Cohu (COHU) Investor Presentation summary

Business overview and market position

• Achieved $402M in FY24 revenue with approximately 65% recurring revenue and a 45% gross margin, supported by $201M in cash and investments as of March 2025.

• Holds a strong market position with about 20% share in a $2B addressable market, serving diverse applications including AI data centers, automotive ADAS, industrial automation, and consumer electronics.

• Operates a global infrastructure delivering semiconductor test and inspection solutions, with a broad IP portfolio in thermal control, vision inspection, and AI process control.

• Installed base of approximately 24,800 systems across 108 customers, supported by a resilient recurring business model and a highly skilled field engineering team.

• Focuses on customer value creation through innovative solutions that enhance yield and productivity.

Growth strategy and new opportunities

• Targeting high-growth markets such as HBM memory, wide bandgap devices, XPU, and mixed signal test through organic development and strategic acquisitions.

• Entered the HBM memory market with Neon, leveraging AI inspection software for micro-scale metrology, addressing a ~$100M opportunity within a $4B market growing at a 68% CAGR.

• Developed solutions for wide bandgap device test, offering significant yield improvements and addressing a ~$50M opportunity in a $3.6B market.

• Expanding in XPU test with active thermal control and in mixed signal test with scalable, cost-efficient platforms, targeting $200M and $400M addressable markets, respectively.

• Launched AI-driven process control and analytics platforms, with a $600M semi back-end analytics market opportunity.

Financial performance and targets

• Demonstrated a track record of gross margin expansion, achieving a 46% non-GAAP gross margin in FY24, with a mid-term target of 50%.

• Recurring revenue reached $253M in the last twelve months, representing 65% of consolidated revenue, with a 93% annual renewal rate on service contracts.

• Mid-term financial model targets $600–$800M in revenue, 48–50% gross margin, 18–26% adjusted EBITDA, and $1.50–$3.25 non-GAAP EPS.

• Maintains a capital allocation strategy focused on R&D investment, share repurchases, M&A, and debt reduction, with $201M in cash and $18M in total debt as of Q1'25.

• Operates a capex-light model (~$20M annually) and continues to expand in-house manufacturing and global IT infrastructure.