Good day and welcome to today Veeco Quarter 3 2022 Earnings Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Anthony Bencivenga. Investor Relations. Please go ahead, sir..

Thank you and good afternoon everyone. Joining me on the call today are; Bill Miller, Veeco’s Chief Executive Officer and John Kiernan, our Chief Financial Officer. Today’s earnings release is available on the Veeco website. Please note that we have prepared a slide presentation to accompany today’s webcast.

We encourage you to follow along with the slides on veeco.com. This call is being recorded by Veeco Instruments, and is copyrighted material. It cannot be recorded or rebroadcast without Veeco’s expressed permission. Your participation implies consent to our recording.

To the extent that this call discusses, expectations about market conditions, market acceptance and future sale of the company’s products, future disclosures, future earnings expectations or otherwise make statements about the future.

Such statements are forward-looking and subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made, including as a result of the COVID-19 pandemic.

These factors are discussed in the Business Description, Management’s Discussion and Analysis and Risk Factors sections of the company’s report on Form 10-K and annual report to shareholders, and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases.

Veeco does not undertake any obligation to update any forward-looking statements, including those made on this call to reflect future events or circumstances after the date of such statements.

During this call, management will address non-GAAP financial measures, information regarding such non-GAAP financial measures, including reconciliation to GAAP measures of performance is available on our website. And with that, I will turn the call over to our CEO, Bill Miller..

Thank you, Anthony. Good afternoon, everyone and thank you for joining us today. Veeco delivered another solid quarter with robust year-on-year revenue growth driven by Semiconductor sales.

The Veeco united team is performing well, continually innovating across our differentiated portfolio of technologies, and executing on our supply chain to meet customer commitments. Today, I’ll take you through our third quarter highlights and discuss our markets and technologies.

John will provide our financial update and guidance, and then we’ll be happy to take questions. Our revenue of $172 million was above the midpoint of our guide and driven by another record quarter in Semiconductor, with significant contributions from Laser Annealing, as well as Systems for Advanced Packaging, and EUV Mask Blank production.

Our solid execution led to non-GAAP operating income of $28 million, and non-GAAP EPS of $0.45, which were both near the top end of our guided range. And we ended the quarter with $272 million in cash and short-term investments, an increase of $40 million.

As we look across our order book for the quarter, we see pockets of strength and in otherwise mixed demand environment. For example, we had multiple multisystem orders for our Laser Annealing systems for logic applications. We also had increased order activity in our data storage market for Ion Beam systems over the last two quarters.

At the same time, the weakness in consumer and mobile device markets is impacting our Wet Processing and Lithography product lines for 5G RF filters, Power Amplifiers and Advanced Packaging Applications.

As such, we’ve seen corresponding push outs of shipments by one or two quarters and reduction in orders, which are impacting near-term revenue for these product lines. Consequently, we’re carefully balancing the risk associated with this mixed demand environment and the investments we’re making to execute our growth strategy.

And from a supply chain perspective, our team has been executing well, and I would say, there’s a sense that the situation is improving. We’re focused on flexibility in our supply chain, and working with our partners to overcome issues as they arise. I’ll switch gears to our specific markets and technologies, starting with the Semiconductor market.

There’s a prevailing consensus among third-parties, that wafer fab equipment spending will decline in 2023 by over 20%. This forecast to decline is more heavily weighted to memory, and stems from weakness in consumer, PC and smartphone markets.

Currently, Veeco’s Semiconductor business is weighted heavily towards logic with our Laser Annealing, Advanced Packaging, and EUV Mask Blank products.

So, while we’re monitoring WFE carefully, at this time, we continue to invest in executing our growth strategy are well positioned with attractive technologies and we’re optimistic about expanding our served available market.

Despite current headwinds stemming from the consumer markets I just mentioned, over the long-term, the Semiconductor market is driven by secular growth drivers include – including megatrends such as AI and High Performance Computing, the transformation of the Auto Industry, and ongoing Data Center and Cloud adoption.

Veeco is well positioned with exciting products in this market, which has grown from approximately 25% of our total revenue in 2018, to more than half of our total revenue in 2022. This reflects the execution of our vision and strategy over the last few years to grow in the Semiconductor market.

To start our Laser Annealing systems have applicability in both leading and trailing logic nodes, helping our customers with AI and High Performance Computing, as well as mature Automotive and Consumer applications. This is Veeco’s largest product line, driving our growth in the Semiconductor market.

Commenting on our third quarter Laser Annealing order activity, the majority of orders came from China for trailing node logic applications. Based on our analysis of the new export regulations, which John will explain in a few minutes, we do not expect these orders to be export-restricted.

During the quarter, we achieved this significant milestone by shipping our Laser Annealing system with shorter dwell times to an important leading-edge logic customer in support of their technology roadmap.

These advancements in dwell times, along with other advancements in optics demonstrate our commitment to help our customers with their most difficult materials’ challenges. Veeco’s Laser Annealing platform is the production tool of record at the world’s leading logic players for select annealing steps.

In addition to logic, we’ve introduced Laser Annealing to the memory market. In fact, after a recent DRAM evaluation sign-off, we anticipate volume purchase orders in the 2023 to 2024 timeframe. Overall, our Laser Annealing business is growing, as we win process steps and new customers. Now, looking at our Advanced Packaging Lithography product line.

We continue to see good potential in applications such as Fan-Out Wafer-Level Packaging, copper pillar and bumping driven by GPU production and High Performance Computing.

And we expect our Advanced Packaging Lithography products to continue to be a contributor to our Semiconductor market as manufacturers seek to increase IO densities and integrating diverse chips in packages to improve performance. Switching gears to the EUV Mask Blank product line.

Our Ion Beam Deposition technology has been identified as the technology of choice to deposit defect-free films to create EUV Mask Blanks. We expect this product line to remain in demand as customers play in their capacity additions to keep up with the adoption of EUV lithography.

ASML recently reiterated their plans to ship over 60 EUV Lithography systems in 2023 and they’re working on capacity expansion plans to ship 90 systems annually by 2025. With approximately one of our systems required for every 10 to 15 EUV Lithography systems, we currently started this market at three to five Ion Beam systems per year.

Our Semiconductor business is performing well today and driving Veeco’s performance in 2022 and beyond. Now, looking at our Compound Semiconductor market, we’re working to penetrate this market with our MOCVD solutions by targeting power electronics applications, and photonics applications, including Micro LED.

Our gallium nitride MOCVD system is in the field under evaluation with a leading customer for an 8-inch power application. We believe there are opportunities in the Consumer, Automotive and Data Center Power markets to enable improved cost of ownership with an eight-inch GaN solution, while delivering best-in-class film properties.

During the quarter, we shipped multiple deposition systems to support photonics applications. And we received evaluation acceptance for our Alumina Arsenide and Phosphide MOCVD system. This system was being evaluated for a red Micro LED application. And we’re now working with this customer to further optimize their manufacturing process.

We continue to believe both Power Electronics and Micro LED are attractive markets and a good long-term opportunity for the company. As such, we’re focusing R&D investments in these areas. Our third major end market is Data Storage.

In the Data Storage market, the mix of hard disk drives shipments for PCs, servers and cloud data centers has been transitioning for some time. Overall number of drives shipping has been declining in the Consumer markets.

But in the growing Enterprise markets, the capacity and number of magnetic heads per hard drive have been increasing in response to a 30% growth rate in data stored each year in Cloud and Data Center applications. In fact, the absolute number of heads shipped has been steadily increasing for years and is forecast to continue to increase.

In addition, the complexity of heads has been increasing and is expected to continue to increase as disk drive makers advance their technology roadmaps. Veeco’s Ion Beam equipment is used to manufacture our customers’ magnetic heads.

And based on these industry dynamics I just described, we believe the data storage market will provide growth over the long-term. After a multiyear period of growth, and based on reduced order activity in 2021, Data Storage performance in ‘22 is paying out as we expected, as customers slow the pace of capacity additions.

As we look forward, however, based on current order activity, we expect ‘23 Data Storage revenue to grow over 2022. Now, let’s review our 2022 priorities. The Veeco team is performing well in a challenging macroeconomic environment. Employee health is a top priority.

We looked at most safety protocols in our facilities, but we’re monitoring and staying flexible. Our customer evaluation program continues to be successful. During the quarter, we received another customer acceptance for one of our systems.

We’re developing exciting products in Annealing and Ion Beam that solve customer’s high value problems and we’re planning to ship systems for customers to evaluate in the coming year. Another key focus for us in 2022 has been managing our supply chain to deal with global shortages of certain components and commodities.

We’ve been doing just that, and I remain committed to remain within our full year 2022 revenue guidance. In fact, I’m confident our technologies are well aligned with growth markets, driven by global mega trends I highlighted earlier and we’re well positioned to capitalize on these megatrends that drive Veeco’s long-term growth and profitability.

And with that, I’ll turn it over to John..

Thanks, Bill and good afternoon, everyone. Today I’ll be discussing non-GAAP financial data, I would encourage you to refer to our reconciliation between GAAP and non-GAAP results, which you can find in our press release or at the end of the quarterly earnings presentation. Turning to Q3 revenue by market and geography.

Revenue totaled $172 million for the quarter, and as Bill mentioned, was driven by record sales to our Semiconductor customers, which increased 3% sequentially from Q2 2022 and 32% from a year ago.

Our Semiconductor business made up 59% of our total revenue, similar to last quarter, with significant contribution coming from our Laser Annealing products. The Compound Semiconductor market contributed 16% of our revenue, and while down sequentially, revenue in this market increased 21% from Q3 2021.

This was driven by system shipments for Photonics and RF applications. And Data Storage market came in at 16% of total revenue and in line with our expectations. And finally, the Scientific Market made up 9% of our revenue. Now looking at third quarter revenue by region.

Our Asia Pacific region excluding China made up 38% total revenue driven by Semiconductor system sales. The United States was 31% of our total revenue, driven primarily by Semiconductor sales as well as system sold to Data Storage customers.

China made up 21% of total revenue, primarily driven by sales to Semiconductor customers, as well as shipments for Compound Semiconductor applications. And finally, EMEA made up 10% of total revenue for the quarter. Switching gears to our non-GAAP third quarter results. Gross margin came in at 42% in line with guidance.

Operating expenses for the quarter were $44 million below our guide on lower SG&A expenses than originally planned. We have begun to slow the pace of hiring, focusing on the highest priority positions, while we address the macroeconomic environment.

Tax expense for the quarter was approximately $300,000 with net income coming in at $26 million, and EPS was $0.45 on a diluted share count of 63.5 million shares. Now moving to the balance sheet and cash flow highlights. We ended the quarter with cash and short-term investments of $272 million, an increase of $40 million from last quarter.

This brings us close to being cast debt neutral, an important milestone we’ve been working toward. Cash flow from operations was $47 million. This cash performance benefit from an increase in customer deposits of 88% or $51 million during the quarter, increasing from $58 million to $109 million.

A portion of the deposits pertain to products scheduled to ship in 2024. Our accounts receivable increased by $16 million due to the timing of shipments and customer payments, some of which were delayed and collected in the first week of the fourth quarter. As a result, DSOs for the quarter increased to 75 days from 70 days in the prior quarter.

Account accounts payable increased sequentially by $4 million to $51 million, with days payable at 46. Inventory was $188 million, up $12 million from the prior quarter due to an increase in income and material with days of inventory increasing to 161 days. CapEx for the quarter was $6.4 million.

This included limited payments for our San Jose facility expansion. We still have remaining payments of approximately $7 million, which we expect to make in the coming quarters. We fully transitioned our operations to the new facility during the third quarter, as expected, and we’re glad we did.

I think it’s fair to say the expanded capacity enabled us to deliver record Semiconductor revenue over the last few quarters. Long-term debt, including the current portion of $20 million was recorded at $274 million on the balance sheet and represents the carrying value of our $278 million in convertible notes.

Before turning to Q4 non-GAAP guidance, let me start with some details on the new China export regulations which have broadened the requirements under which export licenses will be required with the presumption that they will be denied.

Generally, Semiconductor equipment sold to fabs in China manufacturing logic devices at or below 16 nanometer, DRAM devices at or below 18 nanometer half pitch or NAND devices at or above 128 layers will require export licenses. US persons supporting these operations will also require licenses.

In addition, US government created a new export classification code for certain deposition equipment, which will now require licenses. And furthermore, certain China-based companies have been added to the Department of Commerce unverified list.

Our recent order activity has led to an increase in backlog in China, particularly in our LSA product line, which may be subject to these regulations. While the export landscape is fluid and evolving, we believe at this time, the substantial majority of our backlog will not be negatively affected by the new regulations.

Now turning to Q4 non-GAAP guidance. With these new export regulations and current supply and demand environment in mind, we expect Q4 revenue to be between $150 million and $170 million, incorporated in this revenue guide, we’re assuming a less than $5 million impact due to the China export restrictions.

With a less favorable mix in Q3, we expect gross margin to be between 39% and 41%. We expect OpEx to be between $43 million and $45 million. Net income is expected between $13 million and $23 million. EPS is expected between $0.24 and $0.40 per diluted share, and it’s based upon a $64 million share count.

Please refer to the schedule in the guidance section of the earnings press release and backup section of the earnings presentation which illustrates how Q4 EPS is calculated based on the guidance range is provided. And now for some additional color beyond Q4.

Q1 revenue appears to be flat to slightly down from our Q4 2022 guide as we’re experiencing a slowdown in our 5G RF and Advanced Packaging markets.

Given the alignment between our differentiated technologies and the megatrends driving the markets in which we operate, we’re optimistic about the growth of our business despite these current market dynamics.

And finally, as highlighted in our prior quarterly earnings call, there is a possibility within the next 12 months that a significant portion of our deferred tax asset valuation allowance will no longer be needed. If this happens from a GAAP perspective, our P&L tax benefit will be realized in the period in which the reversal takes place.

Additionally, from both a GAAP and non-GAAP perspective, the effective tax rate would increase from that point forward. From a cash perspective, the company will continue to use its tax NOL and credit carryforwards to offset US taxes, limiting the cash impact until such carryforwards have been fully utilized.

And with that, Bill and I would be happy to take your questions. Operator, please open the line..

Thank you, sir. [Operator Instructions] We will take the first question from Rick Schafer, Oppenheimer. Your line is open. Please go ahead..

Yeah. Thanks, guys. Couple of questions if I could. The first one you know, Bill or John, I’m curious you know an order velocities obviously are slowing for everyone.

I mean, I’m curious, are you guys just seeing orders pushed out? Or I didn’t hear you talk much about cancellation? So curious if you are seeing any canceled and if you are? You know if you could just give some color on, is it more near-term backlog that’s being canceled? Or is this – was it more of a long-term stuff you know, three, four quarters out?.

What we’re seeing, Rick is a push out kind of in this kind of Q4-Q1 timeframe out by one to two quarters. We have not seen any significant cancellations, I want to be clear about that. And you talked about order velocity. The macroeconomic environment is a bit challenging.

It’s – I’d kind of characterize it as mixed on one hand, smartphone and PC weakness is creating headwinds for certain segments, particularly Advanced Packaging Lithography for application processors and GPU and Wet Processing is being impacted with slowdown in 5G RF filters and power amplifiers.

And those are typically our shorter lead time, one to two quarter credit products. But at the same time, from a positive standpoint you know the secular growth drivers such as AI and High Performance Computing, transformation of Auto Industry, Data Center, Cloud, et cetera, our Data Storage business has been doing well from an order standpoint.

We’ve been receiving technology and capacity orders from our customers. Laser annealing, we’ve been receiving good orders for both advanced and trailing node logic. You know and we even have our customer deposits for orders scheduled into 2024.

And so it’s really you know kind of the short end of the market in the longer-term part of the market that’s kind of makes us feel like that’s such a mixed environment right now..

That’s really a great color. Thanks a lot, Bill. And maybe a follow-up to that just it sounds like I don’t want to put words in your mouth that that 5G RF and advanced packaged probably were down in 4Q and down again in 1Q it sounds like.

Is it safe to assume the others? I mean, do you see growth in some of the other segments as we go into the fourth quarter? Maybe just some color or directions anyway for you know by segment in 4Q?.

Yeah, so let me take a shot at that, Rick. So you know we are guiding at the midpoint of about $160 million in revenue for Q4. So that’s down from our Q3 actuals of $172 million roughly. And by cover that in the four markets, we see you know Semi down just slightly in Q4, compared to you know Q3 mainly driven by Advanced Packaging.

And the Compound Semi side, we do see revenue down in the Compound Semi market compared to Q4, driven you know by the reduction in you know 5G RF power amplifiers filter business there. We see Data Storage down a bit in Q4. And we see the Scientific, which is a smallest piece of our business, took up a bit in Q4..

Thanks for all that. And I’ll just pick up last one if I could.

I mean, that $5 million impact that you talked about from China, you know if we sort of annualize that, should we think of kind of pulling sort of $20 million out of the ‘23 model is sort of you know you’re derisking China as best we can at this stage?.

Yeah so I think that’s a little bit you know complicated there, Rick. So let me go through a little bit of detail and hopefully that will help gain an understanding. So, in China you know this past year or so, it’s been about 20% of our, you know business overall.

You know spread across multiple technology, Semi, Compound Semi, Scientific, not really any you know Data Storage in China. And, of course, these new export regulations are geared towards advanced semiconductor. So that applies to you know a piece of our business in China.

And based upon the recent you know activity for our LSA products, we actually expect you know our China business to be up a bit in the near-term. So you know the export regulation is –landscape is quite fluid and evolving.

But as we said in our prepared remarks, we believe that at this time, a substantial majority of our backlog will not be negatively impacted by the new regulations. And this is really you know due to that you know we’ve been taking orders for you know trailing nodes and our x – our LSA products aren’t a class of products that require export licenses.

So – but if I look further out in the future, it’s not as clear as the current regulations will impact our, you know customers you know by patterns. And we do recognize there may be future business that we could have you know won that’s not currently in our backlog that might not materialize.

You know this could be from follow-on business from existing customers, if they’re looking to operate at more advanced nodes or you know potential new customers that we would have the ability to penetrate, and they’re either operating at advanced nodes or just been recently you know added to the Commerce Department’s restricted list.

So you know overall as we look forward, it’s hard to estimate what this potential impact you know might be, but as we said you know in our prepared marks, as of now, we expect to be able to ship the substantial portion of our backlog. I know a little bit longwinded, but that’s our current view..

That was – it was great color. Thanks a lot, guys..

Thanks, Rick..

We will take the next question from Mark Miller, The Benchmark Company. Your line is open. Please go ahead..

Thank you for the question.

Are there any other tools besides the LSA that might be impacted in China?.

I’ll throw it in. I think some of our very small ALD sys – R&D systems might be impacted. But it’s not a big number. John I don’t think there’s any other things that –.

Yeah I think that captures it well, Bill. So, Mark that one of the equipments that got added to the export regulations was deposition equipment, and for the most part, we don’t sell a lot of you know deposition equipment into China..

Okay.

Can you give me an update on the status on the eval tools you have in the field?.

Sure, sure. You know we’ve – you know over the last year and a half, we’ve talked about ramping up to 10 eval systems, you know we’ve had a high concentration in the Semi space, and of that a big concentration in the Laser Annealing.

And we’re pretty excited that over the course of this year, the majority of this first batch of eval tools have been successful – it was accepted successfully, excuse me. And we’re working with these customers to turn those acceptances into follow-on volume orders. We do expect to ship a couple of evals this quarter.

And we have an aggressive plan in 2023 to continue our eval program, primarily across Semi and secondarily in the Compound Semi space. So I think we’re continuing the same play – playbook that we’ve laid out previously..

The eval tools, specifically, what are they for with applications?.

They’re for Laser Annealing. I think the next and the next the n plus 2 on the roadmap for leading logic. And we also have a new technology in Laser Annealing that we are going to be putting out into the field in the coming period or periods here.

And we also have Ion Beam Deposition system for low-resistance metals into Semi for both memory and logic applications that we expect to put into the field in 2023..

Thank you..

Thank you, Mark..

[Operator Instructions] And we will take the next question from David Duley from Steelhead. Your line is open. Please go ahead..

Yes.

Could you just elaborate a little bit more on the big increase in deposits that you mentioned? You know, why is it all of a sudden that you’re saying that?.

Sure, David, good question. And you know we’ve seen strong activity during the quarter an area where we collect customer deposits, so thinking some of the longer lead time pieces of the business. And you know we collect deposits on many of our orders, but not on all customers and all technology types.

So the increase in the customer deposits reflect strong Data Storage orders and Laser Annealing you know orders from China. And we mentioned in our prepared remarks as well, that we actually have instances where we received orders with deposits for items scheduled to shift in 2024 as well..

Okay, and just along these lines, did you – and I didn’t see, I’m sorry, I haven’t gone through all the slides.

Did you mention what the backlog was? You mentioned your backlogs very strong, and but I was just curious if you could give us the number?.

Yeah, so David we only report backlog annually once a year at the end of the year. So yeah you didn’t miss that. We don’t provide our quarterly bookings or a backlog number. We haven’t done that for a number of periods now..

Okay.

And maybe even though you haven’t given us the actual number, what percentage of the backlog is shippable in 2023?.

So we wouldn’t record you know into backlog any shipments that we don’t expect to occur in the next 12-month period. So when we get to the end of the year, and we do report our backlog, you’ll see a statement in there that it would relate to only items that we expect to ship in the coming 12 months..

Okay. And then, Bill I was wondering if you might take a shot at you know I think you mentioned as many other equipment companies have talked about you know WFE kind of being down let’s say 20% or 22%.

I was wondering if you might be able to take a guess at what your Semi businesses or your overall revenue might be versus that expectation?.

Yeah, I would say you know a lot of the drop that we’re seeing forecasted data of 20% kind of number is kind of more concentrated in the – on the memory side. And we’re much less susceptible to memory, because our Semi business is really focused today on logic.

And it seems that logic is holding up well with particular strength in China for trailing node applications. All right as we mentioned in our prepared remarks, Advanced Packaging is showing signs of weakness across the board from foundries, IDMs and OSATs. And we think this is really driven by weakness in mobile and consumer applications.

And the third leg of our Semi stool is EUV. And we see that to be continuing along what we’ve said historically, three to five systems per year in 2023. So, I know that gives you a little more color..

Okay, thank you. And I guess final question for me is, I’m assuming as you mentioned, a lot of the boarders that you’re getting are in the hard disk drive business.

Would you guess that your HDD businesses up in calendar 2023? Or is it really for the back half of 2023? What do you think the inflection point happens for the disk drive revenue?.

Yeah, I would say given our long lead times and having orders kind of start you know in the second quarter and then into the third quarter here, our Data Storage – we believe our Data Storage business will be up next year over this year, and it will likely be more concentrated in the second half of the year, just given the lead times..

Okay, thank you..

Thanks, David..

We will take the next question from Gus Richard from Northland. Your line is open. Please go ahead..

Yes. Thanks for taking the questions.

Just on the Advanced Packaging is the Litho which is primarily Fan-Out? Or is it copper pillar you know is there any color you can provide there?.

It’s you know – it’s actually pretty broad in terms of, it’s very hard for us to tell exactly what’s for fan-out for mobile versus copper pillar. I would say, generally our mobile market is weak, which is a lot of fan-out packaging. But you know we are seeing it continue to be soft, I’d say..

Okay, fair enough.

And then just you mentioned you know you’re working on a Micro LED red for application, could you remind me which one has got the most traction? And is it on silicon or is it gallium arsenide?.

This particular one was on gallium arsenide, arsenide phosphide, a red kind of traditional Micro LED approach. And it’s really tied to the luxury TV market inflection, and we still continue to make progress with our customer with the innovative approach with 200 millimeter and now 300 millimeter GaN on silicon approach to Micro LEDs.

And you know they’re getting great performance and they’re targeting the inflection of the luxury TV market as well..

Okay, I understand. Okay, and then I think that’s it for me. Thanks so much..

Thanks a lot, Gus..

I’m sorry. GaN power. Sorry, I forgot one. Power [inaudible] GaN, you’ve been in the eval, sorry. Yeah you’ve been in eval for a long time in that eight-inch GaN for power.

And I’m just wondering are you getting close to conclusion?.

We are making a lot of progress there on this six-inch to eight-inch transition. We’re getting good results from the equipment set. We are working on some modifications and upgrades, if you will. And so we expect this eval to continue into 2023.

And, if successful, I would be looking to, for volume power electronic – GaN on silicon power electronics in 2024..

Okay, thanks. Thanks so much..

Thank you, Gus..

It appears that there is no further question at this time. Mr. Speaker, I would like to turn the conference back to you for any additional or closing remarks..

Yes. Thank you, operator and to all joining us on today’s call. And I understand that maybe a bit foggy out here in the near-term, but I would like to reiterate that Veeco is well positioned to execute our long-term growth strategy as market conditions improve. So, have a great evening. Thank you, all..

That concludes today’s event. Thank you for your participation. You may now disconnect..