UDC Q3 Earnings - 11/2/17
- $61.7M Revenue - $47M materials $12M royalties. $15.8M Op Inc. Net .28/sh. Guidance increased to a range of $310M-$320M for 2017. 03/sh quarterly div.
- News review - Gave a very broad update on products and customer progress, including the iPhone X.
- Green $32.8M in Q3 vs. $32.1M in Q2 and $16M in Q316
Red $13.6M in Q3 vs. $13.7M in Q2 and $7.1M in Q316
Royalty and license $12M in Q3 vs $5.2M in Q316
- OLED materials GM 75% in Q3 and expect high end of the range of 70-75% in 2017. They later commented this was just a continuation in Q4 of what they have seen so far.
- OPEX up 22-23% YoY and expect a similar trajectory going forward. They will update in February.
- $380M in cash at EOQ.
Q&A -
- Guidance implies a materials decline? Q3 was higher than expected, Q4 will not be as robust.
- $12M royalty and license line strength came from a number of customers and not just LG.
- A lot of activity in China, they expect the strength to continue.
- Samsung extension? Did not sound confident in an agreement before end of the year.
- Host revenue is existing host materials, and they think the $600K number an analyst gave was too high.
- Gabelli asked about Samsung materials being down QoQ, they said not to read anything into it, could be just timing.
- Royalties will remain on an upward trajectory but they may be lumpy.
- An eventual blue material(s) offering will be handled on a customer by customer basis with regards to licensing and material volumes, too early to get specific.
- Multiple customers in Japan.
