Varex Imaging Corporation (NASDAQ:VREX) Q4 2022 Earnings Call Transcript

So Q1 is cyclically — Q1 is a little soft, but then we improved as the year goes by. And you would have seen that from last year as well. We had a soft Q1 and then progressively, it got better during the year.

Larry Solow: And does the CT concern — and that’s obviously one of your bigger growth drivers. It sounds like that’s more of a timing issue, but also I guess a supply chain issue. Do you assume in your guidance that you make up most of that through the year, or are you kind of holding that back a little bit because of continuing supply chain issues?

Sunny Sanyal: So we’re expecting to make that up during the year. But the thing you asked what else could be on our minds from a risk perspective as the — in this type of an environment our mix might move to more of the lower-end CT products. As people look at what it is that they’re going to buy during the year in a tough recessionary environment that tends to happen. So we’re not quite sure exactly what the mix will look like in the second half of the year for CT.

Larry Solow: Got it. Okay. Great. I appreciate all that color. Thanks, Sunny.

Operator: Thank you. Next question is coming from Suraj Kalia from Oppenheimer. Your line is now live.

Sunny Sanyal: Hello, Suraj.

Suraj Kalia: Hi, Sunny, Sam, Chris, can u hear me all right?

Sunny Sanyal: Yes, we do.

Sam Maheshwari: Yeah.

Suraj Kalia: Perfect. Hope everyone is safe and healthy. Hey, Sunny one question for you two for Sam. Let me start out with the partnership with Micro-X, Sunny. Maybe you could talk to us about the complementarity that Micro-X their carbon nanotube offers with your platform, especially the multi-beam. What are the implications? And what gap are you trying to fill with this partnership?

Sunny Sanyal: Yeah. Suraj so first of all the — our technology work has made good progress. As you know that, we’ve talked a lot about that. And we are — we feel fairly good and very — believe in the future prospects of cold cathode technology. So our conviction there remains strong and I wanted to make sure that that comes across pretty clearly. Now these are new technologies as you know and there are many different kinds of cold cathode technologies and there are different ways to make these emitters. And so what we wanted to do was to make sure that we were one — there were two things here. One, we wanted to make sure that we had access to a couple of different emitter technologies. One of them is through our joint venture VC.

And the second one, we wanted to make sure that we had it ourselves as well. So this was in addition to our joint venture having the emitter technology and we making multi-beam tubes with that technology we wanted to also for the long-term make sure that we have access to a slightly different type of carbon nanotube-based emitter technology that we could also continue to evolve on our own. So this was mostly a diversification play for us and where we get to own the technology ourselves in addition to through our JV partner.