Earnings call transcript: Photronics beats Q1 2025 EPS forecast, stock rises

Photronics Inc. (NASDAQ:PLAB) reported its first-quarter 2025 earnings, surpassing analyst expectations with an earnings per share (EPS) of $0.52 against a forecast of $0.46. Revenue reached $212 million, slightly above the anticipated $210 million. The stock reacted positively in premarket trading, rising 0.58% to $20.82. According to InvestingPro analysis, the company maintains a "GREAT" financial health score of 3.25 out of 4, suggesting robust operational performance. The stock currently trades at an attractive EV/EBITDA ratio of 3.46x, indicating potential undervaluation relative to its peers.

Key Takeaways

• Photronics exceeded EPS expectations by 13%.
• Revenue slightly above forecast at $212 million.
• Premarket stock price increased by 0.58%.
• Strong cash position with $642 million in total cash.
• Cautious outlook for 2025 amid macroeconomic uncertainties.

Company Performance

Photronics demonstrated resilience in the first quarter of 2025, achieving higher-than-expected earnings despite a challenging market environment. The company’s focus on high-end integrated circuit (IC) segments and advancements in AMOLED display technology contributed to its robust performance. However, a 5% sequential decline in revenue indicates some market softness, particularly in the mainstream semiconductor segment in Asia and Europe.

Financial Highlights

• Revenue: $212 million, 5% sequential decline.
• Earnings per share: $0.52, above guidance.
• Operating margin: 25%.
• Gross margin: 36%.
• Operating cash flow: $78 million (37% of total revenue).
• Total (EPA:TTEF) cash: $642 million.
• Debt: $3 million.

Earnings vs. Forecast

Photronics reported an EPS of $0.52, beating the forecasted $0.46 by 13%. Revenue also surpassed expectations, coming in at $212 million compared to the $210 million forecast. This marks a significant achievement for the company, reflecting its strategic focus on high-end products and cost management.

Market Reaction

In response to the positive earnings report, Photronics’ stock rose by 0.58% in premarket trading, reaching $20.82. This increase follows a previous close of $20.70, indicating investor confidence in the company’s financial health and strategic direction.

Outlook & Guidance

For the second quarter of 2025, Photronics provided revenue guidance in the range of $208 million to $216 million, with an EPS forecast between $0.44 and $0.50. The company remains cautiously optimistic about the remainder of the year, citing macroeconomic uncertainties as a potential challenge. Despite recent market volatility, InvestingPro’s Fair Value analysis suggests the stock is currently undervalued, with strong fundamentals supported by a free cash flow yield of 10% and minimal debt-to-equity ratio of 0.02.

Executive Commentary

Eric Rivera, CFO, highlighted the company’s cautious stance, stating, "We are increasingly cautious about 2025." CEO Frank Lee emphasized the role of AI in driving demand for advanced photomasks, noting, "AI tools have the potential to offer AI capability at a lower cost."

Risks and Challenges

• Macroeconomic uncertainties could impact future performance.
• Increased competition from local Chinese mask makers.
• Weakness in the mainstream semiconductor segment in Asia and Europe.
• Potential geopolitical risks affecting supply chains.
• Market saturation in certain segments may limit growth opportunities.

Q&A

During the earnings call, analysts inquired about the impact of AI on Photronics’ product demand and the company’s expansion plans in the U.S. Executives confirmed that AI is a significant driver for advanced node photomasks and that U.S. expansion is aligned with customer demand. They also addressed concerns about the CHIPS Act, noting no significant impact on current investments.

Full transcript - Photronics Inc (PLAB) Q1 2025:

Conference Operator: Hello, and welcome to Photronics’ Fiscal First Quarter twenty twenty five Financial Results Conference Call. At this time, all participants are in a listen only mode. After the speaker’s presentation, there will be a question and answer session. To ask the question during the session, you will need to press 11 on your telephone. You will then hear an automated message advising your hand is raised.

I would now like to turn the conference over to Ted Moreau. You may begin.

Ted Moreau, Investor Relations, Photronics: Thank you, operator. Good morning, everyone. Welcome to our review of Photronics’ fiscal first quarter twenty twenty five financial results. Joining me this morning are Frank Lee, CEO Eric Rivera, CFO and Chris Progler, CTO. The press release we issued earlier this morning together with the presentation material that accompanies our remarks are available on the Investor Relations section of our webpage.

Comments made by any participants on today’s call may include forward looking statements that include such words as anticipate, believe, estimate, expect, forecast and in our view. These forward looking statements are subject to various risks and uncertainties and other factors that are difficult to predict. Although we believe that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. We are under no duty to update any of the forward looking statements after the date of the presentation to conform these statements to actual results. Photronics has provided additional information in its most recent Form 10 K and other subsequent reports filed with the SEC concerning factors that could cause actual results to differ materially.

During the course of our discussion, we will refer to certain non GAAP financial measures. These numbers may be useful for analysts, investors and management to evaluate ongoing performance. A reconciliation of these metrics to GAAP financial results is provided in our presentation materials. I will now turn the call over to Frank.

Frank Lee, CEO, Photronics: Thank you, Ted, and good morning, everyone. We achieved first quarter sales of $212,000,000 in line with our expectation and normal seasonal trends. Non GAAP diluted EPS of $0.52 was above the high end of guidance and we once again delivered strong cash flow. Turning to our end markets. IC declined 2% year over year due to mainstream weakness in Asia and Europe, particularly at the older nodes within mainstream.

For high end IC, we have seen continued evidence of logic photomars no migration to twenty two and twenty eight nanometer in Asia. Within IC, memory photomask demand also shows trends. FPD declined slightly year over year due to industry softness, though we saw brand demand from customers in China. Our industry leading technology in FPD continues to win business. And our strategy to apply ICMR technology to FPD helps us win market share.

We recognized a milestone during Q1 as we received our first orders for G 8.6 AMOLED displays. G8.6 requires more advanced and complex masks that have higher ASPs. Now, I would like to discuss a few developments impacting the semiconductor industry. First, as the AI landscape evolve, we believe it will be a longer term growth driver for the industry and for autonomous. New AI tools have the potential to offer AI capability at a lower cost.

These tools reduce the barrier of entry into AI, which drives new applications requiring new devices and designs. Customer IC serving these applications will drive photomask demand, mainly at the more advanced nodes that we service. At more mature nodes, AI drives the need for fast interconnects, including silicon photonics and advanced packaging. Second, the semiconductor industry may potentially incur increased costs from tariffs. For photonics, our strategy to invest in regional capacity close to customer locations should buffer us from this potential cost.

Therefore, we import very few mass into The United States and don’t anticipate meaningful impact on our business from tariffs. Fiscal twenty twenty five started off as expected in Q1 and demonstrate our technology leadership. Industry growth drivers in IC include loan migration, regeneration and custom design expansion, while product development and scale up of display size are key for FPD. Further, our markets are benefiting from AI adoption and regionalization trends, where we leverage our competitive advantages in capability, cost, scale and time to market. By working with our customers, we are carefully expanding capacity and capability in projected growth regions such as The United States to meet demand.

These investments further strengthened our market leadership position, giving us confidence in our long term outlook. I will now turn the call over to Eric to review our first quarter results and provide second quarter guidance.

Eric Rivera, CFO, Photronics: Thank you, Frank. Good morning, everyone. As Frank stated, our first quarter results were in line with expectations with revenue of $212,000,000 Total revenue declined 5% sequentially led by IC, which declined 6% quarter over quarter to $154,000,000 Within IC, mainstream declined 9% reflecting the overall softness of the broader semiconductor industry. We did see pockets of strengths within high end. Sales generated out of our European facilities were weaker than anticipated, and this situation is expected to continue.

Our IC business out of our facilities in Asia and The U. S. Also declined sequentially due to typical seasonality as expected, though U. S. IC did exhibit strong year over year growth.

Within IC, we continue to drive towards a greater mix of higher end business with a focus on increasing our blended ASPs. Demonstrating our execution, in fiscal year twenty twenty three, our high end business represented 30% of total IC revenue, increasing to 36% in fiscal year twenty twenty four. For the first quarter of fiscal year twenty twenty five, our high end business increased further to 39%. Within high end, we saw particular strength in Q1 in the 14 nanometer to 22 nanometer geometry ranges. For our leading edge IC mix, we recognized improved demand from memory customers.

FPD revenue was stable both sequentially and year over year at $58,000,000 We are the market leader in FPD photo masks due to our technological superiority and manufacturing footprint. As a result, despite market headwinds, we have been able to maintain our revenues due to increasing market share. Our operating margin of 25% was at the high end of our guidance range. Gross margins declined slightly to 36% because of lower sales volumes. Continued prudent controls along with lower severance and legal related expenses and lower R and D reduced OpEx by $2,900,000 sequentially.

Diluted GAAP EPS attributable to Photronics shareholders was $0.68 per share. After removing the impact of FX gains, fully diluted non GAAP EPS attributable to Photronics shareholders was $0.52 per share, which was above the

Eric Rivera, CFO, Photronics: high end of our guidance.

Eric Rivera, CFO, Photronics: Our FX gain was an unrealized benefit primarily related to the impact of the strengthened U. S. Dollars on intercompany balances, cash and accounts receivables held by our foreign subsidiaries. During the first quarter, we generated $78,000,000 in operating cash flow, which represented 37% of total revenue. We continue to build on our strong cash balance providing us with continued financial flexibility.

CapEx was $35,000,000 in the quarter. We remain committed to spending $200,000,000 in CapEx in 2025 on a combination of capacity, capability and end of life tool initiatives. This run rate is higher than typical to accommodate U. S. Expansion initiative that’s underway.

I want to emphasize that our capacity expansion plans are driven by specific customer opportunities and go through a rigorous investment vetting process. These investments will strengthen our ability to support and win the most attractive photo mask opportunities. Total cash at the end of the quarter was $642,000,000 and remain relatively unchanged from the end of fiscal Q4, driven by CapEx, debt repayment, stock repurchases and the effect of foreign currency exchange rate changes on our cash balances. We have a modest $3,000,000 of debt remaining. Before providing guidance, I’ll remind you that demand for our products is inherently uneven and difficult to predict with limited visibility and typical backlog of one to three weeks.

In addition, ASPs for high end mass sets are high, meaning a relatively low number of high end owners can have a significant impact on our quarterly revenue and earnings. As we have highlighted previously, our business is influenced by IC and display design activity and to a lesser degree by wafer and panel capacity dynamics. With those qualifications, we expect second quarter revenue to be in the range of $2.00 $8,000,000 to $216,000,000 Based on those revenue expectations in our current operating model, we estimate non GAAP earnings per share for the second quarter to be in the range of $0.44 to $0.5 per diluted share. This equates to an operating margin between 2325%. Given current market conditions in our Q2 outlook, we’re increasingly cautious about 2025.

In order to continue to drive cash flow, we will continue to prudently manage costs. I will now turn the call over to the operator for your questions.

Conference Operator: Thank you. Our first question comes from the line of Tom Diffely with D. H. Davidson. Your line is open.

Tom Diffely, Analyst, D.H. Davidson: Yes, good morning and thank you for letting me ask a few questions here. Maybe first one for you Frank. The outlook is for basically flat quarter over quarter and typically we see roughly 5% increase in the first or the second fiscal quarter, first quarter of the year. So I’m curious, is it really just the mainstream in China that is the weakness? Is it just your ongoing lack of real visibility and conservatism or what’s behind just the flat guidance?

Frank Lee, CEO, Photronics: Thank you, Tom. Business of the very low end of mainstream, mainly from the six inches and eight inches wave effect has been weak and we see no signs of recovery in the near future. And this happens not only in Asia, but also in Europe particularly. So I think this revenue is relatively small in our overall business, but still has some negative impact our revenue and revenue outlook. So I think at this moment, we are cautious.

However, long term outlook, we still believe it’s a positive, and we will continue to focus and leverage our competitive strength on the high end to improve our branded ASP. So I believe Q2 at this moment, our forecast is flat. But I think the overall economic picture remains kind of uncertain. So I believe by the end of Q2, we may have a much clearer picture of fiscal twenty twenty five.

Tom Diffely, Analyst, D.H. Davidson: Okay. That makes sense. If I could just dig in a little deeper on the mainstream business then, obviously over the last few years, the demand levels and the supplydemand equation in mainstream was very beneficial to you. You had nice margin expansion in that space. So just curious, how do you look at the supplydemand equation today in mainstream?

And what are you seeing on from a pricing basis? Is the pricing strength gone away? Are you seeing some weakness quarter over quarter? How would you characterize the mainstream business right now?

Frank Lee, CEO, Photronics: Okay. We keep our pricing firm. We do not lower down our price in the mainstream. However, the overall pie of the mainstream business at this moment seems to be smaller. I believe it’s due to the weakness in automotive and maybe industrial applications.

As I highlight, most eight inches and six inches wafer fab fab utilization are relatively low. So it does have some impact on our low and mainstream business.

Tom Diffely, Analyst, D.H. Davidson: Okay. Maybe just one last question on the mainstream. Are you seeing increased competition from local Chinese suppliers for Photomass?

Frank Lee, CEO, Photronics: Yes. We do see increasing competition. However, our focus in China is on the middle and high end of our in the middle and high side of our high end business, such as 55 nanometer, 40 nanometer, 28 nanometer. So we shift most of our business to these segments such that our branded ASP in China still keep a good and stable high range. So the answer is yes, there are more competition from local Chinese mask makers in the low end of the mainstream, but that is not our focus.

So we are getting to the more profitable and more high priced segment of the business in China.

Tom Diffely, Analyst, D.H. Davidson: Great. I appreciate the extra color there, Frank. Maybe just a quick question for Chris then. Congratulations on the new Gen. Six AMOLED screen.

What were the challenges to get to that larger screen size or panel size?

Chris Progler, CTO, Photronics: Yes. Thanks, Tom. Appreciate it. The specs for the AMOLED mass, which prior to this had been all Gen six, Gen 6.5 are the tightest among our FPD products. So we had to scale those specs up to the much larger substrate size, Gen 8.6.

So it’s kind of spec scaling, uniformity, all the mass parameters had to scale up to those larger substrates, which is quite difficult. The second thing is the integration of the mask onto the blank. We use some advanced, as we mentioned in the comments to the call, some IC like technology in our FPD mask, things that people call phase shift and other things that are common. And IC, we use that in our FPD technology. Scaling that up to Gen 8.6 also was a challenge.

So we met those. We’ve been working on Gen 8.6 scale up by now for almost a year. So we were kind of ready for this and it’s really in good coordination with the customer. We had lots of test masks and pilots ahead. So I would not say we’re struggling with yield or execution or delivery from here.

So as the business grows, we should be able to scale that product line up nicely.

Tom Diffely, Analyst, D.H. Davidson: And how big do you expect that to be inside of your flat panel business over the next few quarters?

Chris Progler, CTO, Photronics: Yes, I don’t think we would prefer not to comment on that. I think just to suffice to say so far it’s been more than a single order and it’s connected with fab project or projects that are production level. So these aren’t we’re not just prototype masks or pilot masks. They were masks used for Prudential (LON:PRU) production of AMOLED for larger format displays, particularly things like laptops. So they are production applications and the fabs they’re going into have the possibility to scale to serious panel production for volume products.

But beyond that, I think it’d be a little too early to put a scale on it.

Tom Diffely, Analyst, D.H. Davidson: Okay. Appreciate it, Chris. And then Eric, looking at the balance sheet, obviously, a really strong cash position. There is going to be $200,000,000 of spending in CapEx this year, but it seems like there’s still plenty of cash for a more aggressive buyback. What is your mindset on buybacks versus I know at one point a year or two ago, you guys had talked about potentially keeping a war chest for acquisitions.

But what is your thought process on the balance sheet right now?

Eric Rivera, CFO, Photronics: Thanks, Tom. So with respect to the balance sheet, our capital allocation strategy really hasn’t changed, which is the first is like three bullet points. The first one being just normal CapEx and the second and third option are toggles, the second one being M and A activities or if there is lack of them, then we would do share repurchases. So during the quarter, we certainly repurchased some shares. And in terms of what do we see going forward, given the current macro economic conditions and the geopolitical environment, at the moment, we are being a little cautious, but we certainly do have we have the war chest as you described it to be able to act quickly if the right opportunity comes along with respect to an M and A transaction.

We’re not going to just go to do an M and A transaction to use up our cash or to purchase kind of buy revenues, if you will. We will only do that if it’s accretive to the company. Likewise, we’ll be aggressive with share repurchases if we see that the environment is favorable to do so at the right time. So this is something that we do look at on a consistent basis. The Board and management team, we are aware obviously of the cash balance that we have and we’re consistently monitoring and looking for the best way to deploy that.

Tom Diffely, Analyst, D.H. Davidson: Great. And what is your current authorization for buybacks?

Eric Rivera, CFO, Photronics: We have $100,000,000 of authorization.

Tom Diffely, Analyst, D.H. Davidson: Okay, great. And then final question overall

Frank Lee, CEO, Photronics: go ahead.

Eric Rivera, CFO, Photronics: I’m sorry, go ahead.

Chris Progler, CTO, Photronics: Well, I was

Tom Diffely, Analyst, D.H. Davidson: just going to say the final question overall is, it looks like node migration getting more business at the 22, 20 eight nanometer node is going to be a big driver over the next year. I’m just kind of curious where anything you can say about your current capacity there and how much capacity you’ll be adding with this $200,000,000 of capital spending this year?

Eric Rivera, CFO, Photronics: Yes. So the capital spending that we have this year would be, as I think we mentioned previously, it’s normal CapEx that we have plus the increase from the normal to $200,000,000 is essentially for The U. S. So in The U. S, we have due to regionalization, we have some more opportunities for revenue and certainly provide some node migration within the mainstream area in The U.

S. And likewise, in Asia, we have our part of our normal CapEx. We have we’re putting point tools wherever we need to in order to enable us to be able to be more effective and efficient in kicking out more production where we have some bottlenecks. And that certainly is aiding our node migration strategy.

Tom Diffely, Analyst, D.H. Davidson: Great. I appreciate the time for all three of you.

Eric Rivera, CFO, Photronics: Of course, Tom. Thank you for asking the questions. Thank you, Tom.

Conference Operator: Please standby for our next question. Our next question comes from the line of Gaussi with Singular Research.

Gaussi, Analyst, Singular Research: Can you guys hear me?

Chris Progler, CTO, Photronics: Yes, we can.

Gaussi, Analyst, Singular Research: Okay. Thanks Ted for including us. Just on the first question is, how much of The U. S. IC capacity coming online in mid-twenty twenty six is kind of on the long term purchase agreements?

What was driving that strong demand? Is that strong demand on U. S. Based AI edge chip customers? And maybe you can quantify the percentage of customer commitments that is tied to the Chip Act versus organic demand?

Eric Rivera, CFO, Photronics: So I’ll take a stab at answering that question. Your question was it very clear for just to be clear, but I think you’re asking about what is it that we’re seeing in The U. S. That’s going to for which we’re doing some CapEx. So I’ll mention that our customers are certainly in The U.

S. Have indicated that they would like us to provide service them here in The U. S. Market essentially. And that is what’s driving our increased CapEx in The U.

S. In terms of whether we have some agreements with them that will secure that,

Eric Rivera, CFO, Photronics: I wouldn’t say we have like

Eric Rivera, CFO, Photronics: a take or pace because we don’t we generally do not have take or pace here in our business at all. But we do have customer commitments and indications of that they would support us in the event that we do this. So that’s typically the level of support that we can get from our customers in our industry. And that’s what we have. And as such, we feel comfortable investing the amount that we’re planning to invest here in The United States.

Does that address your question? And I apologize because it didn’t come through.

Gaussi, Analyst, Singular Research: I was kind of looking forward to see if there’s any what was that part of that expansion that’s kind of tied to the Chip Act versus kind of the organic demand?

Eric Rivera, CFO, Photronics: So that would be organic demand for the most part. With respect to the Chip Act, that’s this is not necessarily contemplated in this CapEx at this time.

Chris Progler, CTO, Photronics: Okay. Yes. If the question is how much of the capacity we’re putting in particular in The U. S. Are linked to customers that are getting funding through the CHIPS Act.

It’s not a significant bar. Most of the projects we’re tracking in The States are projects that we believe would proceed with or without CHIPS funding. So we don’t see a lot of, let’s say, risk in the ones that we are tracking that are connected to those customers getting chips funding. We also, as we reported, applied for chips funding under the second NOFO, the small supplier NOFO. Our applications are still under consideration.

But the current investments we’re contemplating and talking about here are being done separate and apart from what we’d invest additionally with the chips opportunity.

Gaussi, Analyst, Singular Research: Got you. And in terms of the mode migration to ’22, ’20 ’8, how much of that demand do you think is going to is that how is the 14 millimeters and the EUV compatible mask trending, are you seeing any increased traction or increase from the AI designs of peripheral chips to customers?

Chris Progler, CTO, Photronics: So we see mostly AI driven business for us. We see mostly adjacent or second order effects from AI. So, and we I would say we see some of that in different regions around the world. These are support chips for the AI ecosystem, designs of new chips for edge devices and things like that, that can take advantage of the AI ecosystem. I think we are definitely seeing some pull from those applications.

We not really appropriate to quantify it, but it is a positive trend. On the memory side, we mentioned that memory is relatively small part of our IC business, but it was one of the stronger growing segments. That is connected also to AI demand and cloud demand and that sort of thing. So we’re definitely seeing a lift from that application driver and we expect that to continue to grow as we look ahead in future quarters and years.

Gaussi, Analyst, Singular Research: So post 2026, as the full capacity of your CapEx comes into line, do you have an idea of what percentage of the high end IC revenue might be tied to supporting that AI infrastructure?

Chris Progler, CTO, Photronics: Yes, I don’t think we would say, what percent of our high end revenue at that time would be AI driven. So it’s difficult to say. I mean, I think it will be a significant part, but we probably would not be wise to put a specific percent on it at this point.

Gaussi, Analyst, Singular Research: Okay. In terms of auto industry, auto and industrial softness, it’s kind of restocking on new design wins in these sectors for your mainstream?

Chris Progler, CTO, Photronics: I mean, I can make another comment on that, maybe Frank or Eric can follow-up. But I would say it still looks fairly weak in that market, the automotive market. Units are down and there is some ASP pressures because the end users are struggling, so that always drives some ASP pressures. And I would say at the moment, we don’t see significant uptick. Maybe we’d say some stabilization is not dropping significantly from where it is.

But as far as a big turnaround in the automotive sector, I don’t believe we’re really seeing it at this point. In China, and Frank could probably comment further, there is more activity going on in automotive design. Some portion of that is government backed and government funded, but still the supply demand situation is not really healthy also in China on the automotive side.

Frank Lee, CEO, Photronics: Yes, correct.

Frank Lee, CEO, Photronics: We see the design activity seems to decrease in these two segments at this moment. So I believe the end product business softness impact the new chip design. Okay.

Gaussi, Analyst, Singular Research: In terms of geographic mix for driving H2, how are you guys thinking about the tariffs, the subsidies impacting regional pricing?

Eric Rivera, CFO, Photronics: I’m sorry, if you don’t mind repeating the question, I’m not sure it came through.

Gaussi, Analyst, Singular Research: In terms of how as we think about H2 of twenty twenty five and the geographic mix, how do you look at the geopolitical landscape and how does that impact the regional price use?

Frank Lee, CEO, Photronics: I see. So thanks again

Chris Progler, CTO, Photronics: for the question for repeating

Eric Rivera, CFO, Photronics: the question actually. So given the current macro and geopolitical conditions, actually we’re increasingly cautious. So we don’t have a great visibility at the moment of how the second half is going to be. We expect to have a better picture in Q2, but the question is a great one. It’s just that the current environment doesn’t allow us to see what that is at the moment.

Gaussi, Analyst, Singular Research: Okay. And will as we model for fiscal twenty twenty five, are we looking at R and D costs declining as the project qualifications kind of taper off?

Eric Rivera, CFO, Photronics: I think I would best describe it as probably I mean, that’s we don’t have a great picture, as I mentioned right now, as how the second half is going to be. But at the moment, if I just were to comment what we see in the moment, we definitely don’t see it increasing. So I think if you take that position of at least stable, that would be the best thing I can give you a comment on. And in the past, our with respect to OpEx, we do expect OpEx to be about 10% of of revenue going forward. That’s our target.

Gaussi, Analyst, Singular Research: Right. And

Frank Lee, CEO, Photronics: just to add that to that,

Chris Progler, CTO, Photronics: I think Just generally on the qualification side, just to make a comment, the goal of course is as we complete one set of qualifications, start new ones after those. So I agree just supporting and seconding Eric’s comment. I think steady state sort of picture is probably pretty good way to look at the R and D. Okay.

Gaussi, Analyst, Singular Research: And in terms of outlook, what would you say were your top two risks for 2025? Is it the macro demand, the geopolitical tensions or customer delays? Do you want to quantify it?

Eric Rivera, CFO, Photronics: Yes, I would say I think you hit them all. But to answer your question, the top two, I would say the macroeconomic and the geopolitical.

Chris Progler, CTO, Photronics: Okay.

Gaussi, Analyst, Singular Research: That’s all I had. Thank you guys for taking my questions and good luck. Of course. Thank you. Thank

Conference Operator: you. Ladies and gentlemen, I’m showing no further questions in the queue. I would now like to turn the call back over to Tay for closing remarks.

Ted Moreau, Investor Relations, Photronics: Thank you, Jawanda, and thank you everyone for joining us today. We appreciate your interest in Portronics. We look forward to catching up with everyone over the coming days and weeks. Have a great day.

Conference Operator: Ladies and gentlemen, that concludes today’s conference call. Thank you for your participation. You may now disconnect.

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