Cohu to Enhance Data Analytics and AI/ML Platform with Acquisition of Tignis

Rhea-AI Summary

Cohu (NASDAQ: COHU) has announced a definitive agreement to acquire Tignis, a provider of AI process control and analytics-based monitoring software. The acquisition targets the $2.6 billion semiconductor process control market through Tignis' PAICe Monitor and PAICe Maker solutions. These products combine physical insights with AI and machine learning for semiconductor manufacturing automation.

Tignis' solutions include an AI-driven anomaly detection platform and process control solution, featuring their patent-pending Digital Twin Query Language (DTQL). The acquisition will enhance Cohu's DI-Core software and expand its analytics capabilities. The transaction, funded with cash on hand, is expected to close in January 2025.

Positive

• Expansion into $2.6 billion semiconductor process control market
• Enhancement of analytics capabilities through AI/ML technology integration
• Addition of advanced predictive and prescriptive automation solutions
• Cash-funded acquisition with no additional debt burden

Negative

• None.

Insights

Tech Expert

The acquisition of Tignis marks a strategic move into the $2.6 billion semiconductor process control market. Their PAICe Monitor and PAICe Maker solutions represent cutting-edge AI/ML technology that addresses critical industry pain points in manufacturing efficiency and yield optimization. The proprietary Digital Twin Query Language (DTQL) is particularly innovative, democratizing complex data analytics by enabling non-data scientists to perform sophisticated analysis. This acquisition significantly enhances Cohu's DI-Core software capabilities and positions them well in the Industry 4.0 transformation, where AI-driven process control and predictive maintenance are becoming essential for semiconductor manufacturing efficiency.

Financial Analyst

While the financial terms are not disclosed and deemed immaterial to Cohu's financials, this acquisition represents a strategic expansion into high-growth market segments. The deal will be funded through cash on hand, indicating strong liquidity position. The target market of $2.6 billion for semiconductor process control presents significant revenue potential. The integration of Tignis' AI capabilities with Cohu's existing products could create new revenue streams and enhance competitive positioning in the semiconductor equipment market. The focus on AI/ML solutions aligns with industry trends and could lead to improved margins through value-added software offerings.

POWAY, Calif.--(BUSINESS WIRE)-- Cohu, Inc. (NASDAQ: COHU), a global supplier of equipment and services optimizing semiconductor manufacturing yield and productivity, today announced that it has entered into a definitive agreement to acquire Tignis, Inc. (“Tignis”), a provider of artificial intelligence (AI) process control and analytics-based monitoring software.

This strategic acquisition enables Cohu to expand its analytics offerings to the estimated $2.6 billion semiconductor process control market targeted by Tignis’ PAICe Monitor and PAICe Maker solutions. These innovative products leverage the insights of physical phenomena with cutting-edge AI, machine learning (ML), and data science to deliver advanced predictive and prescriptive automation solutions for semiconductor manufacturing. Tignis is also expected to deepen Cohu’s expertise in data science while adding advanced analytics to its DI-Core software.

Industry 4.0 continues to drive a sea change in the semiconductor market as IDMs, foundries and equipment OEMs all look toward advanced analytics and AI/ML to unlock significant efficiency gains for manufacturing and test operations.

PAICe Monitor is an AI-driven anomaly detection and predictive maintenance platform that enables customers to quickly deploy the power of machine learning for deep analysis and prediction modeling that cannot be achieved with traditional methods. PAICe Maker is an AI-driven advanced process control solution for manufacturing that automatically adjusts for process drift over time, reducing maintenance costs and process variability. Integral to the platform, Tignis’ patent pending domain-specific scripting language, Digital Twin Query Language (DTQL), provides explanatory syntax that enables users to manage complex data cleaning and analytics tasks without requiring data science experience.

Headquartered in Seattle, WA, and with development teams in the U.S. and Canada, Tignis was founded in 2017 to bring true AI capabilities to process control, enabling optimization of complex semiconductor and industrial manufacturing processes.

“We look forward to the very talented Tignis team joining the Cohu family. This acquisition represents a significant opportunity to accelerate our growth in semiconductor manufacturing, broaden our product portfolio, and deepen our customer presence,” said Cohu President and CEO Luis Müller. “Together, our combined expertise and complementary capabilities will drive artificial intelligence process predictability, empowering semiconductor manufacturers to achieve higher yield, improved quality, and greater productivity.”

“This is a very exciting time for Tignis and our customers,” said Tignis President, CEO and Co-founder Jon Herlocker. “Cohu has a long and successful history in the semiconductor equipment market, and their vision for accelerating the adoption of AI/ML in semiconductor manufacturing and test is well-aligned with the goals Tignis has had since our founding. We are looking forward to creating epic solutions for our customers together as a team.”

The terms of the transaction, which are not material to Cohu’s financials, are not being disclosed. The acquisition will be funded with cash on hand and is expected to close in January 2025.

About Cohu:

Cohu (NASDAQ: COHU) is a global technology leader supplying test, automation, inspection and metrology products and services to the semiconductor industry. Cohu’s differentiated and broad product portfolio enables optimized yield and productivity, accelerating customers’ manufacturing time-to-market. Additional information can be found at www.cohu.com.

About Tignis:

Tignis (tignis.com) is a pioneer in AI-powered process control and monitoring with a physics and engineering foundation. Headquartered in Seattle, the company develops and sells innovative software solutions for the semiconductor industry that use AI and machine learning to enable next-generation Smart Manufacturing. Tignis provides semiconductor IDMs, equipment manufacturers, pure-play foundries, and components and materials suppliers with unprecedented automation, advanced predictive visibility and prescriptive process control—increasing manufacturing yield, decreasing unscheduled downtime, and reducing operating costs. Tignis works with the world’s top semiconductor equipment manufacturers and fabricators.

Forward-Looking Statements:

Certain statements contained in this release and accompanying materials may be considered forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including statements regarding success or contribution of M&A transactions; new market entries, product introductions or customer adoptions and corresponding performance metrics or financial impacts; product market projected growth and market sizes and related revenue opportunities for the semiconductor process control market; and any other statements that are predictive in nature and depend upon or refer to future events or conditions; and/or include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend;” and/or other similar expressions among others. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Any third-party industry analyst forecasts quoted are for reference only and Cohu does not adopt or affirm any such forecasts.

Actual results and future business conditions could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: new product investments and product enhancements which may not be commercially successful; the semiconductor industry is seasonal, cyclical, volatile and unpredictable; recent erosion in mobile, automotive and industrial market sales; our ability to manage and deliver high quality products and services; failure of sole source contract manufacturer or our ability to manage third-party raw material, component and/or service providers; ongoing inflationary pressures on material and operational costs coupled with rising interest rates; economic recession; the semiconductor industry is intensely competitive, subject to rapid technological changes, and experiences consolidation of key customers for semiconductor test equipment; a limited number of customers account for a substantial percentage of net sales; significant exports to foreign countries with economic and political instability and competition from a number of Asia-based manufacturers; our relationships with customers may deteriorate; loss of key personnel; risks of using artificial intelligence within Cohu’s product developments and business; reliance on foreign locations and geopolitical instability in such locations critical to Cohu and its customers; natural disasters, war and climate-related changes, including related economic impacts; levels of debt; access to sufficient capital on reasonable or favorable terms; foreign operations and related currency fluctuations; required or desired accounting charges and the cost or effectiveness of accounting controls; instability of financial institutions where we maintain cash deposits and potential loss of uninsured cash deposits; significant goodwill and other intangibles as percentage of our total assets; increasingly restrictive trade and export regulations impacting our ability to sell products, specifically within China; risks associated with acquisitions, investments and divestitures such as integration and synergies; constraints related to corporate governance structures; share repurchases and related impacts; financial or operating results that are below forecast or credit rating changes impacting our stock price or financing ability; law/regulatory changes and including environmental or tax law changes; significant volatility in our stock price; the risk of cybersecurity breaches; enforcing or defending intellectual property claims or other litigation.

These and other risks and uncertainties are discussed more fully in Cohu’s filings with the SEC, including our most recent Form 10-K and Form 10-Q, and the other filings made by Cohu with the SEC from time to time, which are available via the SEC’s website at www.sec.gov. Except as required by applicable law, Cohu does not undertake any obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241216636156/en/

Investor Contact:

Cohu, Inc.

Jeffrey D. Jones, 858-848-8106

Investor Relations

Source: Cohu, Inc.

FAQ

What is the expected closing date for Cohu's acquisition of Tignis?

The acquisition is expected to close in January 2025.

How will Cohu fund the Tignis acquisition?

The acquisition will be funded with cash on hand.

What is the size of the semiconductor process control market that Cohu is targeting with this acquisition?

The acquisition targets an estimated $2.6 billion semiconductor process control market.

What are the main products offered by Tignis that Cohu will acquire?

Tignis offers two main products: PAICe Monitor, an AI-driven anomaly detection and predictive maintenance platform, and PAICe Maker, an AI-driven advanced process control solution.

How will the Tignis acquisition benefit Cohu's existing software capabilities?

The acquisition will enhance Cohu's DI-Core software with advanced analytics and deepen its expertise in data science.