Intevac , Inc. (NASDAQ: NASDAQ:), a supplier of vacuum deposition gear for varied thin-film functions, has reported sturdy monetary outcomes for the second quarter of 2024, surpassing income expectations with a complete of almost $15 million. The corporate additionally offered forward-looking statements about its HDD expertise and TRIO platform, indicating a optimistic outlook for the rest of the yr.

Key Takeaways

• Intevac’s Q2 income reached almost $15 million, with a gross margin of over 38%.
• The web loss per share was reported at $0.12.
• HDD income forecast for the total yr is elevated to $45 million on account of rising demand for expertise upgrades.
• The corporate delivered its first HAMR improve to a serious knowledge storage firm.
• Progress is being made on the TRIO platform, with 2 to three preliminary orders anticipated within the second half of 2024.
• Intevac ended Q2 with $70.4 million in money and investments.
• Q3 income is projected to be between $10.5 million and $12 million, with a gross margin of 37% to 39%.
• The corporate anticipates a web loss per share of $0.14 to $0.18 for Q3.
• The order backlog stood at over $42 million on the finish of June.

Firm Outlook

• Intevac expects to exit 2024 with an identical stage of money and investments as Q2.
• Nearly all of upgrades are associated to HAMR expertise, with a secure stage of improve enterprise forecasted for the following 5 years.
• Gross margins are anticipated to stay secure all year long.

Bearish Highlights

• The corporate reported a unfavorable money movement of $1 million within the Revenue & Loss assertion for Q2.
• A web loss within the vary of $0.14 to $0.18 per share is projected for Q3.
• Income from orders for TRIO programs shouldn’t be anticipated within the subsequent quarter.

Bullish Highlights

• Intevac has a powerful order backlog of over $42 million.
• The corporate is making strides in qualifying the TRIO system for buyer acceptance.
• There’s potential for extra capability enlargement instrument orders within the close to future.

Misses

• The corporate skilled a unfavorable money movement from operations throughout Q2.

Q&A Highlights

• The main target for the following quarter is on the HDD enterprise, with no rapid income from TRIO orders anticipated.
• The qualification course of for the primary TRIO instrument is underway with a glass finisher and an finish buyer.
• Upcoming IR actions embrace a Benchmark convention in New York on September 4 and a Q3 earnings name in early November.

Intevac’s monetary efficiency in Q2 signifies a powerful place out there, with important demand for its HDD expertise upgrades. The corporate’s strategic investments within the TRIO platform additionally recommend confidence in future progress alternatives. With a strong order backlog and secure gross margin projections, Intevac seems to be sustaining a gentle course by 2024. The upcoming quarters might be pivotal as the corporate focuses on realizing the potential of its TRIO system and increasing its HDD improve enterprise.

InvestingPro Insights

Intevac, Inc. (NASDAQ: IVAC) continues to navigate the market with a mixture of challenges and strengths, as mirrored in its monetary metrics and strategic place. Let’s delve into some key insights primarily based on the newest knowledge from InvestingPro:

• The corporate holds a market capitalization of roughly $95.7 million, indicating its measurement relative to {industry} friends.

• Regardless of not paying dividends, which can have an effect on its attractiveness to income-focused traders, Intevac’s stability sheet exhibits that its liquid belongings exceed short-term obligations, suggesting a level of monetary flexibility within the close to time period.

• A big InvestingPro Tip value noting is that Intevac shouldn’t be worthwhile during the last twelve months, with a unfavorable P/E ratio of -9.42. This might increase issues about its capacity to generate earnings, a crucial issue for long-term worth creation.

InvestingPro additionally supplies further suggestions for these trying to dive deeper into Intevac’s monetary well being and future prospects. At the moment, there are 5 extra suggestions out there on InvestingPro, providing invaluable insights for traders contemplating this inventory.

For a complete analysis of Intevac’s monetary efficiency and strategic outlook, go to https://www.investing.com/professional/IVAC, the place you’ll be able to entry detailed metrics and additional InvestingPro Tricks to inform your funding choices.

Full transcript – Intevac Inc (IVAC) Q2 2024:

Operator: Good afternoon and welcome to Intevac’s Second Quarter 2024 Monetary Outcomes Convention Name. Right now, all individuals are in a listen-only mode. A short question-and-answer session will comply with the formal presentation. [Operator Instructions] Please word that this convention name is being recorded at this time, August 5, 2024. Right now, I want to flip the decision over to Claire McAdams, Investor Relations for Intevac. Please go forward.

Claire McAdams: Thanks, operator and good afternoon to everybody on at this time’s name. Thanks for becoming a member of us at this time to debate Intevac’s monetary outcomes for the second quarter of 2024 which ended on June 29. Along with discussing the corporate’s latest outcomes, we are going to focus on our outlook trying ahead. Becoming a member of me on at this time’s name are Nigel Hunton, President and Chief Govt Officer; Cameron McAulay, Chief Monetary Officer; and Kevin Soulsby, Company Controller. Nigel will start with an outline of our enterprise and outlook, adopted by Cameron’s overview of our monetary outcomes for the second quarter and extra particulars relating to our steerage earlier than turning the decision over to Q&A. I might prefer to remind everybody that at this time’s convention name accommodates sure forward-looking statements, together with however not restricted to, statements relating to monetary outcomes for the corporate’s most lately accomplished fiscal quarter which stays topic to adjustment in reference to the preparation of our Kind 10-Q in addition to feedback relating to future occasions and projections in regards to the future monetary efficiency of Intevac. These forward-looking statements are primarily based upon our present expectations and precise outcomes might differ materially because of varied dangers and uncertainties relating to those feedback and different danger elements mentioned in paperwork filed by us with the Securities and Trade Fee, together with our annual report on Kind 10-Okay and quarterly experiences on Kind 10-Q. The contents of this August 5 name embrace time-sensitive forward-looking statements that symbolize our projections as of at this time. We undertake no obligation to replace the forward-looking statements made throughout this convention name. I’ll now flip the decision over to Nigel.

Nigel Hunton: Thanks, Claire and good afternoon to all of you on at this time’s name. I am very happy to welcome Cameron McAulay, our new CFO, to his first earnings name with Intevac. Cameron joined Intevac in July after a profitable exit at Transphorm which simply accomplished in June its roughly $340 million acquisition by Renesas. Kevin, who’s right here with us at this time for Q&A, now returns to his earlier position as Company Controller and we are going to enormously respect his getting into the CFO position for the final yr. Turning to our Q2 outcomes. Complete income of almost $15 million was considerably stronger than our forecast coming into the quarter on account of elevated demand for HDD expertise upgrades and strong execution from the workforce in Singapore. Given the income upside and the ensuing mixture of upgrades delivered within the quarter, gross margin exceeded 38% and our web loss per share was additionally favorable to steerage at $0.12. With robust collections within the quarter, our accounts receivable stability declined by $7.5 million and complete money and investments at company finish surpassed $70 million, a rise of almost $5 million from Q1. The income upside reported for Q2 can be evident in our elevated HDD income outlook for the total yr which we now count on will strategy $45 million, up from $40 million at our final replace. This displays our HDD income forecast for the second half of 2024, remaining comparatively constant within the low $20 million vary after a really robust first half. HDD revenues year-to-date have now exceeded final yr’s first half by greater than 10%, reflecting continued robust progress for HAMR upgrades. Given the strengthening in demand witnessed for upgrades throughout Q2, we now count on 2024’s improve enterprise to strategy the document ranges achieved in 2023. Much more importantly, our income forecast additionally displays the preliminary set up of HAMR upgrades from a second main buyer which is a number one knowledge storage firm. We’re happy to report the profitable supply of our first HAMR improve for this extra buyer earlier this quarter. Business information of bettering fundamentals for the arduous drive {industry} continues to construct and proliferate pushed primarily by strongly aligned cloud demand progress. Demand for cloud storage has elevated considerably year-to-date in 2024 and is anticipated to proceed rising by subsequent yr. There are additionally indications that rising demand now consists of knowledge middle deployments associated to AI. We’re inspired by the elevated momentum for AI-related HDDs which bodes nicely for the long-term power of our major served market. We proceed to count on the initiatives to improve the world’s HDD media capability to HAMR expertise supplies robust visibility for a strong base of HDD enterprise for the following few years. The power of our buyer relationships and order exercise to this point exhibit that our flagship 200 Lean continues to be the industry-leading platform for all superior media manufacturing, an incredible achievement for a product launched 20 years in the past that’s nonetheless delivering new innovation on the forefront of HDD expertise. Intevac is a crucial enabler within the expertise highway map for the HDD {industry} and we’re solely within the early phases of a multiyear improve cycle that helps a income alternative exceeding $200 million and that is earlier than any further 200 Lean system orders. The strengthening {industry} fundamentals are additionally encouraging and we have been very positively to return to a modest quantity of recent system deliveries within the close to future. Our crucial position within the HDD {industry} supplies important visibility for continued strong base of enterprise and helps our expectations for close to document stage upgrades in 2024 and a powerful progress yr in 2025, a yr through which we additionally count on significant incremental progress for our TRIO platform which brings me to an replace on our progress qualifying the primary TRIO system which was shipped in April to a top-tier cowl glass finisher in Asia. As mentioned on our final earnings name in April, we resolved our JDA partnership and instantly proceeded to ship our first TRIO system on to a number one cowl glass finisher which is a direct provider to main smartphone OEMs. We accomplished the supply set up on schedule which is a credit score to our groups from world wide who’re working carefully collectively and are continuing nicely by the qualification course of which we count on will first conclude with the quilt glass finisher earlier than persevering with in the direction of finish buyer qualification. The three months which have handed into our final replace have been a interval of immense progress and iterations qualifying this TRIO system, whereas additionally processing samples from a number of further prospects on the TRIO which resides at our Santa Clara headquarters. Crucial members of our TRIO workforce, together with myself, have spent nearly all of the previous couple of months on the bottom in Asia as we make the TRIO success, our no 1 precedence. As well as, now we have engaged Intralink to speed up our enlargement in Asia, whose workforce specialised in figuring out alternatives in lots of fast-growing sectors. Collectively, we are going to construct a broader marketplace for the TRIO platform, while we keep our concentrate on securing an preliminary order within the client machine area. Intralink are persevering with to evaluate the automotive sector and have highlighted the introduction of glass panels for future superior packaging which can take main share from the normal silicon-based functions. We proceed to interact with new prospects whereas deepening the collaboration with the important thing gamers concerned in bringing ultra-durable anti-reflective coatings to the smartphone cowl glass market. The deepening stage of collaboration and continued funding in research and improvement is utilizing a number of paths for business success for the TRIO, together with a extra compact footprint that may readily substitute current instrument units to supply extra sturdy coating capabilities for the quilt glass finishers. The modular structure of TRIO which is a key attribute of the 200 Lean, is enabling us to shortly adapt the TRIO platform. We’re working with each our preliminary cowl glass finisher and a number of further prospects to make modifications to the TRIO that can optimize their respective manufacturing capabilities and capability. Because the qualification course of continues, we proceed to count on 2 to three preliminary 3 or 2 orders within the second half of 2024. As we consider the steps in the direction of last buyer acceptance and income recognition, we are going to proceed to replace you on orders and income timing as we progress by the yr. As a reminder, now we have the stock readily available with a view to ship a number of programs with comparatively brief lead occasions. With very severe engagements with a number of the world’s main prospects and companions nicely underway, the morale and pleasure among the many Intevac workforce of outstanding staff is the strongest I’ve seen since becoming a member of the corporate which brings me to a abstract of our outlook for 2024. We’ve now elevated our HDD outlook to the $45 million stage with now a number of HDD prospects within the course of of making their media capability to be HAMR appropriate. We imagine this stage of improve enterprise is sustainable for a number of years and any return to new system orders might be incremental to this stage of HDD enterprise. Our expectations for 2024 additionally proceed to incorporate a number of TRIO orders. At this stage, as with all new product launch, it’s tough to forecast the timing of revenues and our focus is on securing a number of orders. Lastly, defending the stability sheet stays a key precedence for the corporate and we proceed to count on to exit 2024 across the $70 million stage. And with that, I will flip the decision over to Cameron.

Cameron McAulay: Thanks, Nigel. I am fairly happy to see many acquainted investor names listening to at this time’s name in addition to Benchmark which is without doubt one of the a number of corporations who cowl Transphorm and I sit up for constructing upon these relationships each new and current as Intevac’s CFO. Turning to the second quarter outcomes. Second quarter revenues totaled $14.5 million and consisted of HDD upgrades, spares and repair. Income upside for the quarter mirrored over $5 million of further expertise improve demand throughout Q2. Q2 gross margin was 38.2%, above the steerage vary, reflecting the upper income quantity in addition to the actual composition of the combination of upgrades in the course of the quarter. Q2 working bills had been $8.8 million which exceeds our present run price, reflecting increased than typical company, journey and gear set up prices in the course of the quarter. With robust AR collections in the course of the quarter, we had been in a position to transfer a few of our money to increased rate of interest investments. And because of this, our quarterly curiosity earnings run price now exceeds $700,000. The ensuing web loss per share for Q2 was $0.12, considerably higher than our forecast coming into the quarter. Turning now to the stability sheet. We ended the quarter with money and investments, together with restricted money of $70.4 million, equal to $2.63 per share primarily based on 26.7 million shares at quarter finish. The web enhance in money was almost $5 million, reflecting optimistic money movement from operations of $6 million with CapEx of slightly below $1 million. The robust money movement from operations in Q2 displays the numerous assortment of receivables in the course of the quarter, with $7 million of optimistic money movement from working capital offset by about $1 million of unfavorable money movement within the P&L. Non-cash bills for Q2 included $1.1 million for stock-based compensation, $0.5 million for depreciation and amortization and $0.5 million in deferred tax. Now, I will present additional particulars relating to our outlook and Q3 steerage. For the third quarter, we’re projecting revenues to be within the vary of $10.5 million to $12 million. We count on third quarter gross margin to be within the 37% to 39% vary, reflecting the anticipated mixture of upgrades and manufacturing facility absorption ranges in the course of the quarter. Q3 working bills are anticipated to be within the vary of $8.6 million to $8.8 million, reflecting an anticipated moderation in some G&A prices when in comparison with Q2. This vary additionally comprehends our continued funding in personnel throughout a number of features as we proceed to strengthen our general group. As detailed in my earlier feedback, we count on a better run price of curiosity earnings on our robust money stability for the foreseeable future. Our steerage is on curiosity earnings within the vary of $700,000 to $750,000 for Q3. We count on GAAP tax expense of about $500,000, most of which might be non-cash. We’re projecting a web loss within the vary of $0.14 to $0.18 per share primarily based on 26.9 million shares excellent. This completes the formal a part of our presentation. Operator, we’re prepared for questions.

Operator: We are going to now be conducting a question-and-answer session. [Operator Instructions] The primary query is from Peter Wright from PartnerCap Securities.

Peter Wright: And congratulations on the quarter. I’ve 2 questions for you. My first query is your put in base for HAMR now that you’ve got a further buyer opened up. How are you trying in regards to the rollout of your put in base? How ought to we consider what number of are upgraded at this level and what number of lie forward of us and minimize within the cadence there, do you count on it to really speed up? Or is it extra sort of a secure variety of HAMR improve gross sales going ahead? In the event you might shed some mild on sort of the timing and the magnitude of that. After which my follow-up query is on the TRIO aspect and particularly your relationship with Intralink. How are you offering sampling? Do you even have a instrument? Is there a method which you can truly put the pattern in prospects’ arms? Or should you might clarify somewhat extra how that sampling is happening, that might be appreciated.

Nigel Hunton: Protecting the HAMR one first. And as all the time, as you already know, with our {industry}, it is all the time tough to get actual predictions on what is going on to occur in timing. However the put in base, I feel as we have stated on prior calls, we have shipped extra on the slide, over 180 programs. A few of these aren’t in operation in the meanwhile. So we have stated use a median 140 to 145 programs on the planet that may be upgraded to HAMR. We have achieved about 20 to this point, taken in final yr and the beginning of this yr. So there is a important quantity of alternative to improve the remainder of the put in base. We do not share the cut up. We do not discuss in regards to the buyer names, as you already know. However I feel it offers us confidence that over the following 5 years, we’ll proceed to run with an identical stage of improve enterprise as we have seen during the last 2 years. So I feel so far as we will inform, that is form of forecast and form of the longer term HAMR investments. And it is nice that now all the purchasers are speaking about HAMR upgrades and that expertise is crucial as you progress from form of 30 terabytes up to 50 terabytes and truly preserve sustaining this constant value benefit of drives out there. So I hope that offers you a form of vary of solutions there. However I feel general, we’re fairly assured that there’s going to be a movement over the following 5 years at an identical stage and that might be throughout a number of prospects which is nice for us. Shifting on to the TRIO query. I imply, TRIO sampling is a crucial a part of the technique. At this time, if a buyer has curiosity, whether or not that is by Intralink or by our direct contacts with prospects, we do this buyer sampling and run these elements by our 301 take a look at mattress in Santa Clara. In the event you bear in mind, we capitalized that instrument that allows us to do quick turns of samples in a managed surroundings in our headquarters the place our R&D groups and course of engineers, extra importantly, reside. So the fabric science about working samples, placing the coatings down, placing these down both on glass we bought or prospects glass samples which may be very typically the case, in order that they’ll be shipped in from us, whether or not that be from any elements of Asia into the power. We do these coatings below management. We truly then see these again up in a pure surroundings. I imply, after we ship these again throughout to the shopper, they then do their testing and analysis. In parallel, we do testing analysis in our improvement and take a look at lab in Santa Clara, the place now we have instrumentation that may take a look at hardness a number of the key options round optics. And people return to prospects. After which usually, that factor goes by a technique of there could also be on a slight tweak on the efficiency. They’re going to ship us extra samples. We’ll undergo that iteration. And I am actually happy to say that the variety of samples been working and the variety of prospects we’re sending in elements to us is rising and never only for glass elements for client gadgets, we’re getting elements in for polymers with some distinctive functions and likewise we’re seeing the fashion of some requests round superior packaging. So for me, it is fairly thrilling and it is a core functionality that we have invested in and that is why we capitalized the instrument final yr for the Santa Clara facility.

Peter Wright: Yet one more clarification, should you can outline the tip market that polymer is servicing. After which additionally, how custom-made are these samples going out? How a lot backwards and forwards customization is it versus you sending your particular SKUs to those completely different finish markets? And that is the final one.

Nigel Hunton: Perhaps if you consider, you have seen the machine in operation, the potential of the TRIO platform isn’t just for 2-dimensional, it truly goes in the direction of third-dimensional shapes, Clearly, we will not provide the buyer title or particular software. However should you can think about, these polymer items are in curved platforms, most likely offer you some form of concept as you take a look at optical lens and different form of areas the place polymers and non-glass is utilized in extraordinarily excessive quantity functions. So for me, there’s quite a lot of pleasure across the alternatives past the patron gadgets for a few of these polymers. And even inside client gadgets, a number of the headsets and issues are polymers and different natural, inorganic compounds for the longer term applied sciences. So for me, it is the flexibility of the TRIO platform permits us to do a number of functions. And one of many crucial issues within the instrument, the way in which we truly handle the temperature inside that processing, so it is a excessive plasma surroundings, it is like lightning being managed inside a plasma working surroundings. And really, our capacity to regulate the temperature signifies that we will truly put polymers by the machine. So it is a crucial a part of our design method is permitting us to run polymers in addition to glass. So we’re fairly excited in regards to the flexibility and flexibility of the platform. Hopefully that solutions the query.

Operator: [Operator Instructions] The subsequent query is from Mark Miller from Benchmark.

Mark Miller: I am sorry, I received on somewhat late. I simply was questioning, the upside in revenues this quarter, was that pull-ins or orders you did not count on?

Nigel Hunton: Maintain on, I’ve received music coming into my line. I don’t know what was in that music.

Operator: One second, I’ll mute that line. There we go.

Nigel Hunton: Apologies for that. I’m not positive what brought on that sudden music. It wasn’t my style in music both. So the query is form of pull-ins for the quarter. In order you already know, you have been protecting this area for a very long time and every quarter can have completely different fundamentals relying on budgets and cycles for the purchasers we particularly have. I imply this was pull-ins of HAMR and different upgrades into the quarter from the second half of the yr. So these are, I might say, most likely at the very least half had been pull-ins. And as we have stated on the decision, we now imagine the total yr quantity goes to be close to $45 million and $40 million. So general, it is a robust yr however these had been completely pull-ins from the second half to get some extra upgrades achieved and people upgrades which coated each PMR and HAMR and once more, it is a testomony to the workforce in Singapore that we might reply shortly. We’ve a really, very, as you already know, skilled workforce in Singapore that is been in a position to reply very quick during the last 2 years plus as I have been on this position. And each time we have thrown a problem and so they’ve delivered and carried out and stepped up to fulfill the demand. So these are assembly actual customized demand and it was nice to be to realize that and beat my steerage.

Mark Miller: I am simply questioning, I apologize once more, what had been your orders in the course of the quarter?

Nigel Hunton: So the orders are blended. The precise variety of these orders, I will go it over to Kevin simply to verify the quantity. However quite a lot of that was about timing of orders. And so I feel we’ll see, I feel the total yr for this yr, the orders are already in place. I do know that for now. Kevin, what was the ultimate order quantity for this quarter?

Kevin Soulsby: It is slightly below $4 million for the quarter, Mark. The backlog as we sit right here is simply over $42 million on the finish of June as nicely. So strong backlog to permit us to challenge the $45 million that Nigel was articulating.

Mark Miller: That is for the yr. Now $45 million is your gross sales aim.

Kevin Soulsby: Right.

Mark Miller: What % of gross sales upgrades are HAMR-related?

Nigel Hunton: We do not give that actual quantity away however the majority have been HAMR during the last 2 years however extra lately, we have seen some PMR coming by as nicely. So the excellent news is there will be some enhancements happening round PMR in addition to HAMR. In order each applied sciences run in parallel, each expertise want stage of upgrades however the majority have been round HAMR upgrades.

Mark Miller: And what about gross margins for this quarter?

Kevin Soulsby: So gross margins had been robust once more by the quarter. And once more, quite a lot of the gross margin is linked to the combination of the upgrades. I imply a number of the upgrades now we have aggressive choices, a few of them do not, form of a number of the margins, combine and alter every quarter. I do not know whether or not Cameron, do you need to add something on the margin remark however there is a good mixture of upgrades within the quarter.

Cameron McAulay: The margins might be comparable, Mark. Sure, turnout for [ph] September; 37% to 39% towards the 38.2% [ph] we did within the June quarter. So any variability to these, the margins is basically a mixture of the completely different traits of the upgrades that Nigel talked about.

Mark Miller: Did you present money from operations, your money went up I do know.

Cameron McAulay: Sure. We did within the ready remarks. So we had $7 million of optimistic money movement from working capital and about $1 million of unfavorable money movement from the P&L. Sturdy quarter. We exited with simply over $70 million in money.

Mark Miller: So $6 million web money from operations.

Cameron McAulay: Sure.

Operator: There are not any additional questions right now. I’ll now flip the decision again over to Nigel Hunton for his closing remarks. Pardon me, there’s yet another query simply now from Peter Wright from PartnerCap Securities.

Peter Wright: Great. So I am sorry, one clarification on gross margin, should you can, simply constructing on Mark’s query. So gross margin, the steerage is reflective of the HDD enterprise or that’s inclusive of any TRIO programs that might promote you assume it’ll stay secure.

Nigel Hunton: Sure. So the gross margin for the following quarter is assuming HDD which we have stated that.

Peter Wright: Sure. And I am sorry, did you say you are anticipating margins to stay flat by the course of the yr?

Nigel Hunton: Sure. So we have given the margin steerage for the quarter coming up. And once more, we had been going to rearrange for that and that’s predominantly 100% made out of HDD enterprise as a result of we have talked a couple of concentrate on getting orders for TRIO after which the income is not going to be on this subsequent quarter. So it is going to be 100% HDD enterprise within the subsequent quarter.

Operator: The subsequent query is from Dan Weston from West Capital Administration.

Dan Weston: Nigel, simply a few fast factors of clarification, should you would. On the TRIO entrance, is the trajectory to get the primary instrument certified by the glass ending buyer? And is there a second qualification interval to their finish buyer?

Nigel Hunton: Right. I imply a few of them additionally [ph] — the important thing processes — and as we highlighted, it is nice to get that product into the market shortly. That goes by a course of and qualification with the glass finisher. That then goes by a course of with the ultimate merchandise earlier than launch. I feel we stated this on the earlier fall as nicely. Any product analysis into the market, one goes by proving the expertise, getting the instrument certified glass finisher, they then take that and put the precise buyer completed merchandise by it will get that certified previous to launch. So now we have to undergo that second stage of qualification.

Dan Weston: Nice. Sure, thanks for the clarification there. After which lastly, I need to ensure that I heard you appropriately in your ready remarks on the Lean aspect, did you say that there is a chance to have further capability enlargement instrument orders within the close to future?

Nigel Hunton: I feel as we take a look at what is going on on within the {industry} and we’re seeing a number of the AI driving demand that we’re seeing demand began to go up. I feel we’ll keep the main focus round upgrades and that can predominantly be a part of the enterprise. However I feel over the following couple of years, I feel there’s potential for, I feel I stated a small variety of programs. I feel there might be some incremental, I feel nearly all of concentrate on getting the capability up to HAMR readiness goes to be the important thing investments from our prospects. However there’s all the time room, I feel there’s going to be potential for some further however it’ll be a small quantity if that occurs.

Dan Weston: Sure. No, I respect that readability. And congratulations on the superb quarter.

Nigel Hunton: Recognize your help.

Operator: There are not any additional questions right now. I’ll flip the decision again over to Nigel Hunton for his closing remarks.

Nigel Hunton: Thanks. And thanks for the entire questions. And I additionally need to thank all of our staff, quite a lot of these form of working carefully with me in Asia in the meanwhile and all of the counterparts of our {industry} companions for all of the arduous work and dedication to ship one other robust improve quarter and equally importantly, work in the direction of qualifying our first instrument within the subject, first TRIO. I might additionally prefer to thank all of the traders on the decision for his or her ongoing help. And simply to remind individuals, our IR actions scope embrace a Benchmark convention in New York on September 4. And as all the time, please attain out to Clair instantly to rearrange of follow-up. And I sit up for updating you all on our Q3 name in early November. So at that time, so thanks and we will shut the decision.

Operator: Thanks. This concludes at this time’s convention. Chances are you’ll disconnect now.

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