter model. second $XX compared execute operating XX% million to to for the validating the first Our our

performance, from favorable income balance. revenue, our Our increased income investment also net resulting from XX% was cash of supported

Now of moving growth cash cash million ended inventory in expected optimizing quarter operating sheet. Dragonfly to at million in versus The our $XXX the with $XX Inventory with increase and converting half. progress advanced into and the the of $XX nodes levels, down ended flow the second million, of $XXX quarter operating achieving short-term million, made team great our revenue and We cash. the QX. business balance even the income investments XXX% our second

million from We plan for the million of $XXX exit quarter. XXXX be levels. million a below will reduction we third inventory further which to $XX expect $XX inventory reduction our XXXX, $XX million be to We as

chip turning $XXX $XXX third the HBM to million outlook as as invest currently million packaging discussed. our continue quarter quarter. capabilities, in expect We be Mike between Now the new capacity advanced and revenue to for for to leaders third and

We expect XX%, prior reflecting chain improvements and be gross quarters. to supply manufacturing the in initiatives will XX% margins discussed in

operating programs make in maps. as be For road we to between million R&D tied million to $XX $XX expect customer our additional investments to expenses, we

XX% to be For we year. effective tax to for XX% between the and quarter, XX% the third our full rate XX% to expect

Based our for to $X.XX our assumptions, per the non-GAAP million for to upon between diluted we these share. share to be earnings count expect the quarter second quarter third be We anticipate shares. $X.XX approximately XX.X

first of the progress Our our half on on of focus made continuing 'XX margin and the quarter-over-quarter second further for for the half margin in targeted remains the operating executing gross and programs year. improvements

and gate-all-around In addition, further margin driven of growth orders profiles should from logic improve our advanced as exit nodes we business the by XXXX. memory increasing

And and remainder XXXX. with for Mike to Mike? I insights back into that, it will QX of turn the additional

Mark. you, Thank

quarter, revenue revenue applications our advanced see memory coming third the increasing customers. of support will growth our and over About from for gate-all-around we and films with customers logic logic XX%, from half the For OCD node. both node

Looking ahead, the applications. of with fourth revenue XX% to in grow support expect in over logic gate see quarter, of logic all-around we revenue further

growth acoustic third specialty also this the both levels systems We metrology we and and a quarterly quarter expect company. fourth packaging these record record to potentially in growing quarter, the at applications. and new the HBM remain our is, for to and for but leading films demand for logic in growing systems, course, Leading customers Dragonfly see of the packaging and our for demand advanced

in are in of million We the still adoption systems, metrology package year-end. but early for by over deliver these stages expect revenue $XX system to

we first the half revenue and our setup of of the than stronger encouraged year, second X% half we're leading early, to the XXXX. to improved second now XX% Though the view In still expect by XXXX. aggregate, has for into half be

packaging logic capacity benefit expansions bandwidth and or memory memory. continued capacity to and HBM, manufacturers, high-bandwidth from expect gate-all-around from the specifically in We high several announced for investments

first Nvidia's AI gigabytes XXX the capacity to gigabytes half for the the from of processors XX gigabytes. processors to AI increase coming We XXX for expect AMD's from XXX new online year to content of and in HBM support

Adding a but applications These sign value as to cover a just a for combined XXXX, of stronger the over strong with customers, in year, a well. our for closed agreements $XXX we through packaging this purchasing investments optimism, with AI roughly positive agreements not X finish volume quarter. million XXXX and both gate-all-around

concludes remarks. our that prepared And

Justin, questions analysts. fromour please covering the for call open

Stifel. The Brian will Chin Instructions] first with question [Operator come from

revenue questions. more What you is your Nice or but on pause positive. more ask thought it And results or memory foundry improved? dip XQ, is outlook HBM Mike, could few advanced and outlook, and us thanks that packaging for letting the a previously side? in today

Brian. Thanks,

to to which of did revenue to X through their is the X What there and memory. growth were delivering specific set we've the to levels in think and I that that, continue from they expand customers, are we delivering, overall, say first would X them supply revenue some more pause confusion. really or seeing still we packaging, there ability was are I been those a AI are sequentially constraints quarters. that logic next expected that half. reach the said I be specific to would couple customers: of of Though limiting

see still a do we So pause.

definitely it's I think more constructive.

my just think definition been the have said, where some taking packaging on faster get strictly specialty open for versus business delayed. packaging we of We've to their and expansions make room markets? the That around push of a and greenfields handful a are AI actually bit subcons confusion lot ramp seen and was of for and their announced are advanced a of our up bullish, longer. packaging Some overall I little advanced but creative devices and customers some customers of overall more a there capacity

kind a of can -- or when of it amongst you one be how And million that that of to $XXX multipart, then million looking you're rough split or like give in VPAs idea X the announcing $XXX a the may weighted at but biased evenly other? customers? sort those maybe us Is

second, maybe you're then to And of as recognition then revenue amongst that, to gate-all-around still packaging. X maybe is or of me, within next roughly opposed last kind splits with if and that how kind the weighted to lastly, X? linear be quarters the more expected And advanced that

breakdown tied that of $XXX million. I me. by to I Yes, piece next of come front to -- most the when advanced the memory, a going but XXXX that packaging sorry, it But The of -- the out, for was breakdown, don't is have of year. was say course, yes, larger, depend in XXXX on expansions would or chunk

last one. just quick maybe And

packaging. it's Yes, mostly

quarter-to-quarter, for the breakdown about the it's XX% XX% for I roughly so looked. it's I -- So but have packaging, gate-all-around. just or don't

Got it.

helpful. really That's Okay.

if Just that thinking for this thing. was communicated gate-all-around the plans are does this you any, What expansion how XXXX? impact, one last affect revenue in advanced of from potential in week? seeing capacity light your last logic year quick reduced And

our we the mentioned, constructive. as growing continuing more we're Well, fourth see third. And of We're adoption seeing products seeing to more good quarter take the We're logic. from gate-all-around the product. definitely customers in we

next I make working So we that's ramp to -- sure them of a from just purchase are with positive for a agreements on tell customers can continue supply can sign. mentioned volume year. you the And us that what the

still in they volume XXXX. before -- that's and hit So largely production targets all their

to expect that we mix. improve. this nice a What's Iris the films increased adoption So of surprise continue to probably the is planar in

position Iris tool, strong OCD, the to adding been layer system. films addition in share for planar with we've had more our the we've So

will Vedvati question from Shrotre Evercore. next the with And come

customer? XXXX. Can we I customer yours CapEx cut for help your first was, the us kind conversations of guess an I like had down expectations have you particular IDM for just one changed or through forward how that of the if going spending -- had from you think

Well, seen. to that remains be

but they're generation next-generation general, their XXXX, announcing latest to was. processing cuts, let's to So and by CapEx it nodes also, desire their say, they're hit certainly I in believe ramp reaffirming their nodes

they reallocate on a pretty edge. depends of it capital. And us, their to on we are rest big So still where It's the leading number. the

So may my expectations even towards a positive more not that leading negative as any spend edge, see their and impact be are will acceleration. an maybe impact, we

continues And see Could packaging you on? are the driving Understood. between mentioned what's understand on to Is AI spend the us question spend the I had and you into think then it. Got packaging is, and to data grow. next you the really that starting going spend help puts OSATs the that actually second total maybe Like again? the what's half in I advanced pause -- that X? takes

packaging we a that more. to the include But spend advanced So look cetera. all computer includes definitely cetera, high-performance of we et our to OSATs lithography, spend, see if at starting take et

would specific constraints been their spend. So where number limited they've to And has what try to understand the that growth or spending been X in think playing and I capacity advanced going pretty significantly clear people is a just had that it what and space. be are and for We they've and AI packaging bigger help them. it like packaging customers spending

don't we're that anything highlighting. new So I think there's

Got it.

Or characterize me second kind XX% or of you AI so could revenues remind what in that? would you're a it versus you seeing? like kind half again your Is of And packaging pause decline XX%, half? first how decline

X XX% in around different the aggregate, are significantly, I back, between cutting and maybe some some it some But and on flow in of depends of each it's just customers, steady. those are aggregate, the really around customers. growing just and mentioned staying are Overall, ebb doubling, XX%... But XX% the individual that

product kind last XXX back? advanced changing coming one, gross increase then I bps Got of is driven your it. mix On one the that with may. primarily more margins, quarter-on-quarter, your And if is by nodes

all certainly, of manufacturing chain. and it. certainly our the about paying improvements I are Not within mean, been we've dividends supply talking

So I will margin year improving, half nodes see think accelerate second certainly gross advanced as improvement. we that help the the you get yes, of into that and

And packaging lot There's XX% around on. and ] a I important and important. it's announcing for around how mentioned have a just market. also it's We guidance, That's taking Dave think And over I new reported of that's factories That's packaging. think we've our as of some CoWoS. big million. customers to $XX there discussion HBM [ been the both million, AI capacity advanced specialty us. note capacity $XX today, and that been are logic are constraints the for customers gave

be been just that already much think well, in I achieving. as needs we've how context So to of that put

the Steelhead next And come will with David question Duley Securities. from

specifically And technical down rectangular drill two-part impact do technical I you will papers of these as the CPU of a have would putting glass question. be kind are layers? which Or GPU then the that be how substrates. a Onto? lot total Would in lithography were companies that the that If adopt and exactly suggesting, steps substrates, take tool if what place? down layering you the would you -- address are your RDL to what on

Yes.

areas to address question, it from the So and now is the technologies a the control through us translate version into the the different we're packaging side, first tool. which likely would Dragonfly for get Dragonfly your opportunities, panel we is panel process the applying of all means Firefly, what would

metrology to So business. already all the opportunities a drive opportunities expect see, we we well Clearfind as of various would inspection, Firefly

is opportunities, there addition, some course. software of In

say, advance of opportunities some different control to process supply the through software. coming chain. fab-wide they're aren't point capabilities have in -- from their They customers let's our a Those

of lithography layers all the for per addition, is which We're the IC -- lines, biggest In course, be would RDL the would side in And RDL right be to XX printing thing lines, up piece. now substrates. there, the glass. we advanced doing the primarily

about be We are it be a on resolution. sides. to we And both finer expect one to will customers can we we side, talk less go expect seeing it but because all

that I they're to if then impact these follow-on are And we CoWoS is, did might you how road if at substrates move finally, of, made of the then to And more help look much you going larger. was do business. wondering that to how a solutions, as map, Okay. larger bottleneck? whatever substrates, And impact might -- that when substrates, much, TSMC's of to flat panel that panel some a sort lithography the move would lithography or get

challenges of the seen substrates between I at different improvement and believe would substrates heating being heating issues significant with are at It of rates, rates. be that the some scale. so. a thermal economies different expanding that I help might in different mean and

I economies to to an would panel. So think moving there to technical advantage in addition of going scale a to advantage be

And for the steppers, of course, it's iterative.

to required volume the going also would you're have So this chips of but -- to number the the layers. volume steppers to of support of support steppers be

it's So process. iterative an

-- adds be drives layers, our So opportunity to all and us. the do the tools going up they're it for of if that would X utilization to

And then of the substrate... size the

a And obviously we of the because we think came for the even to about we -- handle anyone now. think I have we have panels than significantly flat tend panel world, us the that's the from of is larger display sizes the ability size -- talking because to substrate, good sorry,

like XXX XX So a display years XXX ago. is XX, by

So there's standpoint, from that no problem.

that that And X pretty stitching lab. or now already we we're which if large repeatable, Today, that to capability, downstairs demos our go scheduling for the packaging offer customers X already in demonstrated our want think over for planned. can demos I dense right we system. be have will without highly high-resolution, package is But tool they And to only optics. real and much print benefit wide-field the sizes

So I I have aligned you when tools size highly what their that or interposers going substrates to some is interpreting you -- guess forward. are TSMC's said just of

we're say the didn't but to that, aligned definitely I market needs.

put Let's that way. it

will Riley the question from And with B. [ come Mayer Securities. next ] Puppore

quarters just that advanced back see be supposed go quarters. just Ellis. for of you you've actually packaging, really, the I'm that had was great do obviously how But in I Yes, then said beginning. too. is quarter great, Kind said think one But know you all to on you incredible some is ramp even really this then this and And Craig you again. next I up X going? really

kind a how forward and see ramp? of of this sustainable we is And So it? do this sustainable coming long is kind how

Well, amount mentioned, see for we -- like compute take see you capacities those. each the doubling of on AI those engine, say, I an HBM doubling the on essentially let's -- if we

even which is HBM nobody already to the AI AI go supposed up, stayed doubling. is So flat, just if side projecting, is

that addition, in and driving both into do half next we and In the the see the and they're that of course, constraints. customers about constraints talking year, demand from at of next through see talking -- looking early order next AI supply expanding about their demand year end own continuing or we year, side factories supply customers our to alleviate

growth makes that So about pretty XXXX. us through bullish

great. kind got that's of of popping I've off that's Yes, Okay. that. one another

signs to we've your ability kind some least I of suppliers -- expect last kind seen is or you HBM? a penetrate how power of kind seen guys in or better So do your any diversification, pricing the you Have growing these business. meaningful probably in or for think of at which signal different week blue so, of

already we're HBM. our suppliers Well, in for

And changing of that's then fair position of and any I that propositions share So see matter. value. generally, way. matter in value maintaining it's our that a negotiate we providing our don't

better getting That's to them or new think, our to new and add share I more higher them and faster, profitable technologies accelerate pace and need. they continue to it's as capabilities only helping of we that innovation their from if yields ramp release anything, customers. provide become more gain helping

standpoint, customers. it with us a gives So scenario our I think win-win that from

bouncing as great kind And of David's That's of thing. off Okay. one last well. I'm question. just

thermal expect So design kind different difficult value than that CoWoS products demand? and some a have as of this the that more you. expected seen more your challenges lot with and what towards what Do becomes beating maybe you obviously, can of people we've challenges deliver CoWoS

drive challenges to our these customers our physics are I tools going to to help think But how our not the identify up. are some products process identify and and issues. for to to the cause root determine physics. for of these need of to drive course, and physics. yields adjust products some change the And The yields and adjust measure, use the in order of

critical. seeing new we react our of That's new very we're why types for sensors, we're working demands capabilities, with and So customers. quickly

change to the the I one are helping process. we where lithography, to with there, that a is think define

very hope with that with we collaborators talented Our our focused pace And Several the chiplet adoption glass. level. will do associated customers help and partners challenges on propel lab the downstairs that, is of that, partners. our and are the to solving very, maps next we as by and advanced focused packaging road adopted be

come will question Charles Shi next with Needham. the And from

your any to of And lot cap half? your a from get you upside, upside? China the contribution and because expectation WFE capturing the year's felt sense about of peers. that The is full I based tend your just I large little this your kind more from are QX I quarter half the in of like seen is And a trend you But year first you want total actually to was commentary had revenue revenue. to bit want that you for on numbers. the mid-teens. to from know exposure actually And customers. with percent of single-digit last business China first the haven't ask year question from some a for I the second leading China coming do China. What's

Yes.

half up revenue It's our think it's first massive. not if over be we half. China will level. But I think teens the numbers, I still in look second at the

us you'll China growth, would was really see. general, specialty. a the I about saw QX We QX from growth. significant from So is which lot But for of China. say we're fairly That growth a seeing in into

lot a power talked We've markets. semiconductor about

logic China as but yes, some We challenges are little we selling making within mature mean the well, bit you I progress China. have slower. the in And a of into areas know that's

So surprise. I think don't that's a

able of are that good it's some local we're China think in peers that see achieve and share. rates we of our end, the they're I to to that getting and we're starting enjoying. There's the even projecting competition the without growth China, at lower take tailwinds stronger,

the most are is So I our think us, we applications the that for challenging to higher-end applications, focus strategy add on value. and applications where those most the

Got it.

The think color million about you some the And is that that other about to that, million $XXX that VPA do If peak get through ship When When When provide shipment do would when great. $XXX shipment? you that expect question you start? that VPA? to does we'll be can start? XXXX. does

be the second will shipments initial XXXX. half, going There of is in some the of it through beginning at the but most bulk

Miller come with Benchmark the Company. will question Mark from The And next

quarter. another Congratulations good on

us wondering, Just you some share give you're appears what where and area? doing insights that think most it Can well. very you the gaining you're

think AI share we've very high in maintained I packaging. a

node into and as benefits I full goes hope into the we're and winning. that the films planar the the XXXX XXXX the Iris certainly we into nice further see done production, gate-all-around will then of I increases logic, full adoption the slots in translate of the packaging, growth that in X.XD and there. we've well HBM had we've some gate-all-around, And think So CoWoS our

biggest are those areas. X think the I

overcapacity position lot us a as let's not say, strengthen. panel continues well. Still of packaging of strong of now. for is but our the position small right from lot a a growth There's a course, couple Of years to ago, and

glass I optics And and resolution gains for and competition add this from new to continue creating apart setting with there as high to meaningful well. wide-field is us We the believe our customers. move share opportunities

mentioned You with wondering just Atlas OCD. Atlas just going what's we're and briefly and on

We've -- to the very increased major or opportunities X talked OCD of that's we've tool share intensity the Atlas No, the about that's to and -- gate-all-around continued out. and of That's all players. our going prove OCD at OCD gains well. continuing -- is there. in the and gate-all-around, qualified The for capital least applications

That's So that's, a older for one. story. sure, a strong us an and tailwind for

So earlier, me I didn't for but that mention bring reminding thanks up. to it

do Michael Can going when more? as starts an talking see you think opportunity? you into And PCs. Do People you one if particular, in to just Dell, about, an opportunity? become are about in that squeeze chips that so

Well, That's new players yes, several space. we've I into that. trying mentioned to seen enter why are this

I it by does AI company think on depends the really what mean chips.

So it up tools adoption. and sales. more more opportunities a drives wrapped we're or much because doing what closer and bringing advanced to if for now and Nvidia too been and our lot some it's it can creates won't drives If others, packaging then us it specialty, up I a some think right Dragonfly software has that more mean probably around at packaging their together, architectures, hence around change that unless it's so good current and repackaging memory logic

course, think as phones, advanced refresh their about big more a packaging opportunity integrating manufacturers tremendous NAND talking from packaging phones. we well where is and smartphone hear and nicely drives of of memory could amount a which, another And that content would in as drive I of customers the capability advanced AI OSAT recover business.

the Blayne next will with Jefferies. And Curtis question come from

curious on seen you've color advanced in nodes. advanced packaging the Just of kind or growth more

pace logic with memory. have but the markets? recovery new kind XX-XX you the like question products you're of was seeing also of has you end in about planar. been the there, also it's it And Can strength like where think just I talk

well. So of of much how just products it kind curious is as recovery new versus

of is lot it I recovery. say wouldn't a

investment others transition. that's new more new inflection a course, of or and node, are gate-all-around, the of the in future For same. a the Most

expansions products, again, of so for some NAND. to have then stack seen we've stack that new support -- products, our both by and like traditional aspect So the XD driven the the more been high NAND XD high NAND

coming So these sign or technical a seeing is positive say are seeing buys positive I'd customers the of coming utilizations the say, mostly technical up. takeaway inventories in recovery down. They are indications these transitions market. the or versus, let's are

preparing the next launches. they're in product investing so and And orders of inflections wave for these and

And wanted gross ask then on I just to margin.

if I dated, long also I'm where run through range maybe of think and at to $X into that of out still your range? back term and guess the just which is rate, talk ability at, I different, you're margins assuming model but XX%, that mix you you is billion XX%. the back but different then and it of get kind guiding, the the is to that's gross now was laid right if mix XX% can some XX% you're

product. for thanks the we'll question. updating is look improvement, million and We I But But we commentary long-term margin at into back that the our I our we're our we comes the from the rate margin, as going this to that And No, manufacturing the back mix when driving then that, more just objective Obviously, will where beyond into to model. done the to drive we're -- year back obviously, $XXX it leverage that. been, is run yet. margin help we've look continued update goal Yes. ready capabilities, at not at has with into nodes, million, gross think quarter-over-quarter mean, $XXX when which further. gross get model the that to that quarter our advanced higher-margin things gross and we get model, do look to once it obviously see

now the question-and-answer remarks. over closing turn Sidney conference any conclude back additional Ho does or And I'll that to session. for the

Thanks, Justin.

look in these investor a to conferences be We conferences. quarter. We number seeing will throughout you of many forward of participating at the

your you at be We'd available to in like continued Onto approximately X:XX A replay interest for website on this thank call of the will Innovation. today Time Eastern our evening.

the Justin, please call. conclude

Have you. does conference. do for Thank you an thank participation. today's That your day. We conclude excellent