Curly, the "whisper" was breakeven, so, unfortunately, the victory is "tainted". Furthermore, they recorded $3.3 MM in tax credits for the quarter, and the transition to 5010 was anticipated with inventories right off. SAs a matter of fact, the inventories level currently might include additional write offs, since it is quite high in relations to current sales rate (as compared to prior year's quarterly sales and inventories levels). I wonder how much of this inventory is systems under qualification at customers, if a bunch of this is that, then it is really not so much of a problem.
The more worry some part is that despite cuts in R&D and SG&A the breakeven point will rise to $46 MM per quarter (and they presume that they will not reach this level this quarter as well, after all, they have only $37 MM in backlog, and typically they do not ship more then the backlog in the quarter, so they must expect some rapidly shippable systems, possibly already in inventory).
All in all, it seems that the leading edge business in the semi is not as healthy as the rest of the business (where the BTB is now well above 1), this in my opinion is a warning signal (not so much for CYMI holders) for the semi equip. maybe this recovery will have a long leg at the bottom.
Zeev |
