Kulicke and Soffa Industries, Inc. (KLIC) Earnings Call Transcript & Summary

Greetings, and welcome to the Kulicke & Soffa's 2025 Second Quarter Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Joe Elgindy, Senior Director, Investor Relations. Thank you, sir. You may begin.

Thank you. Welcome, everyone to Kulicke & Soffa's Fiscal Second Quarter 2025 Conference Call. Fusen Chen, President and Chief Executive Officer; and Lester Wong, Chief Financial Officer, are also joining on today's call. Non-GAAP financial measures referenced today should be considered in addition to, not as a substitute for or in isolation from our GAAP financial information. GAAP to non-GAAP reconciliation tables are included within our latest earnings release and earnings presentation. Both are available at investor.kns.com along with prepared remarks for today's call. In addition to historical statements, today's remarks will contain statements relating to future events and our future results. These statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that may cause our actual results and financial condition to differ materially from the statements made today. For a complete discussion of the risks associated with Kulicke & Soffa that could affect our future results and financial condition, please refer to our recent and upcoming SEC filings, specifically our latest Form 10-K as well as the 8-K filed last night. With that said, I would now like to turn the call over to Fusen Chen for the business overview. Please go ahead, Fusen.

Good morning, everyone. Last month, we announced the intent to discontinue the electronics assembly or EA equipment business subject to local regulatory approval. We acquired this business in 2015 and it is currently a component within all other categories. We intend to fully support and serve our customers with equipment purchase requirements over the coming quarters. We will also continue to retain EA equipment technology as well as the related aftermarket parts and service business to support the existing installed base and our customers' operational needs. We believe this decision though difficult, was critically essential to ensure our underlying businesses are competitive and are properly aligned with beneficial long-term technology trend. Looking ahead, we intend to prioritize development and further leverage our dominant ball, wedge and the thermocompression position, where we have demonstrated clear technology leadership to address fundamental assembly transition within high-volume, leading-edge and the power semiconductor market. Additionally, our APS business, which provide revenue consistency as well as our emerging advanced dispense portfolio extend our technology leadership and provide additional growth paths throughout this evolving core market opportunities. This restructuring effort is also intended to enhance our long-term financial with anticipated improvement in gross margin and through cycle improvement. At a macro level, the ongoing trade situation has increased level of uncertainty through our global market and supply chain. This level of macro and industry uncertainty has created hesitation and a more defensive capacity plan approach throughout our served market. Sequentially, this hesitation was most evident in the Southeast Asia automotive and industrial market, which had the effect of limiting the seasonal momentum previously anticipated for the June quarter. Interestingly, over the same period, we saw utilization improvement in other Asia regions. While we are not immune from this macro near-term dynamics, semiconductor unit growth as well as the increased complexity of semiconductor packaging are expected to expand our served market. We remain confident in the industry's resilience and also remain confident that our global business, supply chain and the development paths are best optimized as we look ahead. Over the near term, we intend to further strengthen our growth prospects with a focus on Vertical Wire, Power-Semiconductor, Advanced Dispense and Thermo-Compression, which I will discuss in more detail shortly. During the March quarter, the general semiconductor end market, supported by improving ball bonding utilization rate experienced a 38% sequential increase due to improved demand from both wedge and TCB stemming from U.S. and China. In view of the changes surrounding the EA equipment business, we decided it was appropriate to simplify our end market schedule and consolidate LED within automotive and industrial starting in the current quarter as well as within comparable period. This change is aligned with the external semiconductor marketing forecast, where LED is generally subcomponent of the industry market. With that said, automotive and industrial was sequentially down in the March quarter over the December quarter, largely due to the final project W related LED sales, which were recognized in the December quarter. Automotive and industrial, excluding LED, was down approximately 7% sequentially, but was still up nearly 14% from the same period last year due to ongoing demand improvement of our [indiscernible] solutions. Within Memory, softer NAND system demand was the primary driver for our sequential reduction in the March quarter. Today, our current Memory exposure is centered on NAND, but we remain focused to diversify into dynamic memory through the fundamental advanced packaging transition affecting HBM for leading-edge memory and also driving momentum for our emerging Vertical Wire solution for high-volume memory. Finally, within APS, we continue to enjoy a relatively stable base of parts, service and support revenue through this dynamic market environment. While there may be some fluctuation over the coming months, we anticipate overall installed base and utilization trend will continue to improve, supporting a relatively stable level of APS revenue. At this point, we anticipate the majority of our business has gone through a long-term period of capacity digestion and remain very well positioned for the next set of both Wedge Advanced Dispense and Thermo-Compression opportunities. Within ball bonding, our ongoing pace of customer engagement as well as new product development remain on track with our Vertical Wire solution, which continue to gain momentum. Last month, we officially announced the launch of our latest wafer level packaging solution, AT Premium NAND+, which is especially optimized for stack DRAM opportunity. This high potential new memory packaging approach is driving significant interest with leading customers, some of which are accelerating their transition and may initiate new stack DRAM production by 2026. Additionally, this Vertical Wire capability is also compatible with non-memory [indiscernible] devices, which support high-volume general semiconductor applications. As explained on prior calls, similar to leading-edge application, cost-sensitive wire bonding applications are also aggressively demanding new transistor-density packaging solution and our Vertical Wire technology is very well positioned to effectively address both high-volume Logic and Memory transition. In addition to Vertical Wire, the pace of our ball bonding development initiatives remain on track. We continue to prepare for new solutions through this high-volume market over the coming quarters. Next, within wedge bonding, the power semiconductor opportunity continue to demand higher current, higher reliability and higher efficiency devices. A few years ago, this power semiconductor application was some of the most cost-sensitive and competitive semiconductor assembly market. The growth in electric vehicle and sustainable energy has caused this basic power control application to become increasingly complex, requiring better materials, more robust interconnect and more advanced equipment. In April, we proudly announced the launch of our newest [indiscernible] welding system for power semiconductor application. This new system, which leverage our leading [indiscernible] platform, extend our market reach while enhancing alignment with the growing and evolving global demand for electric vehicle and sustainable energy. The use of pin within this market is rapidly growing, which support better inductance and better flexibility as they improve power monitoring and sensing to support higher efficiency applications. Additionally, within this emerging high-performance power module market, there is an increase in new semiconductor materials such as silicon carbide, but also an increase in the use of copper materials and interconnects. Copper interconnects are a core competency for K&S, which we intend to fully leverage as this long-term market evolution continues. Next, within the Advanced Dispense business, we continue to build out our portfolio of solutions as well as our customer-facing engagement. We continue to grow our customer base and recently received an order from a high-volume U.S.-based integrated devices manufacturers. Additionally, our recently qualified solid-state battery opportunity has been performing well, and we anticipate a potential production ramp to begin over the coming quarters. Over the coming years, we are also focused to expand our advanced dispense market presence. This effort will combine our unique dispense capability with our existing market-leading core system technology. Turning to Thermo-Compression. Our advanced solutions team continue to actively support Logic and Memory customers in production and development. We remain well positioned and are continuing to take the shares in Advanced Logic applications as the market transition to next-generation chip-on-wafer and also wafer-on-substrate applications. Larger and more complex multi-chip processor for data center and AI applications are expected to drive the next wave of leading-edge customer capacity. We have worked very closely with many customers over the recent years and remain well positioned for leading edge, but also higher volume opportunities as mobility devices begin transitioning to chip and heterogeneous applications. Finally, for TCB Memory, we continue to anticipate our unique fluxless solution, which provide direct copper, [indiscernible] and ultra-fine pitch capability will be a key contender for future HBM opportunities. Building on traction from the prior quarters, we expect to ship additional tool to a leading memory customers towards the end of the fiscal year. As a reminder, our innovation in Thermo-Compression and Vertical Wire have unlocked new market access to Logic and Memory opportunity, which our company was previously excluded from. Today, as the world take the next step to transition single-die semiconductor package to multi-die and heterogeneous chiplet packaging format, Thermo-Compression has rapidly become the incumbent technology for high-performance application while our Vertical Wire solutions are increasingly well positioned to address a wide portion of the high-volume market over the long term. As a reminder, we remain the only fluxless TCB supplier who has been qualified for high-volume manufacturing with some of the world's most advanced semiconductor company, and we are nearly fully booked for fiscal 2025. More broadly, we have nearly 120 system installed base across 10 different highly engaged customers. This helped to demonstrate our track record for winning as this installed base captured a wider portion of the market than any of our competitors have been able to address. In closing, we have worked hard to ensure our business is best aligned with critical technology trends, such as Vertical Wire in memory, TCB in leading-edge logic and our increasingly capable assembly solution in Power-Semiconductor. Additionally, our growing advanced dispense portfolio of solutions increased our potential across all of these long-term technology transitions. While recent core market utilization rate are promising, we remain in an unprecedented state of macro uncertainty, although we remain confident in our technology and market positions and are prepared to overcome near-term challenges. At this point, our cost structures, existing product portfolio and the through cycle performance are optimized, and we will continue to enable fundamental technology change throughout our served market. As we have done for 7 decades, we will continue to closely support our customers and emerge a stronger, more profitable and more growth-centric company. I will now turn the call over to Lester to cover the financial overview. Lester?

Thank you, Fusen. My remarks today will refer to GAAP results unless noted. I would first like to provide some additional details regarding our intent to discontinue the EA equipment business. As Fusen explained, this was a difficult but necessary step to ensure our overall business remain competitive, aligned with long-term technology trends and it is optimized for through cycle performance. We remain closely engaged with all key stakeholders as we plan for this intended wind down. We are currently seeking feedback regarding customers' orders and remain in close discussions with local stakeholders. During the March quarter, we accounted for the majority of wind-down related expenses, which represented total EA-related charges of $86.6 million. These charges were primarily related to inventory write-down, supply chain, asset impairment and restructuring-related charges. Dependent on local stakeholder feedback and in alignment with our March 31 disclosure, we anticipate residual non-GAAP expenses to be below $15 million and be accrued for in the first fiscal half of 2026. Turning to the March quarter financial results. We booked revenue of $162 million and gross margins of 24.9%, which included EA-related inventory and supply chain charges of $38.6 million. Total operating expenses came in at $125.1 million, which included restructuring charges of $8.8 million and impairment charges of $39.8 million. Excluding these charges, operating expenses would have been $76.5 million. Tax expense came in at $5.4 million related to our mix of profit and loss across entities during the quarter. We continue to anticipate our effective tax rate will remain above 20% over the coming year. We completed our previous and also initiated our latest repurchase program with a $300 million authorization during our first fiscal quarter of 2025. During the second fiscal quarter, we repurchased over 500,000 shares for $21.3 million. While we do not anticipate current tariff announcements to have a direct impact on our ability to manufacture and sell our products and services to our global base of customers, unique geopolitical and trade dynamics have created near-term order hesitation in certain capital equipment markets. Looking into the June quarter, sequential order activity decreased in Southeast Asia, while order activity increased in China and Taiwan, which was aligned with our utilization data. We have also begun to see global customers begin reallocating equipment across manufacturing sites, which highlights our industry's ability to flex around trade dynamics. With that said, we anticipate semiconductor unit growth will continue to improve through fiscal 2025. While some customers may delay capital expenditures until critically necessary, we expect continued capacity digestion supported by improving utilization rates with ball and wedge bonder to continue over the near term. Looking into the June quarter, we announced a revenue outlook of $145 million, plus or minus $10 million, with gross margins of 46.5%. We anticipate non-GAAP operating expenses to be $68 million plus or minus 2%, a GAAP EPS loss of $0.09 and a non-GAAP EPS gain of $0.05 per share. Although the near-term market dynamics are challenging, we continue to anticipate an eventual return to incremental capacity growth in core ball and wedge bonding markets and continue to see ongoing capacity digestion and field utilization improvements. Incremental opportunities in Vertical Wire, Advanced Dispense and Thermo-Compression are in addition to this anticipated improvement. As we remain focused on these strategic opportunities, we are well prepared to navigate near-term macro level uncertainty. This concludes our prepared comments. Operator, please open the call for questions.

[Operator Instructions] Our first question comes from Krish Sankar with TD Cowen.

I have 3 questions. First one, Fusen. Just kind of curious, can you give some color on June, what are the dynamics? Is it predominantly general semi and auto industrial, that's going to be down quite a bit? And how to think about it beyond June. I understand a lot of moving parts, but any color you can give beyond June would also be helpful?

Okay. So Krish, we have a Q3 slowdown. And this slowdown is the most pronounced and evidenced in our Southeast Asia region. I'll give you an example. The Q3 Southeast Asia slowed down account for the majority of our total Q2 to Q3 weakness. To give you a number, our Q2 revenue is $162 million and Q3 guidance is $145 million. The difference of these 2 number majority actually weakness from the Southeast Asia. So therefore, it is really our belief this near-term slowdown was due to the concern regarding the potential and unknown tariff impact for auto and industry from our customers. So I think in the script, we mentioned while we see the weaker outlook for the Southeast Asia, in the meantime, we also see the utilization rate improve in Taiwan, China and other regions. And with the utilization rate actually is it or close to triggering broader capacity addition. So we see positive, but we also have actually very big actually slowdown in Southeast Asia. We believe it's auto industry related and it's because of unknown tariff impact. People hesitate to build a capacity just for the industry. So yes, the number is a little bit bigger. And the reason, I think, is because we have a bigger, larger presence auto exposure. And also, our manufacturing concept is flexible manufacturing cycle. And we're working with a customer in upturn and downturn with a shorter cycle time. So I think these 2 act together. I hope I explained your questions.

Got it. That's very helpful, Fusen. Just to follow up on just any view beyond June quarter? Or is it too hard to say today.

Yes. So June quarter, so it's really our belief the Q4 -- June quarter is Q3, like Q4. We believe this will be better. It's the feedback from the customers and also some of the weakness in Q3 will be revenued in Q4. And we -- hopefully, this can be a short-term phenomenon. And it's also supported by utilization rate. Actually, in some regions, actually already the number can trigger capacity buy. So we think Q4 will be better, but how much better actually is also depend on macro and some clarity with the tariff. If we have better clarity, I think we should have a sequentially up from Q3.

Got it. And then just to follow up on TCB. Your TCB exposure is predominantly Logic, hardly anything in Memory. Can you give a color on how it's progressing? I also noticed that your European competitor last week announced 5 new orders for TCB chip-to-wafer. So I'm kind of curious, lay of the land. And a little bit if you can talk about TCB, your TCB exposure today and how you see it evolving in Memory, if you have a shot?

Okay, Krish. So practically, our first revenue for the TCB was 2020, right? So although we don't want to say it's a quite large, but I think we made a good progress with a high growth rate. And we actually focus with the Logic first. And we actually are confident at this moment we can grow in both IDM and also OSAT also in the foundry side for the Logic. And this year, we put a lot of effort in Memory. We expect to ship additional system by end of the month -- end of the year. And we won't say this is easy, but I think we're confident on our technology, and I hope we can have some results in 2026. So I think to answer your question, sequentially, we got to focus in actually some segments. And from now, I think it's a good time for us to focus on HBM.

Our next question comes from Tom Diffely with D.A. Davidson.

I was curious, what was the revenue run rate of the EA business that you're exiting? Or any kind of metrics around the size and profitability would be very helpful?

Tom, it's Lester. So based on the recent past, the EA revenue was about $25 million to $30 million a year, gross profit is on $7 million to $11 million, and the operating expense is about $20 million to $25 million.

Great. It's very helpful. And Lester, did you say that there would be a $15 million per quarter charge through the first half of '26?

No, no, no. Tom, what we said is also consistent with the disclosure on March 31. I said that after this -- all the write-down this quarter, the $86 million, we think it will be less than $15 million for the rest of the shutdown, and that will probably be a little bit in the next 2 quarters and then more in the first half of FY '26. Subject to our discussions with local stakeholders, we believe that the business other than to support existing customers and warranty and service should be done by the first half of FY '26.

Great. And then maybe just a quick question on the Power Semi side. What are the dynamics you're seeing on the Power front?

Well, I think the Power is going to grow rapidly in terms of volume. And there was a lot of European company actually invest on it. But recently, I think China actually also gained some market shares. So we are very happy. We still have a very high market shares in Power Semi and this transition to the Power Semi to be more effective with higher power, more cost effective. So we have 2 actually new products. One is [indiscernible]. I actually discussed in my script. And this is [indiscernible]. The other one, actually, we call it [indiscernible]. So we actually announced these 2 new products. We believe it's going to be an important product, start to contribute revenue for us in 2026.

Our next question comes from Charles Shi with Needham & Co.

Maybe Fusen, the first question is about the market dynamics. I wonder if you can further unpack a little bit more. China ordering activity is up. Southeast Asia is down. That's understandable. But it's a little bit interesting to hear that the Taiwan is also up a little bit. In terms of ordering activity, you would assume Taiwan is subject to the same tariff dynamics as Southeast Asia. Why is there a little bit of bifurcation between those 2 regions? Is it Southeast Asia more impact on auto industrial side, Taiwan more on the general semi side? Or what's the reason?

Okay. So let me explain South Asia first. Southeast Asia, we believe, actually, utilization rates are still not high enough. I mentioned about Taiwan and China, actually the utilization rate is actually high and potentially can trigger capacity buy. But actually, we didn't see that yet, maybe it's because of the holdback. People for the unknown period of time, they can run actually utilization rate higher than -- even slightly higher than 80, right? So -- but Southeast Asia, I think utilization rate is below that. And as you know, the tariff impact to auto is a big deal. And Southeast Asia actually have a lot of actually European investment and also OSAT and create a big base for auto capacity. So -- and the Southeast Asia, the slowdown actually account for almost a majority those slowdown sequentially from Q2 to Q3. I hope I answered your questions.

Yes, that's very, very, very interesting color. Fusen, maybe another question about fluxless TCB. I think in your prepared remarks, there are some new languages there. You are saying fluxless TCB at least for fiscal '25, it's fully booked. I wonder if you can provide some color what that means because I don't think your fluxless TCB revenue forecast was that aggressive. It was -- I believe you were guiding to like 40% to 50% year-on-year growth. When you say it's fully booked, do you mean it's -- we even read that is actually a little bit supply constrained at this point? Or...

Actually, I think it's really a limit in our capacity. We have some capacity in U.S. And right now, we move to Asia and we intend to actually increase capacity. So I probably can say this a little bit better. I think right now, we are capacity constrained, right now. And we actually will create more capacity is undergoing.

So is the 40% to 50% year-on-year growth, you think you can still reach that target for...

So for example, I think we actually -- right now, to give you an example, maybe a capacity, we actually -- we just start in 2020, right, 2020. We actually have a capacity target to reach about 60 systems per year, right? So this is the incremental capacity we are undergoing to increase.

Got it. Maybe last one. Any update on the leading foundry. I believe you shipped [indiscernible] system already. Any expectation on repeat orders and the timing of it?

Okay. So our system actually is a long in high-volume production and also multiple systems and also new customer qualification. This year, our TCB only, we expect about $70 million. Next year, we actually expect probably $100 million or above $100 million. So the difference of '26 and '25 , part of that actually is growth of foundry, right? But as we quantify more customers and more devices, I think we will have additional upside on top of that.

[Operator Instructions] Our next question comes from Craig Ellis with B. Riley Securities.

I wanted to start going back to some of the utilization increases you're seeing in China and Taiwan and just try to understand them in a little bit more detail. We've seen pretty visible signs that certain supply chains, PCs since February, March have been tracking well above seasonal. Smartphones seem to be doing that early in 2Q. So the question is if that is happening, and it seems like it's happening on build-aheads given tariff impacts, is there potential that, that related demand in the second half of the fiscal fourth quarter or in the fiscal first quarter would be below seasonal because we've already had the utilization benefit early in the year as companies try to best operationalize to mitigate tariff impacts?

Craig, it's Lester. No, we don't think so. I mean utilization rate, you're right, as Fusen said, is quite high in China and Taiwan and also in general semi. But what I think as we indicated on the call is in a normal cycle at these utilization rates, people should start doing capacity buys. But we're not really seeing that. And I think what we -- the reason for that is, again, there's a lot of cautiousness among our customers. They want to see how this tariff thing kind of plays out. So we don't think that there's -- that it's going to -- the utilization rate is going to start falling. We think it's already remaining at this level. And I think without the tariff uncertainty, we believe that China, Taiwan, North America and Europe, I think the revenues will be much higher in Q3, and that's why originally, we believe that the second half of the year historically has always been better than the first half. I think this has really been affected by the global trade dynamics as well as the tariffs. I think as we get more clarity on the tariffs, I think then people will start making purchases. I think right now, people are doing it just if it's critical necessity. So I think also, as Fusen said in his earlier reply, people are running at a much higher utilization than they normally would. So we don't think actually it will fall off in Q4 and Q1.

And then the second question is more longer term. So interesting ambition to move into the DRAM HBM market and LPDDR market in fiscal '26. The question is, as we think about the Memory business now, which is very NAND-centric, how material could DRAM be and fiscal '26 and '27 relative to the business that you currently have? And how broad would you expect your exposure to be across the Memory supplier base?

So I think on NAND, we have very high market shares. HBM, we actually put a lot of effort. And in the meantime, there's also many, many competitors over there. So we will see how well we will do. But I think we work closely actually with one, but also with others. But one actually has a focus. So in terms of DRAM, it's taking time. We actually see this Vertical Wire is going to be very important for the industry in both the logic and memory. The first customer, we see it's going to go to production. This for stack DRAM is going to be in the first half of 2026, right? So -- and not only -- almost every Memory customer is working with us including IDM. So next year will be a transition year, and we probably can give you more update about the order, maybe we go to production for the first half and we will see the order, maybe our fiscal 2026, maybe Q1 or Q2. So we believe the Vertical Wire will take off and there will be many customers going to work on this for the first product. First product is going to be DDR, is going to have a capability to reduce the form factor about 30% and this is going to be on Mobile. But this is only a first application. We believe Vertical Wire is going to find a home for many other applications in the future.

That's a significant form factor reduction, Fusen.

Our next question comes from Dave Duley with Steelhead Securities.

Yes. Just a couple of clarifications. You talked about the utilization rates in Taiwan and China being elevated. Could you just give us what those percentages are at this point? And then also a bit of a housekeeping question. What is your IC unit volume assumption for calendar 2025 and 2026, if you have them?

Dave, utilization -- this is Lester. Utilization in China is over 80%. In fact, it's almost into the mid-80s. In Taiwan is just touching 80% or so. And semi revenue growth, we still expect about 10%, a little greater than 10%.

In calendar '25?

Yes.

Okay. And then as far as the HBM opportunity goes, I think you've made it clear you're working with one specific customer here. And is it fair to assume that HBM4 or HBM4E is the cut-in point? Or usually, it's with a new product. Maybe just explain to us what new product you think you'll get cut in at?

Well, right now, it's -- high volume is a 3E. So we expect will be our future generation. Yes, more specific, I think from HBM4.

So HBM4 would be the target point to try to incorporate yourself into the market, so to speak?

Yes, that's correct.

Okay. And final question from me is you've talked about, I guess, demand hesitation driven by trade policies and tariffs. But could you just talk about any impacts that you might have? I assume that tariffs -- that you can ship from Asian facilities into China, so there won't be a major tariff impact from doing that? And then maybe just talk about if there are any higher costs from -- input costs into your products from tariffs?

Yes. So Dave, you know we manufacture our capital equipment here in Singapore. So shipping it into China will not trigger any tariffs because the tariffs right now from China is aimed towards the United States on reciprocal basis, right? So we don't think there's any direct impact for us. As we indicated, the impact is more on an indirect basis as our customers and their customers are right now a little bit uncertain about how all this is going to play out. So therefore, they are much more conservative in their supply chain, right? So that's I think what we've been talking about earlier. As far as cost is concerned, I think there will be -- again, there may not be a direct cost, but there's always going to be indirect costs. Tariffs are going to -- it costs everybody money, right? So I think it's across the board.

Okay. And one final clarification is you talked about the customer hesitation in Southeast Asia. And I guess you're kind of suggesting that, that's an industrial automotive end market driven. And then I think you even mentioned it was European customers. Is that the really way to think about it as European auto and industrial customers are the main customers or the food chain that is in hesitation, so to speak?

Well, Dave -- David, I don't think Fusen said it was just these people who are in hesitation, right? I think all our customers are in hesitation, including those in Taiwan and China, which is why at that high utilization rate, they're not making the orders that they normally would make. I think what Fusen is talking about Southeast Asia, in particular, is we see Southeast Asia actually drop the most sequentially from Q2 to Q3. And part of that is because we have a large auto industrial client base in Southeast Asia and most of them are, you're right, IDMs from Europe, and they are very -- so they are particularly, I guess, affected by concerns about the tariffs. So we didn't say it's only them that have concerns about the tariff. I think it goes across the board is that they particularly have been affected in Q3 when you compare it to Q2.

There are no further questions at this time. I would now like to turn the floor back over to Joe Elgindy for closing comments.

Thank you, Maria, and thank you all for joining today's call. Over the coming quarter, we'll be presenting at several conferences and road shows. As always, please feel for you to follow up directly with any additional questions. This concludes today's call. Have a great day, everyone.