Re: Photon Dynamics:
This is from the March issue of Infrastructure.
Admittedly, it is somewhat dated now. The company had a bad third quarter, due to not completing a couple of orders, and having one project (which they said was not FPD) cancelled midstream. For a current quote:
quote.yahoo.com
Photon Dynamics (PHTN):
Photon Dynamics recently offered about 2.5 million shares for sale in its first public offering. Previously financed by Venture
capital, this company makes equipment for testing of Flat Panel Displays. The displays can be tested on this equipment before
expensive electronics and drivers are added. The in process tester uses their trademarked Voltage Imaging to scan active
plates without direct contact to determine voltage levels on individual pixels. A Capacitance imaging in-process tester is also
available to identify and locate opens and shorts on ITO and other conductive layers where voltage can be applied. The
equipment's software is sophisticated, in that defects can be located on another tool for repair, using the same files. Photon
Dynamics provides repair equipment in the form of laser cutting and welding, which can fix certain types of defects. Photon
Dynamics also makes test equipment for FPDs in their final assembled stages, so test data from the plate side of the process
can later be correllated to final display yield. Photon Dynamics has over 20 US patents, and foreign applications pending.
Photon Dynamics has found their systems applicable to all types of FPD's, since they test the images in a non contact mode
using a camera to capture actual optical properties. This testing was previously done by human eye or indirect types of
measurements. Since a display is essentially an image, evaluating the image is what is important, regardless of fabrication
technology used to make the display. ITO is used in almost all flat panel processes, so their capacitance imaging method is
effective on any of these. Photon Dynamics' systems are particularly useful to replace the "calibrated eyeball" used in low
volume production, as facilities ramp up and also have to develop rigorous, repeatable inspection methods for military or
ISO-9000 type certifications. Challenges include thruput increases demanded by customers, material handling interfaces (which
they will probably outsource) and better price/performance ratios. On the other hand, there is no significant competition for
these tools at the moment. One would expect companies like KLA to possibly enter this market, but they are probably too
busy with the semiconductor boom, as are most of the tester manufacturers. Orbot, already in Flat Panel inspection could be a
threat, but they are closely tied to optical methods of inspection. Micrion, currently in the mask inspection and repair field is
another possibility, but they are also very busy, the tools are very expensive, and their technology may be overkill.
Photon Dynamics was founded in 1986 and has over 80 employees in Milpitas, California where their manufacturing, design,
and research facilities are located. (Originally, they developed some Gallium Arsenide test/inspection equipment, an idea ahead
of its time, but possibly timely now. Since 1990 they have been focusing on FPDs.) They also have offices in Japan, Korea and
Taiwan, where they have been very successful. Customers include ARPA, AT&T, OIS, Planar, Standish, Xerox, Kopin,
Sharp, Fujitsu, Hitachi, LG, Samsung, Litton, and others. System prices are typically $500K to $1,600K, making each a major
investment for the clients and major revenue generator for the company. Their annual sales have been concentrated among two
to four major customers at a time, but this may change, especially with this year's expansions in the US, Korea and Taiwan.
Some offshore manufacturing may be done by their Japanese partner Ishkawajima-Harima Heavy Industries Co. Ltd., now
mostly helping with sales and support, since about 60% of P.D.'s FY 95 revenue was attributable to sales outside the US.
Revenues were $18.4M in 1995, $10.6M in 1994, $10.3M in 1993. Net income was $377K in 1995, their first profitable
year. Losses were $2M to $4M in each of the 4 previous years. Common Stock outstanding is about 6.7 million shares. Some
early investors include Kleiner Perkins Caufield & Byers, Floyd Kvamme (of National Semi long ago), LG Electronics, and
various domestic and international venture capital firms and individuals. The stock is now down from its high of about 12, but
above its low of about 7, hovering around 9. It seems to be suffering from the general market misgivings about Semiconductor
equipment suppliers with narrow customer bases and very expensive equipment. Good revenue and profit performance in the
first half of 1996 could considerably improve stock prospects, if publicity is also good. |
