Tom Edman Chief Executive Officer
Todd Schull Chief Financial Officer
Sameer Desai Vice President of Corporate Development and Investor Relations
Srini Pajjuri SMBC Nikko Securities America
Jim Ricchiuti Needham & Company
Mike Crawford B. Riley Securities
Matt Sheerin Stifel
Christian Schwab Craig-Hallum Capital Group
Call transcript
Due to licensing restrictions, you must log in to view earnings call transcripts.

Good afternoon, ladies and gentlemen. Thank you for standing by, and welcome to TTM Technologies Fourth Quarter 2021 Financial Results Conference Call.

During today's presentation all parties will be in a listen-only mode.

Following the presentation, the conference will be open for questions. [Operator Instructions] As a reminder, this call is being recorded today, February 9, 2021. President TTM's Development disclosure Vice will Investor TTM's review now statement. Desai of and Corporate Relations Sameer Please go ahead.

Sameer Desai

Thanks Keith.

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

presented of the and press direct was the certain with release, be company's included GAAP and in SEC, TTM's as we adjusted measures Such not to EBITDA. you non-GAAP this prepared GAAP. the will considered www.ttm.com. with to We on which as also for filed the available substitute measures website, on is reconciliation And in non-GAAP accordance financial such call measures discuss a should measures

the call on Executive go will our TTM's Edman, I over we turn Chief posted Tom. refer a to slide Officer. have call. We will our during to now Tom also website Please, deck, which ahead

Tom Edman

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

growth ourselves markets ongoing continued and XXXX, for call of the labor including and achieved the variant than high-end year-on-year despite of logistics delivered headwinds, performed challenges open the and questions. by to results our of impact we customers, strong non-GAAP EPS labor of pressures, supply operational quarter challenging revenues fourth better then led These despite markets. will guided North our in guidance, a the end Omicron inefficiencies. and We were TTM and production expected In the America, end resulting at range constraints chain your supply All inflationary commercial with above in the environment COVID-XX. chain and

sold work of level elevated at in to the QX. our take prices cost through impact in material raw that time to stabilizing an was in the than our goods it's but Given inventory, QX, QX larger

price we increases cost-savings, mix, all adjustments. During the mitigated of XXXX, in and price material virtually product through adjustment additional

our first costs in the in to quarter, do the labor and and and continue output North challenges will fourth inefficiencies America production challenges However, in exacerbated further quarter. so

North labor to and the profits sequential decline quarter, with quarter due in America. Year we less one expecting in revenues changes Looking into are the having Chinese continued associated seasonality New a week in first and

use operations grew will our and despite mentioned. the and most to cash employees we all like return these challenges of I closed divested This part flow XX.X% XXXX, from the to one be we full-year the we Todd accomplished manufacturing Full-year as to with cash previously difficult capital shareholders, face $XXX.X of to continues profitability, For businesses, excluding discuss of flow on environments TTM our COVID solid million have what also and have challenges. has in I update would ever been the of situation. later. the you am was experienced proud and

to another our was as cases variant aware, that impacted As you cases continue other the with similar world. absentee rate contributed as began In labor positive in in started absentee well QX cases much some to North shortages, quarantines, to as as constraints North capacity along parts are started TTM, the late America. which during positive of to Omicron America, employee the employee created has population we In with surge as January, our climbed in winter rates and production inefficiencies the COVID into subside see and resulting decline. our of to general relief facilities XX%. At

to see retaining companies, operational. to many be continue manufacturing America. other in particularly of North have continue and attracting challenges All Like we in facilities our and labor, been

are of demonstrate employees methods. value endeavor and we our and financial the their Our to TTM non-financial company paramount of actively through to success to a combination

will North a year, significant increase our improving of we needed being the We America in on labor half which adjustments, of with we have review in round we to our make labor embarked thorough compensation in that of increases quarter, of became while the it practices changes the a initiative our These clear the announced another to to done cost our compensation competitive first a operate. these realign positioning. customers. have and fourth structure price markets in goal as our In

full we of year. extensive to the half not effect impact commitments, new pricing take of the backlog until the contractual second and expect the do Given our

the As a expect result, we the improve first over in to profitability second half. half

strong margins. is and flow time, to on growth, business believe cyclical differentiated. cash stable rewarded journey a and less Our be with more long-term improving strategy investors We transform that unchanged. to remains be TTM more performance, our over will

business As in part our of we sold the XXXX. strategic mobility transition,

generate part strategy products ongoing consistent our now broad markets. through will flow to current and more that of be cash are longer to and strong our to internally A end to capabilities complementary exposure acquisitions. of and add with cycle both technologies our offerings, We able are set key

As our continue RF&S solutions advanced technology invest product organically microelectronics such, we in unit, from center, differentiated technology and business to businesses.

Looking balance as to position organic forward, our sheet investment as a support acquisitions needs. in to -- well further our strong is further pursue to

the review markets. divested Now production EMS historical plants, our I'd end like of business December and halted end mobility the disclosures XXXX. unit market to exclude which two All in

and posted presentation, of please quarter market and and QX X QX on our details to disclosures, to X which Pages The aerospace XX% end on XX% website. of compared sales market XXXX. is refer in total XXXX For more represented defense end of sales our of earnings XX% sales, fourth

and ago. saw experience book-to-bill ongoing bookings program, result $XXX We record programs. strong positive year the significant quarter X.XX. for million new the a climate A&D in compared and our key We bookings market for a solid to strategic continue of the with overall defense our in a our was alignment SPY-X for million, franchise program defense AESA is Radar to program demand $XXX A&D at The backlog a

to market sales. We this sales end of expect QX about our represent from in XX% total

Defense America. due decreased December, signed NDAA, in see significant aerospace roughly a topline We and the declines happy National Act, law aerospace, XXXX full for ongoing Authorization X% to production commercial in to increase spending. providing were and fiscal X.X% defense into the or year, North For inefficiencies in last defense

market printed the Automotive quarter, that sales long-term due and during are of other Department and In contain our benefits XXXX. Defense expect telecom growth countries that to quarter starting footprint. of our XXX compared XX% requires recovery in XX% commercial of be X% North represented circuit the to third sales to expect of TTM by This projections or we boards weapon XX% XXXX U.S. allied suppliers that with Defense XX% to America in applications as new Xth part the the the strong Automotive addition, critical of of the the the purchase we of provide from slow In section and aerospace total to the our year-ago products datacom side commercial by in or driven by NDAA defense Department manufactured XXXX. XXXX business should quarter used January, in X% segment. systems year-over-year. other U.S. a of line XXXX, grew during of

aware that directly automotive not of been are limiting affected our has do not We shortage we phenomenon the this semiconductors production, has since purchase semiconductors. business but

monitor However, continue we situation will the closely. to

quarter. total sales of XX% first the in contribute to automotive expect We

For the end in our in impacts XXXX. XXXX. demand XX% market year, of XXXX, was full as rebounded and technology automotive XX% after supply XX% In COVID advanced to automotive compared increased

market Chinese New longer-term with of to growth, we expect in medical grew to instrumentation sales technologies the revenues While compared end broad-based the the and grew in saw faster. standard starting segments. XX% even million to In we quarter third of we forecast despite year-on-year, expectations XX% The fourth solid market year-ago of in exceeded our our contributed QX quarter, above The industrial X%. be our technology XXXX year are QX year-on-year across strength and in XXXX. market X% in XX% total performed $XXX advanced Year as all a the XX% quarter, than and the revenue much MI&I better

with a to of environment. first expect revenues the we demand quarter, MI&I For be XX% strong continued

trend and XX% moderated and basis due the XXXX. segments and XX% in for networking QX, to line past X% customers. on the growth as growth particular. continues during in years. strength compares Networking of we of to due the strategic to XXXX. capacity relative two XXXX, grew Telecom, with XX% For the a the following end build-out decisions for expect we in in demand XG quarter fourth to continues of to higher supply Networking. In of above as for fourth constraints in of to these to be MI&I In as be see revenue, years in weak year-on-year industrial we layer market be XX% as use full-year, the soft, following in expect extraordinary line this forecast strength quarter the our X% Telecom row We key XXXX, to XX% compared third networking well previous China data the our of the year, and revenue saw be of several customers revenue demand made in a quarter XX% center count in to communications two This strength accounted to

third with of this early be the declined start For expect the quarter fourth XX% year. X% Center customers. from represented the total due in the XX% in full-year, in in to growth XXXX strengthened longer-term sales up primarily forecast XX% center Networking XXXX. weakness market and of data X% in of growth in Telecom the end by soft but networking of X.X% end part QX to Computing the anticipated XXXX We market grow, the to to year-on-year, Data compared offset communications the Sales XX% This in of was due market to quarter, our below

expect year-on-year growth. as drive end center XX% We approximately of this revenues to market represent demand strong first data quarter to sales continues in

center For to the the saw customers. growth. forecasted full center In data we above be year, our by across of X% growth primarily XX% to end center data as computing X% grew driven expect data we XXXX, growth market

I'll Next, the Xth details of some of cover the quarter.

EMS following information metrics presentation. of operations X also plants is business mobility two Page unit the earnings of the This on that closed. exclude we available our and All the

for RF the technology subsystems and QX. which rigid quarter, This and year-ago XX% microelectronics, in the of quarter approximately approximately business, our XX% to our During accounted in includes advanced and revenue. XX% components, HDI, compares flex,

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

QX North in in Our in quarter, to QX. XX% utilization overall the year-ago in XX% compared and capacity America XX% was

quarter customer XXXX. Our XX% top At one in above the of the five XXXX subject to fourth sales quarter the compared is QX. end million end We of quarter. end third was total customers of to of our million the compared $XXX.X in $XXX.X XX% million the XX-day in the quarter contributed had year, the XX% fourth to at and of of at cancellations, QX, which last backlog $XXX.X

PCB was January Our ending X.XX book-to-bill three the months ratio Xrd. for

our we customers. expected inspiring our forecast for and uncertainty by materials chain and employees innovation than business and result and employees challenges partners challenges chain our higher to our are the with better our around thanking labor due and efforts as contribute than critical is customers. revenue direct TTM and ourselves. Despite both facing, continuing to like our our performed concerted to of support supply a our our we to labor-related raw I'd conclude customers backlog mission of TTM to for again Our supply

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

Todd Schull

reviewing good posted press Thanks quarter well release the for afternoon, results on in the as which and year, Tom, and everyone. some Xth Slide presentation the highlights our our distributed our on shown I'll is are X as of today, which be for website. financial earnings also

North were $XXX.X to to our For decline in from the compared was and sales quarter commercial our which offset to more operations of in production softness in America. net increase growth strong in commercial million, aerospace markets, $XXX.X aerospace XXXX. end revenue year-over-year market a and The defense quarter, Xth than continuing in the due modest million challenges due end Xth

two which million in the and headwind was there quarter. current our the EMS year revenue addition, revenues In in facilities year-ago in of quarter, the $XX.X closure generated no from a

impact grew our the closures, of ongoing year-on-year. the XX.X% Excluding of revenues EMS business

diluted year, the million or $XX GAAP comments an when $X.XX last This my full was extra the Data focus XXXX year. XXXX. income quarter compared in Automotive, of week basis, income in per The Instrumentation quarter fourth numbers and That $X.X full-year the $X.XX quarter extra Industrial week the to contributed driven fourth the end was income of to of compared million the net non-GAAP for compares include the to fourth million XX.X% On XXXX in GAAP approximately diluted net $XX.X the on by XXXX. Computing, quarter a of our XXXX share grew remainder million For million per of or fourth fourth revenue. periods and comparable of for share. operating financial quarter and performance. will Both Center $XX revenues our $XX.X markets. Medical

We comparisons excludes tax information our divested quarter production financial investors related infrequent mobility through to largely was in in unusual The eyes compared M&A due enable to America. company to non-GAAP costs, restructuring items, present non-routine other decline quarter in and certain or unit, in expense XX.X% the fourth prior North facilitate the to Our of items. management with and and performance non-cash to business Gross costs XXXX. XX.X% of items, the expectations year-on-year margin see challenges periods. non-GAAP was the fourth labor

to quarter. mitigate ago. million year million to year sales XXXX, Fourth X.X% we expense quarter of we or During expense customer cost manufacturing the through G&A compared in revenues experience $XX.X net X.X% able increases net quarter of quarter million the X.X% sales sales those fourth material X.X% the marketing were $XX.X the million of year net $X.X million impact X.X% in ago a or did or of ago. was profit compared the the In of $X.X quarter, million, and was same a or R&D price of or quarter, net increases significant efficiencies. but increases, and sales versus or in to $XX.X of substantially X.X% Selling was $XX.X fourth

quarter. by was the year, Our last fourth X.X%, in from operating due bond lower offset expense the year. in primarily our a of of quarter X% decrease as compares December in last QX margin to $XX.X in partially levels of XXXX, current the we this quarter week of million was quarter, $X.X in the expense Interest same $XXX extra convertible million million the debt to repaid same

negative QX of this of This of impact line. or $X.XX last $X.X a to the a reduced quarter, or impact million $X.XX incentives to the interest on Government million was year. EPS. $X.X operating During EPS compares loss foreign million there negative and exchange in $X.X a income below

quarter of income to tax or $X.XX to quarter, Fourth X.X% year per in rate or $X.XX compares million or This $XX.X resulting This million. of expense fourth prior $XX.X was in fourth tax diluted the the per effective share. was Our $X.X in tax per share. compares a net $X.XX net income quarter benefit share. million diluted million of XXXX $X.X

EBITDA million For per quarter diluted of $X.XX share with quarter or Adjusted XX.X% year, $X.XX to the per million $XXX was Net EBITDA million. the Depreciation XXXX or was million. adjusted for sales. flow $XXX.X compared net last fourth was And the million full share full diluted million income net compared of flow $XX.X a the $XXX.X net for fourth was sales, or $XX.X year. the for quarter million. $XX.X operations of quarter was from capital from for XX% $XX.X or operations spending cash Cash million. $XX.X was year,

Our very quarter our divided months of $XXX.X by end balance was And were X.X. XX net XXXX equivalents the cash strong. fourth EBITDA Cash liquidity sheet last million. and the at and of positions debt remain

the we million of announced at $XX.X million repurchased average stock of previously program During per share X.X under total price $XX.XX shares for of fourth common an repurchase a our quarter stock our $XXX out-expenditure million.

spent For have to X.X back million total million we buy repurchases a stock of the year, shares. $XX.X for

I'd for Now quarter. to the first turn our guidance to like

quarter sees fourth this Tom week normal has As and less our the earlier, one with than New first quarter quarter. seasonality associated Year, stated Chinese first our year

In are competitiveness. the to we our for in America addition, improve adjusting North compensation employees our

these significant balance existing are higher to backlog. won't we year have our While as a impact we second until half work increasing through costs, prices the of these the increases

of to of to $XXX earnings $X.XX expect of count EPS shares. share we approximately XXXX Given $XXX per share. revenue million. to range XXX expect that, diluted $X.XX is diluted of total to the the a in forecast non-GAAP based we for And range be million be quarter first in the on million

settled warrants our since share no such associated all and securities of as guidance dilutive includes options but have with those count now. shares Our RSUs,

about first revenue. X.X% and to quarter the that will in be of SG&A revenue X.X% expect R&D expense be We about of

we your million. finally, to to effective assist the approximately We in our $XX estimate developing models, total be additional and following information. XX% expense financial we expect To offer XX%. tax between And rate you interest

expect estimate first million, amortization depreciation expense $X.X million, stock-based interest approximately quarter, record we expense of will compensation and $X.X of of $XX.X expense we the to $X.X non-cash about be about During of intangibles approximately million. million,

the for to Conference Xst. Cowen IEO we tomorrow Leveraged remarks. Conference our prepared in I'd March Industrials Keith? Finally, I'd concludes open be the the will to participating Morgan line & and and That Finance virtually on announce like Aerospace/Defense questions. like that now And J.P.


Securities. Instructions]. go [Operator Thank SMBC Srini question you. Nikko We'll ahead. our with Please Pajjuri take first from

Srini Pajjuri

Thanks guys. and question on my Thank for taking job great you. the quarter,

that So in. the half, as to the the back look take guiding I guess talked Do half to and which as decline through price mention profitability go we you Todd know go your about, the is Tom, second out or are profitability we for you is? rate do get normalized target will inflation cost increases you half, long first kick whatever a you surprise not have it we a but second how as to that did might you into given to for you

Todd Schull

and only growth we back talked it this go answer of few with over as become deal can that until But through, bit time the with that inclined. supply really talked of we're taken try And which our talk and you pleased material raising about on effective our me we a that go that. an that that is chain year, pretty Very, just to pricing the and witnessed. been we've increases, We here increases there don't do actions, to gotten we by later labor and But say cost our extensively to quarters proactive those end let how inflation work and cost very lot price noted, backlog its we've to of I'm the year going And I'll that. our to challenging And our to that well we so to we've find if mitigate is challenges last materials from -- Tom worked little to this product take the in a perspective. come so we about year. hard and one. very model, from feel add into had to having was hope about head in now expectation, where the in XXXX. the adjust of we've all of

to cost have internally ongoing in we're starting through we well inflations have So have efficient. initiatives to that as we going as mitigated the in that later we're to pricing, going -- to the be but QX, incur more year, expect

a I've job in of our looking do, second a at of as year. this fighting been So later healthier lot a position and go, more little Tom through unforeseen what of will more have team and the get think we've we circumstances, a last plan position year and point we to through expectations, are terms a in we to highlighted, some need that to back good other bit half get seen a in the we've but I has done really by of have all the us this seen but much the we to normal year.

Tom Edman

responsibilities get we alignment. Anaren had only a our adjustment to that This just to add labor of launched after be And longer-term related process that as sure thing the strong the leveling well of little as the actually global acquisition. taking. will we is our global making organization we and more color began and the a project that part on the compensation, We bit I'd

-- that we're where stand much designed of this, phase competitive career they that process, outgrowth want really about terms terms now a global part, on -- the do being them excited able long then excited on adjustments this move But was in an of We're so competitive to looking development TTM's roadmap of As make where that for our this is implementation a -- better-defined has adjustments. employees America being sure -- offers and it's situation in to we to something I opportunities, in to up project, we've now coming And at those highlight, process a at big looking really offer North make a we're the levels. been about. need overall TTM and that there our in term. ensure we to

Srini Pajjuri

potential annual That look as And it. your And as I sense. we beneficial some price when makes question have like at impact, top-line growth I'm given it generally some that second I guidance lot suspect -- here, segment, telling a doesn't total somewhat look on the changing consistent increases. would you're again, you've Got impact just by pricing that as about, your will we curious, then half. we just half? go whole price here, potential in us. what one into or increases been being well conservative with are go into second

Tom Edman

of you What that go -- at and I markets, we the a that close Asia later were particularly to also, to benefited customer the maximize the side through have past really sure our we'll certainly and there by ability as say of if through adjustment level being I house call to demand a related. little driven price this -- from But growth output strong would the portion say we talk year XX% our and there. this. But end in I'm certainly by

out think demand. we this look at don't adjustments right look as to year, we at point As the incorporate much as we really you're pricing real I that

off rate solid still year. to elevated businesses growth I we're at a if of looking has returning given that of which liked so our at mix to particularly be we've where think an excited And coming you're be growth traditionally, mid-single-digit to looking situation again,

that growth but a So here. that portion solid we're again, there's really think we of missing, I that yes, potentially foresee

Srini Pajjuri

Got and it. luck. Thanks, good

Tom Edman

you. Thank


next Jim with our question & Company. ahead. Please take Ricchiuti We'll Needham from go

Jim Ricchiuti

seeing areas Good you're signs I'm have business? to where is of still case Hi. wondering labor you're wondering to be next any, aside as quarters may through in and Or the seeing to react of potentially any cost two putting go other take having you this if pricing stabilizing one a challenges, afternoon. actions? if other you the I'm the

Tom Edman

in of that. think seen last generally a we some did at China some our stabilization material at This have see quarter, the we high chemical-related way Yeah. that inputs worked through increase levels. facilities. stabilizing prices, -- We Jim, I our in

elevated least We have in that again, at would in a laminate we down -- electricity And material. our see laminate certainly major overall, we But over minor hope here which -- relatively winter, are primarily come trend is situation, the there. I those to China. stabilizing course do again that high raw say of time the compared. levels, costs levels will but

Jim Ricchiuti

in the light of next parts might of taking, other of side? to can what be quarters within activities the the still the actions on and say And pursuing moving Tom, you business couple of M&A the you some the you're some about

Tom Edman

able our And -- be be looking in in area what what reiterate might strategic Asia. then that strategic work to direction. active. the at say very of Continuing that still have major America, to Defense side of business to do our looking our still And position is place RF Europe, strengthening I we’re themes can do might And to another particularly bolster North and Southeast in our we process we is we overall Aerospace able what in pipeline at primarily to looking there, our just the outside footprint and China also priority.

moving, that bit valuation little expectations standpoint, in valuation remain more, of from So are with as but we're place. would realistic much volatility, go of a we we markets also see I Interesting those period in going some a forward. very say, the to priorities means hoping a that that

Jim Ricchiuti

it. Got Thanks


our Instructions]. go B. ahead. Please We'll from Mike Securities. question next Crawford Riley take with [Operator

Mike Crawford

you. Thank

Just question. on follow-up the a M&A

OEMs and investing building 's U.S. Intel your how footprints, in does other on U.S.? your calculus Ohio in billion fabs $XX the regarding own that change Given footprints the in

Tom Edman

there. A few things

in then we the of defense -- position for customers, and and love defense know, commercial primarily customers, America North of communications area. we but first and that would it's say think, in in position and MII as our I both I all, of Mike, pilot for you requirements and prototyping our production also customers, particularly also area computing the for the the some use

continue requirements So absolutely be to North will in customer around our we occur is reassuring time around start that on with fast-forwarding more that start be our their to a as an see a printed boards. That you even part cost pursuing the customer's capabilities going that base, forward. circuit advanced effort understanding an differential there we the now and with will a -- requires we America differential, initiatives dialogue

being Asia, is production With differential and in infrastructure the material, associated in cost there with North America. supply a primarily

supply seeing As with with potential non comments, certainly - forward resiliency on in from But let's And of my chain fact cost America in that to our an I in comes as NDAA regards the that through a with we I production. views China customer that shift the say in base, differential. mentioned emphasis tell came an we're acceptance interest production. to I start in going North will -- think go you

will discussions so see it we'll And and takes active where there us. continue

Mike Crawford

Thanks, America And that America in being that for and you position already count layer through be you somewhat mentioned that investment aerospace RS high also just your know to room layer defense, talked North mean internal but North allocated about I then Does to high strategic would add to more count in verticals. Tom. or? capacity some there

Tom Edman

around had layer are networking the about decisions, some just are demand customers, allocation data North that capacity. you talk at around to our high customers you're really we center for requirement. those really total And it's When right, count America we Right. not and looking difficult. make And for

towards customer associated so from On towards the towards the shifting pretty more been strategy with a continuing requirements, count advanced higher and to is layer standpoint needs and clear markets higher, that we've hand, technologies, where the have around move that. we other

by primarily, driven new chipsets support Now circuitry that's to those demanding more chips. than chipsets new being

North an those see see are and automated to to about that requirements. the Absolutely, to to sense. the become may if really as -- trend sense important, at American do so North and understand our again, that resiliency the supply capability differential, component make other and service the relates put if willing point, that And makes that we customers that more the -- continue need and America regions makes we it we yeah, more cost expect where meantime, for well capacity. capacity then, In chain as

we as look continue look -- that at supporting absolutely to think So footprint yeah, customer the I base. we'll at

Mike Crawford

you $XXX Thank you you And vertical Program XXXX. have production metric for [Indiscernible] you. that record last 'XX? automotive then in was that track the in number in have Do question million this at is,

Tom Edman

I sure do.

at a let previous quarter. see, to $XXX in million. most the had right. design year As -- just a million want $XX wins, we We sure wins, That make the I QX. of total numbers give from some XX had numbers to let's we the XX but only design had look compares me just recent We my automotive, you get

And so quarter. very strong

figure look step to at Now, XXX back at XXXX million, wins if $XXX about you was that fiscal year was let's say, $XXX even compares then the a million, design $XXX at okay, that XXXX metric, an for you and and which stronger million.

XXXX this this automotive of we're past saw this won into coming what coming in coming year their beginning And we programs that and what into customers -- in feeding So is seeing will in production these growth, and production. year see we move XXXX as a or we year portion XXXX that in our is what XXXX alive.

So from base to sure. it's for be nice a positioned

Mike Crawford

much. very you Thank Great.

Tom Edman

Mike. Thanks,


with next Sheerin We'll Please Matt question take go from Stifel. ahead. our

Matt Sheerin

Yes, thanks. Good afternoon.

to sounds back expansion expect -- that of gross we earlier, Just questions, are know about through a on How got stabilize. we asked you've this versus Could the fiscal half you're margin raw get we as half passing costs gross was prices margin. along, back again, I the in starting material think the year, particularly like the material follow-up 'XX? the -- but should

Todd Schull

things project it's to everybody our that for I can bit else that because challenging Chinese help for Matt, that giving because little far production is and But always for calibrate what lost do question the you me hard quarter a let the of is New low Year, of QX as year and seasonally we're matter. inefficiencies that here for guidance Remember out. drives.

to year-over-year. you got something mind that's So in keep

in we're we're there. the for of So nicely that certainly, ran negative be the situation, and described going to year. that standpoint has And last several The big of lowest look issue the pattern you expect whole from would years. impact been seeing process into year with will if we're the in that the first QX, consistent through Tom it America this half our was that is QX us that at we point and North addressing, a we that year labor really

some XXX to XXX of basis that, Just in by that which that plan that more of about we a issue. sense sense in that impacted points. of XXX solution If place neighborhood fourth executing we're the challenge particular a plan, we are QX points. the have able magnitude mitigating the us in, that to closer gives believe impact QX us we and in you a quarter basis -- will And in in

more favorable. and lot hope a and overall that XXXX. avoid during in be been supply growth that chain seeing we so us there's that revenue can things into that volume, obviously, any year other of can we've much Now the of hurt those challenges factors play margins, other And we

that hope through that of magnitude order sense I labor you the a of in we're So gives at now. helps least this working right direction, challenge of

Matt Sheerin

in Those a America all that's North SG&A? jobs. COGS, And mostly hit labor factory to issues it's not because

Todd Schull

really in There's really, SG&A, amount minor talk too Essentially, about. yes. but it's to a minor

Matt Sheerin

And I XX% you always products the America, about below the of I of North and in utilization it's that Asia know rate nature the know etc. do, you talked of significantly What's level the well you're get wanted and to where between think optimal you of you where year. the certainly, the it I But do think can and because below end you now be.

Tom Edman

where are, good jump start So, we're Where in we one that, terms and contribution we Todd, last revenue. on in quarter and out a of supplement. I were please North to can of America still that about think way to then

production, was coming after XX% North mobility about So sale the been of we America XX%. where out revenues have our of

start to that think labor we performance better up So will clearly plants, start when the XX. versus above like need those thinking high And we'd force we XX, that I see that approach. -- to again, labor again, moving if is and America those mix, your the get because standpoint if into like force to volume it bring we'll up mix will, force, low utilization we're be thinking answer you way start directly be labor help plants like question utilization, to on to really think again, then our as through dependent they'd as us to to get facilities. it, much things well, in about a levels this North we as about be utilizing but operating see for we'd the We'd margin so to that's really, And about XX%, expansion. we show above our we with that bring have

Matt Sheerin

impact board mix, it you're doing, on across said, like headwinds. in the end volume, like business, U.S. stuff some high a a labor on And complex where issues talked in I know you a it you of is networking your mostly the for [Indiscernible] you're NPI these terms all But doing areas much your like MilAero? is about more Or pretty the across here Or lower for where instance? markets?

Tom Edman

far America. commercial Yes. in course, aerospace America do The XXX% China. North is above is as very But close absolutely bit or that way by and of defense, biggest not we a but XXX aerospace of of it's production, a little North XX%

MII. end other affected The is by market that's this

turn of will, a that have several niche and quick applications. market, early market, for service you and if a mainly market some development the We MII the also that's facilities

is North Netcom, little facility, that going bit small into that's dependent America market Center which but America and part so fairly Data a of our North And a on primarily that's the So then Falls footprint. production. Chippewa

Matt Sheerin

on your there. Okay. sounds got Center, good like positive it really And just Data growth commentary the lastly, you've

expect do at you that, is be expect backlog customers? low and given -- to think seeing to your market above-market, I the given you the in we've growth to mid-single but than growth digits. better You're much Would those seen

Tom Edman

to because the forecasts, much always at through that market That all in we that on clearly have to would on the -- include growth is expect is growing rates. better X% and do puts -- it's monitors -- visibility they and data X% certainly most higher laptop through We than our Prismark center that. a desktop area. That damper

Matt Sheerin


Okay. lot. a Alright thanks great,

Tom Edman

you. Thank


our Capital take next go We'll ahead. Craig-Hallum with Group. Schwab Please from question Christian

Christian Schwab

would inflation Hey, be know America. what idea, but by you geography on now and North you guys. guys help modestly basis? in a to paying you're a in understand the paying Can hourly different, I -pandemic the were now blend pre as were paying What just wage give you go-forward what rough just labor us us

Tom Edman

I you. Maybe help that characterize can for

per just a move -- see hour past of pay the you you an we a level. move of back or above wage or It's I there $XX And we starting think and pay making I number having the been we're really tell major manufacturing year-on-year overall the let's I a is need year, substantial, was changes can it's north $XX we've -- in go for overall that for But year the substantially Yes, It's hourly starting this average, that, again kind -- than workforce. or over of structural moving are what pay our you to in think, this is compensation. seeing has X% sure. say there and that. again, the to been make the a workforce, time compare. said increases see the just for pay. seeing terms overall what scale simply context been a numbers, think from on lately to from I of inflation is I've in in But you standpoint, to more XX% if closer a closer more

Christian Schwab

your from back future costs? materials, guys increases customers? your any price Have on you as on seen push customers that? push but for or significant in obviously due seen book any Have to any you increases labor back revenue backlog of based readily from Or order raw

Tom Edman

where a our competition when customer -- demand, market said time the away deal labor you and the There be we price we've commercial if move the don't end satisfied the equivalent for that are is we're our depending -- doing to programs are I movement on into can have yet run choose of our of by rates the this from bit actually see base. to us really on situation, with well-documented. particularly is given volume at that, reasons a if a where they side. kind with, utilization commercial program. business, given it strength increase customer relief the But frankly, The of Having well from had are the inflation that to I us raw customers think pricing. a understood material this that

So of general absolutely, also but right we a back around price understanding in environment say is, in that what now. I would are the had we've increases, pushed --

Christian Schwab

then XX% you some given my could And sense. utilization? a of sounds -- utilization utilization XX% makes That is low. programs, which XXX% on last in a -- the operate complexity America or a is at of really rate or is of XXX% very the But utilization the relatively some North facilities question those

Tom Edman

plant. the printed for a that's we move for that a bottleneck utilization on business does mix will low that And core North over you coming the use. be to because measuring utilization Because The metric America bottlenecks use based process circuit high-volume plating facility, a high great a capacity measure that's board facility. in tend is move area. of measuring When capacity and the to use facility. those volume of nature into to a the around It's

move to quite bit. in bottlenecks you're the around a you're the to inspection, going in have bottlenecks have they drill, So going

a we the nature of requirements, you've you that's if over that requirements and use because why of there's that about above a in high got at to -- of Really, equivalent need hit be there's start XX mix of So volume also if that we quick and expansion pushing point, received sorts. point, to the you measure have the Certainly, always capacity. at a capacity being thinking XX capacity turn excess place, that XXX% much it. that's

is Of side the it's about what utilization not about now is, the labor course, equipment labor. now, a on shortage. really with it's right dealing capacity That right we're

Christian Schwab

Thank clarity. No that you. questions. on helps That Great. other

Todd Schull


Tom Edman

you. Thank


queue. the questions to in closing conference back We further have any additional the I for to remarks. would Edman like turn no Tom or

Tom Edman

just points the of earlier. some summarizing like Yeah, by you. I'd to All I close made that right, thank

First, and we delivered was guidance, of we the of above revenues our challenges that covered. the operational high-end despite that some

year, for market XX.X% almost growth. strong year-on-year diversification solid playing or XX% XX.X% is out for the and end the our of so growth quarter Second, very

continue our Thank cash very for solid generation repurchase customers, to continued used like we I'd again, you and you, just your investors, to much. to, finally, And employees, Third, support. thank our our our stock.


Ladies We gentlemen, your participation. conference. this and appreciate today's concludes

now You may disconnect.