And Rafi mentioned that a certain Tier 1 customer, we were able to develop tens of new steps and obviously, the ones that we develop together with the customer are ones that we will win and will take from our competitors. So I think that we are winning a lot of steps and this will be one of the main reasons for increasing the business in 2024 and beyond.
Unidentified Analyst: Got it. Thank you so much.
Kenny Green: Thanks, Tucson [ph]. Our next question is going to be from Gus Richard of Northland. Gus, you may go ahead and ask your question.
Gus Richard: Yes. Thank you for letting me ask a couple of questions. Just a follow-on, you did mention tens of new inspections. I was wondering if you had a sense of how much TAM expansion you got, or you could give us some color on is this for backside power? Is it for what sort of end applications, not specific, but just in general?
Moshe Eisenberg: Well, we have to be very careful because we cannot disclose information from customers. I can say that those steps are in the advanced packaging world.
Gus Richard: TAM opportunity, is it tens of machines, single digit?
Moshe Eisenberg: No, no, no. It’s here at this customer and in other places, you are talking about tens of machines. The potential is very large. And this is why we are so focused on winning new steps.
Gus Richard: Got it. That’s super helpful. And then just in terms of your ability to supply your customers supply constraints, in slotting. Could you give us a little bit of color on if orders continue to accelerate, what sort of sequential growth can you deliver? Are there any inventory constraints, people constraints in terms of ramping the revenue as we go through the year and into next?
Moshe Eisenberg: So I think we discussed in previous calls, and we’ve mentioned that already, I think, a couple of years ago, we increased our capacity from clean room space and our, I would say, operational capabilities to around, I would say, at least $500 million in revenues. So from the longer, I would say, the longest lead time, which is the building itself and the basic clean room space we have enough capacity. Now what we have done, we also increased our inventory in order to meet the potential growth. And I think if you go back to 2020 during the year when we grew up 70%, we were able to work very closely. We have excellent relationship with our subcontractors, they have enough capacity to grow if we need to grow certainly beyond our expectations. So we have all the capabilities to grow, and we are very confident that we will be able to supply all the requirements that are out there.
Gus Richard: Got it. Super helpful. Thank you so much.
Moshe Eisenberg: Thank you, Gus.
Kenny Green: Thanks Gus. Our next question is going to be from Alon Last of Meitav Dash. Alon, you may go ahead and ask your question.
Alon Last: Hi. Thanks for taking my questions. Going back to the orders, could you please provide some details about what are the implications of those 300 machines? What kind of revenue projection are due to — only to the current orders? What would we expect in the first and second quarters?
Rafi Amit: Okay. Hi, Alon. The orders that we have received in the second half of 300 machines partially were delivered in the — within the second half. But most of them, I would say, close to 70% will be delivered in 2024, mainly in the first half of the year. Our ASP for the machines is around $1 million. So that’s the magnitude of the orders. And again, this is a general number, but our ASP is $1 million. So we are talking orders of the magnitude of $300 million. And a big portion of these orders will be delivered already within our guidance of $93 million to $95 million in the first quarter.
Alon Last: Okay. And another question. If I look at the — I mean the operating expenses, it doesn’t seem the form factor contributed a lot to the expenses. So could you please provide some per forma details about what’s the contribution of form factor to the OpEx and also revenues during this quarter?
Rafi Amit: So we can’t get into the level of details between Camtek and FRT. But they — obviously, they did contribute their share to the operating expenses in the form of two months only. Next quarter, the contribution to the expenses will be a little bit higher. Also, as I said, it’s harder to provide an exact number because, as I said, we are going more and more direct in terms of sales distribution. So the level of sales and marketing expenses that are part of the operating expenses level are coming down. But in general, the — what is important to say is that what we plan to — the plan that we plan to integrate FRT fully into our business, our sales people, when I say our, there will be a combined sales team that will say both the Camtek legendary product as well as the FRT new products, technical support team will support both product lines. So everything will be integrated within 2024.
Alon Last: Okay. And last question from me. A client had mentioned that they expect a certain pullback in orders from China in the second half or during 2024. What’s your projection about the Chinese demand? Are we likely to see it stable or decline during the year?
Rafi Amit: We see a stable demand coming out of China. I think the comparison of Camtek with Applied is a little bit misleading because we serve, I would say, first of all, the OSAT world, which is growing very fast on China, trailing edge, fabs. I think these are the main markets. And of course, there are small applications. But these are not the segment that applied is serving. And therefore, I think the comparison here is a little bit misleading.
Alon Last: Thank you very much.
Rafi Amit: Thank you, Alon.
Kenny Green: Thank you, Alan. Next question is going to be from Joey Chai of Analog Century Management. Joey, you may go ahead and ask your question.
Joey Chai : Hi. Can you guys hear me?
Kenny Green: Yes. We can.
Rafi Amit: We hear you Joey.
Joey Chai : Yes. Yes. Thank you so much for taking my questions. So I have more of a housecleaning question here. So today, like management reported like 300 orders. But based on like my track, so I think since Q3, the company reported around 240 orders, and on December 18, there was another 25. So I suppose like on public release, there’s like 265 machines. So I’m just trying to ask like, is there a discrepancy between 300 and the 265 that I see here, is that rounded on the 10s to the 300 or was it rounded on the single-digit base? Like for example, was around 295 machines, then you guys run it to 300?
Rafi Amit: It’s — so far so it’s rounded up in a single layer on the scene.
Joey Chai : Understood. Okay. Okay.
Rafi Amit: Correct. But look, what we have discussed is in the last call, we have mentioned 240 machines, if I remember correctly. And since we’ve got additional orders, and we’re already counting them until the end of the quarter. We did not mention the orders, so by the end of 2023, we had about 300 orders, 300 machines, some of them — some of those 300 were shipped in the second half and a significant portion of it will be shipped during 2024. And of course, we are getting additional orders as we speak, it’s on a daily basis. In general, we announced orders when we receive a large order. That’s the time we make a special announcement. And from time-to-time, we discussed it during our calls. Did I answer your question, Joey?
Joey Chai : 100%. Thank you so much. Sorry. Yes, I have one more follow-up. So for the 30% of the revenue in 2024, which is management comment is going to be from like HBM and HPC, like can management kind of comment what’s split between these two? Because based on the comments, it seems like most of it is from the HBM part going forward?
Rafi Amit: So — so Joey, I cannot really make here the distinction, and I don’t have it in front of me. But in general, we talk about the high-performance computing.
Joey Chai : Yes.
Rafi Amit: It comprises of the chiplets and the HBMs.
Joey Chai : Sorry. How about the — so what would be the split between the chiplets and the HBM?
Rafi Amit: I don’t have them in front.
Joey Chai : Okay. No worries.
Rafi Amit: So we just bundled them together because eventually, they — this is more or less the segment that is really today the growth engine and eventually most of these chiplets need the HBMs around it.
Joey Chai : Understood. Understood. And another clarification. Sorry, this is the last one. So, yes, you guys saying, seeing clear indication for the orders in the second half of 2024. And I assume you guys have much more better visibility also into 2025. Can I assume that’s also the case?
Rafi Amit: No, that’s not the case. Its not.
Joey Chai: Okay. Okay.
Rafi Amit: I think still 2025, is far enough so we cannot have the visibility. We understand the market, we understand the trends, but when you come to a real backlog, this is a little bit — this is beyond the horizon.
Joey Chai: Thank you very much.
Rafi Amit: All right. Thank you.
Operator: Thanks, Joey. So that ends the Q&A session. Before I hand it back over to Rafi, for a concluding statement. I’d like to just let everyone know that in the coming hours, the upload and recording of this call will be available on the Investor Relations of Camtek’s website at www.camtech.com. I would like to thank everybody for joining this call. And Rafi, please go ahead with your closing statements.
Rafi Amit: Okay. I would like to thank you all for your continued interest in our business. I want to especially thank the employees and my management team for the tremendous performances. To our investor, I thank you for your long-term support. I look forward to talking with you again, next quarter. Thank you, and goodbye.
