Q4 2021 CyberOptics Corp Earnings Call
Yes.
Good day, ladies and gentlemen, and welcome to the Ciber optics fourth quarter 2021 earnings call. Today's conference is being recorded at this time I'd like turn the conference over to Doctor Sue boat Kulkarni, President and CEO of cyber optics. Please go ahead.
Thank you.
Good afternoon, and thanks for participating in fiber optics earnings conference call for the fourth quarter of 2021.
Joining me is Jeff Bertelsen, our CFO and Chief operating Officer, who will review our results in some detail following my overview of our recent performance.
Have you done they'll be pleased to answer your questions at the conclusion of our remarks.
In keeping with regulation FD, we have made forward looking statements regarding our outlook in this afternoons earnings release.
These forward looking statements reflect our outlook for future results, which is subject to a number of risks that are discussed in our Form 10-K for the year ended December 31st 2020.
Other filings with the Securities and Exchange Commission.
We urge you to review these discussions of risk factors.
Turning now to our recent performance cyber optics reported strong sales and earnings in the fourth quarter of 2021.
Sales of $22.1 million rose, 31% from $16 $9 million in the fourth quarter of 2000.
Net income for the fourth quarter of 2021, which benefited from a gross margin percentage of almost 50% came to $3.4 million or 45 cents per diluted shares.
132% for earnings of $1 $5 million or 20 cents per diluted share in the year earlier quarter.
We also reported today.
Card sales and earnings in 2021.
For the full year.
So you're just over $92 $8 million, an increase of 32% from $71 million in 2020.
Net income in 'twenty, and 'twenty, one was $12 $8 million or $1.69 per diluted share up significantly from five four and $7 million or <unk> 77.
Diluted share into integrated.
Fiber optics fourth quarter and record full year operating results were driven by sales of our treaty M RSV sensors and inspection systems <unk> and.
And wafer semiconductor sensors.
These products accounted for 76% of brokered Cds in the fourth quarter of 2020 was compared to 16, 9% in the euros pdx.
Well for full year 2021.
A modest enabled N V for defense products accounted for 78% of overseas up from 67% for all after integrating.
We believe this ongoing shift in our sales mix demonstrates that fiber optics is continuing to penetrate and gain traction in our targeted surface Mount technology and semiconductor capital equipment markets.
The competitive advantages, so far advanced sensors and inspection systems products, but it didn't.
Playing us to capitalize upon strong growth opportunities in this market.
Demand for all of them on SBC products and wafer sensors is expected to remain strong for some time, making us optimistic about cyber optics outlook for the first quarter of 2022.
We also see the full year shaping up as another period of strong operating results.
No for the next few minutes I will review the performance of each of our product families.
Sales of <unk> sensors increased 40% year over year to $7 million in the fourth quarter of 2021 .
Within this category sales of <unk> sensors rose, 41% year over year to $5 million into fourth quarter.
Even by demand for these sensors and high end electronics and semiconductor inspection and metrology applications.
Sales of <unk> sensors are forecasted to post strong year over year growth in the first quarter of 2022.
See yourself semiconductor sensors, principally at wafer since late of sensors increased 62% year over year to $6 million in the fourth quarter of 2021.
Ongoing demand for semiconductor capital equipment is driving the sales growth.
This unit and process improvement sensors.
Sales of semiconductor sensors are forecasted to record strong euro what are your growth in the fourth quarter of 2022.
Yes.
Sales of inspection and metrology systems rose, 11% year over year in the fourth quarter of 2021 to $9 $1 million.
Within this product category fourth quarter sales of S. Q3 thousand multifunctional inspection systems increased 15% year over year to $4 $7 million.
Of total fourth quarter <unk>, one 1 billion was generated by sales of systems for mini Leds inspection and metrology.
Yes, Q2 is related to many of the applications totaled $8 million for the full year and the many Eddie backlog at December 31, 2021 stood at $1 4 billion.
Additional orders for this growing market anticipated in 2022.
Fourth quarter system sales also benefited benefited from customer acceptances of nearly $1 million or.
<unk> 3000 final vision inspection systems and sensors kits for memory modules.
Additionally, it makes 3000 orders of $1 5 billion.
But it has seen earlier in the first quarter of 'twenty Crazy too.
Bringing our current backlog of 38, <unk> startups to $5 million.
This artist presently scheduled to be recognized as revenue primarily in the second and third quarters of 2022.
Sales of inspection and metrology systems are forecasted to post strong year or what are your growth in the first quarter of 2022.
Cyber optics backlog at December 31st 'twenty, 'twenty, one totaled a record $47 $3 million up from $44 $2 million at the end of third quarter of 2021.
And $23 million at the end of 2020.
We are forecasting sales of $22 million to $24 million for the first quarter of 2022.
Ending March 31, compared to $17 $7 million in the first quarter of 2021.
As mentioned earlier.
Expect to report strong operating results in the first quarter of 2022 based on the continuation of favorable market conditions and shipments from our order backlog of three D. A modest sensors and system products.
Cyber optics made significant progress penetrating our targeted SMT and semiconductor capital equipment markets in 2021 due.
Due to the demonstrated competitive advantages of our advanced sensor interesting products.
We believe this progress will continue in 'twenty, 'twenty, two which would be shaping up as another strong period for cyber optics.
Thank you Jeff.
Jeff Bertelsen will review, our fourth quarter performance in greater detail.
Thanks abode.
Our gross margin percentage in the fourth quarter of 2021 was almost 50%.
Up from 47% in the year earlier period and better than our forecast at the beginning of the quarter.
Sales of <unk> systems with better price points for more demanding higher end electronics and semiconductor backend Assembly applications were the primary factor driving the improvement in our gross margin percentage in the fourth quarter of 2021.
Our gross margin percentage for the first quarter of 2022 is expected to be down a couple of percentage points from the strong level posted in the fourth quarter of 2021.
Primarily due to lower price points for <unk> system sales.
The COVID-19 pandemic has caused disruptions in the global supply chain, including parts and labor shortages and delays in ocean freight and port congestion.
It has become increasingly difficult to obtain adequate supplies of certain key components needed to manufacture our products.
We are spending an increasing amount of time working with our suppliers to ensure that we have adequate supplies to meet customer demands.
To date. These shortages have not had a significant impact on our business and we are confident that we have adequate supplies to meet customer customer demands for the first quarter of 2022.
In addition, we are keeping extra inventories on hand at the present time. So we can meet anticipated customer to customer demands for later quarters.
Total operating expenses in the fourth quarter of 2021 increased 13% year over year to 7.2 million.
This increase was due to higher third party channel commissions, resulting from the significantly higher year over year sales and higher compensation costs for new employees.
Depreciation and amortization expense totaled $665000 in the fourth quarter of 2021 and stock compensation expense came to $348000.
Total operating expenses in the first quarter of 2022 are forecasted to increase by about 5% to 8% sequentially.
From the fourth quarter of 2021 again due to higher Channel Commission and compensation cost and also increase participation in trade shows.
Our effective income tax rate for the fourth quarter of 2021 was 9% and was favorably impacted by $190000 of excess tax benefits from stock option exercises investing.
Of restricted shares of restricted stock units.
Absent excess tax benefits our tax rate for all of 2021 would've been about 16% and this was the tax rate we are expecting for the first quarter of 2022.
We presently anticipate that there will be additional excess tax benefits later in 2022, which will drive down our tax rate in future quarters.
Cash and marketable securities totaled $38 3 million at the end of the fourth quarter of 2021 up from $33 5 million at the end of the third quarter and $36 million at the end of 2020.
We believe our capital resources are adequate for achieving our growth objectives.
Want to conclude by saying that we are optimistic about the cyber optics outlook for the coming year.
We expect to make further progress throughout the year at penetrating our targeted markets with our lineup.
Mrf's enabled sensors and systems and wait for some semiconductor products.
Progress should make 2020 to another year of solid improved operating results. Thank you we will now be happy to take your questions.
Thank you, ladies and gentlemen, if you'd like to ask a question you may do so by pressing star one on your telephone keypad using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment.
Again, Please press star one to ask a question, we'll pause just a moment to give everyone an opportunity to signal for questions.
We will take our first question from <expletive> Ryan with Colliers. Please go ahead.
Okay.
Thank you congratulations on the strong quarter and good guidance.
Thanks.
David you.
You gave us the $8 million for many LCD business for all of it.
'twenty one.
And you said you anticipate some additional orders can you just kind of give us kind of the perspective that you're looking at right now of that market opportunity.
Sure. So linearity has already been a good contributor for us.
In the last two or three.
For years now.
And this.
This year is shaping up to be an exciting year for mid easily scalable.
So it is knowledge consumer electronic companies have made announcements that they are going to scale up many of EDI Beast.
As the year goes on.
And we certainly will.
And so keep layering enabling inspection.
<unk> process steps.
Doses or excuse me those and gets used in the most critical depending steps.
During the manufacture of medium duty.
And that multiple companies in multiple products getting scared of the feel pretty optimistic that this will be another solid growth year for.
Or is Q4, the medium duty application.
Yes, I was wondering if you're getting any more if you're gaining any other additional inspection steps or you're just getting deeper into some of your existing customers.
It's.
It's more and more customers are joining and activity and we are getting more and more from the existing customer and the newest away. So.
Not because of any inspection steps, but because moura coming in at more length out of getting scaled up.
Okay switching.
Switching over to the memory side.
<unk> had some good commentary as well they are what what is your anticipation.
Order patterns.
Now in 'twenty one.
The first customer shifting more from the <unk>.
Yes, so we right now have two customers and go to subprime.
Florida.
Distance almost.
One customer has ordered PD.
As you know if it makes it makes 3000 from day one.
Other customers that started earlier.
Starting with duty they have ordered some PD, but we also continue to order.
Turning on their needs. So we expect one customer to continue to buy.
It makes systems and wanted to continue to buy <unk>.
All of the memory market is doing really well.
Both these custom motorcycle.
Increasing the number of lines and based on the forecast that they have given us we feel pretty good about growing a lot it makes business as new customers.
No.
And particularly if you could.
Okay.
Turning to a couple of financials, you said that the supply chain hasn't had much of an impact.
Are you seeing any revenues that had been pushed out.
At this point.
No.
To this point deck, we really haven't seen any significant.
Revenue was pushed out.
We have and haven't had any significant disruptions.
Certainly we've seen component shortages like everybody's.
Experienced thankfully to date, we've been able to.
Secure the components that we need in the parts that we need to deliver for the customers.
And.
Right now we're in good shape for Q1, and we are carrying some extra inventories to help buffer us as the year progresses.
Okay, Great and just one last one Jeff do you have the cash flow from ops for the quarter on the year and then did I hear you right. You said the gross margin from Q4, we will drop a couple of percentage points.
Yes, yes, that's right. So first on the gross margin.
As the numbers show, we were almost 50% so so pretty strong quarter, there, but you know I am.
Thinking those margins might drop a couple of points still a good good showing but I'm thinking it'll be down a couple of points in Q1 2022 sequentially from the fourth quarter.
In terms of operating cash flow in the for the for the full year, it's $10 $1 million is what you would see and about 5 million in the fourth quarter alone.
Okay.
Great. Thank you.
Thanks, Nick.
We will take our next question from Greg Palm with Craig Hallum Capital Group. Please go ahead.
Yes, Thanks <unk>.
Jeff Congrats on the good results and frankly, a pretty outstanding year.
Thank you Greg Thanks, Greg.
I wanted to start on the gross margin because that was that number really stood out so.
Other than mix anything that you can point to and I am curious as we think about this year I know you've given guidance for Q1, but.
Should we assume any further gross margin expansion based on that SKU cost reduction plan that you've talked about in the past.
Yeah.
So certainly when you think or when I think about or we think about gross margins I mean.
For sure mix is the biggest factor in our gross margin.
<unk> had a phenomenal year in 2021, we think that will continue into 2022.
And then also the probably the biggest driver in terms of our gross margin is just.
The <unk> product line and the sales price points, there and as we target into.
More higher end applications for that product certainly that's where we expect to go with with increasing.
Mini Leds sales and so forth. So I think those are really the main drivers in our gross margin profile for 2022, its really mix dependent.
More wafer sense more mras sensors, and really driving eschew into those higher end applications at this point I don't think.
No.
We do have eschew cost reduction programs that we're working on but I don't think that'll be a huge factor when we think about gross margin in 2022, certainly our gross margin trend.
Really throughout 2021 has been has been good and we're going to continue to work on that but I think its a really mix for 2022.
I mean do you looking back you know kind of this 44% range was sort of the.
The gross margin on it at least on an annual basis for 2018, 2019, 2020, I mean do you get the sense at least.
Excluding any mix.
Either way I mean is gross margin, maybe the newer baseline more like mid to high <unk> versus the 44% to 45% just trying to get ahead of it.
<unk>.
Yeah.
When you look at our results.
You know and certainly every quarter you know if you look at 2021, we had one.
One quarter at the second quarter was around 40 for the others, we're north of 45% in 2021.
And you know we started to see a little bit of that really like in the fourth quarter of 2020, So I think.
No.
As you know.
Just assuming mix sort of stays the same I mean I think this is as you know.
Newer baseline for US you know wafer sense grew 59% in 2021, so that has a huge impact on our on our gross margins.
If the mix stays the same I think.
This is sort of the newer baseline.
Our composition of Mrf's based product sales and wafer product sales has continued to grow which has helped helped gross margins. So I think we have made some progress and I think this is closer to the newer baseline maybe than fourth.
44 ish type percent that we've seen in the past, but definitely it is mix dependent.
Yeah No that's that's.
Great obviously, that's a pretty important lever if that's the case.
Yeah. It's about can you give us just a little bit of sense on.
The overall pipeline you gave a little bit of color on on many LCD and certainly memory, but what are you seeing out there anything that concerns zero.
It seems like it's a pretty good backdrop.
I mean, what are the backdrop continues to look very healthy.
Both semi cap and electronics markets seem to be going fairly well.
The numbers vary depending on which analyst report, if you look at and which specific markets. I mean, the latest indications are that semi cap market.
Overall grew roughly 10% in 2022.
Electronics market.
Lennox inspection market is roughly 10% to 15% in 2022.
So it's a very healthy macroeconomic backdrop.
But the range varies there are some analysts are predicting the order numbers that are some are projecting higher numbers.
But we believe the in general the market, leading and arguably inputs that neighborhood right now so it's a very healthy backdrop within that obviously we have.
Our two differentiated technology platforms, <unk> and we continue to gain traction.
Increase our market share if you will in those markets. That's why we feel pretty good about.
I need to be another solid year for us.
<unk> gets difficult once you go beyond a few months. So most of the reports that we are seeing right now.
You're delivering for certainly for Q1 and Q2.
People would get updated.
Everyone have a tough time projecting given all the external events that I believe only deployed what exactly will happen.
In the second half of this year or certainly next year, but overall I believe.
Semi and electronics industries feels pretty good solid growth here in 2022, you'll see it's looking like a very good growth.
Blake.
And.
No.
That your end markets I guess are still showcasing some some good growth I think you nicely outperformed those end markets. This past your your is your.
Sort of goal or target to continue to outperform the the actual end market growth.
Yes that is our target it certainly we want to keep gaining share and do better than what the overall semi cap electronics inspection markets veto.
And I guess just last one any help with the cadence of our 2022 based on your current backlog I know you've got.
Multiple items that are shippable across various quarter. So anything that we should sort of no in terms of the cadence of how the quarter lease will play out.
Yeah.
Well certainly as you have given provided guidance for Q1, you know the backlog. So we are certainly expecting a solid Q2.
Q2, with the teams we will increase sales in Q2 based on the backlog right now.
We will keep lifting at this point at least it looks like Q1, we have given you the number in Q2 will be higher than Q2.
Point.
Certainly quantify that once we get into April time period.
Okay, Great Alright, I'll hop back in the queue. Thanks.
Thanks, Craig.
As a reminder, star one for questions well go next to Eric slate with Acme analytics. Please go ahead.
Eric.
Yes can you hear me okay.
Yes, we can now.
Okay perfect.
Paul.
Hi, unbelievable those numbers.
We'll talk about those but.
<unk> questions first of all bode.
On the <unk> 3000.
I think you guys without a P O.
That hit this quarter or is that correct that new system for the Midland.
Let me go to appeal in Q3.
The book, either this quarter or next quarter, depending on the exact timing of delivery and acceptance and all that but certainly the <unk>.
Can you disclose how much that was for.
We would rather not get into the details because.
Number two our competitors.
Okay I understand.
More than half a million dollars in less than $1 million somewhere in that neighborhood. Okay.
And when do you think will really start seeing the ramp on that if you have any guess.
Well as we have mentioned in the past.
We are participating in this advanced packaging market.
In two ways, we sell a nano and modest censored.
Two our system integrator customers.
Where do you currently.
Our system integrators in China.
They are getting some good wins in China and someone else just growing Chinese will set.
Our companies is using the <unk> sensor.
And our software.
And the same product essentially outside China UWS St Jose.
So thats what we are we have secured 180 <unk>. So I can see that we have all the unsecured two large important customers in this area.
It is a good start certainly we are talking to another five to 10 customers as we speak and we.
We are confident we will get some of those done in 2022 but that's what it is material impact is concerned I mean, it's still going to be relatively small most of the P&L is going to be dominated by the current lineal, Florida SKU mix defenses.
Okay.
I'd just add Bob.
I talk with Jeff, but I understand you know as we get in the fourth quarter. It gets more interesting.
Hopefully you don't have any of these things going into the Ukraine.
This is Kevin.
So now I wanted to ask his question you always get the same answer I'm sure I'll get the same answer on the third memory player.
I guess, that's hot and heavy but.
That could go this year I would assume.
We continue to target.
They continue to be interested in the technology, we are discussing different options on how to enable data business.
What is very much in progress we continue to discuss it then.
And the next one for you is any more mini micro Leds.
<unk>.
Or you have been talking to.
As opposed to the end of the third quarter.
Hum.
I believe you have already mentioned that.
So far the orders we have seen.
Many of duty SKU systems are primarily driven by one large consumer electronics companies, but the actual orders come from centers.
That companies I believe you have so many skus systems to roughly eight customers so far.
And the same sub cons do service other large consumer electronic companies do so sometimes it's difficult to know exactly what all of our systems are ending up.
I got a very high level I can say that if you look at published reports three large consumer electronic companies are scaling our products as we speak in the medium duty work right now and those three large consumer electronic companies and soda.
Some of them are the ones, who have been purchasing from us. So before the end of 2020, we certainly expect many consumer electronic products with linearity and we certainly expect a skew to be part of that supply chain.
Okay, I will make an observation here.
I had well documented Jeff will tell you I was I had you at the end of 'twenty or 'twenty, one doing a buck 35 to about $40 a share.
This next year, well documented and you guys are making me look.
Conservative already with <unk> 69 for the year, how do you guys doing $3 next year, unless we have a recession.
The three other analysts had 81 cents at the end of 'twenty.
I think.
You guys came in a Buck 69, so they missed by a.
Mobile then they only have a buck 63.
For 'twenty.
'twenty two I have three you guys already the Buck 69 for 'twenty one come on boys up the estimates. This is the semiconductor industry. This is not packaged foods here I just want to put that out there because.
You've got to do a service for the plenty of investors out there get numbers quite close.
That's my fondness industry for 30 year analysis, Nike <unk> and.
This isn't the buying cycle, Jeff and I talk about this the demand drivers are.
Leasing whats coming out as cloud computing five G.
So Eric.
Do you have any other questions right now.
That's it for me you guys go.
Congratulations.
Star one for questions. We will take our next question from Chris Lukowski Private Investor. Please go ahead.
Hello, Good afternoon congrats.
Congratulations again.
So.
Thank you.
So if you don't mind I can ask a more general questions for you you were investors like me.
It seems it seems like a big part of your growth was thinking buckets.
In addition to the usual semiconductor semi cup.
Our growth.
And can you tell us at this point what percentage of the market for optical inspections have both in electronics.
He's putting spectrum, so that we know that how much how long ago did conduct performed.
The average semi KEPCO.
This is a good questions.
Unfortunately in the visa.
Cynthia.
There are no external reports have level part of it is because we have a very strong IP position.
Any competitors in that area.
In the wafer Cynthia wherever the market is for those kinds of subsea service seven applications right now.
All of the market, we believe so theres no market share per se. So when you see our market share is increasing in the auto industry, we are talking about more penetration.
The market in different Cynthia.
On the electronic inspection systems side, certainly there are competitors that are external reports are available.
<unk>.
Sean those reports and our investor presentation that is available.
And what are they saying.
If you look at it but I can mention often the last report we have a lead.
The key category, which is the <unk> market.
We believe we have roughly about 13% market share.
The high inside we don't participate in the bottom half of the market.
If you want to look at our aggregate market share you can see it's about 6% to 7% would be out of the high performance high price I E.
It is mostly the top half of the market.
Our market share continues to increase in the tea category, where we compete the TDA why it's about 13% right now for.
For instance, I would say the flip side.
Does that answer your question.
Yes, yes, that's very helpful I Didnt wafer sense.
As you said, it's about penetration, but in terms of wafers.
Being optically inspect 13 inspecting most of the wafers being batesville or just a small portion.
Kind of trying to convince people to optically inspect their wafers.
And the question becomes a little more complicated because it.
Inspecting MPV floating LIFO defense.
Forget our Florida.
We are measuring things like leveling vibration particle humidity.
The exit Mig.
So we actually go inside the two.
Do the in situ measurements and report the data in real time oversight. So we don't really expect a V.
Measuring and monitoring the equipment if you have it.
So typically our products get used then to the foot is not inside.
So we are kind of going in monitoring the condition of the equipment come out and then the LIFO to start with Disney.
So it's not like you can quantify how many of these leasing space.
Have done bottoms up element.
How many fabs that are and how many pieces of equipment and.
And we have some of these that are getting in our investor presentation, and we believe based on bottoms up analysis.
The market potential for wafer sense is at least in the neighborhood of $100 million growing at about 15% to 20%. So we believe we have plenty of penetration opportunities.
At the existing applications, we had and we continue to increase applications.
Suffice it to say that we believe.
Plenty of upside growth potential in the future.
Okay. That's oh, that's good to hear.
Neal apologies for reading your presentations.
The presentation will be folks had more carefully.
But.
Also in general.
The about you you.
You know you mentioned that you know you're you're thinking about it could show increasing penetration because of your superior technology.
Can you tell us in general.
So I was just thinking over to superior and does that tie in with <unk>.
General trends in the industry such as miniaturization.
The packaging side.
Packaging and so on.
Sure so the <unk>.
Technology, where we compete directly with other competitors.
Judy.
<unk> sensing technology, we call it <unk> <unk> stands for multi reflection separation.
You have several patterns.
Taking that technology.
It's essentially a very unique.
Doing PD lone contact optical sensing.
Which gives higher accuracy.
And higher speed both at the same time they are taking.
Technologies that are more accurate, but significantly slower than what we do and there are some technologies that are.
Significantly faster, but very inaccurate compared to what we do so what day modest allows us and our customers is the combination of higher accuracy and highest speed both at the same time.
Compared to many of their condition are definitely that is the real differentiation we have.
But it manifests itself into is superior image quality. If you look at the immediate coming from a modest sensors significantly.
Significantly superior compared to conventional technologies, and usually better image quality leads to better inspection and measurement business and Thats what enables us to continue to gain traction with that modest impact.
Okay.
Hopefully that answered your question yes.
Yes, yes, it does and then would you say that.
This is becoming more important with the miniaturization of everything.
And there being like more features.
Assume there'll be more reflections right.
In general I mean.
Folks are getting smaller parts are getting more reflective of everyone's packaging is becoming more lethal oriented by definition before he's like a mirrored so yes, <unk> is well suited for interconnect cycle and that's what makes us optimistic.
Alright. This is it for me thanks for bearing with me congratulations again and good luck.
Thanks.
And we'll take our next question from Ash Birla with Birla Dk capital. Please go ahead.
Oh, Hey, Thank you guys.
Sure.
Amazingly I.
Just said.
I'll start with Sabra.
I figured I use this opportunity to ask like a couple of questions.
As it relates to like Miracle situations, because I mean, we I know Jeff.
We have talked a lot about <unk>.
Most of my personal goals.
Right.
I was wondering if you can probably comment on that.
Because I couldnt get on the aim that.
And nobody asked applied materials on this.
The Russia situation.
Kurt.
And wood.
Would you know what impact that would have.
Do the entire semiconductor supply chain.
Especially because it will hit the 8% is the most in case.
From what I've heard is like the neon gases are all 70% to 90% supplied by Ukrainians.
And that Goldman <unk> tools and not the <unk> tools, what do you need to also like would you have any idea of what that impact.
Impact would be for me personally.
And then I have a follow up.
I mean, you are asking a very difficult question that we don't have much visibility to I mean, this is like material supply coming from Russia and Ukraine.
I'm sure there are some second order.
Thanks.
We are not aware of what exact percent of.
So unless you are you couldn't get used in the semiconductor industry and with that I'd like to introduce or anything like that.
As of today at least in Minneapolis, followed this area very closely as you know.
No one has said that.
Any of the potential Cisco being from that part of the world would have any direct impact on fab output any fab output.
So I think what it will effect.
We expect it will be would be the second or third order effect not a direct.
But again, if you remove from that overall ecosystem. So we really cannot comment much more than what other analysts have said.
Sure.
That makes sense.
I had never worked in a fab so but.
That's why I was really curious about some of the specialty gases.
And I figured.
Do you have work then once I figured you might know.
The impact.
The second question I was wondering.
When you have you broken down how much is the TMR with sales to KLA.
Is that available in the 10-K, what have you guys broken that out revenues I mean, yes. We are we have commented on significant customers.
Cash.
And so currently we have one customer who accounts for a little less than 20% of our revenue, but we have not given that customer's name.
So we won't comment specifically on what percentage of our sales are specific to <unk>.
L a.
So Jeff.
So Jeff I would just the only.
It's okay I don't need the customer's name I was just curious if the the CDM or shipment that's going in is that is.
Is that mostly for like 10 nanometer.
The Bakken testing is that for the.
The advanced node chips like E V chips or is it the D V chips, which is 10 nanometer.
Or is it the 10 nanometer do you know the which weird where are those.
Hum.
Where's that slip system going to within the fab.
Yes that we can see I mean, a modest.
Optical physical optical domain technology, so if you're using 400 nanometer late in a modest the highest resolution and medicines that we use all.
All of the applications with a modest sensors visited fescue system or what we say to our OEM customers.
All of the backend advanced packaging applications. So we are not in the front end inspection.
The art of infant and with LIBOR.
We are not in fact at this point.
So we don't deal with Athena and we didn't find out and we didn't know anything I mean at the advanced packaging.
They are many of the advanced chips.
Packages, rather odd using peanut underground five nanometer nodes, we are handling them as a package that was not at the transistor level.
Great that's what I meant sorry, the package that theyre doing it.
Five nanometer chips right.
Yeah, absolutely I mean, a modest is being used to inspect the most sophisticated advanced packages right now.
And certainly many of those advanced packages are coming from the 10 nanometer and find out then we done very advanced node chips.
Got it okay, great I mean, guys, congrats and I really wish I was writing on fiber optics I mean these are just.
These are fun numbers the way down.
Well congrats again, thank you.
We have no further questions at this time.
Well. Thank you all for your interesting questions and we look forward to updating you with our Q1 results in April Thank you again.
Ladies and gentlemen. This concludes today's conference. We appreciate your participation you may now disconnect.
Okay.
Okay.
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