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Veeco Instruments Inc  (NASDAQ:VECO)
Q1 2019 Earnings Call
May. 06, 2019, 5:30 p.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good day, everyone, and welcome to the Veeco Instruments Incorporated corporate hosted Q1 2019 Earnings Conference Call. Today's conference is being recorded.

At this time, I'd like to turn the conference over to Anthony Bencivenga. Please go ahead sir.

Anthony Bencivenga -- Investor Relations

Thank you, and good afternoon, everyone. Joining me on the call today are Bill Miller, Veeco's Chief Executive Officer; and Sam Maheshwari, our Chief Operating Officer and Chief Financial Officer. Today's earnings release is available on the Veeco website.

Please note that we have prepared a slide presentation to accompany today's webcast. We encourage you to follow along with the slides on veeco.com. This call is being recorded by Veeco Instruments and is copyrighted material. It cannot be recorded or rebroadcast without Veeco's expressed permission. Your participation implies consent to our recording.

These factors are discussed in the business description and management's discussion and analysis sections of the company's report on Form 10-K and annual report to shareholders and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases. Veeco does not undertake any obligation to update any forward-looking statements, including those made on this call, to reflect future events or circumstances after the date of such statements.

During this call, management may address non-GAAP financial measures. Information regarding such non-GAAP financial measures, including reconciliation to GAAP measures of performance, is available on our website.

With that, I will turn the call over to Bill for his opening remarks.

William John Miller -- Chief Executive Officer

Thank you, Anthony. Good afternoon, everyone and thank you for joining the call. Veeco executed well in Q1 and our results were above the mid-point of our guided range. Q1 bookings were $107 million, led by data storage and EUV products and our backlog has grown to $295 million.

With the commodity LED business largely behind us, our revenues for the quarter have stabilized at $99 million. Data storage revenue was a large portion of our overall revenue. We also shipped multiple systems to both Advanced Packaging Lithography and Laser Annealing customers.

Our non-GAAP gross margin was 35.5%, non-GAAP operating income was a loss of $4.8 million and our non-GAAP EPS came in at a loss of $0.14. We ended the quarter with $237 million in cash and short-term investments. We are focused on restoring top line growth and returning to profitability, by improving our gross margins and carefully managing our expenses.

At this time, I'll provide an update on our markets and growth opportunities and then Sam will provide more details on the financials. When we look at the macro environment influencing capital equipment, there are cyclical downturns across a few markets. Smartphone sales growth has slowed, memory prices have declined and automotive softness is also impacting the tech sector.

In fact, wafer fab equipment spending is forecasted down this year, anywhere between the mid-teens to 25%. It is our belief that, while these cyclical slowdowns have a temporary effect on capital equipment sales, in the longer run mega trends such as cloud computing, improvements in GPUs and the refresh cycle brought about by 5G provide tailwinds to the industry.

We have aligned our technology investments to these mega trends. We have engaged with our customers to solve the tough materials challenges and expect to benefit in the next industry upturn. You will recall our four focus areas for growth are: EUV Mask Blanks using Ion Beam Deposition, advanced Front-End Semiconductor with Laser Anneal, VCSEL manufacturing using MOCVD and Advanced Packaging Lithography.

Looking at the EUV Mask Blank opportunity, trends such as artificial intelligence, high-performance computing and cloud computing are all drivers of Moore's Law, which in turn is a driver of EUV. The proof points for EUV are happening now.

TSMC has announced risk production of their 5-nanometer process, which utilizes EUV lithography. And they've released their design infrastructure which enables 5-nanometer system-on-chips designs for next generation high-performance computing applications.

Likewise, Samsung has also announced they have completed 5-nanometer EUV development and are ready for customer samples. Accordingly, ASML has recently indicated they're on track to ship 30 EUV lithography systems in 2019 and another 33 in 2020. And in addition to their existing EUV logic customers, they are seeing DRAM customers express interest in EUV as well.

We mentioned on prior earnings calls that we have been building backlog in EUV Mask Blank systems. These are extremely low defect Ion Beam Deposition systems, which are required to manufacture Mask Blanks for EUV lithography.

During Q1, we received our fifth order for production capacity and I'm happy to announce that we shipped the first of these systems in April as planned. We believe the market opportunity is between $20 million and $50 million per year. We are working very closely with our customers and conducting roadmap discussions as this technology continues to evolve.

In Laser Annealing, we continue to make good progress with our customers. During the quarter, we shipped additional systems to a leading foundry for a process step at a very advanced node. The LSA or Laser Spike Anneal demand we are experiencing is consistent with industry trends. The same trends that are driving EUV lithography are driving Laser Annealing.

Veeco's LSA leverages our unique dual-laser architecture to offer exceptional, temperature control and low thermal stress. These process advantages are becoming increasingly important at today's advanced nodes. We believe this market potential is about $100 million. We continue to work with our customers for current production requirements as well as potential future applications.

And now, an update on our MOCVD technology applied to the VCSEL market. As you know, we have been enhancing our TurboDisc platform to produce high-performance epitaxial VCSEL stacks. We believe our new product has an advantage over our competition.

In our environment, we have validated our product's superior performance and we are currently working with multiple customers to place the beta tool in their facilities. This market today is absorbing the capacity that was recently added for the smartphone facial recognition application.

However, we believe additional 3D sensing applications such as world-facing sensors and automotive LIDAR will generate demand for some time. This is a potential market opportunity of $100 million to $150 million per year.

Another source of growth for Veeco is advanced packaging. As consumer demand higher performance, device manufacturers are responding by utilizing advanced packaging techniques to integrate components in very close proximity. This wafer-level integration improves performance and power consumption.

An example of advanced packaging is the well-publicized application processor that Apple has been using for years in their mobile devices. In this approach logic and memory are assembled together in one system in-package device.

Our advanced packaging lithography systems play an important role in many advanced packaging applications such as fan-out wafer-level packaging, fan-in wafer-level packaging, and copper pillar interconnects in flip-chip packages. We have had recent traction with our lithography system at both sets for a variety of applications including GPU manufacturing.

We also had recent order and shipment activity for copper pillar application in high-bandwidth memory with a leading memory manufacturer. These repeat technology investments have come at a time when memory capacity is being carefully scrutinized. This market has the potential to be somewhere between $75 million and $100 million annually.

In summary, we continue to remain focused on three priorities throughout 2019. The first is innovation. We continue to invest in new products and applications to help our customers solve their toughest materials engineering challenges.

The second is to continue to work penetrating new markets and accelerating our growth in EUV mask blanks, front-end semiconductor with laser anneal, VCSEL manufacturing, and advanced packaging lithography. And lastly, we are focused on returning to profitability. We are doing this by improving our gross margins and managing our expenses.

With that, I'll turn it over to Sam for further details on the financials.

Shubham Maheshwari -- Chief Operating Officer

Thanks Bill and good afternoon everyone. I will be discussing our non-GAAP financial performance. You can find the detailed reconciliation between GAAP and non-GAAP results in the press release and on our website.

I'll start with an administrative update and then move to the financials. In line with broader semiconductor equipment industry practice beginning in 2020, we will also discontinue providing our quarterly bookings results.

We have found over the years that bookings can be volatile and may not serve as the most reliable indicator of near-term business performance. We will, however, continue to provide quarterly bookings information for the rest of 2019.

With that said, Q1 bookings were $107 million and backlog at the end of the quarter was $295 million. We saw strength in scientific and industrial orders driven by our data storage customers. We also received multiple advanced packaging lithography system orders and another EUV mask blank system order as Bill mentioned.

And now turning to revenue details. Revenue for the quarter was $99.4 million. This was above our guidance midpoint driven by strength in our services business. Scientific and industrial market made up 40% of the total revenue, driven by shipments to our data storage customers as well as several ion beam sputtering systems shipped to our optical customers.

Advanced packaging MEMS and RF filter market made up 23% of overall revenue, driven by multiple AP lithography systems sold for high-bandwidth memory as well as GPUs and other applications.

Front-end semi market was 23% of revenue, driven by multiple LSA systems sold to a leading foundry for an advanced node. LED lighting display and compound semi was 14% of overall revenue with almost no contribution from commodity LED equipment sales as expected.

By region the U.S. was 33% of overall revenue, EMEA was 18%, and China was 10%. Rest of the world which includes Japan, Taiwan, and Korea for us was 39% of overall revenue. As we have highlighted before, we expect China to remain a small portion of our overall revenue going forward.

Now, turning to non-GAAP operating results for Q1. Gross margin of 35.5% was toward the higher end of our guidance, driven by tighter spending controls. OpEx for the quarter was $40 million. Our cost reduction efforts were achieved a quarter earlier than previously communicated. Tax expense for the quarter was $0.5 million. Net income was a loss of $6.4 million and EPS was a loss of $0.14 on a diluted share count of 47 million shares.

Now, moving to the balance sheet and cash flow highlights. We ended the quarter with $237 million in cash and short-term investments of which $66 million were held offshore. Cash flow from operations was negative $22 million, primarily due to working capital investments, biannual debt interest payment, and a non-GAAP net loss of $6.4 million.

Although the cash balance declined during Q1, we expect to generate positive cash in Q2. Accounts receivable increased to $75 million, due to stronger shipment profile in the third month of the quarter and accounts payables dropped to $36 million as incoming inventory received decelerated. As a result, inventory declined to $148 million. Long-term debt on the balance sheet was recorded at $290 million representing the carrying value of $345 million in convertible notes. And lastly, our CapEx during the quarter was $2.2 million.

Now turning to Q2 guidance, which is non-GAAP unless GAAP is specifically mentioned. Q2 revenue is expected between $90 million and $110 million. Gross margin is expected between 37% and 39%. OpEx is expected around $40 million. Operating income is expected between a loss of $7 million and income of $3 million. GAAP EPS loss is expected between $0.47 and $0.27 per diluted share. Non-GAAP EPS is expected between a loss of $0.18 and income of $0.02 per diluted share.

And now for some additional color beyond Q2. At this time, based on our backlog and current visibility, we see Q3 sales tracking above Q2. We also see our gross margins further improving due to favorable product mix. For the second half of 2019, we see top line improve over the first half by roughly 10%. We continue to target gross margin of 40% by the end of this year.

And with that, Bill and I will be happy to take your questions. Operator, please open the lines.

Questions and Answers:

Operator

Thank you. (Operator Instructions) We'll take our first question from Brian Lee with Goldman Sachs.

Brian Lee -- Goldman Sachs -- Analyst

Hey, guys. Thanks for taking the questions. It looks like on the four focus areas Bill that you outlined here the TAM it totals as much as $400 million. Can you talk to how much of that is already in play with tools that you have in the field and any other tool of record? And then related to that, I guess, how much is still to come? Maybe an update on evals that you have in the field. How close you are on some of those turning into beta tool agreements and ultimately POs?

William John Miller -- Chief Executive Officer

Sure, Brian. Let me kind of start at the top with EUV. We see that to be kind of in the $20 million to $50 million market. We are the leader in that space today and so that we expect to start hitting our financials Q2. So that would be incremental and that's in really good position. Laser Anneal in the front end, we are a player there and we are gaining some share today. But we are currently a player in that market.

Moving to VCSEL that's kind of the $100 million kind of sized opportunity, where we do not play today. And so as I mentioned, we have a tool that we've developed for this application. We're getting great results in our lab. We are close to landing a beta customer here. We're working with multiple of them right now and expect that to be done here in the near-term. So that would be kind of in the incremental opportunity. And then in advanced packaging lithography -- in that opportunity, we do have a leading market share and we are developing a product to maintain that strong position. So I would characterize it as EUV is incremental and strong VCSEL would be incremental and LSA and advanced packaging would be existing markets that we compete in today.

Brian Lee -- Goldman Sachs -- Analyst

Okay. That's helpful. And then --

Shubham Maheshwari -- Chief Operating Officer

Brian, I'd also like to add that beyond the growth opportunities, we are a very strong player in data storage. And that market is also very strong and at least here it's growing.

Brian Lee -- Goldman Sachs -- Analyst

Okay. Great. I appreciate that additional color Sam. Maybe just with EUV you're specifying Q2 here. How -- I mean, I guess is there any sort of granularity you can provide on the VCSEL opportunity in terms of time line and kind of what scale of that TAM you think is actually applicable based on the number of engagements you have across the customer set? And then just housekeeping, I'll throw this in there and pass it on. I don't know if I missed it, but any updates on the security breach you guys had talked about last quarter and any additional thoughts around the cost related to that? Thanks.

William John Miller -- Chief Executive Officer

Okay. I'll jump in on your VCSEL question. So typically, from the time of placing a beta tool, to having those that first tool revenue is probably as fast as six months and maybe as long as 12 months. So, maybe somewhere in the middle that would be about nine months to have meaningful revenue -- but have revenue on the first tool. And it's probably a similar timeframe to have meaningful revenue as well.

Shubham Maheshwari -- Chief Operating Officer

Okay. And Brian I'll take the question on the security breach. So that investigation -- we largely completed that. And we had a public filing in 8-K or something like that in February timeframe. So we have largely completed that. That cost is behind us at this time. And at this time, we are just cooperating with any of the investigative or government authorities that might be interested to investigate it in further, but at this time the cost is largely behind us.

Brian Lee -- Goldman Sachs -- Analyst

Okay. Thanks guys.

Operator

We'll move next to David Duley with Steelhead Investments.

David Duley -- Steelhead -- Analyst

Yes. Thanks for taking my question. I had a couple. You mentioned -- you talked the second half would be up 10% from the first half as far as revenue goes. Just from a macro perspective, could you talk about which areas you expect to contribute to that 10% growth?

William John Miller -- Chief Executive Officer

So -- sure. We're seeing some strength in logic particularly in the technology transitions. With EUV we have exposure with our Mask Blank tool I just spoke about, as well as our laser Spike Anneal tool at 5 nanometers.

And then as Sam previously mentioned, in the cloud we do have some exposure in data storage with third technology transitions with HAMR and MAMR. And so that seems like it's progressing really well. So I'd say those are the big growth areas. And as you know we don't have a lot of exposure in the memory market as well so.

David Duley -- Steelhead -- Analyst

Okay. And as far as the LSA business, you mentioned that you're shipping tools into advanced nodes. It's been some time, I think since you've done that at a major foundry or logic customer. Perhaps you could talk about why it is that you've been reinserted there and what the potential opportunities -- and do you expect other customers beyond the first customer here add advanced nodes?

William John Miller -- Chief Executive Officer

Sure David. I think the last win that Ultratech had was, I'd say 28-nanometers and we've now been able to penetrate at these advanced nodes at 5-nanometer and beyond. And what we're seeing is our ability to have very fine temperature control and stability with our dual-laser system is -- really seems to be well liked by our customers. And we are engaged with more than one at this time.

And working to -- since we got our foot in the door, really working to win more applications at the current customer as well as new customers as well, so it's kind of a beachhead position we have.

Shubham Maheshwari -- Chief Operating Officer

David, I would also like to add that we won this major customer at the 5-nanometer node and then we're also going to be on the development tool of record for the following node as well.

David Duley -- Steelhead -- Analyst

Okay. That's good to hear. Now as far as advanced packaging goes, it just seems like there's a lot of OSATs and IDMs that are making incremental investments and talking about their product roadmaps in this areas such as TSMC and Intel and Samsung and others.

And I'm just wondering do you see an acceleration in the size of this overall market? I think you mentioned the market was like roughly $100 million which is what I seem to recollect it's been for some time. So maybe just frame what you expect to happen to this market and help us understand what you're seeing as far as the customer base broadening out?

William John Miller -- Chief Executive Officer

Sure. So I would say historically it's really been strongly driven by smartphone demand from the last period of time. And certainly we're seeing some headwinds in smartphone demand which is definitely big wins at us. But you're right though that we are seeing new applications come on with OSATs with different graphic processor units applications, as well as applications in DRAM with high-bandwidth memory.

So -- and then also many of these other customers that you mentioned have their own various integration schemes. So, we see the smartphone is a kind of a big piece of the current demand, but it does seem that there are new applications being developed that would continue to show this business growing certainly for the long-term, but even in their current position.

David Duley -- Steelhead -- Analyst

And the large foundry customers that has purchased multiple tools in the past, is there an expected rekindling of demand from that customer given that at 7 and 5-nanometers there's 6 or 7 customers rather than just 1?

William John Miller -- Chief Executive Officer

Good question. I don't want to get into too specifics here -- too much specific here. But a lot of their business is driven by -- or maybe driven by smartphone demand which is soft at this time. And so their -- our business with them is soft as well.

David Duley -- Steelhead -- Analyst

Thank you.

William John Miller -- Chief Executive Officer

Thank you, David.

Operator

(Operator Instructions) And we'll move next to Gus Richard with Northland.

Gus Richard -- Northland -- Analyst

Yes, thanks for taking the question. On the MOCVD business, is what remains still mostly gallium nitride or are there other applications?

William John Miller -- Chief Executive Officer

Hi, Gus. Yeah. They're both gallium nitride as well as arsenic phosphide opportunities. And so the tool that we're developing for the photonics market is really an arsenic phosphide tool to compete in that $100 million market we don't have a strong position today. So that would include VCSELs; edge-emitting lasers; red, orange, yellow specialty LEDs and the like; as well as microLED.

And then really the GaN opportunity for us would be in power electronics, GaN-on-Silicon power electronics, and down the road opportunities in RF for greater than 20 gigahertz millimeter wave type RFID applications. It will be for GaN.

Gus Richard -- Northland -- Analyst

Got it. And I've recently heard some other folks talking about microLED at least some development going on. Is that still a ways away before being revenue opportunity for you all?

William John Miller -- Chief Executive Officer

Yeah. We are engaged with many of the players in the display space and they are working through technical challenges. Some of those technical challenges are driving new performance requirement in our MOCVD epitaxial growth, which is good for us. But there are also system-level integration challenges like transferring the LEDs et cetera.

And so I think you're going to see some first adoption of say mini LEDs larger size LEDs. But true microLED displays I think are a few years out still, but there's still a fair amount of activity ongoing in that area.

Gus Richard -- Northland -- Analyst

All right. Thank you. And then on MRAM, I noticed seeing increased level of development activity. I don't think anybody has reached production at this point. You didn't mention it in your prepared comments and I was just wondering what activity you're seeing in the MRAM market.

William John Miller -- Chief Executive Officer

Yeah. So we are working with a partner here and we have seeded a number of tools at all the players that are working in MRAM. And we're in a position to see how those orders materialize once their customers develop the applications.

Gus Richard -- Northland -- Analyst

Got it. Okay. But still when do you think that might contribute to revenue?

William John Miller -- Chief Executive Officer

So in this -- in MRAM we're actually the -- as opposed to selling a complete multimillion dollar system, we're supplying a key component -- an expensive component but a key component to the system. So the revenue will not be as significant as selling the entire tool. I just want to be really clear about that. But I think it is a good business but it's not a big top line growth.

Shubham Maheshwari -- Chief Operating Officer

Gus, I'd like to add along with what all Bill said is that along with our partner, a capital equipment partner we are in a pull position under MRAM side. Between us and the partner, they provide the full tool and we provide a critical subassembly like Bill just said. So we -- our position together is very strong and we wait for the industry to tick up over time here as things go into production. But that's the way we are participating in this market.

Gus Richard -- Northland -- Analyst

Got it. I understand. All right. Thanks so much for taking the questions.

William John Miller -- Chief Executive Officer

Thanks, Gus.

Operator

We'll move next to Mark Miller with The Benchmark Company.

Mark Miller -- The Benchmark Company -- Analyst

I just wanted to talk about your guidance. You're indicating --you believe you'll be -- or at least your goal for the fourth quarter is 40% non-GAAP gross margins. Is that correct?

Shubham Maheshwari -- Chief Operating Officer

That's true, Mark. Yes.

Mark Miller -- The Benchmark Company -- Analyst

Yeah. I also want to talk about data -- excuse me?

Shubham Maheshwari -- Chief Operating Officer

No. Go ahead, Mark.

Mark Miller -- The Benchmark Company -- Analyst

Data storage, which was strong last quarter you said it's growing. I assume because Nidec came out last week and indicated that their spindles -- their motor sales will be lower. I assume that's desktop, laptop considerably lower. So you're anticipating the cloud or the near-line drives, which have more platters to compensate and actually provide growth. When do you see that picking up?

William John Miller -- Chief Executive Officer

Yeah good question, Mark. We've actually seen our business from an order standpoint picking up for some number of quarters as we've been saying. And all of our equipment is used to make -- to meet the very steps of making the head of the drive. So as drives are decreasing, actually not only heads per drive are increasing also in total number of heads is increasing. So our business is doing very well there and we're also exposed as I mentioned to technology transitions with HAMR and MAMR and we're working closely with our customers to make that a success.

Mark Miller -- The Benchmark Company -- Analyst

And specifically I know your tools are used in the reader for leads hard bias deposition. For the HAMR-MAMR, what is the application there for those structures for the writer?

William John Miller -- Chief Executive Officer

There are actually similar types of steps just different requirements.

Mark Miller -- The Benchmark Company -- Analyst

Those are deposition -- it's a deposition rather than edge. Is that correct?

William John Miller -- Chief Executive Officer

Yes.

Mark Miller -- The Benchmark Company -- Analyst

Okay. All right. Well, thank you very much.

William John Miller -- Chief Executive Officer

Yes. Thank you Mark.

Operator

(Operator Instructions) We'll move next to Patrick Ho with Stifel.

Patrick Ho -- Stifel -- Analyst

Thank you very much. Bill, maybe if you could add a little color on your comments regarding the LSA and additional shipments this past quarter. The industry is pushing more aggressively to 5 nanometers. Are these additional shipments as part of this aggressive push for the same application? Or have you broadened your reach with this customer to additional applications that drove some of these increased shipments?

William John Miller -- Chief Executive Officer

Yes. That's a great question. Yes, we are shipping, but it's really, as I said, we're still at that beachhead one particular application unfortunately at this point. But certainly, we are working very closely with our customers at the next nodes to gain more to broaden our applications if you will.

Patrick Ho -- Stifel -- Analyst

Great. That's helpful. And maybe as a follow-up onto that LSA question. Given that you've made this entry back into this key foundry, but the industry itself also continues to push toward 7, 5 and eventually 3 nanometers. How do you feel your valuations are going with other potential foundry logic customers at these advanced nodes? Is there -- are there opportunities for additional wins given the wins you have -- given the win you had on this one customer?

William John Miller -- Chief Executive Officer

Yes. I think it's a very strong proof point for us and we're certainly doing demo programs -- significant demo programs with other customers. And there is generally interest for our tool and we're also working on our next-generation product as well. So I think we're in a pretty strong position here.

Shubham Maheshwari -- Chief Operating Officer

Yes. Patrick, I'd also like to add that for the trailing edge application for some time, we were expected to see China foundries buying this tool. And now we are beginning to see that activity pick up, or beginning to see that activity start. So on the leading edge, we are feeling good about this thing -- this tool in terms of advanced nodes. And Bill just said about the next-gen tool, but then at the same time want to remind investors about the trailing edge particularly from China, where we are also seeing a good bit of activity.

Patrick Ho -- Stifel -- Analyst

Great. Final question from me, Sam maybe specifically for you on the gross margin trends going forward. With the, I guess, the decline of your traditional and conventional MOCVD business out of the way, I know product mix always has some type of influence. But on a going-forward basis is revenue and absorption the biggest variable -- excuse me, as we look at gross margins going forward?

Shubham Maheshwari -- Chief Operating Officer

Yes. Good question Patrick. Of course, there are always two or three factors that play here. But going forward a number of things are coming into play here. First, obviously, with the EUV tool shipping and also data storage, we begin to ship products for which we have backlog. So those are all beneficial product mix. So the mix is beneficial going forward.

Secondly, the revenue that declined with the deemphasizing of the commodity LED, all of that created some extra cost, but at this time, we have worked through a lot of that cost out. So cost reduction is also playing a beneficial impact to the gross margin, although, in a smaller way than the product mix.

And then thirdly, we are looking at growth here. So as revenue grows, overall, absorption begins to look better than what it has been doing in the last one or two quarters. So, all these three factors and playing, and we feel very good about meeting our gross margin goals, as we look forward for the next many quarters here.

Patrick Ho -- Stifel -- Analyst

Great. Thank you very much.

Shubham Maheshwari -- Chief Operating Officer

Thanks Patrick.

William John Miller -- Chief Executive Officer

Thanks Patrick.

Operator

That does conclude our question-and-answer session. At this time, I'll turn the call back over to our speakers for any final or additional comments.

William John Miller -- Chief Executive Officer

Okay. Thank you all for attending today. Look forward to giving you an update next quarter as well. Thank you.

Shubham Maheshwari -- Chief Operating Officer

Thanks.

Operator

This does conclude our conference call for today. Everyone, we do thank you for your participation. You may now disconnect.

Duration: 38 minutes

Call participants:

Anthony Bencivenga -- Investor Relations

William John Miller -- Chief Executive Officer

Shubham Maheshwari -- Chief Operating Officer

Brian Lee -- Goldman Sachs -- Analyst

David Duley -- Steelhead -- Analyst

Gus Richard -- Northland -- Analyst

Mark Miller -- The Benchmark Company -- Analyst

Patrick Ho -- Stifel -- Analyst

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