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Ultra Clean Reports Second Quarter 2024 Financial Results

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Ultra Clean Holdings (UCTT) reported its Q2 2024 financial results, showing strong performance driven by demand from domestic China and AI-related applications. Total revenue reached $516.1 million, with Products contributing $452.7 million and Services $63.4 million. GAAP net income was $19.1 million or $0.42 per diluted share, improving from a net loss in the previous quarter. Non-GAAP net income was $14.4 million or $0.32 per diluted share.

The company's Q3 2024 outlook projects revenue between $490 million and $540 million, with GAAP EPS ranging from $(0.07) to $0.13 and non-GAAP EPS between $0.22 and $0.42. CEO Jim Scholhamer highlighted UCT's strategic positioning to support customers' technology roadmaps and accelerate growth as the market strengthens.

Ultra Clean Holdings (UCTT) ha riportato i risultati finanziari del secondo trimestre 2024, evidenziando una performance robusta grazie alla domanda proveniente dalla Cina interna e dalle applicazioni legate all'IA. I ricavi totali hanno raggiunto i 516,1 milioni di dollari, con i Prodotti che hanno contribuito con 452,7 milioni e i Servizi con 63,4 milioni. Il reddito netto GAAP è stato di 19,1 milioni di dollari, ovvero 0,42 dollari per azione diluita, migliorando rispetto a una perdita netta nel trimestre precedente. Il reddito netto non GAAP è stato di 14,4 milioni di dollari, ovvero 0,32 dollari per azione diluita.

Le prospettive per il terzo trimestre 2024 dell'azienda prevedono ricavi compresi tra 490 milioni e 540 milioni di dollari, con un utile per azione GAAP che varia da $(0,07) a $0,13 e un utile per azione non GAAP tra $0,22 e $0,42. Il CEO Jim Scholhamer ha evidenziato la posizione strategica di UCT per supportare le roadmap tecnologiche dei clienti e accelerare la crescita man mano che il mercato si rafforza.

Ultra Clean Holdings (UCTT) reportó sus resultados financieros del segundo trimestre de 2024, mostrando un rendimiento sólido impulsado por la demanda desde la China doméstica y aplicaciones relacionadas con IA. Los ingresos totales alcanzaron los 516,1 millones de dólares, con Productos aportando 452,7 millones y Servicios 63,4 millones. El ingreso neto GAAP fue de 19,1 millones de dólares o 0,42 dólares por acción diluida, mejorando a partir de una pérdida neta en el trimestre anterior. El ingreso neto no GAAP fue de 14,4 millones de dólares o 0,32 dólares por acción diluida.

El pronóstico de la compañía para el tercer trimestre de 2024 proyecta ingresos entre 490 millones y 540 millones de dólares, con un EPS GAAP que varía entre $(0,07) a $0,13 y un EPS no GAAP entre $0,22 y $0,42. El CEO Jim Scholhamer destacó la posición estratégica de UCT para respaldar las hojas de ruta tecnológicas de los clientes y acelerar el crecimiento a medida que el mercado se fortalece.

Ultra Clean Holdings (UCTT)는 2024년 2분기 재무 결과를 발표하며, 중국 내수와 AI 관련 애플리케이션의 수요 증가로 강력한 실적을 기록했다고 밝혔습니다. 총 수익은 5억 1,610만 달러에 달했으며, 제품 부문이 4억 5,270만 달러, 서비스 부문이 6,340만 달러를 기여했습니다. GAAP 기준 순이익은 1,910만 달러, 즉 희석 주당 0.42달러였습니다, 이전 분기에는 순손실을 기록했던 것과 비교해 개선된 수치입니다. 비-GAAP 기준 순이익은 1,440만 달러, 즉 희석 주당 0.32달러입니다.

회사의 2024년 3분기 전망은 수익이 4억 9천만 달러에서 5억 4천만 달러 사이라고 예상하며, GAAP EPS는 $(0.07)에서 $0.13, 비-GAAP EPS는 $0.22에서 $0.42 사이가 될 것으로 보입니다. CEO 짐 숄하머는 UCT의 전략적 입지를 강조하며 고객의 기술 로드맵을 지원하고 시장 강화에 따라 성장을 가속화할 것이라고 밝혔습니다.

Ultra Clean Holdings (UCTT) a annoncé ses résultats financiers pour le deuxième trimestre 2024, montrant une forte performance soutenue par la demande en Chine continentale et les applications liées à l'IA. Le chiffre d'affaires total a atteint 516,1 millions de dollars, avec les Produits contribuant 452,7 millions et les Services 63,4 millions. Le bénéfice net GAAP était de 19,1 millions de dollars, soit 0,42 dollar par action diluée, s'améliorant par rapport à une perte nette au trimestre précédent. Le bénéfice net non-GAAP était de 14,4 millions de dollars, soit 0,32 dollar par action diluée.

Les prévisions de l'entreprise pour le troisième trimestre 2024 projettent un chiffre d'affaires compris entre 490 millions et 540 millions de dollars, avec un BPA GAAP allant de $(0,07) à $0,13 et un BPA non-GAAP entre $0,22 et $0,42. Le PDG Jim Scholhamer a souligné la position stratégique de UCT pour soutenir les feuilles de route technologiques des clients et accélérer la croissance à mesure que le marché se renforce.

Ultra Clean Holdings (UCTT) hat seine finanziellen Ergebnisse für das zweite Quartal 2024 veröffentlicht und dabei eine starke Leistung ausgewiesen, die durch die Nachfrage aus dem chinesischen Inland und AI-bezogene Anwendungen antreiben wurde. Der Gesamtumsatz betrug 516,1 Millionen Dollar, wobei Produkte 452,7 Millionen und Dienstleistungen 63,4 Millionen Dollar beitrugen. Der GAAP-Nettoertrag betrug 19,1 Millionen Dollar oder 0,42 Dollar pro verwässerter Aktie, eine Verbesserung im Vergleich zu einem Nettoverlust im vorhergehenden Quartal. Der Non-GAAP-Nettoertrag lag bei 14,4 Millionen Dollar oder 0,32 Dollar pro verwässerter Aktie.

Der Ausblick des Unternehmens für das dritte Quartal 2024 rechnet mit einem Umsatz zwischen 490 Millionen und 540 Millionen Dollar, während das GAAP EPS zwischen $(0,07) und $0,13 und das Non-GAAP EPS zwischen $0,22 und $0,42 liegen dürfte. CEO Jim Scholhamer hob die strategische Positionierung von UCT hervor, um die Technologie-Roadmaps der Kunden zu unterstützen und das Wachstum zu beschleunigen, während sich der Markt stabilisiert.

Positive
  • Revenue increased to $516.1 million in Q2 2024, up from $477.7 million in the previous quarter
  • GAAP net income improved to $19.1 million, compared to a net loss of $9.4 million in the prior quarter
  • Non-GAAP net income rose to $14.4 million from $12.1 million in the previous quarter
  • Strong demand from domestic China market and AI-related applications
Negative
  • Slight decrease in gross margin from 17.3% to 17.1% on a GAAP basis
  • Q3 2024 outlook suggests potential for lower revenue compared to Q2
  • Projected GAAP EPS for Q3 2024 includes possibility of a net loss

Insights

Ultra Clean Holdings' Q2 2024 results reveal a mixed bag of financial performance. The company's revenue increased to $516.1 million from $477.7 million in the previous quarter, representing a 8.0% quarter-over-quarter growth. This growth was primarily driven by strength in the domestic China market and demand for AI-related technologies.

However, the company's margins saw a slight decline. GAAP gross margin decreased from 17.3% to 17.1%, while non-GAAP gross margin fell from 17.9% to 17.7%. Despite this, GAAP operating margin improved from 3.6% to 4.4% and non-GAAP operating margin increased from 6.5% to 6.9%.

The most significant improvement was in net income. UCT swung from a GAAP net loss of $9.4 million to a net income of $19.1 million. On a non-GAAP basis, net income increased from $12.1 million to $14.4 million.

Looking ahead, the company's Q3 2024 outlook suggests potential headwinds. The projected revenue range of $490 million to $540 million indicates a possible decline from Q2. The wide range in projected EPS (-$0.07 to $0.13 GAAP, $0.22 to $0.42 non-GAAP) suggests uncertainty in the near-term business environment.

Investors should closely monitor UCT's ability to maintain its margins and profitability in the face of potential revenue challenges. The company's exposure to the AI market and its strategic positioning in China could be key factors in its performance moving forward.

Ultra Clean Holdings' Q2 results underscore the growing influence of AI and advanced packaging technologies in the semiconductor industry. The company's performance was bolstered by demand for High Bandwidth Memory (HBM) and equipment supporting advanced packaging for AI applications. This trend aligns with the broader industry shift towards more sophisticated chip designs to meet the computational demands of AI and machine learning.

The strength in the domestic China market is particularly noteworthy. Despite ongoing geopolitical tensions and export controls, UCT's strategic footprint in China appears to be paying dividends. This could provide a competitive edge as the global semiconductor supply chain continues to evolve and regionalize.

However, the semiconductor industry is known for its cyclicality and UCT's cautious outlook for Q3 suggests that the company may be anticipating a potential slowdown. The wide range in the revenue forecast ($490 million to $540 million) indicates uncertainty, possibly due to factors such as inventory adjustments or shifts in customer demand.

Looking ahead, UCT's ability to capitalize on emerging technologies like AI and advanced packaging will be crucial. The company's mention of supporting customers' technology roadmaps suggests a focus on staying ahead of industry trends. Investors should watch for UCT's investments in R&D and capacity expansion to gauge its long-term positioning in the evolving semiconductor landscape.

HAYWARD, Calif., July 25, 2024 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT), today reported its financial results for the second quarter ended June 28, 2024.

"UCT executed well in Q2 due to ongoing strength in demand from the domestic China market and customers supplying High Bandwidth Memory and equipment supporting advanced packaging for AI applications," said Jim Scholhamer, CEO, "UCT's broad portfolio and strategic footprint are supporting our customers' technology roadmaps in 2024 and will enable us to accelerate growth as the market strengthens."

Second Quarter 2024 GAAP Financial Results

Total revenue was $516.1 million. Products contributed $452.7 million and Services added $63.4 million. Total gross margin was 17.1%, operating margin was 4.4%, and net income was $19.1 million or $0.42 per diluted share. This compares to total revenue of $477.7 million, gross margin of 17.3%, operating margin of 3.6%, and net loss of $(9.4) million or $(0.21) per diluted share, in the prior quarter.

Second Quarter 2024 Non-GAAP Financial Results

On a non-GAAP basis, gross margin was 17.7%, operating margin was 6.9%, and net income was $14.4 million or $0.32 per diluted share. This compares to gross margin of 17.9%, operating margin of 6.5%, and net income of $12.1 million or $0.27 per diluted share in the prior quarter.

Third Quarter 2024 Outlook

The Company expects revenue in the range of $490 million to $540 million. The Company expects GAAP diluted net income (loss) per share to be between $(0.07) and $0.13 and non-GAAP diluted net income per share to be between $0.22 and $0.42.

Conference Call

The conference call and webcast will take place on Thursday, July 25, 2024 at 1:45 p.m. PT and can be accessed by dialing 1-800-836-8184 or 1-646-357-8785. No passcode is required. A replay of the call will be available by dialing 1-888-660-6345 or 1-646-517-4150 and entering the confirmation code 53952#. The Webcast will be available on the Investor Relations section of the Company's website at http://uct.com/investors/events/.

About Ultra Clean Holdings, Inc.

Ultra Clean Holdings, Inc. is a leading developer and supplier of critical subsystems, components, parts, and ultra-high purity cleaning and analytical services, primarily for the semiconductor industry. Under its Products division, UCT offers its customers an integrated outsourced solution for major subassemblies, improved design-to-delivery cycle times, design for manufacturability, prototyping, and high-precision manufacturing. Under its Services Division, UCT offers its customers tool chamber parts cleaning and coating, as well as micro-contamination analytical services. Ultra Clean is headquartered in Hayward, California. Additional information is available at www.uct.com.

Use of Non-GAAP Measures

In addition to providing results that are determined in accordance with Generally Accepted Accounting Principles in the United States of America ("GAAP"), management uses non-GAAP gross margin, non-GAAP operating margin and non-GAAP net income to evaluate the Company's operating and financial results. We believe the presentation of non-GAAP results is useful to investors for analyzing our core business and business trends and comparing performance to prior periods, along with enhancing investors' ability to view the Company's results from management's perspective. The presentation of this additional information should not be considered a substitute for results prepared in accordance with GAAP. Tables presenting reconciliations from GAAP results to non-GAAP results are included at the end of this press release.

The Company defines non-GAAP net income as net loss before amortization of intangible assets, stock-based compensation, restructuring charges, acquisition activity costs, fair value adjustments, debt refinancing costs and the tax effects of the foregoing adjustments.

A reconciliation of our guidance for non-GAAP net income per diluted share for the subsequent quarter is not available due to fluctuations in the geographic mix of our earnings from quarter to quarter, which impacts our tax rate and cannot be reasonably predicted or determined. As a result, such reconciliation is not available without unreasonable efforts and we are unable to determine the probable significance of the unavailable information.

Safe Harbor Statement

The foregoing information contains, or may be deemed to contain, "forward-looking statements" (as defined in the US Private Securities Litigation Reform Act of 1995) which reflect our current views with respect to future events and financial performance. We use words such as "anticipates," "projection," "outlook," "forecast," "believes," "plan," "expect," "future," "intends," "may," "will," "estimates," "see," "predicts," "should" and similar expressions to identify these forward-looking statements. Forward looking statements included in this press release include our expectations about the semiconductor capital equipment market and outlook. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, the Company's actual results may differ materially from the results predicted or implied by these forward-looking statements. These risks, uncertainties and other factors also include, among others, those identified in "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations'' and elsewhere in our annual report on Form 10-K for the year ended December 29, 2023, as filed with the Securities and Exchange Commission. Ultra Clean Holdings, Inc. undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise unless required by law.

Contact:
Rhonda Bennetto
SVP Investor Relations
rbennetto@uct.com 

 

 ULTRA CLEAN HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited; in millions, except per share data)










Three Months Ended


Six Months Ended


June 28,
2024


June 30,
2023


June 28,
2024


June 30,
2023

Revenues:








Product

$        452.7


$         362.5


$        871.2


$        731.1

Services

63.4


59.0


122.7


123.7

Total revenues

516.1


421.5


993.9


854.8

Cost of revenues:








Product

383.9


311.1


738.0


626.2

Services

43.7


42.3


84.8


87.5

Total cost revenues

427.6


353.4


822.8


713.7

Gross margin

88.5


68.1


171.1


141.1

Operating expenses:








Research and development

7.1


7.2


14.1


14.3

Sales and marketing

14.8


12.7


28.5


25.8

General and administrative

43.7


35.6


88.3


76.0

Total operating expenses

65.6


55.5


130.9


116.1

Income from operations

22.9


12.6


40.2


25.0

Interest income

1.4


0.8


2.8


1.3

Interest expense

(11.7)


(11.8)


(23.9)


(23.6)

Other income (expense), net

17.4


(1.5)


13.5


1.3

Income before provision for income taxes

30.0


0.1


32.6


4.0

Provision for income taxes

8.5


8.3


18.4


11.8

Net income (loss)

21.5


(8.2)


14.2


(7.8)

Less: Net income attributable to noncontrolling interests

2.4


1.2


4.5


5.0

Net income (loss) attributable to UCT

$          19.1


$           (9.4)


$            9.7


$        (12.8)









Net income (loss) per share attributable to UCT common  stockholders:

Basic

$          0.43


$         (0.21)


$          0.22


$        (0.29)

Diluted

$          0.42


$         (0.21)


$          0.21


$        (0.29)

Shares used in computing net income (loss) per share:








Basic

44.9


44.7


44.7


44.8

Diluted

45.4


44.7


45.3


44.8

 

ULTRA CLEAN HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited; in millions)






June 28,
2024


December 29,
2023

ASSETS




Current assets:




Cash and cash equivalents

$           319.5


$            307.0

Accounts receivable, net of allowance for credit losses

206.9


180.8

Inventories

399.9


374.5

Prepaid expenses and other current assets

34.5


30.9

Total current assets

960.8


893.2

Property, plant and equipment, net

326.6


328.3

Goodwill

265.2


265.2

Intangible assets, net

200.0


215.3

Deferred tax assets, net

3.1


3.1

Operating lease right-of-use assets

161.3


151.7

Other non-current assets

10.3


10.9

Total assets

$        1,927.3


$         1,867.7

LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Bank borrowings

$             16.3


$             17.6

Accounts payable

229.0


192.9

Accrued compensation and related benefits

49.2


47.7

Operating lease liabilities

18.7


18.1

Other current liabilities

38.2


33.7

Total current liabilities

351.4


310.0

Bank borrowings, net of current portion

478.3


461.2

Deferred tax liabilities

18.9


19.0

Operating lease liabilities

152.4


143.0

Other liabilities

14.6


37.3

Total liabilities

1,015.6


970.5

Equity:




UCT stockholders' equity:




Common stock

503.3


496.6

Retained earnings

356.4


346.7

Accumulated other comprehensive loss

(7.4)


(4.4)

Total UCT stockholders' equity

852.3


838.9

Noncontrolling interests

59.4


58.3

Total equity

911.7


897.2

Total liabilities and equity

$        1,927.3


$         1,867.7





 

ULTRA CLEAN HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; in millions)






Six Months Ended


June 28,
2024


June 30,
2023

Cash flows from operating activities:




Net income (loss)

$                14.2


$                 (7.8)

Adjustments to reconcile net income (loss) to net cash provided by
operating activities:




Depreciation and amortization

22.7


18.2

Amortization of intangible assets

15.3


11.4

Stock-based compensation

8.0


4.7

Amortization of debt issuance costs

1.9


1.9

Change in the fair value of financial instruments

(22.6)


(0.2)

Deferred income taxes

(0.5)


(0.6)

Loss (gain) on sale of property, plant and equipment

0.1


(0.4)

Changes in assets and liabilities:




Accounts receivable

(26.1)


75.1

Inventories

(25.4)


45.1

Prepaid expenses and other current assets

(1.5)


5.2

Other non-current assets

0.7


(0.3)

Accounts payable

41.4


(62.6)

Accrued compensation and related benefits

1.5


(12.5)

Income taxes payable

1.4


(4.3)

Operating lease assets and liabilities

0.5


(2.9)

Other liabilities

1.4


(5.6)

Net cash provided by operating activities

33.0


64.4

Cash flows from investing activities:




Purchases of property, plant and equipment

(31.0)


(47.0)

Proceeds from sale of equipment

0.1


0.5

Net cash used in investing activities

(30.9)


(46.5)

Cash flows from financing activities:




Proceeds from bank borrowings

67.7


Proceeds from issuance of common stock

0.9


Extinguishment of debt

(44.2)


Principal payments on bank borrowings

(7.1)


(30.9)

Payment of debt issuance costs

(2.5)


Employees' taxes paid upon vesting of restricted stock units

(2.2)


(2.2)

Payments of dividends to a joint venture shareholder

(0.1)


(0.1)

Repurchase of shares


(23.7)

Net cash provided by (used in) financing activities

12.5


(56.9)

Effect of exchange rate changes on cash and cash equivalents

(2.1)


1.0

Net increase (decrease) in cash and cash equivalents

12.5


(38.0)

Cash and cash equivalents at beginning of period

307.0


358.8

Cash and cash equivalents at end of period

$               319.5


$               320.8

 

ULTRA CLEAN HOLDINGS, INC.

REPORTABLE SEGMENTS

GAAP TO NON-GAAP RECONCILIATION

(Unaudited; dollars in millions)














GAAP


Non-GAAP


Three Months Ended


Three Months Ended


June 28, 2024


June 28, 2024


Products


Services


Consolidated


Products


Services


Consolidated

Revenues

$     452.7


$      63.4


$          516.1


$     452.7


$      63.4


$          516.1

Gross profit

$       68.8


$      19.7


$            88.5


$       70.8


$      20.7


$            91.5

Gross margin

15.2 %


31.1 %


17.1 %


15.6 %


32.7 %


17.7 %

Income from operations

$       18.8


$        4.1


$            22.9


$       28.2


$        7.5


$            35.7

Operating margin

4.2 %


6.5 %


4.4 %


6.2 %


11.8 %


6.9 %




















Three Months Ended








June 28, 2024








Products


Services


Consolidated

Reconciliation of GAAP Gross profit to Non-GAAP Gross profit (in millions)

Reported gross profit on a GAAP basis


$       68.8


$      19.7


$            88.5

Amortization of intangible assets (1)


1.3


1.0


2.3

Stock-based compensation expense (2)


0.5



0.5

Restructuring charges (3)


0.2



0.2

Non-GAAP gross profit


$       70.8


$      20.7


$            91.5













Reconciliation of GAAP Gross margin to Non-GAAP Gross margin

Reported gross margin on a GAAP basis


15.2 %


31.1 %


17.1 %

Amortization of intangible assets (1)


0.3 %


1.6 %


0.5 %

Stock-based compensation expense (2)


0.1 %


— %


0.1 %

Restructuring charges (3)


0.0 %


— %


— %

Non-GAAP gross margin


15.6 %


32.7 %


17.7 %













Reconciliation of GAAP Income from operations to Non-GAAP Income from operations (in millions)

Reported income from operations on a GAAP basis


$       18.8


$        4.1


$            22.9

Amortization of intangible assets (1)


4.7


2.9


7.6

Stock-based compensation expense (2)


4.2


0.5


4.7

Restructuring charges (3)


0.5



0.5

Non-GAAP income from operations


$       28.2


$        7.5


$            35.7













Reconciliation of GAAP Operating margin to Non-GAAP Operating margin

Reported operating margin on a GAAP basis


4.2 %


6.5 %


4.4 %

Amortization of intangible assets (1)


1.0 %


4.5 %


1.5 %

Stock-based compensation expense (2)


0.9 %


0.8 %


0.9 %

Restructuring charges (3)


0.1 %


— %


0.1 %

Non-GAAP operating margin


6.2 %


11.8 %


6.9 %













1    Amortization of intangible assets related to the Company's business acquisitions

2    Represents compensation expense for stock granted to employees and directors

3    Represents severance, retention and costs related to facility closures

 

ULTRA CLEAN HOLDINGS, INC.

UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS








Three Months Ended


June 28,
2024


June 30,
2023


March 29,
2024

Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income (in millions)

Reported net income (loss) attributable to UCT on a GAAP basis

$           19.1


$          (9.4)


$          (9.4)

Amortization of intangible assets (1)

7.6


5.5


7.7

Stock-based compensation expense (2)

4.7


1.3


3.9

Restructuring charges (3)

0.5


2.4


1.8

Acquisition related costs (4)


0.1


0.3

Fair value related adjustments (5)

(24.1)


1.6


1.3

Debt refinancing costs expensed (6)

3.6



Legal-related costs (7)


(0.9)


Income tax effect of non-GAAP adjustments (8)

1.9


(1.6)


(3.0)

Income tax effect of valuation allowance (9)

1.1


8.1


9.5

Non-GAAP net income attributable to UCT

$           14.4


$            7.1


$           12.1







Reconciliation of GAAP Income from operations to Non-GAAP Income from operations (in millions)

Reported income from operations on a GAAP basis

$           22.9


$           12.6


$           17.3

Amortization of intangible assets (1)

7.6


5.5


7.7

Stock-based compensation expense (2)

4.7


1.3


3.9

Restructuring charges (3)

0.5


2.4


1.8

Acquisition related costs (4)


0.1


0.3

Legal-related costs (7)


(0.9)


Non-GAAP income from operations

$           35.7


$           21.0


$           31.0







Reconciliation of GAAP Operating margin to Non-GAAP Operating margin

Reported operating margin on a GAAP basis

4.4 %


3.0 %


3.6 %

Amortization of intangible assets (1)

1.5 %


1.3 %


1.6 %

Stock-based compensation expense (2)

0.9 %


0.3 %


0.8 %

Restructuring charges (3)

0.1 %


0.6 %


0.4 %

Acquisition related costs (4)

— %


0.0 %


0.1 %

Legal-related costs (7)

— %


(0.2) %


— %

Non-GAAP operating margin

6.9 %


5.0 %


6.5 %







Reconciliation of GAAP Gross profit to Non-GAAP Gross profit (in millions)

Reported gross profit on a GAAP basis

$           88.5


$           68.1


$           82.6

Amortization of intangible assets (1)

2.3


1.5


2.3

Stock-based compensation expense (2)

0.5


0.5


0.6

Restructuring charges (3)

0.2


0.4


Non-GAAP gross profit

$           91.5


$           70.5


$           85.5







Reconciliation of GAAP Gross margin to Non-GAAP Gross margin

Reported gross margin on a GAAP basis

17.1 %


16.2 %


17.3 %

Amortization of intangible assets (1)

0.5 %


0.3 %


0.5 %

Stock-based compensation expense (2)

0.1 %


0.1 %


0.1 %

Restructuring charges (3)

0.0 %


0.1 %


— %

Non-GAAP gross margin

17.7 %


16.7 %


17.9 %







Reconciliation of GAAP Other income (expense), net to Non-GAAP Other income (expense), net (in millions)

Reported Other income (expense), net on a GAAP basis

$           17.4


$          (1.5)


$          (3.8)

Fair value related adjustments (5)

(24.1)


2.9


1.3

Debt refinancing costs expensed (6)

3.6



Non-GAAP Other income (expense), net

$          (3.1)


$            1.4


$          (2.5)







Reconciliation of GAAP Income (Loss) Per Diluted Share to Non-GAAP Earnings Per Diluted Share

Reported net income (loss) on a GAAP basis

$           0.42


$        (0.21)


$        (0.21)

Amortization of intangible assets (1)

0.17


0.12


0.17

Stock-based compensation expense (2)

0.10


0.03


0.09

Restructuring charges (3)

0.01


0.05


0.04

Acquisition related costs (4)


0.01


0.01

Fair value related adjustments (5)

(0.53)


0.04


0.03

Debt refinancing costs expensed (6)

0.08



Legal-related costs (7)


(0.02)


Income tax effect of non-GAAP adjustments (8)

0.04


(0.04)


(0.07)

Income tax effect of valuation allowance (9)

0.03


0.18


0.21

Non-GAAP net earnings

$           0.32


$           0.16


$           0.27

Weighted average number of diluted shares (in millions) on a non-GAAP basis

45.4


45.0


45.1







ULTRA CLEAN HOLDINGS, INC.

UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP EFFECTIVE INCOME TAX RATE








Three Months Ended


June 28,
2024


June 30,
2023


March 29,
2024

Provision for income taxes on a GAAP basis

$          8.5


$          8.3


$          9.9

Income tax effect of non-GAAP adjustments (8)

(1.9)


1.6


3.0

Income tax effect of valuation allowance (9)

(1.1)


(8.1)


(9.5)

Non-GAAP provision for income taxes

$          5.5


$          1.8


$          3.4







Income before income taxes on a GAAP basis

$        30.0


$          0.1


$          2.7

Amortization of intangible assets (1)

7.6


5.5


7.7

Stock-based compensation expense (2)

4.7


1.3


3.9

Restructuring charges (3)

0.5


2.4


1.8

Acquisition related costs (4)


0.1


0.3

Fair value related adjustments (5)

(24.1)


2.9


1.3

Debt refinancing costs expensed (6)

3.6



Legal-related costs (7)


(0.9)


Non-GAAP income before income taxes

$        22.3


$        12.3


$        17.7

Effective income tax rate on a GAAP basis

28.3 %


8300.0 %


366.7 %

Non-GAAP effective income tax rate

24.7 %


14.8 %


19.7 %







1    Amortization of intangible assets related to the Company's business acquisitions

2    Represents compensation expense for stock granted to employees and directors

3    Represents severance, retention and costs related to facility closures

4    Represents acquisition activity costs

5    Fair value adjustments related to contingent consideration and intercompany loan related to an acquisition, net of $1.3 million loss attributable to noncontrolling interest

6    Represents the third party transaction costs related to the amended credit agreement and the previously capitalized costs of extinguished debt

7    Represents estimated costs related to certain legal proceedings

8    Tax effect of items (1) through (7) above based on the non-GAAP tax rate

9    The Company's GAAP tax expense is generally higher than the Company's non-GAAP tax expense, primarily due to losses in the U.S. with full federal and state valuation allowances. The Company's non-GAAP tax rate and resulting non-GAAP tax expense considers the tax implications as if there was no federal or state valuation allowance position in effect

 

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SOURCE Ultra Clean Holdings, Inc.

FAQ

What was Ultra Clean Holdings' (UCTT) revenue for Q2 2024?

Ultra Clean Holdings reported total revenue of $516.1 million for Q2 2024, with Products contributing $452.7 million and Services adding $63.4 million.

How did UCTT's Q2 2024 earnings compare to the previous quarter?

UCTT's Q2 2024 GAAP net income was $19.1 million or $0.42 per diluted share, compared to a net loss of $9.4 million or $(0.21) per diluted share in the previous quarter, showing significant improvement.

What is Ultra Clean Holdings' (UCTT) revenue guidance for Q3 2024?

UCTT expects revenue for Q3 2024 to be in the range of $490 million to $540 million.

What factors drove UCTT's performance in Q2 2024?

UCTT's Q2 2024 performance was driven by ongoing strength in demand from the domestic China market and customers supplying High Bandwidth Memory and equipment supporting advanced packaging for AI applications.

Ultra Clean Holdings, Inc.

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