We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
FormFactor (FORM - Free Report) reported third-quarter 2022 adjusted earnings of 24 cents per share, which surpassed the Zacks Consensus Estimate by 9.1%. However, the bottom line decreased 40% year over year and 47.8%, sequentially.
Revenues declined 4.8% year over year and 11.3%, sequentially, to $180.9 million. The top line missed the Zacks Consensus Estimate by 1.9%.
The top-line decline was attributed to weak demand for Foundry & Logic and DRAM products.
Nevertheless, strong demand for Flash and Systems remained a tailwind.
FormFactor has a negative outlook for the fourth quarter. It is expected to reflect the negative impact of the export regulations announced by the U.S. government on the sale of U.S. semiconductor technology to China. Management also expects weak demand for Foundry & Logic and DRAM probe card.
Probe card: Revenues from this segment were $139.4 million for the third quarter, down 10% year over year and 99.9%, sequentially.
Foundry & Logic (accounting for 50% of revenues) revenues were $90.6 million, down 13.5% year over year and 25.98%, sequentially.
Revenues for DRAM products (19% of revenues) were $34.9 million, reflecting a decrease of 12.3% year over year and 5.2% from the previous quarter’s level.
Flash revenues (8% of revenues) were $13.9 million, up 33.7% from the year-ago period’s level and 63.5% from the prior quarter’s level.
Systems: Revenues from this segment were $41.5 million (23% of revenues), up 18.2% year over year and 14.6%, sequentially.
Regional Details
Revenues generated from the United States (accounting for 21% of revenues), Europe (7%), Singapore (6%) and the Rest of World (2%) were $38.1 million, $11.8 million, $10.4 million and $4 million, respectively. All revenues increased 49.4%, 12.4%, 36.8% and 60% each year over year.
Revenues generated from Taiwan (20%), China (20%), South Korea (16%), Malaysia (4%) and Japan (4%) were $36.8 million, $36.7 million, $28.9 million, $6.5 million and $7.7 million, respectively. The metric from each country was down 11.5%, 28%, 0.3%, 44% and 28%, respectively, year over year.
Operating Results
On a non-GAAP basis, gross margin contracted 700 basis points (bps) year over year to 39% in the third quarter.
Non-GAAP operating expenses increased 2.1% year over year to $49.5 million. As a percentage of total third-quarter revenues, the metric expanded 184 bps year over year to 27.4%.
Non-GAAP operating income was $21 million, down 46.1% year over year. As a percentage of revenues, it contracted 889 bps year over year to 11.6%.
Balance Sheet & Cash Flow
As of Sep 24, 2022, cash & cash equivalents and marketable securities were $251.6 million compared with $266.3 million on Jun 25, 2022.
Cash generated from operating activities was $24.2 million for the reported quarter, down from $42.6 million in the previous quarter.
Capital expenditure was $8.91 million, down from $14.5 million in the second quarter of 2022.
Free cash flow was $15.5 million for the reported quarter, down from $28.3 million in the previous quarter.
Guidance
FormFactor expects fourth-quarter 2022 revenues of $155 million (+/- $5 million). The Zacks Consensus Estimate for the same is currently pegged at $193.8 million.
Management expects a non-GAAP gross margin of 33% (+/- 1.5%).
On a non-GAAP basis, it projects earnings of 3 cents (+/- 3 cents) per share. The consensus mark for the metric is pegged at 31 cents per share.
Zacks Rank & Stocks to Consider
Currently, FormFactor has a Zacks Rank #5 (Strong Sell).
Fortinet is set to report third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for FTNT’s earnings is pegged at 27 cents per share, suggesting an increase of 35% from the prior-year period’s reported figure. FTNT has lost 22.8% in the year-to-date period. FTNT’s long-term earnings growth rate is currently projected at 18%.
The Trade Desk is scheduled to release third-quarter 2022 results on Nov 14. The Zacks Consensus Estimate for TTD’s earnings is pegged at 24 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure. TTD has lost 39.6% in the year-to-date period. The Trade Desk’s long-term earnings growth rate is currently projected at 24%.
ZoomInfo Technologies is scheduled to release third-quarter 2022 results on Nov 1. The Zacks Consensus Estimate for ZI’s earnings is pegged at 20 cents per share, suggesting an increase of 53.9% from the prior-year quarter’s reported figure. ZI has lost 28.8% in the year-to-date period. ZI’s long-term earnings growth rate is currently projected at 34.7%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
FormFactor (FORM) Q3 Earnings Beat, Revenues Decline Y/Y
FormFactor (FORM - Free Report) reported third-quarter 2022 adjusted earnings of 24 cents per share, which surpassed the Zacks Consensus Estimate by 9.1%. However, the bottom line decreased 40% year over year and 47.8%, sequentially.
Revenues declined 4.8% year over year and 11.3%, sequentially, to $180.9 million. The top line missed the Zacks Consensus Estimate by 1.9%.
The top-line decline was attributed to weak demand for Foundry & Logic and DRAM products.
Nevertheless, strong demand for Flash and Systems remained a tailwind.
FormFactor has a negative outlook for the fourth quarter. It is expected to reflect the negative impact of the export regulations announced by the U.S. government on the sale of U.S. semiconductor technology to China. Management also expects weak demand for Foundry & Logic and DRAM probe card.
FormFactor, Inc. Price
FormFactor, Inc. price | FormFactor, Inc. Quote
Segments in Detail
Probe card: Revenues from this segment were $139.4 million for the third quarter, down 10% year over year and 99.9%, sequentially.
Foundry & Logic (accounting for 50% of revenues) revenues were $90.6 million, down 13.5% year over year and 25.98%, sequentially.
Revenues for DRAM products (19% of revenues) were $34.9 million, reflecting a decrease of 12.3% year over year and 5.2% from the previous quarter’s level.
Flash revenues (8% of revenues) were $13.9 million, up 33.7% from the year-ago period’s level and 63.5% from the prior quarter’s level.
Systems: Revenues from this segment were $41.5 million (23% of revenues), up 18.2% year over year and 14.6%, sequentially.
Regional Details
Revenues generated from the United States (accounting for 21% of revenues), Europe (7%), Singapore (6%) and the Rest of World (2%) were $38.1 million, $11.8 million, $10.4 million and $4 million, respectively. All revenues increased 49.4%, 12.4%, 36.8% and 60% each year over year.
Revenues generated from Taiwan (20%), China (20%), South Korea (16%), Malaysia (4%) and Japan (4%) were $36.8 million, $36.7 million, $28.9 million, $6.5 million and $7.7 million, respectively. The metric from each country was down 11.5%, 28%, 0.3%, 44% and 28%, respectively, year over year.
Operating Results
On a non-GAAP basis, gross margin contracted 700 basis points (bps) year over year to 39% in the third quarter.
Non-GAAP operating expenses increased 2.1% year over year to $49.5 million. As a percentage of total third-quarter revenues, the metric expanded 184 bps year over year to 27.4%.
Non-GAAP operating income was $21 million, down 46.1% year over year. As a percentage of revenues, it contracted 889 bps year over year to 11.6%.
Balance Sheet & Cash Flow
As of Sep 24, 2022, cash & cash equivalents and marketable securities were $251.6 million compared with $266.3 million on Jun 25, 2022.
Cash generated from operating activities was $24.2 million for the reported quarter, down from $42.6 million in the previous quarter.
Capital expenditure was $8.91 million, down from $14.5 million in the second quarter of 2022.
Free cash flow was $15.5 million for the reported quarter, down from $28.3 million in the previous quarter.
Guidance
FormFactor expects fourth-quarter 2022 revenues of $155 million (+/- $5 million). The Zacks Consensus Estimate for the same is currently pegged at $193.8 million.
Management expects a non-GAAP gross margin of 33% (+/- 1.5%).
On a non-GAAP basis, it projects earnings of 3 cents (+/- 3 cents) per share. The consensus mark for the metric is pegged at 31 cents per share.
Zacks Rank & Stocks to Consider
Currently, FormFactor has a Zacks Rank #5 (Strong Sell).
Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like Fortinet (FTNT - Free Report) , The Trade Desk (TTD - Free Report) and ZoomInfo Technologies (ZI - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Fortinet is set to report third-quarter 2022 results on Nov 2. The Zacks Consensus Estimate for FTNT’s earnings is pegged at 27 cents per share, suggesting an increase of 35% from the prior-year period’s reported figure. FTNT has lost 22.8% in the year-to-date period. FTNT’s long-term earnings growth rate is currently projected at 18%.
The Trade Desk is scheduled to release third-quarter 2022 results on Nov 14. The Zacks Consensus Estimate for TTD’s earnings is pegged at 24 cents per share, suggesting an increase of 33.3% from the prior-year quarter’s reported figure. TTD has lost 39.6% in the year-to-date period. The Trade Desk’s long-term earnings growth rate is currently projected at 24%.
ZoomInfo Technologies is scheduled to release third-quarter 2022 results on Nov 1. The Zacks Consensus Estimate for ZI’s earnings is pegged at 20 cents per share, suggesting an increase of 53.9% from the prior-year quarter’s reported figure. ZI has lost 28.8% in the year-to-date period. ZI’s long-term earnings growth rate is currently projected at 34.7%.