Semiconductor production equipment provider Amtech Systems (NASDAQ:ASYS) fell short of analysts' expectations in Q4 FY2023, with revenue down 14.3% year on year to $27.71 million. It made a GAAP loss of $0.85 per share, down from its profit of $0.29 per share in the same quarter last year.
Key Takeaways from Amtech's Q4 Results This was a disastrous quarter. Revenue missed by a large amount, and operating profit did as well, even if we exclude the one-time impairment charge of $5.2 million that the company highlighted. Adding to the woes was guidance. Q1 fiscal 2024 revenue guidance missed by a large amount as well. The stock closed down 31.6% on the results.
Is now the time to buy Amtech? Find out by reading the original article on StockStory.
Amtech (ASYS) Q4 FY2023 Highlights:
- Market Capitalization: $58.09 million
- Revenue: $27.71 million vs analyst estimates of $30.85 million (10.2% miss)
- Operating Loss (GAAP): -$11.7 million (including $5.2 million impairment charge) vs analyst estimates of -$0.6 million (miss, even when excluding the charge)
- Q1 Fiscal 2024 Revenue Guidance: $22.5 million at the midpoint, well below expectations of $33.0 million (31.8% miss)
- Free Cash Flow was -$1.53 million compared to -$2.77 million in the previous quarter
- Inventory Days Outstanding: 127, down from 160 in the previous quarter
- Gross Margin (GAAP): 10.1%, down from 38.8% in the same quarter last year
Semiconductor ManufacturingThe semiconductor industry is driven by demand for advanced electronic products like smartphones, PCs, servers, and data storage. The need for technologies like artificial intelligence, 5G networks, and smart cars is also creating the next wave of growth for the industry. Keeping up with this dynamism requires new tools that can design, fabricate, and test chips at ever smaller sizes and more complex architectures, creating a dire need for semiconductor capital manufacturing equipment.
Sales GrowthAmtech's revenue growth over the last three years has been strong, averaging 23.7% annually. But as you can see below, its revenue declined from $32.32 million in the same quarter last year to $27.71 million. Semiconductors are a cyclical industry, and long-term investors should be prepared for periods of high growth followed by periods of revenue contractions (which can sometimes offer opportune times to buy).
Amtech had a difficult quarter as revenue dropped 14.3% year on year, missing analysts' estimates by 10.2%.
Product Demand & Outstanding InventoryDays Inventory Outstanding (DIO) is an important metric for chipmakers, as it reflects a business' capital intensity and the cyclical nature of semiconductor supply and demand. In a tight supply environment, inventories tend to be stable, allowing chipmakers to exert pricing power. Steadily increasing DIO can be a warning sign that demand is weak, and if inventories continue to rise, the company may have to downsize production.
This quarter, Amtech's DIO came in at 127, which is 20 days below its five-year average. At the moment, these numbers show no indication of an excessive inventory buildup.
