Q1 2025 Veeco Instruments Inc Earnings Call
Cover by Nahee Blayne Special Thanks to www.flights.bank.usa
John Kiernan, Mark Miller, John Kiernan
Speaker Change: Greetings and welcome to the Veeco First Quarter 2025 earnings call. At this time all participants are on our listen only mode. A question and answer session will follow the form of
Speaker Change: If anyone should require operating assistance during a conference, please press star zero on your telephone keypad. It is not my pleasure to introduce your host, Anthony Pappone, Head of Inress Relations. Thank you, you may begin.
Anthony Pappone: Thank you and good afternoon everyone. Joining me on the call today are Bill Miller, Veeco's Chief Executive Officer and John Kiernan, our Chief Financial Officer. Today's earnings release and slide presentation to a company today's webcast is available on the Veeco website.
Anthony Pappone: and are subject to the risks and uncertainties that could cause actual results to differ materially from the statements made.
Anthony Pappone: These risks are discussed in detail in our form, 10K Annual Report and other SEC filings. Veeco does not undertake any obligation to update any forward-looking statements, including those made on this call to reflect future events or circumstances after the date of such statements.
Unless otherwise noted, management will address non-CAP financial results.
Anthony Pappone: We encourage you to refer to our reconciliation between gap and non-GAAP results, which you can find in our press release and at the end of the earnings presentation. With that, I will turn the call over to our CEO , Bill Miller.
Thank you, Anthony.
Anthony Pappone: Veeco delivered solid top and bottom line results, revenue total $167 million above the midpoint of our guidance
Anthony Pappone: non-GAAP Operating Income $24 million, and non-GAAP EPS of 37 cents above the high end of our guidance.
Anthony Pappone: Our semiconductor business had another quarter of strong performance, growing both sequentially and you over year.
Anthony Pappone: Growth was led by an increase in advance packaging, including wet processing systems to a leading foundry and HBM manufacturer, as well as lithography systems to an IDM and OSATS.
Anthony Pappone: We also ship several LSA systems to leading customers for gate all around and high bandwidth memory.
Anthony Pappone: In addition to our solid results, I'm excited to share an important customer award in several significant strategic wins.
Anthony Pappone: First, Veeco was awarded Intel's 2025 Epic Supplier Award due to our excellence in the Neal Technology.
Anthony Pappone: As one of 37 recipients in Intel's global supply chain, receipt of this award acknowledges us for our commitment to quality, excellence, and dedication to technology innovation.
Anthony Pappone: Recognition from a market leader such as Intel has been an internal goal of Veecos and we believe this milestone validates us as a top supplier in the semiconductor industry.
Anthony Pappone: 2. During the quarter, Veeco received laser annealing system orders from two leading edge logic customers for their gate all around nodes, including one customer's 2nd NSA 500 nano 2nd annealing system.
Anthony Pappone: For a high band with memory, our customer continues to place laser and kneeling system orders as the man remains strong.
Anthony Pappone: Third, two leading logic customers have designated Veeco's laser spike annealing platform as production tool of record for new applications at their most advanced gate all around nodes.
Anthony Pappone: Expanding adoption of laser annealing at the leading edge is core to our Sam expansion strategy. Both wins are a culmination of ongoing collaboration with each customer and a great example of our market leading position in laser annealing.
Anthony Pappone: Fourth, we recently announced an IDM Qualifier Wet Processing Platform for two new applications and placed initial orders in Q1. These wins validate the growing use cases for our technology for new applications tied to a growing SAM.
Anthony Pappone: Before moving ahead, I laid to address recently enacted tariffs and the prospect of further tariff policy escalations, which are resulting in uncertainty across Veeco's business.
Anthony Pappone: Recently enacted tariffs are currently causing some customers to delay shipments, could impact future and market demand, and has also resulted in an increase in certain costs. Given the dynamic nature of the situation, we continue to evaluate potential implications to our business.
Anthony Pappone: While uncertainty may persist for some time, we remain confident in our long-term strategy and believe each of the wins previously highlighted reflect our strengthened market position, which we expect will enable us to capitalize on long-term semiconductor industry growth.
Anthony Pappone: I'll now provide an overview of our role in the semiconductor manufacturing process and and then update on key technologies.
Anthony Pappone: Veeco technologies remain critical for several leading-edge semi-manufacturing process steps. Veeco is the market leader and laser annealing with our laser spike annealing system qualified as production tool of record for leading logic customers and one tier one DRAM customer.
Anthony Pappone: Our recently launched next-generation NSA system expands our capabilities to enable new applications and we're pleased to report our evaluations at advanced logic customers are progressing well.
Anthony Pappone: Equally is important, interest from logic and memory customers to evaluate our system remains high.
Anthony Pappone: During the quarter, we saw continued demand for our laser annealing systems from leading edge customers, primarily driven by end market demand for high performance computing and AI.
Anthony Pappone: In addition, recent orders for GADOL around and HBM are contributing to expectations for strong growth in our leading edge laser and nailing business in 2025
Anthony Pappone: Veeco is also the market leader for deposition of defect-free films for EUV mass-blind production with our IBD-EUV system. Our IMVM deposition technology is critical to the industry's roadmap, and we're in a strong position to support growing demand for EUV lithography.
Anthony Pappone: We see opportunity for growth in this business as our technology continues to expand to adjacent mass blank steps.
Anthony Pappone: Growth in AI is accelerating adoption of new technologies and materials that enable device scaling and address the growing need for energy efficient compute performance.
Anthony Pappone: As the waste geometries continue to shrink, traditional technologies are struggling to achieve resistivity requirements, driving Tier 1 customers to consider new solutions to address their high value challenges.
Anthony Pappone: Veeco has recently launched IBD 300 system, differentiates itself from traditional technologies through its ability to achieve improved thin film properties and lower resistivity with critical metals in memory and logic.
which can directly impact device performance, speed and battery life.
Anthony Pappone: Looking ahead, we remain highly focused on working with our customers to integrate our technology into their manufacturing processes and evaluate new applications.
Anthony Pappone: Our systems' unique capabilities have enabled our strong position in 3D packaging for AI, providing expectations for growth to accelerate in 2025.
Anthony Pappone: An advanced packaging lithography, we're seeing a recovery led by capacity expansion for AI and high performance computing, highlighted by today's announcement of $35 million in orders from IDM and OSAT customers.
Contributing to Expectations for Growth in 2025
Anthony Pappone: Demand for Veeco Technologies is being accelerated by leading edge inflections such as GADOL around, Hyban with memory, EUV lithography, and 3D packaging.
Anthony Pappone: Our exposure to each of these high-growth areas of the market offer opportunities to expand our SAM in several areas.
Anthony Pappone: In annealing, we project our Sam to Grove to around $1.3 billion dollars.
Anthony Pappone: Customer road maps require precise annealing solutions with tighter thermal budgets to address scaling challenges associated with shrinking, geometries and new architectures, resulting in an increase in steps available to laser annealing.
Anthony Pappone: In logic, gate all around architecture and new technology such as backside power delivery are increasing laser annealing intensity.
Anthony Pappone: In memory, high bandwidth memory and 3D devices are driving customers to adopt laser annealing to solve new challenges.
Anthony Pappone: An I&B deposition for front-end semi-applications, we forecast growth in our SAM to approximate $350 million for high-value steps requiring critical film performance.
Anthony Pappone: In IMVM Deposition for EUV Mass Blanks, we see our SAM growing to over $120 million as the market adopts EUV and high NA lithography, and customers continue to evaluate new use cases for our technologies.
Anthony Pappone: And in Advanced Packaging, we see potential SAM growth for our enabling wet processing solutions for a growing number of applications supporting AI and high performance computing.
Anthony Pappone: As we look ahead, we believe our portfolio of enabling technologies for key inflections, positions are semi-business to outperform WFE growth over the long term.
Anthony Pappone: I'll now provide additional details on our evaluation program, which is core to our investment strategy and essential to capturing our largest opportunities.
Anthony Pappone: Many evaluations are targeting several applications which can result in follow-on business between $30 to $60 million per application when assuming $100,000 wafer starts per month.
Anthony Pappone: While the timing of adoption by system, customer and market will vary, customers are excited about the value proposition our technologies offer and we're highly focused on executing.
Our evaluations in the field are progressing well.
Anthony Pappone: And we're also investing in additional systems to win new business in logic and memory. We expect to ship an LSA evaluation system to a second tier one memory customer in the coming months, as well as an NSA evaluation system to a third logic customer leader this year.
Anthony Pappone: There's also potential for additional NSA and IBD 300 evaluation shipments later this year or in the first half of 2026 With that, I'll turn it over to John for a financial update
John Kiernan: Thank you Bill, starting with revenue for the quarter. Revenue came in at $167 million above the midpoint of our guidance, down 4% from the prior year and 8% sequentially.
John Kiernan: Our semiconductor business had another strong quarter, growing 10% sequentially and 3% year over year, representing 74% of total revenue.
John Kiernan: Our results included strong performance from our laser kneeling products which shipments to leading edge customers for gate all around and high bandwidth memory.
John Kiernan: Multi-quential and year-over-year growth were led by an increase in advance packaging.
John Kiernan: In the compound stem, we conduct a market revenue decline from the prior quarter to $14 million dollars, totally 9% of revenue.
John Kiernan: Data storage revenue decreased to $7 million, totaling 4% of revenue in line with our expectations, as highlighted on recent earnings calls. Revenue for the quarter was only derived from service and aftermarket support.
John Kiernan: Also in line with our expectations, scientific and other revenues declined to $22 million from $33 million in the prior quarter, totaling 13% of revenue.
Turning to Quarterly Revenue by Region
John Kiernan: Revenue from China customers was flat in Q1 from Q4 with the percentage of revenue increasing from 39 to 42%.
John Kiernan: Revenue from Asia-Pacific region, excluding China, was 36% and increased from 31% in the prior quarter, led by sales to semiconductor customers in Taiwan.
John Kiernan: The United States came in at 15% and in me a 7% [inaudible]
Switching gears to our non-GAAP quarterly results
Gross Margin Total, approximately 42% in line with guidance.
John Kiernan: Operating expenses totaled approximately $46 million, below our guidance as we maintain our focus on cost management. Income tax expense was approximately $3 million, resulting in an effective tax rate of approximately 12%.
John Kiernan: Net Income came in at $22 million and deluded EPS with $0.37 on 60 million shares.
Now I'm moving to the balance sheet and cast low highlights.
John Kiernan: We ended the quarter with cash and short-term investments of $353 million, a sequential increase from $345 million million dollars.
John Kiernan: From a working capital perspective, our accounts receivable increased by $18 million to $114 million million.
John Kiernan: Customer deposits included within contract liabilities on the balance sheet decreased by $8 million to $40 million [inaudible]
John Kiernan: Casual from operations total $20 million and CAPEX totaled $7 million during the quarter.
John Kiernan: Before providing our Q2 Outlook, I'd like to offer additional insights into the potential impact of recently announced tariffs which have resulted in an elevated level of uncertainty across our business with possible direct and indirect implications.
John Kiernan: A substantial majority of Veecos and our contract manufacturers operations are located in the United States.
John Kiernan: Products manufactured in the United States, its shift to customers in China are subject to substantial tariffs unless otherwise exempted.
This is currently causing some China customers to delay shipments
John Kiernan: While we are monitoring changes to tariff and trade dynamics, we continue to work closely with our customers to mitigate impacts. Outside of China, we've not seen material changes to our customers' plans.
John Kiernan: However, the potential impact on the macroeconomic environment from global trade uncertainty are difficult to predict
John Kiernan: We are experiencing higher costs due to tariffs on imported materials from overseas suppliers, as well as increased costs from domestic suppliers incurring tariffs on their imports.
John Kiernan: While tariff dynamics continue to evolve, our team is working diligently with suppliers to mitigate the impact on costs
Taking this into account in relation to our Q2 Outlook in relation to our Q2 Outlook.
John Kiernan: Due to revenue is expected between $135 and $165 million. The midpoint of our guidance range assumes approximately $15 million in shipments to China customers will be delayed.
John Kiernan: Our guide also includes a wider than normal range to account for increased risk associated with China customers.
John Kiernan: Gross margin is expected between 40 to 42%, which includes an approximate 100 basis points impact primarily from lower volumes to the tariffs and tariff related costs.
We expect op-backs between $47 and $48 million $48 million.
Net income between $7.20 million $7.20 million.
John Kiernan: and deluded EPS between 12 and 32 cents on approximately 60 million shares. I'll now provide qualitative commentary for each of our markets.
John Kiernan: Beginning with the semiconductor market, despite expected headwinds from our mature-node business in China, we see opportunity for growth in 2025. We continue to see strength
John Kiernan: In leading-edge investment in areas driven by AI and high-performance computing, providing the potential for gate all around an advanced packaging revenue to approximately double in 2025 versus 2024
John Kiernan: We remain confident in our long-term growth outlook due to our strong product portfolio in laser annealing. I am beam deposition, wet processing, and lithography.
John Kiernan: In the compound semiconductor market, we see opportunities in Gantt Power, Solar, and Photonics, which provide potential for revenue growth beginning in late 2025 into 26.
John Kiernan: In Data Storage, while service revenues picked up due to higher customer utilization, customers are not investing in capacity additions. In line with our prior forecast, we do not expect system shipments to data storage customers in 2025.
John Kiernan: and in scientific we'll continue to see strength in research areas such as quantum computing which have the potential to revive rope in 2025.
Speaker Change: With that, I'll now turn the call over to the operator to open up Q&A.
Speaker Change: Thank you. We will now be conducting a question and answer session.
Speaker Change: If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue, for participating in speaker equipment, and maybe necessary to pick up the handset before pressing the star keys.
One moment, please, while we pull for questions.
Speaker Change: Our first question comes from the line of David Duley with Steelhead Securities. Please proceed with your question.
David Dooley: Thanks for taking my question. I guess the first thing is could you just elaborate a little bit more on the advanced packaging orders for your lithography pools? You know, it's been some time since.
David Dooley: Well, I can't remember the last time you've announced a large order in this segment of the business and I know you mentioned AI and high performance computing applications. I was wanting to just dig in a little bit more, is there some sort of packaging change?
David Dooley: or what exactly is driving this rekindling of this business at this point.
Sure, Dave. The first part.
David Dooley: We did have a press release just recently for $35 million in Litho orders over the past
A few quarters from...
David Dooley: IDM as well as a number of OSATs, and it's really kind of picked the business up and it's really driving.
Significant EAR Rear Growth for us in 25. And really…
David Dooley: All of this is really attached to advanced packaging lithography and I, you know, I feel broad, more broadly, at advanced packaging.
David Dooley: Excuse me, our advanced packaging business is going to probably double this year to about $150 million in $25, partially on this lithography business that we just pressed released, but also a lot of the activity that we have going on
David Dooley: and it's really being driven by AI, particularly high bandwidth memory and 3D device stacking. So it's an exciting space and...
David Dooley: and I think there's some room to run here with some Sam expansion with some of the products that we have here in wet processing.
Speaker Change: Yes, that's a nice, nice piece of business there. And it's also, you know, did you, I guess, I was wondering were you expecting the advanced, the lithography business to be this robust or did this kind of surprise you? And, you know, what exactly inside, you know, who's ever advanced packaging business, that you're, that, that this is driving these incremental orders.
David Dooley: What, you know, is there a new adoption of a CPU in some sort of package or, you know, just kind of wondering, you know
David Dooley: What sort of technology shift in the marketplace is all of a sudden driving a lot of orders for you guys?
David Dooley: Yeah, I would say it's really a more capacity by, I would say there's a number of customers there as I mentioned in the OSATs and an IDM, adding capacity because of this
David Dooley: You know, this demand really driven by A.I. and the like.
Okay.
And as far as the...
The impact from…
David Dooley: China and the inability to or the hesitancies of customers to take shipments.
David Dooley: Is there, could you talk about which in markets those are associated with number one and number two is, you know, what sort of mitigation strategies do you have to be able to ship into China, can you?
David Dooley: to another location first, and then ship it into China, or how can you get around the current tariff structures to ship tools into China?
. . . .
Speaker Change: Yeah, so Dave, we see some customers continue to take shipments as scheduled.
Speaker Change: and we're seeing other customers, delay shipments as we anticipate in...
Speaker Change: in Q2 currently, and as we guided about a $15 million impact on our Q2 guide.
Speaker Change: We mentioned that we are principally ship product from the United States, so to the extent that our customers are importing those goods, they would have to pay for the tariffs unless there is some exemption in place.
Speaker Change: Now, there have been some unofficial reports that certain products are being exempted from the tariffs and our China customers are already seeking exemptions that could mitigate the exposures. Our customers have indicated that they'll take the shipments.
you know, if tariffs are resolved, are resolved there. So in the near term, you know,
Speaker Change: You know, we are manufacturing those systems in the US not really much in the very near term that, you know, we can...
Speaker Change: You know we can do now we are looking at you know plans and we've had plans as we look at our semi conductive business for [inaudible]
Speaker Change: You know, expansion and, you know, expansion, you know, outside of the US, but that's not going to help in the very...
in the very near term. You also asked about—
Speaker Change: Yeah, I think in what areas of the business here in China, I would say in Q2 it's about evenly split between customers in scientific markets where we anticipated shipping systems to about half of the in the semiconductor.
Neil Markett [inaudible]
Speaker Change: Okay, final question for me is you've had a lot of moving parts in your semi-business, could you just maybe just recap again, which parts do you think are going to grow in 2025?
Speaker Change: Yeah, I think that's a great question, Dave. I'm going to start and then Bill May choose to add in here a bit. So really in the semi-business there's really two main drivers. In the one sense, irrespective of tariffs.
Speaker Change: You know, our expectation was we had good visibility for our semi-business in China for the first half of, you know, 2020- 2025 and we expected that business to fall off in the second half of the year. Now you add a little bit more uncertainty around, you know, tariffs there.
Speaker Change: and Gate All Around being driven by high performance computing and AI, and high performance computing and AI are also impacting growth in our advanced packaging business. So, when we look at the business attached to Gate All Around,
Speaker Change: and Advanced Packaging, and I've been with memory. We've seen those areas of the business have the opportunity to double year-over-year. That could potentially offset or more than offset where we can see growth in our semi-business overall year-over-year.
OK, thank you.
New Kyoto Positive
And then, what about lithography?
Lethography is counted for in the advanced packaging numbers.
Okay, great [inaudible]
Thank you Dave. Thank you Dave.
Speaker Change: Thank you. Our next question comes from the line of Gus Richard with Northland Capital. Please proceed with your question.
Yeah, thanks for a lame-ass couple of questions.
Speaker Change: Just a little quick on some of the wins and the process tool of records. Could you just help me understand are these new, you mentioned new applications and wins and I just want to.
Speaker Change: Understand, are you winning in existing customers' new layers? Is this an expansion or is this the result of a bank off?
This is...
evaluation system
with existing customers in advanced logic.
Speaker Change: Gate all around, where we have had an application at these customers, and now we have a second application that we've won with two different customers. So it is incremental and just to give you a feel for the size of that gust, that would be
Speaker Change: 40-50 million dollar revenue increase per application, per 100,000 wait for starts.
Speaker Change: as they build out the FAB over a year or two or so but obviously it's very sensitive to the customer's ramp and their business conditions.
Speaker Change: So that's the variable there, but it is incremental business, but the timing for HVM is unknown still. Well likely to be more in the 26 time frame than in the 2025 time frame.
Speaker Change: Okay, and these are incremental steps on the gate all around, correct?
Yes.
Speaker Change: Have you won any backside metal? Have those decisions been made at this point or are you still waiting on customers to make a decision on thermal processing?
Yeah, they're, they're still considering they're still assessing with these systems.
Speaker Change: where they're going to insert, but a decision has not been made specifically on backside power.
Speaker Change: Okay, got it. And then just, you know, to understand that the guidance, you know, looks like
from the midpoint.
Speaker Change: Guidance came down 15 million and it was just primarily all China related. There wasn't anything else there that caused you to be a little bit more conservative and guidance relative to consensus. Am I understanding that correctly?
Speaker Change: Yes, so we had previously guided earlier in the year that we expected Q2 to be in a similar
Speaker Change: to Q1 numbers, so that at that time, roughly 165 million dollar quarters for Q1 and Q2.
Speaker Change: and absent of customers delaying shipments in Q2 in China until tariffs get resolved, we would have been writing that same range, so that is an accurate assessment cuss.
Speaker Change: Got it. Got it. All right. And then the last one from me, on GAN power, you know, are we any closer to?
You know, um...
Speaker Change: Process Tool of Record and you know primary versus secondary supplier for those that application you're demoing now or being valuable.
Speaker Change: Yeah, we continue to work with the customer and make progress. We are meeting all of the in film and electrical device performance that the customer needs to move forward.
Speaker Change: We're working to meet their deliverables for kind of a high-volume manufacturing configured machine and if their plans continue they'll probably continue to ramp through 27 in.
and beyond. So it's an exciting opportunity and...
Speaker Change: You know, we've been told very positive things, we don't have a purchase order yet [inaudible]
Speaker Change: Got it, got it. All right, that's it for me. Thank you so much.
Thank you, guys.
Speaker Change: Thank you. Our next question comes from the line of Mark Miller with Benchmark. Please receive with your question.
John Kiernan, Mark Miller,
Speaker Change: Thank you for the question. From the picture you've been painting during the call.
Speaker Change: I'm just thinking about second half of revenue. I know it's very uncertain, but in the absence of any new developments with tariffs.
Speaker Change: It sounds like we're looking at least a flash stage second half in sales, can we uh...
Would we all face modeling that?
Speaker Change: Yeah, thank you for the question, Mark. So, yeah, I mean, given the macro uncertain team potential changes in global trade policies.
Speaker Change: You know, we're not really providing a specific quantitative guidance for the second half of the year.
Speaker Change: primarily due to a larger range of outcomes. But that being said,
Speaker Change: We are continuing to see Strength and Gate all around in advance, packaging, providing opportunity [inaudible]
Speaker Change: for our semi-business to grow despite the China market headwinds and tariff headwinds.
Speaker Change: You know, our view on data storage is that the same like we don't see a system revenue picking up in the second half of the year we're not [inaudible]
Speaker Change: You know, forecasting any system revenue in the first half or the second half. So yeah, I think taking all of that into consideration, you know, we could see, you know, second half, 2025 business activity at a similar level to the first half.
Speaker Change: Okay, are you seeing any improvements in your tool utilization at the disk drive manufacturers?
Was it around Mola mid-70%?
Speaker Change: Yeah, we have seen that steadily pick up our customers are bringing capacity online and a judicial
Speaker Change: Manor, and that's showing up for us in terms of service revenue and spare parts and
Speaker Change: and the lake as they bring equipment back on and their utilization rights are picking up from what we hear and they're continuing to pick up but
Speaker Change: But certainly the order activity from a system standpoint is not there yet.
Thank you.
Thank you, Mark. Thank you, Mark.
Thank you.
Speaker Change: Our next question comes from the line of Ross Cole with Needham and Company, please receive with your question.
Ross Cole: Thank you for taking my question. I just wanted to clarify a little bit in the semi-segment regarding
Ross Cole: between China as well as the GAA and Advanced Packaging Strengths, but it sounds like you're expecting that to still be relatively flat, to slightly up. Is that correct?
Ross Cole: You're over here. You're over here in our semiconductor market. Is that the question? Yes, thank you.
Ross Cole: Yes, yes, that's what we're saying. It's one sense we've got the headwinds in China and as we said, irrespective of tariffs, we expected that business after two very strong years in laser kneeling to moderate in 2025. We had good visit in China.
Ross Cole: We had good visibility, you know, for the first half of the year, second half of the year we're not seeing the type of projects
Ross Cole: continue and that we expect to fall off in that business. And then on the flip side of it is on a positive side that we are seeing in our advanced pieces of the business and business tied to high bandwidth memory, gate all around and in our packaging business. [inaudible]
Ross Cole: We're seeing the opportunity for that to offset or more than offset the headwinds in China given the opportunity for flatish to growth in the semi-conductive piece of our business in 2025.
Speaker Change: Great, that was helpful. And then I'd also curious about maybe some indirect tariff impacts. Are you, where are you seeing potential other issues? Like could like compound semi maybe have any impact from, you know, indirect tariffs from suppliers or anything like that?
Speaker Change: Yes, so yeah, if we separate out on the demand side, we only have seen impact on the demand side to customers, you know, in China where there would be substantial, you know, impacts on importing.
Speaker Change: and so no impacts for demand outside of China. Now as we think about...
Speaker Change: Europe and South East Asia. That's a principle area. And then, you know, indirectly what we're seeing is we have a U.S. supply base and suppliers and certain of those suppliers also import parts.
Speaker Change: and they're seeing, you know, so it cost increases, you know, they are for the same type of, you know, same type of parts. So we are seeing, you know, potential for, you know, cost increases there as well. So.
Speaker Change: We are trying to mitigate that as much as possible, we're looking at logistics and to the extent of...
Speaker Change: You know, using parts for, you know, services and supporting install base, not bringing those, you know, parts into the US and using logistics outside the US to the extent those, you know, parts of being, you know, secured. So that's also, you know, an area of indirect that
that we're looking to mitigate.
Okay, thank you so much.
Thank you, Ross [inaudible]
Thank you.
Speaker Change: Hey, we have reached the end of the question and answer session. I would like to turn the floor back to Bill Miller for a close remarks.
Bill Miller: Before we end the call, I'd like to just reiterate our confidence in our long-term strategy.
Speaker Change: This was further solidified by several strategic wins we announced this quarter.
All of which reflected progress in the-
Speaker Change: Summing Conductor Market. As we look at the full year 25, we're continuing to see strengths in areas tied to AI, resulting in expectations for gate all around in advance packaging relative to double, and providing our Summing Conductor business the opportunity to grow.
Speaker Change: With that, I'd like to thank our customers, shareholders, along with the Veeco team for their continued support. Have a great evening.
Speaker Change: Thank you. This does conclude to its teleconference. We thank you for your participation. You made this connection line at this time.