Cohu Reports 36.9% Revenue Decline and $69.8 Million Net Loss for Fiscal Year 2024

Cohu, Inc. reported a significant decline in its financial performance for the fiscal year ending December 28, 2024, with net sales dropping 36.9% to $401.8 million, down from $636.3 million in the previous year. The decrease in revenue was attributed to lower demand in key markets, including automotive, industrial, and mobile applications, driven by global macroeconomic conditions. The company also recorded a net loss of $69.8 million, compared to a net income of $28.2 million in fiscal 2023. This downturn reflects the ongoing challenges faced by the semiconductor industry, including reduced capital expenditures and inventory management issues.

Cohu's gross margin decreased to 44.9% from 47.6% in the prior year, primarily due to lower business volume impacting fixed cost leverage. The company incurred approximately $5.4 million in charges related to excess and obsolete inventory during fiscal 2024, compared to $4.5 million in the previous year. Research and development expenses were $84.8 million, representing 21.1% of net sales, a decrease from $88.6 million or 13.9% of net sales in fiscal 2023. Selling, general, and administrative expenses also saw a slight reduction, totaling $128.0 million, down from $132.2 million in the prior year.

Strategically, Cohu has made several acquisitions to enhance its product offerings. In January 2023, the company acquired MCT Worldwide, a provider of automated solutions for the semiconductor industry, and in October 2023, it acquired Equiptest Engineering Pte. Ltd., which specializes in semiconductor test contactors. These acquisitions are expected to contribute to Cohu's growth by expanding its capabilities in the semiconductor test and inspection market. Additionally, on January 7, 2025, Cohu completed the acquisition of Tignis, Inc., a company focused on artificial intelligence process control and analytics-based monitoring software, further enhancing its analytics offerings.

Operationally, Cohu's employee headcount stood at approximately 3,024 as of December 28, 2024, with a significant portion of its workforce located in Asia. The company reported a backlog of unfilled orders amounting to $138.0 million at the end of the fiscal year, a decrease from $160.4 million at the end of fiscal 2023. Cohu's international sales accounted for 86% of total revenues, highlighting its global presence in the semiconductor market. The company continues to focus on innovation and customer engagement, aiming to capture new opportunities despite the current industry challenges.

Looking ahead, Cohu remains optimistic about its long-term prospects, driven by the increasing demand for semiconductors across various sectors, including automotive and artificial intelligence. The company plans to continue investing in research and development while managing costs effectively to navigate the cyclical nature of the semiconductor equipment industry. Cohu's management has indicated that they will maintain a focus on strategic acquisitions and operational efficiencies to enhance their competitive position in the market.