Q3 2024 FormFactor Inc Earnings Call Transcript
Key Points
- FormFactor Inc (FORM) achieved an all-time record revenue in the third quarter, driven by growth in both segments.
- DRAM probe-card revenue set a third consecutive quarterly record, highlighting the company's strong market position.
- The company's diversification strategy across Foundry and Logic, DRAM, and Flash probe cards is providing stable results and exposure to industry growth trends like generative AI.
- FormFactor Inc (FORM) is seeing strong demand for DDR5 and high-bandwidth memory (HBM), which is expected to continue into the fourth quarter.
- The company is making progress in qualifying new customers and expanding its market position in high-performance compute GPU applications, reducing dependence on mobile and client PC markets.
- Gross margins in the third and fourth quarters are below the target model due to a challenging product mix, particularly the DRAM-rich mix.
- The foundry and logic probe-card demand is expected to decrease in the fourth quarter, impacting overall revenue.
- Unexpected quality-related costs in the systems segment affected gross margins in the third quarter.
- The geopolitical environment, particularly US-China trade restrictions, poses risks to FormFactor Inc (FORM)'s business operations.
- The company faces potential fluctuations in demand due to macroeconomic conditions and customer-specific factors, leading to uncertainties in future revenue projections.
Thank you, and welcome, everyone, to FormFactor's third-quarter 2024 earnings conference call. On today's call are Chief Executive Officer, Mike Slessor; and Chief Financial Officer, Shai Shahar. Before we begin, Stan Finkelstein, the company's VP of Investor Relations, will remind you of some important information.
Thank you. Today, the company will be discussing GAAP P&L results and some important non-GAAP results intended to supplement your understanding of the company's financials. Reconciliations to GAAP to non-GAAP measures and other financial information are available in the press release issued today by the company and on the Investor Relations section of our website.
Today's discussion contains forward-looking statements within the meaning of the federal securities laws. Examples of such forward-looking statements include those with respect to the projections of financial and business performance, future macroeconomic and geopolitical conditions the benefits of
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