| From: slacker711 | 8/26/2021 7:43:47 AM | | | | | | onsemi buying GTAT for $415 million.
I think they needed to accelerate their internal supply. First 150mm boules in Q4 '22 and 200mm in Q4 '24 was both an unrealistic schedule and yet still not fast enough.
It is hard to evaluate GTAT. Their history makes me skeptical but they had won contracts with both onsemi and Infineon.
s27.q4cdn.com
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| To: EvanG who wrote (10418) | 8/26/2021 9:52:09 AM | | From: slacker711 | | | | With most of growth in 2nd half, was expecting Cree guidance to be stronger because of that. The part of Malaysia that was locked down, was down for a good portion of July so perhaps that explains it.
They said that Malaysia was a $5-$7m impact in the guidance for the current quarter.
They didn't break out how much of the >$100m in unfulfilled demand for the fiscal year was going to be left on the table for the current quarter. Presumably, that number will ramp through the fiscal year before the Mohawk ramp starts to be felt in the 2nd half of calendar '22.
Maybe they could have given guidance for ~$170m without the supply issues?
Regardless though, the STM numbers likely indicate that they are ramping some internal supply in the 2nd half. We'll see whether they break out any numbers going forward. |
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| To: slacker711 who wrote (10420) | 8/27/2021 9:40:08 AM | | From: EvanG | | | | They didn't break out how much of the >$100m in unfulfilled demand for the fiscal year was going to be left on the table for the current quarter. Presumably, that number will ramp through the fiscal year before the Mohawk ramp starts to be felt in the 2nd half of calendar '22.
It is very much a mystery to me why Wolfspeed revenue did what it did over the last 2.5 years. Yole is confused enough that they think Cree power device revenue was flat from 2019 to 2020. So how 2 quarters later it suddenly became capacity constrained doesn't make sense. Guessing it really isn't, they just don't want high expectations out of Durham.
Personally I hate watching fab startups, seems like they always take much longer than anticipated. Don't know if I have seen one of these take less than a year to be automotive certified but not sure when the process would have started. |
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| To: EvanG who wrote (10421) | 8/27/2021 12:43:45 PM | | From: slacker711 | | | | My theory has been that RF revs fell off a cliff but they rarely talk about RF anymore (including the LDMOS revs) so it is impossible to say if this was the case.
The underlying problem is that Cree still doesn't break out the revenues within Wolfspeed. It is absurd that they have a single division and give total group revenues without giving the split between materials and devices. |
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| To: Lou Weed who wrote (10423) | 8/27/2021 5:05:12 PM | | From: EvanG | | | | Best guesstimates would be 45/30/25 split Materials/RF/Power?
From the 4Q21 call:
I would anticipate to Jed -- Ed, I'm sorry is that when we look at our plans for 2024 at $1.5 billion we were projecting that roughly $600 million of that was going to be devices.
And about $900 million of that was going -- excuse me $600 million was going to be materials and $900 million was going to be devices. Actually we are anticipating that our device business will be growing faster than the materials business through that timeframe of 2024. And it will most likely accelerate as a percentage of the business beyond 2024 as we start seeing customer ramp with the you know the $1 billion of device wins that we just posted this first previous quarter.
$600 million in materials out of $1.5 billion would be 40%. If the device business is growing faster than materials through 2024, then it would seem materials might be much larger than 45% currently. |
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| To: EvanG who wrote (10418) | 8/28/2021 12:35:25 PM | | From: slacker711 | | | | A partial answer to your question about revenues from the 10k. Revenue from STM barely grew in FY '21 ($89.3m to $94.6m) STM signed a deal with SiCrystal (Rohm) in Jan. 2020 so perhaps we are seeing the impact of that in FY '21?
I'm going to try and dig up some more details about the revenue splits this weekend.
sec.gov
Customers
We have a small number of customers who represent more than 10% of our consolidated revenue. ST Microelectronics, Inc. (ST Microelectronics) accounted for 18%, 19% and 11% of our total consolidated revenue from continuing operations in fiscal 2021, 2020 and 2019, respectively. Sumitomo Corporation (Sumitomo) accounted for 10%, 14% and 14% of our total consolidated revenue from continuing operations in fiscal 2021, 2020 and 2019, respectively. Additionally, Arrow Electronics, Inc. accounted for 13% and 14% of our total consolidated revenue from continuing operations in fiscal 2021 and 2019, respectively. For further discussion regarding customer concentration, please see Note 16, “Concentrations of Risk,” in our consolidated financial statements included in Item 8 of this Annual Report. The loss of any large customer could have a material adverse effect on our business and results of operations.
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| To: slacker711 who wrote (10426) | 8/31/2021 7:09:32 AM | | From: slacker711 | | | | Transcripts are great, but I finally did something I should have done a while ago....took notes on some earnings calls.
I really wanted to get a better understanding of what has been driving the recent margin and revenue trends. Unfortunately, it is still hard to parse the various pieces of color commentary that they have given over the last year or so.
For example, they said during the Q4 2020 earnings (last August) that materials made up half of revs. Unfortunately, they didn't specify whether they were talking about the whole fiscal year or the last fiscal quarter. Since that earnings call, materials revenues have grown "modestly" each quarter while device revs have seen substantial growth.
If materials were half of revs in Q4 2020, then they would be substantially less than that today. OTOH, that wouldn't be true if materials were half of revs for all of 2020. The last two fiscal quarters were impacted by COVID so it is really tough to parse the statements around those particular quarters.
One thing I am fairly certain of, they have substantial amounts of excess capacity for materials right now. |
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| To: slacker711 who wrote (10427) | 8/31/2021 7:11:07 AM | | From: slacker711 | | | | Cree Q4 July 2020
Wolfspeed $108m revenue
RF “some improved performance”
Early signs of strengthening demand in RF and power
Materials declined as expected. Unable to ship to one customer (STM?)
GM of 35.3% driven by COVID costs
$400m of capex in 2021. Expect ‘21 to be peak.
Guidance of $107-$117m GM’s of 35.5 to 37.5%
150mm MOSFET yields still below expected levels
$600m in design awards
Opportunity pipeline is “well above” $10 billion
Delphi win expected to ramp between ‘22 and ‘23
Q&A
Device side saw strong demand, particularly for power
Materials side slower demand. Expect “modest improvements” through end of ‘20. More substantial in ‘21
Outsourcing LED SiC operations and moving capacity to wolfspeed. Increased capacity “into FY ‘22”. Presumably devices.
Materials expansion linear growth.
Capex in ‘21 could be higher but then ‘22 would decline.
No shipments to Huawei and no revs in device guidance. Maybe small material revs could be impacted going forward.
Repurposing Huawei technology for other customers.
Snyder question. Management used to say ? GaN ? SiC ? materials.
Last several years materials growing faster than devices.
Right zip code with materials “roughly half” of Wolfspeed.
Power fastest growing through ‘24
Some RF design wins during quarter.
Normalized Wolfspeed margins ~40%, 50% once you get to MVF |
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