Intevac, Inc. (NASDAQ:IVAC) Q3 2023 Earnings Call Transcript

So how should we think of this TRIO contract? So if we have to roll forward five years 20 tools out there just with your first customer what would the service component look like on that contract a couple of couple of years from now?

Nigel Hunton : Okay. A crystal ball question. First of all, to talk to the TRIO the one that really exciting things about the TRIO concept and design it’s the modularity of it. So this system we took some of the real learnings from the 200 lien and built into the design a modular build. So as you look at them video, as you look on the enhanced investor slide that we put out this time. You can see how that modular structure enables, you to add to a common chamber multiple types of process chamber. So I could actually put on an ion beam etch stage, I could put on other bits of technology and actually expand or shrink that tool to optimize it for other materials whether that be for auto sector or whether that be for running of a polymer through the machine.

So the machine is incredibly versatile. As we look at the auto sector, the auto sector for us it’s early days to get a real understanding of the key target applications for us. Probably in that auto sector you have that you can think about inside the inside of a car screens that are very similar to a tablet or a laptop. And therefore, those are actually would actually fit very nicely into the common structure of the machine today. If you look beyond that into large hyper screens ago panel to panel, it probably would be at the new machine. But our focus initially will be about leveraging the capability leveraging the R&D we’ve put into getting the tools where it is today and utilizing that initially to get some inroads into the auto sector. So I see that the whole design concept being a brilliant bit of engineering expertise from the team to enable that flexibility.

So I hope that answer that question. As I look out 5, 10 years, I mean, clearly service is going to be a key part of our strategy. I think one of the things we actually if I look back 20 years, I’ve added a very different strategy around the 200 lien to build a much stronger service capability. I think it is too early to give you a mix today, but as we actually build the market presence we start putting tools into the market a key part of our thinking is around building a strong service capability in the service business. But also as you’ve seen with the concept of design as we’ve seen over the 200 lien over 20 years, you can take a modular a different enhanced type of technology a different type of spectrian component onto the machine. So I do see that the whole design concept of upgrade has been possible.

But I think it’s for the first couple of years, it’s about gains expected to land that market building some real learning, building a business around the spares and service and then actually coming back to play in a play 12 months to 18 months it gives you a bit more granularity around the service, but certainly its a part we want to actually build on as part of a focused strategy.

Peter Wright : If I could have one little follow up into your crystal ball there. If you think of upgrades just alone on this business. How does this technology evolve over time? Is it chemistry? Is it fitness? Is it I guess, productivity and throughput and that’s more of a tool generation but upgrading existing tools, and the camera as an example, a different architecture or density or whatever you know kind of the migration is what is the metric that is going to be kind of how these systems get better over time?