ACM Research Inc (ACMR) Q4 2024 Earnings Call Highlights: Strong Revenue Growth Amidst ...

GuruFocus.com
27 Feb
  • Revenue (Q4 2024): $223.5 million, up 31.2% year-over-year.
  • Revenue (Full Year 2024): $782.1 million, up 40.2% year-over-year.
  • Gross Margin (Q4 2024): 49.8%.
  • Gross Margin (Full Year 2024): 50.4%.
  • Operating Income (Q4 2024): $52.8 million, up 46.4% year-over-year.
  • Operating Margin (Full Year 2024): 25.6%, up from 22.1% in 2023.
  • Net Income (Q4 2024): $37.7 million, up from $28.7 million in Q4 2023.
  • Net Income (Full Year 2024): $152.2 million, up from $107.4 million in 2023.
  • Net Cash (End of 2024): $259.1 million, up from $198.5 million at the end of Q3 2024.
  • Cash Flow from Operations (Full Year 2024): $152 million.
  • Capital Expenditures (Full Year 2024): $85.3 million.
  • Revenue from Single Wafer Cleaning (Full Year 2024): $579 million, representing 74% of total revenue.
  • Revenue from ECP Furnace and Other Technologies (Q4 2024): $51.7 million, up 60.9% year-over-year.
  • Revenue from Advanced Packaging (Full Year 2024): Grew by 3.3%.
  • Shipments (Full Year 2024): $973 million, up 63.1% year-over-year.
  • Warning! GuruFocus has detected 6 Warning Sign with ACMR.

Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • ACM Research Inc (NASDAQ:ACMR) reported a strong revenue growth of 31% for the fourth quarter and 40% for the full year 2024.
  • The company achieved a gross margin of 49.8% for the fourth quarter and 50.4% for the full year, indicating strong profitability.
  • Operating profit increased by 46% in the fourth quarter and 63% for the full year, showcasing effective cost management.
  • ACM Research Inc (NASDAQ:ACMR) has successfully localized its supply chain, reducing reliance on US-sourced components.
  • The company has a strong market presence with a 30-35% market share in plating, both in the front and back end in China.

Negative Points

  • ACM Shanghai and ACM Korea were added to the US Department of Commerce's entity list, impacting their ability to obtain components from the US.
  • The new regulations may pose challenges to ACM Shanghai's operations, potentially affecting production.
  • Visibility for the fourth quarter of 2025 remains unclear, which could impact future revenue projections.
  • The impact of recent export control rules on customer spending plans in 2025 is uncertain.
  • Four customers accounted for over 50% of ACM Research Inc (NASDAQ:ACMR)'s business, indicating a high customer concentration risk.

Q & A Highlights

Q: Can you provide more details on the assumptions behind the fiscal 2025 revenue outlook, particularly the low and high ends of the guidance? A: Hui Wang, CEO, explained that the revenue prediction is based on last year's shipments and customer expansion plans. Visibility is clearer for Q2 and Q3, but Q4 remains uncertain. The company will reassess projections as the year progresses, which is a typical process.

Q: Is there good visibility for the third quarter of 2025, and is the fourth quarter still unclear? A: Hui Wang confirmed that visibility is good through Q3, with potential for additional orders. However, Q4 remains unclear, and more clarity is expected by the end of Q2. Mark McKechnie, CFO, added that this level of visibility is standard for this time of year.

Q: How are the recent US export controls affecting your customers' spending plans for 2025? A: Hui Wang noted that the impact varies by customer, with some affected by being added to the entity list. The company is working with customers to assess the impact and is still in the process of evaluation.

Q: Can you provide insights into the market share and trends for your plating products, particularly in the front-end versus back-end applications? A: Hui Wang stated that ACM Research holds a 30% to 35% market share in both front-end and back-end plating applications in China. The company sees growth opportunities in both areas.

Q: What are your expectations for advanced packaging (AP) sales in 2025? A: Hui Wang and Mark McKechnie discussed the growth in advanced packaging, noting the expansion in 2.5D and 3D packaging. They expect 2025 to be better than 2024 for packaging, with contributions from panel-level packaging products.

Q: Can you provide a breakdown of sales related to memory, logic, and electric vehicles? A: Mark McKechnie mentioned that ACM Research does not typically break down sales by these segments. However, he noted that four customers accounted for over 50% of the business, and the company may consider providing more detailed breakdowns in the future.

Q: Is it correct that four customers accounted for over 50% of your business? A: Mark McKechnie confirmed that four customers accounted for over 52% of ACM Research's business.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.

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