BE Semiconductor Industries (BESI) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue rose 27% year-over-year to €156.6 million, with net income up 33.7% to €46.8 million, driven by strong demand in advanced packaging, hybrid bonding, and photonics, despite weakness in automotive and Chinese markets.

• Orders increased 19.2% year-over-year to €151.8 million, with hybrid bonding orders comprising about 50% of total orders in the past 12 months and over 100 systems ordered to date.

• For the first nine months of 2024, revenue reached €454.1 million (+8.3% YoY) and net income was stable at €122.7 million, as higher R&D and share-based compensation offset revenue gains.

• Financial position strengthened, with net cash at €110.7 million and total cash/deposits at €637.4 million, supported by a €350 million senior note offering and ongoing share buybacks.

• Ongoing expansion of advanced packaging production and R&D capacity, including plans to double Malaysian clean room space and expand Singapore R&D by 2025.

Financial highlights

• Q3 2024 revenue: €156.6 million (+27% YoY); orders: €151.8 million (+19.2% YoY); net income: €46.8 million (+33.7% YoY); EPS: €0.59 (+31.1% YoY).

• Gross margin for Q3 2024 was 64.7%, up 0.1 points YoY; operating income rose 29% YoY to €55.1 million.

• Net cash at quarter-end was €110.7 million, up 48.8% sequentially and 22.7% YoY; total cash and deposits: €637.4 million.

• Adjusted net income for Q3 2024 was €50.2 million (32.1% margin), up from €36.6 million (29.7%) in Q3 2023.

• Dividend payout ratio for 2023 was 92%; cumulative dividends since 2011 total €1.4 billion.

Outlook and guidance

• Q4 2024 revenue expected to be flat (+/-10%) versus Q3, impacted by shipment timing of hybrid bonding systems.

• Gross margin guidance for Q4: 63%-65%; operating expenses expected flat to up 5% sequentially.

• FY 2024 revenue expected at €610.7 million, up 5.5% from FY 2023; FY 2024 gross margin forecasted at 65.2%.

• Market upcycle now expected in 2025-2026, with 2024 assembly equipment market growth revised down to 2.9%.

• CapEx for 2025 expected to be around €10 million, mainly for clean room expansion.