0522.HK FY2026 Q1 Earnings Call Transcript
Date: 2026-04-22
Source: Financial Modeling Prep

Benjamin Poh: Good morning, ladies and gentlemen. I'm Ben Poh, Head of Investor Relations. And today, I will be moderating the call. On behalf of ASMPT Limited, welcome to our First Quarter 2026 Investor Conference Call. Thank you all for your interest and continued support. [Operator Instructions] Before we start, let me go through our disclaimers. Please note that there may be forward-looking statements about the company's business and finances during this call. Such forward-looking statements could involve known and unknown uncertainties and risks that could cause actual results, performance and events to differ materially from those expressed or implied during this conference call. For your reference, the Investor Relations presentation on our recent results is available on our website. On today's call, we have the Group Chief Executive Officer, Mr. Robin Ng; and the Group Chief Financial Officer, Ms. Katie Xu. Robin will cover the group's key highlights for the first quarter 2026 and provide outlook and guidance for the following quarter. Katie will provide details on the financial performance for the quarter. Now I will hand the time over to our Group Chief Executive Officer, Robin.
Cher Ng: Thank you, Ben. Good morning and good afternoon and good evening to all. Thank you for joining us today for our first quarter 2026 earnings conference call. Now let me start with the key business highlights for Q1. This quarter, I'm pleased to share that ASMPT achieved the highest quarterly bookings and billings in the last few years. We continue to see AI drive demand across multiple products as the rapid evolution of AI increases the value and complexity of back-end semiconductor manufacturing. New AI architectures demand heterogeneous integration, tighter interconnect pitch, higher bandwidth and power efficiency. And these requirements are driving higher precision, alignment and process control needs across packaging flows, benefiting a wide range of the group's product from TCB photonics, CPO, flip chip and mainstream volume and die bonding and pick-and-place solutions. Let me provide some color on these specific product areas. First, let's look at TCB. In Logic, we delivered sizable shipments for chip-to-substrate applications, reinforcing our leadership in chip-to-substrate TCB. We received bookings for 4 ultra-fine-pitch chip-to-wafer TCB tools, featuring our fluxless plasma-based AOR technology from a leading advanced logic customer. We are also actively engaging key logic players across multiple programs, and we are well positioned for more opportunities as the industry advances towards more complex logic chip architectures. In memory, our TCB tools remain at the forefront of technology development. A key memory player is using a flux-based TCB tool for assembly and this customer is also qualifying a Fluxless AOR solution for HBM4 16-high. Next, we'd like to share an update on Photonics. I'm pleased to report that our Photonics revenue grew nearly fivefold year-on-year, benefiting from strong demand for high-speed optical transceivers of 800G and above. In addition, our 1.6T transceiver solution received bulk orders from leading optics suppliers in the data center networking supply chain. This demonstrates strong traction for our optical transceiver solution as the market leader. I would like now to touch a bit on co-packaged optics or CPO before we move on to the next item. CPO represents a paradigm shift in AI system design, bringing optical engines closer to compute silicon to reduce electrical losses, lower power consumption and improved system efficiency. Our CPO solutions enable high precision bonding to integrate diverse components, including fiber array unit, microlens, electronic IC and photonic IC into a single high-performance optical engine. We have deepened our engagement with multiple leading global players and this positions the group well to gain market share as CPO adoption accelerates. Looking now at our flip-chip solutions. I'm pleased to update that they registered strong bookings growth, both Q-on-Q and year-on-year. This momentum is coming from two areas. First, there is an accelerated adoption of 2.5D packaging for larger AI package sizes that is driving a steady pipeline of opportunities for embedded bridge die-bonding solutions for both chip-on-wafer and chip-on-panel solutions. Second, we also gained traction in panel level fan-out for radio frequency and power devices. Both these areas are well solved by our flip chip solutions, which combine cost efficiency, scalability, high placement accuracy and strong throughput. And finally, in our mainstream business, we registered strong bookings for both SEMI and SMT. SEMI's mainstream business benefited from sustained utilization at leading global IDMs and OSATs alongside rising demand for AI data center power management solutions. In China, there was increased demand for wire and die bonding applications. For SMT, we achieved record booking gains in driven by strong customer demand across AI servers, optical transceivers and China EVs. In particular, SMT's high-flex high-force solutions for large format boards are a leading choice for AI server assembly. As we broaden our AI customer base, we are fully committed to delivering the highest quality of solutions and services. ASMPT was recently recognized with a prestigious Intel Epic Supplier Award for 2026, the highest supplier recognition award for excellence in business collaboration. This is a reflection of our strong technical capability and deep engagement with our customers. With these highlights, now let me hand over the time to Katie, who will walk you through our group and segment financial performance.
Yifan Xu: Thank you, Robin. Good morning, and good evening, everyone. Before I start, I would like to say that unless otherwise specified, the numbers I'll be referring to today are for the group's continuing operations only, with adjustments made on the non-HKFRS measures. This slide covers our group financial results for Q1 2026. In Q1, the group delivered revenue of USD 507.9 million flat Q-on-Q, but up 32.0% year-on-year, driven by SMT and SEMI. Group revenue came in above market consensus and was the highest in the last 3 years. Group quarterly bookings exceeded expectations with SMT bookings at a record level. Group's booking reached USD 727.0 million, up 46.0% Q-on-Q and 71.6% year-on-year, the highest in the last 4 years. This strong growth came from multiple products, notably SMT products, wire bonders and die bonders and photonics. Group adjusted gross margin was 39.5% Q-on-Q, up 357 basis points due to higher gross margin and revenue contribution from SEMI. The year-on-year decline of 151 basis points was due to a higher revenue contribution from SMT. Group's adjusted OpEx declined 4.6% Q-on-Q but increased 12.4% year-on-year, largely due to unfavorable FX impact and from strategic infrastructure and R&D investments as we have guided for 2026 during our last earnings call. Both adjusted operating profit and adjusted net profit improved Q-on-Q and year-on-year due to higher revenue and operating leverage. Adjusted EPS was at HKD 0.81, up 118.9% Q-on-Q and 189.3% year-on-year, which was above market consensus. Moving on to the Semiconductor Solutions segment. In Q1, SEMI revenue delivered USD 274.5 million, up 12.2% Q-on-Q and 14.6% year-on-year. Q-on-Q, growth was driven by high-end die bonders and TCB, while year-on-year growth came in from multiple products, largely driven by AI-related applications. SEMI bookings were USD 309.6 million, up 22.6% Q-on-Q and 43.2% year-on-year due to higher demand for wire bonders and die bonders driven by China OSATs, high-end smartphone-related applications AI-related power management applications and optical transceivers. SEMI achieved a book-to-bill ratio of 1.13, which marks 3 consecutive quarters of improvement. SEMI adjusted gross margin reached 46.4%, achieving the guidance we set last quarter. Adjusted gross margin improved by 594 basis points Q-on-Q but declined slightly by 37 basis points year-on-year. The significant Q-on-Q improvement was mainly driven by high volume and favorable product mix. SEMI adjusted segment profit was HKD 309.4 million, up 165.9% Q-on-Q and 16.8% year-on-year. The strong Q-on-Q improvement was mainly driven by higher gross margins and operating leverage. Let me move to SMT. SMT Q1 revenue was USD 233.5 million, down 11.0% Q-on-Q but up 60.7% year-on-year. Q-on-Q decline was due to seasonality, while year-on-year increase was due to strong demand from AI servers and China EVs. As mentioned earlier, SMT achieved a record bookings of USD 417.4 million, up 70.0% Q-on-Q and 101.1% year-on-year. This was primarily driven by strong demand from AI servers, optical transceivers and China EVs together with robust China demand arising from global data center expansion. SMT adjusted segment profit was HKD 141.8 million, down 28.3% Q-on-Q due to lower volume, but it improved year-on-year. Now let me hand the time back to Robin for the outlook and the revenue guidance.
Cher Ng: Let me present our Q2 2026 revenue guidance. The group expects Q2 2026 revenue to be in the range of USD 540 million and USD 600 million. At the midpoint of USD 570 million, this represents an increase of 12.2% Q-on-Q and 37.0% year-on-year. Notably, our midpoint revenue guidance exceeds current market consensus, and it will be mainly driven by SEMI. Group bookings in Q2 2026 are expected to remain elevated for both segments, though SMT will be down Q-on-Q due to the high base effect from Q1. The continued proliferation of AI expected to drive structural demand growth for both SEMI and SMT in 2026 across multiple products. This includes our flagship TCB and HP solutions, photonics and CPO to mainstream wire and die bonding and pick-and-place solutions that enable AI infrastructure deployment. Looking ahead, structural AI-driven demand is expected to support revenue growth across both SEMI and SMT in 2026. This concludes our first quarter 2026 presentation. Thank you, and we are now ready for Q&A. Let me pass the time back to Ben to facilitate.
Benjamin Poh: [Operator Instructions] And I see a raised hand from Gokul of JPM.
Gokul Hariharan: Great results, and also thanks, Robin, for your amazing leadership over the years. So first question is on memory TCB. What are we seeing in terms of bookings and potential for bulk orders for memory TCB given that we haven't really seen any big bulk orders in the last maybe couple of quarters now. And at the same time, the R&D progress seems to be quite good on both flux-based and fluxless. And in addition to that, could you also talk a little bit about your engagement with the bigger memory vendor that the market is talking about, which has largely been using internal TCB tools? Do you see that there is an opportunity opening up with this customer, which will definitely expand your addressable market?
Cher Ng: Thank you, Gokul. I think there are a number of questions within your questions. Let me address I think the first one first. You're asking about memory TCB bookings and potential for bulk orders for TCB and in the last few quarters. The last bulk order that we received was in Q4 2025. We're still confident that we are well placed to -- well positioned to receive orders from memory makers as far as they are ready to dish out orders for equipment supply ourselves. Now I think your second question is on fluxless, R&D fluxless, how is it going. I think we are making good progress, especially on the logic side, as we have mentioned, we have won 4 tools in Q1 for CoW fluxless applications. We believe this is a start of this particularly exciting program. I think as the industry continue to migrate to more complicated GPU or even ASIC architecture, I think at some point, they may have to switch to a chiplet kind of configuration rather than using SoC, and that's where the opportunity to use our TCB fluxless tool for chip-on-wafer application will be there. So since now that we are already in that supply chain, I think, again, I think we are really well positioned to capture more opportunities for CoW fluxless application going forward. I believe your third question relates about the biggest memory player who is used to using internal TCB tools. Yes, I think we are unable to really name or confirm any specific collaboration with any customer, I hope you understand. What I can say that in the process of finalizing an evaluation program with a key memory player. We definitely see this as a positive step, possibly in the future, enabling our group's technology from memory as a process standard in the future. So we are excited about this potential collaboration going forward.
Yifan Xu: Gokul, very quick. Just going back to the question on the memory TCB bulk order. I just want to -- probably to say that we want to reiterate, right? Our TAM forecast is actually of the $1.6 billion is intact. And you're probably reference into some of the recent adjustments for the next generation of GPU HBM4 road maps. They are leading to some -- maybe quarter-to-quarter, there might be some variability in the times of a customer's decision. But our activity level remains very healthy, but it could be uneven from quarter-to-quarter.
Gokul Hariharan: Got it. That's very clear. Second question I have is on your photonics, obviously, very strong growth, 5x kind of growth. Could you help us size the like photonics business, I think you've said it long back that it was probably under $100 million annual run rate ballpark? Or is this still -- is now much bigger than that?
Cher Ng: Yes. I think, Gokul, you...
Gokul Hariharan: When we transitioned?
Cher Ng: Yes. Maybe answer the photonics first, Gokul.
Gokul Hariharan: Well, go ahead, Robin. I'll follow up later.
Cher Ng: Yes. There's a little bit of feedback on this.
Benjamin Poh: Yes. Your line is breaking up, actually, Gokul.
Cher Ng: Okay. Anyway, I'll answer the Photonics question first Gokul. Yes, Indeed, when we look back in a deep dive into the photonics and the CPO market recently, actually, the TAM looks even more promising than before. right? So -- but we are not ready to disclose the TAM at this point in time. But I can tell you the TAM looks bigger than before. So when we combine the optical transceiver TAM and the CPO TAM, I must say that the TAM looks interesting. We are definitely paying a lot of attention in this area. And fortunately, I think for photonics, we are already a very strong player in the optical transceiver market. And I think for the CPO, you probably will follow up with your question on CPO as well. I think we're well positioned with some key players already. Our solutions, I would say, have been designed in with a number of key CPO players. So when the adoption takes place, I think we're in a good position to capitalize this opportunity for CPO. Maybe back to you for second question, please.
Gokul Hariharan: Yes. So I think just to follow up on that CPO comment, Robin, the market understanding, obviously, is that hybrid bonding plays an important role in CPO for the EIC, PIC attach. And obviously, your hybrid bonder is still in qualification, especially the second generation. So could you talk a little bit about the progress there? And maybe also help clarify. I think there are multiple die attach steps, not just hybrid bonding, I think beyond that as well. So I just wanted to understand like what is the span of like SMT's involvement when it comes to CPO, just beyond the EIC, PIC attach?
Cher Ng: That's right. I think we also said in the MD&A, we are participating in several key high-precision bonding areas for CPO, one of which is FAU attach on PIC. The other one is what you mentioned, stacking EIC on PIC. The third application we can think of is micro lens attached on PIC and also finally, the whole optical engine on the substrate. So we have solutions actually for all these key bonding solutions. That's why we feel particularly quite excited about the CPO market. And as I said earlier, I think the TAM looks interesting, maybe not in the initial years. But I think the CPO will accelerate probably from '28 onwards, and the TAM in fact, looks very interesting for CPO. So these are the areas we are participating. Now back to your question on EIC on PIC, hybrid bonding is one solution. I think CPO players are also exploring whether they can use TCB for the application as well. So if they use PCB, that will be also very an interesting market segment for us.
Benjamin Poh: I'm seeing a next raised from Daisy. Daisy, could you please unmute yourself and raise question?
Daisy Dai: Yes. And my first question is regarding the OSAT CapEx. So we saw that the OSAT CapEx is getting higher and higher for this year. So which area do you expect to record the highest growth for the year based on the current order visibility? And I mean the regions. And also, China is the largest revenue contributor last year around 41% of your total revenue. Within China, do you see that still advanced packaging, I mean your TCB and other hybrid bonding tools growth, outgrow the mainstream or mainstream for this year is also very strong. That's my first question.
Cher Ng: Thank you, Daisy. In terms of -- I think your first question first in terms of OSAT CapEx yes, in fact, we are experiencing strong demand, I would say, on the OSAT front, mainly coming from wire bond die bond because of the AI demand for infrastructure. I think we have been talking about this for a few quarters already, but in Q1, the demand is particularly very strong. What is driving this is really power applications that go into data center. So this require new power devices and because of that new capacity is required. So that's driving a lot of our wire bond and die bond and also not forgetting SMT as well. We mentioned that SMT had a very fantastic booking in Q1 highest so far in history, largely also driven by AI server boards. And in there, there are a lot of power packages using tools from SiP, tools from SMT as well. So all this infrastructure deployment and spending are driving a lot of our mainstream tools, both in SEMI as well as in SMT. Now I think your second question is about China, whether China region, whether AP grow, is it faster than mainstream or mainstream is still very strong. I think typically, in China, say especially on the SEMI side, the mainstream side are definitely stronger than the AP side. However, on the SMT side, in the rest of the region, still stronger than the China side. So there's a mix in terms of China demand coming from SEMI and SMT segment.
Daisy Dai: And my second question is also regarding the optics, photonics solution. So you mentioned that the revenue delivered fivefold increase year-on-year this quarter. And may I ask why we suddenly saw a very strong pickup in this segment. And I believe you mentioned that regarding the booking, the photonic solutions is both in your SEMI solutions segment and SMT segment. May I ask what tools for the SMT and what tools within the SEMI solution?
Cher Ng: Yes. I think it's really all AI-driven, data center driven, as you can imagine, as the industry continued to increase the silicon compute, the transmission side has to match that capability as well. So that drives a lot of growth presently in terms of optical transceivers and the industry is moving from 400G to 800G to 1.6T, and we have a very, very good solution for optical transceivers. This segment has been seeing steady growth for a few quarters already. We have been reporting there. So it's nothing new to us. We have been saying that optical transceiver is a good market for us. We have been quite dominant in that space. We've been winning market share as well. So that's something that we are experiencing from many quarters already in terms of photonics. Now your second question is for -- both segments indeed are participating in this area. Now for SMT, mentioned in the optical transceiver there are many, many components, some require higher precision than others. So for those components that require higher precision bonding. They use our SEMI tools for that purpose. For those that do not require a lot of precision they use our SMT pick and place tool to bond those components. So both segment SMT and SEMI are actually benefiting from this surge in demand for optical transceivers.
Benjamin Poh: Yes. Next, I will request Kevin from Citi to unmute.
Kevin Chen: So I have two questions. Number one is that I would like to get some more detail on the booking guidance outlook. As you see right now, our booking is back to -- especially like SMT back to a record level. So can we get for the coming quarters, do we see -- have a rough sense of breakdown for booking into the, say, SEMI and SMT and specifically, which region are we seeing the most growth from. And also, last time we mentioned we're seeing some improving visibility. Is this still the case so that right now, approximately how many months of visibility do we have right now? .
Cher Ng: Thanks, Kevin, for the question. Now I think you're referring to Q2 bookings. Now we -- as you know, we don't really guide but we can definitely give you some color we see bookings in Q2 this quarter to remain elevated. Booking may, however, moderate Q-on-Q but still expected to grow strongly on a year-on-year basis. We believe in large part, we continue to benefit from the secular demand for AI-related applications. And in the infrastructure spending, plus, of course, overall improving market condition as a whole. Giving a little bit of color as to the or the segment booking. Now for SEMI, Q2 SEMI bookings are expected to increase Q-on-Q and more significantly higher on a year-on-year basis. However, for SMT bookings are likely to decrease Q-on-Q due to high base effect as we have reported, Q1 booking for SMT was at a record high. So we don't expect the current level to continue on a Q-on-Q basis. However, having said that, SMT bookings are also expected to be higher on a year-on-year basis. Now you asked about visibility. Looking ahead, while we are definitely more optimistic about business compared to some quarters back, there is less visibility for the second half of 2026 for the whole group. I think this is pretty normal for a business that we can't really look too far away. So I hope I answered your question, Kevin.
Yifan Xu: Yes. Maybe real quick, I think Kevin was asking about the booking by region. And Kevin, we actually sort of answered it already when we were talking about -- when Robin was addressing Daisy's question. Since overall, the regional mix will stay relatively stable. But like what Robin was mentioning about the strength of China OSATs. So there will be a little bit more booking from China. But overall, it's quite steady.
Kevin Chen: Great. My second question is on the EMIB outlook. I think recently, there has been some demand pickup on this technology. I'm just wondering what type of or tools are addressing this kind of demand? And also our position to the share allocation in this type of technology. Do we need a special type of TCB and that require customization as well?
Cher Ng: Yes. I think, Kevin, I can't hear you properly. I think you mentioned EMIB-T right? .
Kevin Chen: Yes.
Cher Ng: Okay. So A couple of layers we have to understand on the EMIB-T program. If you are talking about embedded die bonding, we believe this is on a large substrate, probably 510 x 500. Unfortunately, TCB, we are not ready for that yet in terms of that kind of panel size because it will take some time for us to deliver a tool of that size for TCB. But however, if this EMIB program takes off and we believe it will, we are already -- this particular customer is really using our tool for CoW application. So do you have to -- I mean, if this program proliferates, right? So they will probably need also more tools to place a lot more components on the EMIB-T substrate. So I think I think we will benefit from that particular area that means on the CoW tools, which we're already in. But if you're talking about embedded die bonding for the EMIB-T, we are not there yet.
Benjamin Poh: Next, I will move to Sunny. Sunny, could you please unmute and raise your question?
Sunny Lin: Hello. Could you hear me okay?
Cher Ng: Yes. Very well.
Sunny Lin: Congrats on the very good results and thank you, Robin, for all your leadership over the years. And so my first question is on your opportunity on the logic, especially on chip-on-wafer. And so Robin, earlier, you mentioned the chip-on-wafer migration for TCB could be somewhat related to chiplet. That was a bit surprising to me because I always think that the chip-on-wafer migration for TCB should be related to larger package. And so how should we think about from here? You just secured 4 tools from a leading-edge foundry customer. How aggressive are they in migrating to TCB for chip-on-wafer from here? How should we think about when you may get another bulk orders? Would that be in second half? Or will you need to wait until maybe 2027?
Cher Ng: Okay. Thanks, Sunny, for your question. Now when we -- when I mentioned about chiplet, between chiplet and SoC, when the GPU architecture is using SoC, there is less need to use TCB to place the SOC onto the interposer because you don't need that kind of precision. But when you try to -- when you go into SOIC kind of packaging, you need more precision to put those chips onto an interposer. So that's why TCB will be needed going forward. So I think as the industry migrates from an SoC structure to an SOIC structure, we see increasing use of TCB for that application. So however, having said that, we have been telling you guys that for 2026, the number of tools for CoW will not be significant because it all depends on the migration to the next chip architecture. So we believe '26 will not be high for CoW. But going forward in the years to come, I think there's a meaningful TAM over there for CoW application for logic. Now how aggressive is this migrating to CoW? Yes, I think I already answered your second question as well. So '26 will not be high, but '27 would be meaningful.
Sunny Lin: Also, if I may follow up on my first question. Also, these leading-edge logic customer, they are already working on the follow-up solution beyond CoWoS, meaning CoPoS. So yes, so from your perspective, for their CoPoS, they will start from smaller form factor, 310 x 310. And so from your perspective, are you seeing any signs of clients trying to pull forward the technology development. And for CoPoS, how should we think about your overall opportunity, especially around chip-on-panel.
Cher Ng: Yes. I think we are -- as we speak, we are developing tools for CoP. So we deal to deliver demonstration tools sometime this year. So that part, we are already engaged with the key advanced logic customer. So that is another exciting area for TCB. So if you look at TCB in general, we have a wide customer base. We have a very diverse applications. We don't just depend on certain applications, but a very diverse application both on the logic side as well as on the HBM side. So certainly, panel packaging at CoP level is an interesting development for us as well.
Sunny Lin: Also, if I may, I do want to ask a question on SMT. So any update on your strategic review for the division? And have you identified a specific option that you want to go for? And what would be the time line?
Cher Ng: To answer your second question first, no. I think we are still in the progress of evaluating. But certainly, we have received some interest in the SMT business at this point in time.
Benjamin Poh: Next, I would like to request Arthur. Arthur, please unmute.
Yu Jang Lai: Robin, can you hear me?
Cher Ng: Yes.
Yu Jang Lai: Congrats on a strong result and guidance. So I will have two questions. Number one is on the CPO. You just mentioned that you have a deep dive into the process, right? And you mentioned the timing is '28. I want to confirm that that's the optical engine shipment or that's your equipment shipment timing?
Cher Ng: Shipment TAM, we're referring to our equipment TAM for CPO, it wouldn't look interesting from '28 onwards.
Yu Jang Lai: Okay. Interesting on '28. Because what we heard from the supply chains that actually some of the CPO equipment already kick off. So can you share more color on your target for example, is for the GPU side maker or is for the ASIC side maker?
Cher Ng: I think the clientele that we have probably serving both Arthur. I think can really differentiate whether it's ASIC or GPU, yes.
Yu Jang Lai: Okay. Okay. And my second question is about the HBM. So thanks for sharing this good progress. Do you think for the HBM4 and 4E and actually, you can continue to -- so my question is about HB progress, hybrid bonding progress and your tools, so do you think the visibility is getting longer and longer in the HBM side?
Cher Ng: Not really. I think the road map from our customers are pretty clear, but like what Katie said, if there is adjustment to the road map, of course, the demand will vary from quarter-to-quarter. But however, in the long run, I think we are still sticking to a very significant TAM of $1.6 billion in 2028. And we intend and we have never wavered from our aim to target 35% to 40% market share for the whole TCB market.
Yu Jang Lai: Got you. And finally, a question to Katie. On the modeling perspective, we know there is a strong booking, right? But how about your component supplier lead time? Is it getting longer? Or does that remain controllable? How should we think of the real billing seasonality of this year? Do we see any constraints?
Yifan Xu: Yes. Arthur, thank you for the question. Maybe I'll answer it by segment. On the SMT front I'll do that first, though we have very, very strong bookings, as we've mentioned a few times now, the conversion -- the revenue conversion is somewhat impacted by the lead time of our suppliers. The team is actually actively addressing this, and we expect that in the second half, this kind of situation actually will get better. On the SEMI side, I mean, there's always the kind of tight supply chain, especially given all the uncertainties around the globe. But so far, we will say that we are managing the supply situation just fine.
Benjamin Poh: Next, I would like to request Alex Chan to unmute. I think Alex have some technical problem. Maybe we'll go to the next one. Next, I would like to invite Donnie. Donnie, could you please unmute?
Donnie Teng: Can you hear me?
Cher Ng: Yes, Donnie. Go ahead.
Donnie Teng: Robin, my first question is regarding to your NEXX business. So I'm wondering if that -- I mean, I remember in the past few years, the NEXX one of the NEXX major business was plating tool, and it can be sold to some PCB companies. And recently, I think PCB companies or substrate companies are expanding capacity due to their running out of the fab. So I think I just want to ask is like if NEXX can generate some revenue momentum recovery in the future? Are you still considering to sell this business? And also in terms of time line, when we expect that we can dispose SIPLACE and NEXX, these two businesses in the future? Would that be in second quarter? So this is the first question.
Cher Ng: I think let me answer your second part of the question first. We don't have an exact timing for you. Whenever there is a deal we have we will announce it. But so far, we have nothing to mention here. Now you're talking about NEXX, yes, they are into deposition. When we make a decision to divest NEXX, we don't just look at financial alone. We look at strategic fit to our whole business, right? So we feel that we want to divest that because we're going to focus more on the SEMI back-end. NEXX is not exactly in the back end. NEXX is on the middle end. So that's the reason why we made the decision to divest NEXX, not purely on financial but because of strategy.
Donnie Teng: Okay. Okay. Understood. Just one follow-up on this. So when you decide to divest NEXX, have you already seen the pickup of the orders from those PCB and substrate makers?
Cher Ng: I would say, yes, as I said, but our decision is not based on financial alone. It's really more on strategy.
Donnie Teng: Okay. And my second question is regarding to the CPO. So my understanding was that AMICRA for example, can be used for laser bonding or, as you s, maybe micro lens bonding on to IC. I guess that's the major business still today. But I'm also wondering if you can quantify a bit more on the 5x growth in the first quarter of this year. It's like what kind of base in the last year? And also in terms of the inspection, as you know, for CPO, the FAU alignment with optical engine is also very critical and it also requires inspection. So we have AOI tool. We have AOI tool. I'm wondering if we can explore some of the business opportunities there or we are mainly staying at the die bonding market?
Cher Ng: Yes, very good question, Donnie. Actually, when we deep dive into the Photonics business, right? So we also think that may be we shouldn't just focus on just on the die bonding because there's indeed a lot of opportunities in the photonics in the CPO as well as the optical transceiver business. So too early. I don't have any concrete answer for you at this point in time. But coming back on the FAU, yes, I think AMICRA has a solution especially for FAU attached onto the PIC. So as I said earlier, I think as far as CPO is concerned, we feel good. We feel excited about this particular development. So we will probably have more of the share as we move throughout the quarters in the years to come.
Donnie Teng: And in terms of 5x growth, can you elaborate a little more is like what kind of base we are growing from in capacity.
Cher Ng: Yes. I would say Donnie, right now, it's still a small base. But again, in terms of growth, if it was a significant growth we thought it's worth to highlight to you guys as well that we are making good progress in terms of optical transceiver as well as CPO.
Benjamin Poh: I'm afraid this is the time that we have. And now I'll pass the time back to Robin for his closing remarks.
Cher Ng: Yes. So thank you for a very good discussion today. So let me take a step back and say that this quarter really marks an important point for ASMPT. We delivered one of the strongest quarters in recent years, not just in terms of revenue and bookings, but notably also how broadly AI is translating into more opportunity for ASMPT, from TCB and advanced packaging to photonics, CPO and mainstream platform, we are indeed seeing AI driving demand across multiple products and customer segments at the same time. Also this breadth matters because it reflects the increasing complexity of AI system architecture and the value of back-end manufacturing, an area where our range of solutions, our scale, our capabilities are allowing us to participate meaningfully across the technology space. We are indeed very encouraged by the operational leverage we have demonstrated this quarter. Our adjusted margins improved sequentially, supported by product mix and volume, and our results came in ahead of market expectations. So looking ahead, we continue to see AI as a multiyear structural driver of our business, with strong engagement across advanced logic and memory photonics and CPO and mainstream wire and die bonding and SMT pick-and-place solutions. We believe ASMPT is well positioned to support this next phase of industry growth across both SEMI and SMT. So once again, thank you for your interest and your continuous support. We look forward to updating you more in the next quarter. So this concludes our call. Thank you, and take care.