Photronics Down 10% After Q2, CEO Cautions Slower Recovery In Order Rate, Taiwan Earthquakes

Zinger Key Points
  • Photronics reports Q2 earnings miss with adjusted EPS of 46 cents and revenues of $217M, down 5% YoY.
  • CEO highlights slower recovery in order rates post Lunar New Year and Taiwan earthquakes impacting production, causing $3M revenue impact.

Photronics, Inc. PLAB shares are trading lower on Wednesday.

The company reported second-quarter adjusted earnings per share of 46 cents, missing the Wall Street view of 55 cents. 

Photronics reported quarterly revenues of $217.0 million, down 5% year-over-year. Sales missed the analyst consensus of $231 million.

“Order rates, which typically pause during Lunar New Year, have recovered at a slower rate than we typically observe,” flagged  Frank Lee, chief executive officer. 

IC revenue was $160.9 million, down 4% year-over-year. FPD revenue was $56.1 million, down 10% from the same quarter last year.

“In addition, the recent earthquakes in Taiwan caused a loss of production across both IC and FPD, resulting in an approximately $3 million revenue impact,” Lee added.

Photronics said that cash generated from operating activities was $76.5 million in the quarter under review, and cash invested in organic growth through capital expenditures was $20.0 million.

The company’s cash balance at the end of the quarter was $539.2 million, with $20.7 million in short-term investments and $21.8 million in debt.

Outlook: For the third quarter, Photronics expects revenue to be between $221 million and $229 million (estimate: $240 million).

The company expects adjusted earnings per share between $0.53 and $0.59 (estimate: $0.58).

Price Action: PLAB shares are trading lower by 9.24% to $25.65 at last check Wednesday. 

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