SkyWater Technology, Inc. (NASDAQ:SKYT) Q4 2022 Earnings Call Transcript

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Richard Shannon: Excellent. My next question is some language used to being and I think maybe the last call and maybe in 2 calls here about stabilization of fab operations and productivity. In the context of one of the other questions in your prepared comments here about gross margins, where you just finished at 20%, excluding the big contract revenue recognition and you’re expecting 15% to 20% seems like that’s implicitly stating you’re not expecting any more improvement or stabilization in productivity. To what degree does that — that you’re not expecting more versus that could happen and you potentially see upside throughout this year?

Thomas Sonderman: Yes. I mean, clearly, we’re going to continue to drive productivity improvement throughout the year. I think, if anything, it’s what Steve said earlier, is that we also expect some tool revenue to come into the mix this year. We have some subcontractors that are tied to the R&D program for RadHard that will come into play where the margins aren’t the same level as ATS, so our traditional ATS. So, I think — and frankly, we’re in a very — we’ll call it cautionary environment at a macro level in terms of what’s the overall economy going to do here in the U.S. And so I think all that is why we’re cautiously optimistic about our ability to continue to grow and scale the business but recognizing that there are going to be some different factors that hit the revenue line and their margin profile will be somewhat different than what we had this year. Steve, anything to add? Does that answer your question, Richard?

Richard Shannon: Yes, sorry, I was waiting for Steve to respond. If he did, I didn’t hear anything. My last question…

Thomas Sonderman: He just nodded his head.

Steve Manko: Yes.

Richard Shannon: He just nodded, all right. Last question, I’ll jump out of line here. Just any info you can give us on the 10% customers and they will see the 10-K but I wonder if you can give it to us for the fourth quarter or for the year, please, Steve?

Steve Manko: Sorry. Can you repeat what was the question, 10% of what?

Thomas Sonderman: 10% customers.

Richard Shannon: What were the 10% customers either for the quarter or for the year?

Steve Manko: Yes. We’ll just wait for the 10-K and we’ll list those out like we do consistently. Those will be in their customers I believe for the fourth quarter.

Operator: And ladies and gentlemen, that will conclude our question-and-answer session today. We’d like to thank you all so much for joining the SkyWater Technology Fourth Quarter and Financial Results call. Again, thank you so much for joining us and we wish you all a great evening. Goodbye.

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