Cohu, Inc. (NASDAQ:COHU) Q4 2023 Earnings Call Transcript

Luis Müller: That’s really the main driver, Brian, is the mix between the recurring and the system revenue in Q1. It’s more skewed towards the recurring revenue than Q4 was closer to just call it about 60% recurring, 40% systems and so that’s very helpful on the margin side. Now at this point we reach in the systems revenue you reach a point where the margin is degrading because of the fixed cost infrastructure for primarily handler systems, so that’s a bit of a drag, which is why the quarter-over-quarter gross margin is coming down a couple hundred basis points, but it is supported by the recurring revenue.

Brian Chin: Okay, great. Thank you.

Operator:

Robert Mertens with TD Cowen:

Robert Mertens: Hi, this is Robert Mertens on for Chris. Thank you for taking my questions. I guess just the first one, in terms of looking at the puts and takes of the utilization rates, you were good about sort of providing those throughout the year on a quarterly basis. And then this quarter, sort of where each sub-segment has come in, is there any sort of forecasting that you’re doing in terms of the categories? Maybe mobile is one that picks up more in the second half of the year. If you’re starting to see auto and industrial declining a little bit, since that’s the highest utilization among your sub-segments, just sort of any color there would be helpful, thanks.

Luis Müller: Hi, Robert. We don’t typically forecast utilization. We forecast markets and customers, but not utilization. But if I take our forecast by markets and by segments, I would say there’s probably a little bit more to give on the downside in the auto and industrial segment and a little bit more to gain and pick up here sequentially in the mobile segment. I think we’re starting to see a little bit of signs of life in the mobile market and at the same time a lot of caution by our large auto and industrial semiconductor customers. You can probably attest [ph] yourself from their recent earnings release. So that’s supposedly going to dictate the pattern also in utilization once we finish the quarter.

Robert Mertens: Great, thank you. That’s helpful.

Operator: Thank you. And I’m showing no further questions at this time. So with that, I’ll hand the call back over to Chief Financial Officer, Jeff Jones for any closing remarks.

Jeffrey Jones: Yes, I just want to say thank you to everybody for joining today’s call and we look forward to speaking with you soon. Take care.

Operator: Thank you. And thank you all for participating. This concludes today’s program. You may now disconnect.