Amkor Technology, Inc.

Good day, ladies and gentlemen, and welcome to the Amcor Technology First Quarter 2024 Earnings Conference Call. My name is Diego, and I will be your conference facilitator today. At this time, all participants are in a listen-only mode. After the speaker's remarks, we will conduct a question-and-answer session. As a reminder, this conference is being recorded. I would now like to turn the call over to Jennifer Ju, Head of Investor Relations. Ms. Ju, please go ahead.

Thank you, operator. Good afternoon, everyone, and thank you for joining us for AMCOR's first quarter 2024 earnings conference call. Joining me today are Hiel Rutin, our chief executive officer, and Megan Faust, our chief financial officer. Our earnings press release was filed with the SEC this afternoon and is available on the investor relations page of our website, along with the presentation slides that accompany today's call. During this presentation, we will use non-GAAP financial measures, and you can find the reconciliation to the US GAAP equivalent on our website. We will make forward-looking statements about our expectation for AMCOR's future performance based on the environment as we currently see it. Of course, actual results could differ. Please refer to our press release and SEC filings for information on risk factors, uncertainties, and exceptions. that could cause actual results to differ materially from these expectations. Please note that the financial results discussed today are preliminary, and final data will be included in our Form 10-Q. And now, I'll turn the call over to Hiel.

Thank you, Jennifer. Good afternoon, everyone, and thank you for joining the call today. MCOR delivered first-quote results in line with expectations, with revenue of $1.37 billion an EPS of 24 cents. Overall, a 7% year-in-year revenue decline, with the most significant decline from the automotive and industrial markets. After a multi-quarter industry cycle, we believe the first quarter marks the low point for revenue and utilization for MCOR. Although macroeconomic and geopolitical uncertainties continue to impact market sentiment, we observe positive signs of market recovery in multiple areas across our portfolio. During the quarter, we continue to focus on our strategic pillars to elevate our leadership position. With our strong technology leadership in advanced packaging, a unique diversified global footprint, and partnerships with lead customers in the secular growth markets, we are well positioned to accelerate as the industry exits the cycle. Now let me review the dynamics in each of our end markets. Revenue in the communications end market declined 3% year-in-year in the first quarter. Within the IOS ecosystem, we experienced a larger than seasonal correction after record revenues in the second half of 2023. Within the Android supply chain, as well as in memory, we observed improvement in demand and year-in-year growth from the lows in 2023. Overall smartphone units are projected to be up low single digits this year. We believe that the introduction of AI into edge devices like smartphones will accelerate innovation and drive increased demand for advanced packaging solutions. With mCore's strong position throughout premium-tier smartphones and our advanced packaging leadership, we expect this to create opportunities for further business growth. In Q1, revenue in our automotive and industrial business declined 22% year-on-year, as several of our customers implemented inventory control measures. Despite these near-term inventory corrections, Long-term drivers for growth remain intact. Semiconductor content per car is expected to continue to increase, driven by the proliferation of ADAS, electrification, infotainment and telematics, all requiring advanced packaging technology. Emcor is the leading automotive OSET and has multiple decades of experience meeting the stringent requirements of the automotive industry. During the quarter, we used our Portugal facility as a base for enhancing key partnerships with industry leaders in support of a resilient European semiconductor supply chain. We also expanded engagements with leading Japanese automotive semiconductor companies through our factory in Komamoto and other locations in Japan. We remain focused on leveraging our broad geographic footprint and strengthening partnerships with leading automotive semiconductor customers. Revenue from the computing end market increased 4% sequentially, driven by strength in the AI devices and several new product introductions for ARM-based PCs. Slow recovery of infrastructure and traditional server demands resulted in a 4% year-on-year decline. Planned investments to expand 2.5D capacity for AI devices are on track to come online by the end of the second quarter. We also strengthened our R&D efforts in Korea to innovate and enable next-generation advanced packaging technology for high-performance computing. The consumer end market increased 6% year-on-year and experienced a typical seasonal decline in the first quarter. Traditional consumer product demand remains weak, while increased demand for IoT wearables drove the year-on-year growth. Production ramps of new products utilizing advanced SAP technologies are on track for high-volume production in the second half of this year. Emcor is engaged with lead customers across a diverse set of products, ranging from audio devices, smartwatches, and the emerging AR VR experience. Our advanced SIP expertise positions us well for growth, and we continue to expand capacity and invest to drive manufacturing scale and innovation. During the first quarter, our manufacturing organization continued to demonstrate operational excellence with a focus on cost control while maintaining the high quality standards required by our customers. We focused on optimizing capacity for 2.5D technology in Korea, supporting AI data center applications, and on qualifying advanced SIP and memory technology in Vietnam to support REMS in the second half of this year. Additionally, we progressed our plans for our advanced packaging and test facility in Arizona and submitted our full application for CHIPS funding. Now let me turn to our second quarter outlook. After a multi-quarter semiconductor industry cycle, we believe the first quarter marked the low point of our revenue. We expect second quarter revenue of $1.45 billion, which represents sequential growth of 6% and flat revenue year-on-year. Overall, our expectations for full year 2024 have not changed. We foresee a muted first half followed by strong growth in the second half, driven by the seasonal launch of premium tier smartphones, a meaningful ramp of a new consumer wearable program, and additional capacity coming online for 2.5D technology. Assumptions for more balanced inventory levels within Android, memory, and PCs add additional confidence. Although the automotive and industrial market appears to be softening more than we expected earlier this year, we see upsides in other areas of our portfolio. We believe that the secular growth drivers for the semiconductor industry remain in place. And with our leading technology portfolio, scale, and global footprint, we are confident in our position to accelerate as the industry exits the current cycle. With that, I will now turn the call over to Megan to provide more detailed financial information.