Sameer Desai Senior Director-Corporate Development and Investor Relations
Tom Edman Chief Executive Officer
Todd Schull Chief Financial Officer
Matt Sheerin Stifel
Sherri Scribner Deutsche Bank
Steven Fox Cross Research
William Stein SunTrust
Sean Hannan Needham & Company
Paul Coster JPMorgan
Call transcript
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Good day, everyone, and welcome to the TTM Technologies, Inc.

Second Quarter Earnings Call. At this time, I would like to turn the call over Sameer Desai, Senior Director of Corporate Development and Investor Relations. Please go ahead, sir.

Sameer Desai

Thank you.

of I forward-looking to of outlook. statements Securities Reform started, today’s everyone the get related Litigation contains statements call within Act we would future remind like that Private to Before TTM’s including business XXXX, the meaning results our these statements Exchange most and report Form one materially recent due including the our from and XX-K with and more annual Commission. risks uncertainties, differ the other factors could to Actual forward-looking or explained Securities filings in on forward-looking of expectations the These based assumptions and management’s statements on this are as of date presentation. any TTM other does or of not or to undertake a information, statements new obligation circumstances, these except any whether result as revise of as events update required future publicly law. by regarding which affect disclosure other the reports that Please SEC registration X-K, the in and refer may found Form on the TTM, XX-K, on XX-Q, company’s filings. statement the the may risks S-X be Form to

press discuss this substitute measures will for We a you and accordance GAAP non-GAAP and measures like adjusted website measures as of EBITDA. Officer. go the was in with Edman, financial Chief company’s the Tom as prepared the TTM’s call SEC such turn reconciliation ahead, which Executive to we to presented non-GAAP on Please not considered to direct measures www.ttm.com. and Such in also should be GAAP, with call the I certain is included filed TTM’s on now Tom. available release, at would over to

Tom Edman

a our the quarter of by our strategy, follow performance second you XXXX of discussion results. Thank begin XXXX QX our us an overview call. for will of you, joining QX our Todd financial our business for with quarter thank from conference a quarter, with Schull, and highlights our and guidance. afternoon, second CFO, XXXX I’ll including followed Sameer. Good review

call open to questions. then will the We your

contribution. for achievement was of quarter quarter in the the very in we above all revenues high-end Anaren’s all, seasonal I challenging EPS trends. was the first with company achieved some was their for quarter their for that the our of highest despite pleased XXXX We the TTM thank of First Technologies. history the to second non-GAAP guidance, included and of employees and I’d This our results second like

on May. communicated continue months and markets several have of toward our differentiation further our strategy, path the the Day over We during capabilities. of Analyst two past elements diversification many and the in years our last we elaborated our presentation have of validated which of The end on

diversification the company volatility quarter was end to helped in challenging our what of quarterly markets First, end of reduce and revenues our total one markets. a grow in

industrial cellular in medical Specifically, defense, our market. difficult end conditions markets offset end aerospace growth to automotive, helped in instrumentation and the and computing

driving; number and on trends autonomous towards in well continues increasing per continue vehicle a content advanced we expected to to and number PCB market vehicles; three, are driver connectivity. mega We key driving technologies. XXXX. and Second, automotive four as the differentiation advanced electric by two, grow increased number vehicle $XX automotive, and in of of one, growth; four, content Estimates adoption PCB XXXX safety hybrid $XX the infotainment; core content and our in be to defense The see aerospace due end markets. path increasing electronics of end to adoption as growth automotive

doubling. increasing China well XX,XXX sensor were of unit won minivans design another being the its X.X%, vehicle, May by Waymo second of driverless car well second larger, per XXXX these million new with trade and to XX PCBs start electric sales in Chinese high quarter hybrid wins in designs XX XXX of the more and In Chrysler, as plans year Despite in to new more public. in go more electric new wins quarter. is been won in before electric in vehicle OEMs established first In Chinese-based the ramps quarter automotive dramatically total, sales hybrid of market, growth a XXXX. $XXX automotive driven begins the customer solid. The XXXX electric half product areas. currently we concerns engagement NIO, for designs. than and fleet. buy smaller, up automotive XXXX high sales Byton, vehicles over electric autonomous Some company we filed up of vehicle XXXX, growth have $XXX vehicle. and growth XXXX cars with employ vehicle design from the wars, as are product registered the expect we In raised in we seeing XX and Fiat and first suppliers we newer of companies. OEMs, This well both ramp. with than

to qualification critical and market in satellite Anaren another The addressable focus represents strategy. are adoption in on The we radar our will TTM that wireless to market a end to Finally, presence market. under and leveraged automotive accounts, acquisition growth are defense qualification which new step components. of components total greatly proceeding high Anaren integrating with portions substantial into customers our radar XG track. which brings process aerospace The the for increase our differentiation addition and on the technology, Anaren’s these future XX. of is the will of our also in the Anaren radar five increase of lead in enhance

reported businesses. quarter starting separate our our Anaren in unit, While as QX business be will results Anaren’s businesses existing a into second integrated

of process growth. future opportunities, We have already TTM’s synergy the which accelerate identifying revenue will begun

up add with addition to the of TTM’s cycle. before, major to moves design in Anaren TTM this chain, acquisition goal of revenue is I’ve allowing higher to growth. customers mentioned the us value in the The earlier As engage

Our to now RF their completely customers on TTM to meet can needs. a designed solution deliver rely

time have closure of firm synergies plans In period we have two-year XX to identified and run addition, synergies these as the acquisition. previously on discussed, annualized rate continue following in executing the we over the million cost

to I’d markets. review end Now like our

QX For to market sales X XXXX we TTM, and XX% revenues of represented defense sales the upside XX% QX RF in XX% points approximately QX and of saw the quarter in Anaren second quarter to and from for total for due aerospace applications. second XXXX. meaningful of sales, end accounted of strength Anaren in compared military subassemblies

$XXX $XXX A&D pro is forma also rose $XXX been Including core backlog on XX% program what our and versus backlog record A&D Anaren, QX in business TTM. QX basis. growth $XXX by a for a quarter, million have at Core driven was a million of end high total last For year-over-year our defense which program record was million would level customers. larger the million to from reached

total XX% this We expect of XX% in driven first Year-on-year sales. of E-M and the QX about sales segment. quarter from X% total second Automotive in quarter our market sales Solutions of during XX% XX% represented ago quarter of to the of by year to our during sales XXXX. primarily represent XXXX, sales end was compared the growth

in second This and of XX% We quarter QX, total of driven Anaren second our during revenue PCB X accounted XXXX. expect growth XXXX points. of compares and in for sales. XXXX of to first communications year-on-year segment, by accounted quarter in XX% XX% automotive the and quarter revenue and contribute Network sales the of of for to expect XX% the

XX% due relatively Sales networking partially to a Anaren, on were represented primarily as in related market and year-over-year XX% to by end compared largely peripherals stories of sales first market data offset sales the shipments. year-over-year of XX% telecom in our computing in XXXX. of demand the driven be weakness QX from We saw centers. the in high-end revenue. XXXX market, we quarter second in expect first sales basis, Excluding In of segment QX XX% by total XX% of stronger of began the we XG total down growth quarter the this to

sales. customers to market market growth quarter, first year in of represent in medical/industrial/instrumentation end sales expect our XX% of The each quarter total submarkets. in We quarter, and XXXX. XX% saw this across in to of the of ago We the sales based in third broad XX% quarter XX% second the contributed approximately compared the end

expect X% market third phone in compared The We the launch for the to to quarter, second end sales this cellular the of sales for in The XXXX end XX% to sales revenue QX XXXX. models. represent and of prior due XX% in approximately of accounted new market of primarily was to inventories in decline QX of of XX% customer of reduction the quarter.

the We year. new in expect of quarter cellular sales third to second represent XX% the half models as of launch

quarter. some cover the details I’ll second from Next

did not quarter During the market. driven This end subsystems company’s in RF and Anaren. the rigid-flex declines by business compares QX, The our our and accounted XX% the quarter, which in and HDI, approximately revenue. XX% substrate, year-ago includes which of components of and both XX% for approximately advanced were to include technology cellular

that are our leverage business capabilities XX% in in to increased QX. opportunities will advanced to new utilization was activities quarter and compared XX% markets. technology in continuing in Asia-Pacific in Capacity We pursue QX year-ago the and new XX% design customer engagement

markets North was the QX, capacity drove our in XX% year-ago end production compared America. in America in in A&D quarter utilization Our additional computing XX% North overall QX in XX% and and as to in growth

Our XX% XXXX. top quarter XX% customers to second of in the and contributed first quarter total five the year-ago the XX% sales quarter in compared of in XXXX of

cancellations, the in versus QX. At our second XX% the the in end for the our XX-day end At year and is our in request no to last X% of million million, subject QX. of $XXX quarterly reporting accounted customers, of Our XX% top of $XXX earnings customers the at calls. second million year-ago our largest customer five to $XXX backlog, we in compared and be longer of the of will at end several QX, quarter the quarter quarter sales which was

in optimistic aerospace the operational in the our about Our end better-than-expected In the consumer-oriented achieved see the book-to-bill ending seasonality ratio positive X.XX acquisition our on and of defense remain July was the markets, future months X. focus three demonstrated our Anaren results we with We and to from managed summary, benefits second for PCB of continued markets the quarter, execution. during diversified results and market, TTM.

Todd performance second review quarter. our the Now will financial for

Todd Schull

and Thanks, good afternoon, everyone. Tom,

rate operating million, per the from Revenue date. million. an second of entered of adjusted highlights results and fixing the earnings of interest $XXX.X of non-GAAP interest share arrangement $XX.X of debt. the Some the quarter, acquisition million, $XXX.X EBITDA the our swap X.X%, Also affectedly flow from XX million $X.XX, rate inclusion the operations non-GAAP that rate and during Anaren cash their from on in of of note quarter quarter of margin include $XXX April we variable on into of

the details. So now on to

$X.XX second post instrumentation $XX year share $XX.X The million. and which per quarter quarter second first year first revenue and diluted in second $XX markets acquisition, income to share. the million the automotive, $XXX.X our $XXX.X year. of to $XX.X $X.XX XXXX million quarter million second our diluted XXXX $XX.X to of diluted of to and million and compared quarter sales in due quarter lower and the the year-over-year the medical this This operating core cellular million of for $XX markets. net in quarter end in by sales share Anaren inclusion net On was in quarter last basis, communication contributed end was in million the of the to million, increase net partially network per first last and $XX.X million of in industrial a or in or second the compared due GAAP or revenue income of offset computing TTM in net sales and of For XXXX aerospace $X.XX were was the compares $XXX.X and defense, quarter XXXX. quarter GAAP million second growth XXXX the of of per

valuation The income allowance focus non-GAAP of million. of comments will remainder financial GAAP the release net my Our tax performance. a on our $XX.X reflects of

noncash associated Our and acquisition-related non-GAAP tax certain impact well or the unusual items. items of excludes these as other costs, as performance expense items infrequent

net allowance. quarter of in margin and eyes in year-over-year nonoperational management exclude insight Gross discrete like quarter as investors in to tax of focused in marketing the sequential X.X% due and the we in such year $XX.X facilities. high-end net valuation end quarter Selling of net The expense sales of XX.X% provide Anaren were release our in through increases challenges contribution of to earlier, the in We and XXXX. to XX% laptop expense information the and quarter X.X% of second the compared was $XX.X million more cellular and in million XXXX than first second company’s lower performance. a enable our quarter present of this primarily items to volumes financial or gross non-GAAP or or higher markets and of into margin in the tax quarter. of better ago and company $XX.X the versus Additionally, changes second a X.X% offset the noted to million first see noncash sales the was the the which volumes financial ongoing sales XX.X%

million to million were in X.X% was net G&A the of most compared the in quarter. marketing or X.X% or a and increases previous quarter $XX.X due X.X% ago addition and selling for net net to Second or Anaren expense sales quarter. sales $XX.X $XX.X The of same G&A the expenses of of quarter year million sales in the of and

expense in X.X% the an increase incremental quarter with from Interest same the associated X.X% the in quarter term million last same of Our $XX.X to was the $X.X million quarter, last operating and margin in first to This compares the XXXX. year the due was of in acquisition. year loan Anaren second quarter QX X.X%.

gain or quarter, $X.XX the Government loss a in in to Chinese gain. This of brought of primarily versus year quarter share. this foreign of earnings X.X% quarter million due the last $X.X $X.X gain of compares million U.S. we depreciation quarter. exchange approximately second net During year. $X.X The recorded the the the dollar to incentives foreign in second was the exchange total to per during the of renminbi million

LIBOR the our debt. of valuable rate million interest rate the highlights, in X.XX% our at swap, fixes for mentioned entered $XXX an which portion into interest As of we

effective rate ago. from year quarter, down second tax XX.X% Our was the in XX.X% a

to and per $XX XXXX $X.XX net income of Second income Adjusted $XX.X quarter million compares diluted quarter or net quarter second $X.XX or share income first was diluted diluted million This quarter XX.X% of $XX.X of or XX.X% XXXX net $X.XX adjusted EBITDA per sales. million share. million net the share. of XXXX first the $XXX.X sales. EBITDA In net of $XX.X million or for second or was sales was compared or $XX.X EBITDA quarter second million of with adjusted quarter, net per XX.X%

XX.X% lower acquired previously. in to production decline was higher by our in and volumes the segment’s to The sales the the ago same $XXX.X PCB and this of quarter We was $XXX our margin segment year-over-year at year. cellular sales noted gross million up margins quarter quarter the and to the same at compared our segment had manufacturing of and million, offset PCB in The April a performance. down from efficiencies income volumes year operating last laptop million other second in from quarter quarter. change first year-over-year quarter, quarter the was the in first on in the $XX.X million Moving $XXX.X XXXX in of The second $XX.X Gross compared high-end partially second for The quarter due segment quarter. facilities, in this operations. year to million in was first million in second XX.X% and Anaren XX. XX.X% on $XX.X

quarter, $XX gross net XX.X% and of the of of million, contributed second million. Anaren $XX.X sales income margin operating During

second the the first increase as we The separate unfavorable no $XX.X quarter, second market. as forward, mainly end compared the it operations of top in of in due as million quarter million a year million quarter first of second million PCB, the from cash to The end this $XXX.X million the Going flow with X.X% third automotive increase quarter. operating debt and in solutions $XX.X compared Using XXXX, And first of to quarter the mix. second year-over-year same of cash in associated $XX X% the acquire Anaren. margin stronger was ago to million was our ago $XXX,XXX integrated at The segment last Tom second net higher million million decline XX.X% income segment quarter. year-over-year first longer this Cash a Anaren and margin loan. SG&A repaid our year was this volumes. $XX.X quarter and XXXX segment this we ago or XX, $XX.X will Anaren second electro-mechanical July and quarter term of for start The of in margin quarter the directly in The sequential the a the decrease same year from mentioned due $XXX.X solutions used $XX.X we’ve second of quarter in due operations, to quarter gross earlier. a year. million million million product in in quarter was $XX.X electro-mechanical million. sales with reporting for gross had $XX.X flow our segment’s electro-mechanical on quarter to the was Depreciation expense Cash The up our not quarter is second first Gross cash million the Corporate the the was $XX.X up year. the in million, $XX.X solutions equivalents quarter the volumes spending $X.X $X.X from reflecting $XX.X the year for was to to in million be in versus effective the and into quarter the in repay totaled was net was in entity quarter. quarter year. priority us. versus the capital for

quarter. to turn to for the like I’d third guidance Now

which range quarter of expect We the $XXX a to of for million, to quarter third million the includes full $XXX of XXXX revenue total be in Anaren.

year revenue million. $XXX.X our As third last point, was a reference quarter

per $X.XX count is based in The earnings non-GAAP per approximately third XXX share on diluted $X.XX This diluted a XXXX. the of share of shares. share. EPS diluted million to of $X.XX EPS We to quarter be range expect the an forecast to of compares in reported

securities includes count as options and as convertible such varies our well on which future dilutive price. our stock guidance RSUs associated roughly X as bonds, million shares Our share with based

in dollar approximately share As every average the million $XX.XX for quarter, a the our shares. increase during increase reminder, X.X by price shares outstanding above would

quarter. the that about We will of in SG&A third be expense revenue expect X.X%

We associated expense expect loan Anaren. $XX interest to of which additional about million, acquisition term with the total the reflects

XX% to your To additional effective in we assist rate models, financial the following offer Finally, and between information. our estimate you developing be we tax XX%.

noncash expense estimate stock-based million, Anaren of record about during $XX of $X.X We expect million. approximately of million completion of $XX we to approximately third amortization pending and The of includes quarter be still recent $X.X is expense depreciation expense will accounting intangibles the compensation process. intangibles, about of the million, amortization acquisition, purchase but the interest

a the result, forecasted amortization could change. As expense

announce Bank our to Needham now line the participating in XX, Conference and X. questions. Technology the September New Vegas Deutsche Industrial Leverage City Scottsdale That that October Las like the we’ll prepared open on Deutsche Bank tomorrow; remarks, to for I’d Finally, in concludes on the Conference in be Technologies York in we’d like Conference Anne? Finance and


We’ll Instructions] take Stifel. our question with [Operator from Sheerin first Matt

Matt Sheerin

and everyone. good afternoon Thanks Yes.

to last I handsets. for have have And to you think, the range, regarding It and year-over-year. talked correction. your first year XXX% for looks X% you’re last big be It to it fourth I conference X% Tom, like looks to in business, like the flat guidance sort don’t to the inventory call, really will your quarter about it it in thinking know, to was there. another handset to question, XX% talked about looks cellular of going And Just markedly, still be that down like up you’re you for get the to previously quarter you’re going grow know going I sequentially.

business? views So what are your that on

Tom Edman

Sure. Thanks, Matt. Yes.

accelerating of ramp. course, So into expect, overall, third you moving we’re would quarter, an as

moving You’re third quarter a a expected absolutely has in second strong the what in less ramp been from quarter. we right, to fact, are, than

and point point into third with and means forecast over a sequentially required We’re going on actually at to means up during overall quarter, curve preparation we of QX that in being as that been of as I looking given the ramp. up the at from XXX%, work of we XXX% below full has cellular are lot X% actually in start range if moving X% cold up ramp bringing our people the look that around this the do to today for quarter. overall Obviously, range, a terms at and terms think being that closer a somewhere or slightly our forecast, year-on-year then was course so of yield in X% you really quarter. of quarter that of third And second facility below below moving vantage a went on from from you that from the in coming agree we looking of this the growth. into

to we the strong what have actually other On hand, forecasters the X%. a exceed projected very expect up The zero and – expect the computing end coming our are for to there. growth we see the – longer-term at QX, computing market forecasters market to

above be expect We rate that to growth year. well for the

So – sit would where update we hopefully yes, you today. that an gives on

Matt Sheerin

change you like segment commented for year, for any And by there’s for Is the to fair? doesn’t computing, Okay. it that maybe handsets the and material except year then computing. on the but the forecast look

Tom Edman

see right. That’s the Those correct. two change – areas we’d will a that Those be that’s

Matt Sheerin

are lot Okay. about. issues a to and talking And then topics materials tariffs of switching that companies

a build to tariffs. not on are of how sure And susceptible first I’m lot electromechanical side, the Obviously, you you I tariffs. components. in China. products products Just buying are know, on your

on So any you’re side tariff with there working the that issues seeing customers?

Tom Edman

a or inclusive aluminum, our supply manufacturer and supply we’re going of situation directly end contract first China Yes, terms bit U.S. of into or with sure. can at. in China But and little generally, minor a is what number within the Very chain. tariff a moves on that in Southeast little as – the tariffs Asia. as south our also locations in side, part within But pointed where China out region the Obviously, of actually is, terms PCBs we included up and dynamic say of impact aluminum past, in our within move the I product to customer more of assemblies the chain trade, from one, PCB locations the to very an lift from

than So impact the $X we’re per we QX factored have guidance. less into quarterly course, million looking we, which of our quarter, there of at

the include and laminates. that lifts also do discussed As those and lifts we include third been frequently, PCBs at second, fourth look have changing and out been have relatively

on PCB already side, our So a little impact the directly as into into U.S. direct I’ve very of actually the production part minor mentioned, – moves Only there.

chain a a global On the comment we been actively side, into importing and And laminates other and pretty production global those in impact that laminates that but tell finally, demand U.S. continue to into situation is have customers’ of impact is on to to do I’d suppliers. our working there to we on this laminate extensive really we’ve have to what locations certainly, the supply point, situation closely this watch our face. move customers from they A say couple which the we ability production those of locations. too overall as China are the in suppliers with that is navigate at and critical early any what’s us

Matt Sheerin

helpful. much. so Okay, that’s very Thanks

Tom Edman

you. Thank


next with We will Sherri our take question Bank. Scribner Deutsche from

Sherri Scribner

you. more you’re seeing that detail could on hoping compute thank side. a little was Hi, the the strength give you on I

driving you’re much so and color seeing, data enterprise? this hoping traditional little but quarter you year? strength a that what I to cloud center it applications? I think said there Is on that’s more is What this primarily you are get seeing was

Tom Edman

of we’re of and requirements seeing cloud mainly the from or of customers there production in volume out is of The our coming what higher-end coming that as out the prototyping really of some proprietary Sherri. data actual were America there. work for server required products and the terms some production Sure. pilot doing they Thanks, bulk, North center footprint

side, but on high-end mainly again, cloud. that requirements China course, coming see and some related to Of customers, from the we from of continue the to the also most our server benefits,

Sherri Scribner

on long guess, you Do when that any there. you how strength? business, lot are I strength have cloud that a seeing will think visibility last, of clearly some companies And about that

Tom Edman

looks business demand think we’re I what is the grow for interest Certainly, certainly continues the year, like quarterly there of that as I say well. prospects we look see it the would that any but next good in terms changes, may to through And seeing. – strong

Sherri Scribner

mentioned you’re I great. I you much Okay, but And you maybe maybe you’re and Can really seeing something you XG expecting we’re then telecom year, then XXXX? some year adoption? XG of what not and Thanks. side. that next different in that think of and terms talk think see how a do strength this the seeing through of progressing bit

Tom Edman

Yes, question what Sure. there’s is and from – – interesting versus right, I think you’re X.XG the it’s this of always is what XG.

So going I’m seeing XG, everything requirements. initial requirements PCB what terms to in our assembly we’re there, call of both and just shipments,

installations. from components, the on early the XG Anaren benefiting also We’re – the antenna needs from for of side, demand some X.X, in for wireless and used again,

shipments I’d PCB. side the from and component board volume really, pretty the say as are into we much initial benefits and now so – And across assembly

As those year, early. it’s volumes but until next strong initial out, you still Really, we expect shipments. see pointed don’t to nice

Sherri Scribner

much. Great, thanks so

Tom Edman

Thank you.


with go to will Cross Steven We Research. next Fox

Steven Fox

afternoon. Hi, good

if curious area. talk could negative phone original said cell that question was the you that was forecast. you realized leverage sounds I – the it in you like disappointing First to about was It

roughly, So about out you the Can also that maybe hurt just how EPS quarter? the expectations? to live think disappointing. you much of I also of sort market that is why And didn’t laptop up in called talk

Tom Edman


just the forecast. So overall market talk me about let

the through a channel was was saw than greater inventory expected. in that work combination we of what think I

forecast terms of So lineup we the didn’t cell result, phone out – product plans. some the changes on moved what in side also as a

situation And as that the with inventory just demand quarter so into the we saw, fell. went we forecasted

out side pushed saw us postponements quarter. some computing the introduction in the plans just but And short-term the we really terms impact in that of of and product the laptop quarter. On impacted side,

Steven Fox

yes, looking Okay, – And sorry. that’s just helpful.

Tom Edman

No, Steve. go ahead,

Steven Fox

it than also ago? No, I It���s ask talk could XX, quarter. you is greater – imply volume where going ramping a would it, large seems your of it was say have you if of to expected would’ve phone you to content just just does expected. what XX, sort days cell this XX the And such challenges about

Tom Edman

Yes, expect the content is it. where we would

is quarter With challenge really the that second does ramp, below what trained early up. situation the had getting the workers part forecast, involves heighten in in what which bringing being required, them of we around the the

of we facilities we way our when work, shift times the our fact, demand. we’re between actually workers trained In in soft

a the bringing experienced in of which So workers is have certainly from standpoint, equipment. relatively bring labor, last go we so the biggest up July. the really labor had technology new trained still That’s up our starting important all And into the what bringing moving in challenges through some on started then helpful, ramped training and labor similar to June, to the in than less challenge. more back, technology that that getting steps. and but year, And we

on now imagine, quarter and last we’re can you If running running this full the limited relatively out quarter. lines in

So up need that getting the points those exercising and lines, we we to that back stuff them to. yield getting them, making sure hit

Steven Fox

Thank helpful. very that’s Great, you.

Tom Edman

Thank you.


Stein to go will with SunTrust. next William We

William Stein

early I’m impressions taking the can my question. wondering you if Great, and results. lessons thanks and great on margins Congrats for earnings from comment Anaren. on

quarter couple months a and in in outlook it here, that’s saw your results good had the now. for incorporated so You’ve we

follow sort view you talked then this you of over any at up, do think please. a but have asset Analyst to will Day, help And lot impressions, trends, your in a that what I obviously You’ve time? the early about changes as

Tom Edman

My continues able to the you seeing new a with so business, what can we’re into And our quarter a short-term – our organization the Sure. imagine, integrating see be in it. From when management I’m number that this absolutely entire and really a they it’s grateful just into tremendous great. with on that’s be was come deliver to team. are to last compliments the to Will. tremendous results one, right, TTM, just my and exciting. Anaren you’re to tremendously And the year very keep certainly perspective, and Anaren’s quarter. fiscal the focus great as Thanks, you’re longer-term, for we’re And employees thrilled, from

recognize complete and full the opportunities. immediately think this, a of it side it defense I been thrilled some combining of understanding, with defense to the aerospace brings really customer We it customers. side. that really while, capabilities, been And on and Being customers engineering TTM several we’ve the takes simulation the offers. the certainly years with with have and have the components defense challenged for us They aerospace things reaction takes that pleased helps of depth on fully. But Anaren out to customer really with offering and little new benefits breadth technologies play aerospace the these to the our the reaction as testing the and our for

involvement on As the the you I opened side same extent to there; which the up move business, nice side, in enjoy the shipments, side. as commercial with the the of initial also PCB opportunities have antenna XG mentioned into we of some X.X, didn’t

XG. opening of So to frequency and information MIMO antennas rollout overall the the given up that are going to the flow absolutely antenna XG, with opportunity be critical of density, density

see there. explore that, can with to are we to are in whether space assist seeing our engineering starting networking we automotive what the customers with we the hope in And building So then space capability we and discussions there. optical on

focus in of maintain staff really to keeping course, as of the Anaren need has that of supported we All kind this to and they distinguished while the mind customers. properly that need

– really there. future pleased TTM and looking the into overall forward with more coming to So be Anaren

William Stein

good thanks the more up The follow follow the that. And is in margins up there quarter. top – upside broadly, there about for was

handsets, leverage going to quarter, now remind where target. XX% you Can to positive the a tracking from you are linearity, have seasonality, of and you to from XX% the Next the you’re get us sort margin margin op think timeframe? understand about next, should progressing let’s op X.X X be to how range, going the but within some years? over of say, to we I there’s get some

Todd Schull

So, Will, Todd, to respond this that. is I’ll

previously, in looking operating margin process, we targeting margins XX% Analyst that. new did share we that You’re community our things kind XX% did performance, we’re in we now. target. the for target, of – correct of kind of like EBITDA we’re shared XX% a targets, what disclose that investor flow, going margins, terms and cash that margins profit We with in where we at our and to Day, were were And op

organic three-year the end to in – basically least We’re a time be in looking two- to low looking kind the of growth. at on that hitting of at horizon, or relying

percentage that from come from to quarter, the saw That past our able And improve table op comes also our that’s of that of terms you that to our And the business from? to margin. us growing revenue where base upside operations some help we So we the contribution was mix all their to improving pie But does contribution going we business. had addition Anaren, that to a additional there, us our bring in on as in execution of with get the in our as business. total in revenue, to some of revenue. where their continue will increase as support help Anaren benefit and us

that very to – confident at the growth see it our But we target see Nothing’s does horizon, that that as fluctuate quarter-to-quarter. range. the going path roughly end markets we that as we’re in linear? at low revenue we the is be two- time opportunities the So to to that three-year we from linear, end of ever longer-term have to look feeling serve, we least in the getting

William Stein

good congrats on and Thanks the results.

Todd Schull

Thank you, Will.

Tom Edman

Thanks, Will.


to next go with & Sean Needham We’ll Company. Hannan

Sean Hannan

the afternoon. question. Thanks for taking Good

If in specifically dive if specifically, one, this clarity And where really relevant going months see around swing? I into more First us us in indication would are that these maybe and can your give into be what can back that looking, you Todd, then helpful. or was I theme moving very into of boards XG more the XG is quarters various stages a truly in deployments. what that any an can provide topic. can perhaps there’s would you full shipping be broader earlier Tom later for and be pieces if might the you remind

Tom Edman

future. And the I informs always think the past Sure.

about station demand, base equipment so follow, so we think of happened course, PCB what moves XG forward. a as standpoint, in demand from And you demand as rollout the

today, so probably business our And so of look – that climbed, networking/ about is In business revenue. XX%, about to the half the one-third you our up that our moved at that to remember of PCB about if piece networking/communications peak the business And telecom. you of if XG, communication networking/communications our XX% that business, of moved one-third look business. demand up at you of we

was you So – terms over of period. – informs three-year – approximately think I that I peak it and occurred that a XG. a in about would climb expect over

up particularly more requirements rollout expect we bit of and looking period, Anaren we of extended little say in at And XG the a also I and that it base bandwidth that if see or antennas move of the lower XG, on to The the is moving we be the won’t do peak. MIMO then looking we – latency, on probably which XG. an antennas and would for bandwidth, of in be wireless be the longer think some rollout if about So take to combination and up also they’re in centers you’re a I on benefit micro addition to in components in the saw right? PCB, used station being and it peak it, have cells. to now urban the at rollout. a you then that expect there that longer the Anaren the is will that also piece we’ll would what I that station, is that of to so business bit a see Now complexity, XG in antenna a And initial the expect terms used little bringing won’t being steep called base reason thing, than be than should we’re in going we that focus given from good

much the pretty by as is So now board you the built see providers. infrastructure the component requirements service across upon are

that revenue is flow step-up infrastructure. allows very limited in of initial terms And providers that’s really build because step-up And much continue and seen what on past service longer what to to starting the station a of then that so on with that’s and that to grow has base now roll XG rollout continue as XG. top that naturally moving we’re the into well XG they see XG Anaren peak, certainly

with see you with different, or what legacy versus So dynamics with Anaren would PCB situation. different pure TTM there the

what So expecting. hopefully, we’re a that gives feel you of

Sean Hannan

great. That’s

little And prepping so station a pieces, I’m assuming for that and antennas demand early down? these that’s further some getting of those you’re kind and field some then initial shipments the around are where really of tests orders for, base

Tom Edman

correct. That’s

out for of top and that build-out prototyping on I think antenna seeing we’re – base and initial then test some seeing being test, stations rolled are really we’re that.

lot a again, that’s going early So of on. testing

Sean Hannan

question That’s of here, the and over-interpreting that okay. helpful. may then some momentum I healthy next there. defense, Great, And very have be aerospace you

or Anaren us? doing? of that say, margin here you influence acceleration insight to – what could little you either either the the in how you’re any with road, what this transaction? an offering with there kind combined of that any segment, at ask, bit the top versus share down thinking wanted And time margin on were inherent announced Anaren Just is winning there what model dynamics Any that you this has on is within positively its opportunity organically or that or could own been a

Tom Edman


the – inclusive on hitting also climbed, think Just what our backlog a to course, declined but what excited last on a can core you’re despite see, having of very see. I tremendous quarter again, And has bit. And you of overall, Anaren been I program I’ve little shipping Anaren, quarter. that’s business

takes what momentum anything, course, side, been on we’re – that’s RF absolutely the real combination it strong impact I generally Anaren revenue – engineering but revenue So are had at revenue, what to our – there’s course, synergy to into of takes into a expected the plan in with And revenue say seeing we seeing aren’t of turn revenue which engineering, the efforts. is can folks initial funded the us roll road. usually, the expecting. build solid is several be that we which To opportunities. But we funded for on down even we the years it and beyond gives offers optimistic – synergies And revenue. if from synergy – yet, of to engineering just reason engineering have

is, looking I make can say side, we piece cost as course, chain of it, that start, tell the that the bringing Anaren bring the update course, there. to supply can leveraging in-house potentially you initial this. the to promising. as certainly But the I we’re and The TTM side on related of is of the continue synergies very as onto of additional approaches progress of looking we’ll and is of So at margin tied very, your at piece of we well what some operational can you, this what

– synergy there’s forecast. cost So some there’s opportunities a are contemplated again, our there that, by

Sean Hannan

Great. much. Thanks so

Tom Edman

Thank you.


next to Paul Coster with go We’ll JPMorgan.

Paul Coster


the the been aerospace of some. But is I discern a can we from of growing is outside anything Anaren SKUs backlog, proportion color defense? significant, have then and the asked Any from and in Is Is products? questions there higher-margin quite which backlog, of it think my most please? towards it? it

Tom Edman

impact backlog Those and year-on-year Thanks, That then of backlog. Anaren on the what the – absolutely Anaren backlog. The is combination in biggest correct. the – and is Yes. you’re our into two are defense change the Paul. reasons the seeing there a bringing the for aerospace

Paul Coster

time converting revenue? business, have to process is of there on Anaren-related whole Do i.e. visibility the lead more a into you generally longer

Tom Edman

the Very much XX-day we side our we in calculations. backlog defense course, provide had and for terms you, window visibility has so. a use beyond always of longer and program the for backlog, the stretches backlog of why that’s of aerospace of which business, figure The one that reasons

that TTM, visibility even better to designing customer, beyond complete visibility given orders the placed the you and specification is the defense. because a looking that with the we’re then of absolutely, stack for for of look into get gives design, in at even program. So brings business model and And engagement Anaren if predominantly and rollout engagement a that that, better in aerospace and turn as the capabilities course, early the then earlier

I profitability. us. see can standpoint also, for So absolutely, a And the think you development it’s again, impact the immediate a quarter our positive in on from visibility

Paul Coster

Last question, seeing? customers? Or it this your it portfolio? network broad across you’re of that Is a on whole couple the maybe is how telecom concentrated XG and adoption is

Tom Edman


for customers days, Of – relatively direct course, these of limited customers telecom us. set

out at, customers, inclusive looking primary really ZTE you’re four global three, customers. if So you look the there, so three of globally,

the pretty say across customers. there I’d activity is so broad And those

Paul Coster

you. Thank Okay.

Tom Edman

you. Thank


And in back Edman queue, with turn call Tom to would the like remarks. no with questions any to over or closing further I additional the

Tom Edman

some close to – Thank summarizing like the I you. points the points earlier. that by just made of I’d

second delivered First, for of XXXX quarter we the provided. ahead had results the of guidance we

diversification are We continue and and well, our execute working. differentiation to strategies

revenue are product to synergies just I’d of goodbye. the by year as you, excited the investors, the and, course, We thank like discussed of ramps your second front of in the that finally, Thank Anaren. the half continued well in integration our our And support. as us and arising for I employees, of you, from customers our


This does conclude today’s thank conference. We your you for participation.

You may now disconnect.