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CFO Eitan Zamir explained the modest gross margin dip from 48.3% to 47.7% was due to inventory absorption impact and, to a lesser extent, tariffs. CEO Yoav Zeif stated the Nexa3D asset acquisition provides a strong IP portfolio and R&D knowledge, offering shortcuts for strategic growth in areas like aerospace and defense, rather than being an acquisition of an operational company.

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CEO Yoav Zeif confirmed the outlook is cautious but is based on good pipeline visibility, with the main variable being the sales cycle length. He identified Aerospace & Defense, Tooling, and Dental as the key growth verticals. He clarified that second-half optimism is based on both the existing sales pipeline and an expectation of reduced macro uncertainty, stressing the company's resilience even with flat revenues.

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CFO Eitan Zamir clarified that the Q4 EPS guidance is actually a positive $0.08 to $0.12, reflecting significant benefits from the company's restructuring. He noted that while Q4 revenue benefits from seasonality, it is too early to guide for 2025. CEO Dr. Yoav Zeif identified government, defense, aerospace, and automotive tooling as the primary areas showing recovery. Eitan Zamir added that software revenue is growing significantly with high margins, and more details will be shared as it becomes a larger part of the business.

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President and CEO Jeffrey Graves explained that the total dental business declined only 3% despite a 19% drop from a large aligner customer, indicating underlying strength in the broader portfolio. He characterized the 'point of care' service not as a significant revenue generator, but as a vital application development tool that provides direct insight into new uses for 3D printing in trauma, bone repair, and cancer treatment by embedding staff within leading hospitals.

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CEO Jeffrey Graves confirmed the Q4 industrial strength came from reliability markets like rocketry and aerospace, but noted that Q1 could see normal seasonality and that broader customer CapEx remains hesitant due to geopolitical and tariff uncertainty. He stated the company is planning for a flat to slightly positive year. Regarding dental, Graves agreed that 2025 would be dominated by aligners, with a more significant ramp-up for dentures and other segments expected in 2026 and beyond as new products are commercialized and regulatory approvals are secured.

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CEO Jeffrey Graves explained that the wide Q4 guidance is due to uncertainty around customer CapEx spending and inventory management ahead of 2025. He noted that while an uptick in printer sales is expected, which is good long-term, it could negatively impact the Q4 gross margin mix and factory absorption rates, alongside potential customer inventory management on higher-margin materials.

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CFO Joe Corso stated that while it is too early to provide a 2026 outlook, the company remains confident in continued growth. He clarified the upgraded 2025 A&D forecast is due to broad-based growth across existing and new laser sensing programs, directed energy deliveries, and progress on high-energy laser programs. VP of Corporate Development & Investor Relations John Marchetti explained the amplifier transition is a critical internal process of moving production from R&D teams to manufacturing groups to enable future volume scaling.

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CFO Joseph Corso stated it was too early to provide 2026 guidance but confirmed the growth in the 2025 A&D forecast is broad-based, stemming from existing and new sensing programs as well as directed energy initiatives. VP of Corporate Development & IR John Marchetti clarified that the amplifier transition is a critical internal process of moving production from R&D teams to dedicated manufacturing groups to enable future volume scaling.

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CFO Joe Corso confirmed confidence in at least 25% A&D revenue growth for the year, noting that while quarterly timing is difficult to predict, revenue should increase as the year progresses due to the strong backlog. Corso added that while the manufacturing transition will help margins, the primary driver for margin expansion will be increased production volumes.

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President & CEO Vijay Manthripragada explained that Measurement and Analysis margins are benefiting from operating leverage but the long-term target of 18-22% remains appropriate. He noted that greenhouse gas services represent about 3% of the business and are largely driven by state-level regulations. Regarding PFAS, the outlook is positive with a growing patent portfolio expanding into broader water treatment. Finally, he attributed the strong organic growth primarily to a dedicated commercial focus on cross-selling and deepening relationships with existing clients, rather than new onshoring tailwinds.

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President & CEO Vijay Manthripragada explained that Measurement and Analysis margins are high due to operating leverage and project mix, but the long-term 18-22% target remains. He noted that greenhouse gas services represent about 3% of revenue, with minimal impact from federal policy changes due to state-level regulations. Regarding PFAS, he confirmed a positive outlook following regulatory clarity and highlighted an expanded patent portfolio for broader water treatment. Manthripragada attributed the strong organic growth primarily to successful cross-selling and a dedicated commercial focus, with onshoring trends providing an additional tailwind.

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CEO Vijay Manthripragada stated that client activity remains strong with no changes to project timelines, noting that the private sector business is picking up as political uncertainty subsides. He highlighted that cross-selling success is evident in clients purchasing multiple services, which deepens relationships and provides strong conviction in the company's organic growth outlook without needing to acquire new customers.

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CEO Ronen Samuel clarified that while ARR is below internal targets, it has still grown to $19 million within a year of the AIC program's launch, with a strong pipeline expected to drive a meaningful increase by year-end. He confirmed a follow-on upgrade order from their global strategic customer for the second half. Samuel also stated that the ink inventory issue was concentrated among "less than a handful" of significant customers.

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CEO Ronen Samuel explained that many digital platforms need to move to on-demand production and that Kornit is actively pursuing them, citing existing relationships with major players like Printful and Custom Ink. CFO Lauri Hanover stated that approximately $70 million remains on the approved $100 million share repurchase authorization, which the company expects to use. She reiterated the capital allocation framework balances shareholder returns with organic investments like AIC and potential strategic acquisitions.

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CEO Ronen Samuel noted that key customer Printful completed a major upgrade to Atlas MAX and that the large global strategic account had a strong peak season, with hopes for further fleet upgrades in 2025 following some in Q4. CFO Lauri Hanover indicated Q1 is seasonally the lowest gross margin quarter. Regarding tariffs, Ronen Samuel described customers as being in a 'wait and see' mode with no immediate changes in behavior.

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CEO Ronen Samuel explained that the 30 Apollo systems planned for 2025 will go to a mix of new and existing customers, highlighting one customer that is installing 7 systems this year and is committed to 10 more next year. He noted that most of the Atlas installed base has been upgraded to MAX, with the notable exception of a global strategic customer where the upgrade process has just begun.

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EVP and CFO Paul Oldham stated that new data center products have margins much closer to the corporate average, making the segment significantly less dilutive. President and CEO Steve Kelley added that the I&M recovery is driven by both a broad market rebound and early revenue from recent design wins, with an expected acceleration in 2026 as more wins ramp.

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CFO Paul Oldham stated that the gross margin improvement was a combination of facility actions, volume, and mix. He noted that at least half of the targeted 200-250 basis points from facility consolidation has been achieved, with more to come from the China factory closure. CEO Stephen Kelley confirmed a more positive stance on the data center market since the last call, based on direct customer feedback and public statements on AI-related spending, giving them confidence in continued growth through 2025.

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CFO Paul Oldham estimated the transition headwind at 50 to 100 basis points, which he expects to abate over the next three quarters. CEO Stephen Kelley confirmed that design win activity in Industrial & Medical includes many new customers, particularly those acquired through the company's new website, with wins in mil/aerospace, factory automation, and test and measurement.

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CEO Mark Gitin confirmed the book-to-bill ratio was approximately 1.0 across all regions on higher revenue. He detailed the significant growth potential for the Crossbow directed energy system, highlighting a key partnership with Lockheed Martin and a disruptive cost advantage. Gitin and CFO Timothy Mammen attributed systems growth to the Clean Laser acquisition, robotics, and LightWELD sales. Gitin also affirmed IPG's strengthening leadership position in the medical urology laser market, supported by a new customer win.

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CEO Mark Gitin described the AkzoNobel partnership as a 'small starting' opportunity with long-term potential to replace industrial curing ovens. Regarding the medical business, he noted the new urology system will contribute modestly later this year, with a more significant impact in 2026. For micromachining, he stated that while he could not name the specific application, the recent doubling of revenue was driven by a new product launch addressing areas like microelectronics, with a strong product roadmap to follow.

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CFO Tim Mammen explained the Q1 OpEx increase is due to normalized stock compensation, target-level bonus accruals, and strategic investments, expecting a further rise in Q2 before stabilizing. CEO Mark Gitin added that medical growth will be driven by a new thulium laser product launching late in the year and the addition of a new key OEM customer.

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CEO Mark Gitin stated the existing cleaning business is in the 'tens of millions,' with the Clean Laser deal adding about $30 million in revenue. He affirmed that while internal R&D is primary, the company is open to strategic M&A. CFO Timothy Mammen explained the gross margin model is intact, with under-absorption at 660 basis points. He projected margins would climb above 40% as quarterly revenue approaches the $250 million to $300 million range, aided by normalizing inventory provisions.

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CEO Bill Burns identified EMEA as a challenged region, citing tough mobile computing comps and mixed performance, with softness in auto manufacturing and some retail sectors in France. He confirmed that Elo has a very similar go-to-market approach, working with end customers and fulfilling through distributors and resellers, noting that their largest distributor in North America is also Zebra's largest.

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CFO Brian Millard explained that foldable phones can contain up to two to three times the material of a standard phone, representing a significant growth opportunity. CEO Steven Abramson added a personal endorsement of the form factor's utility. Brian Millard also stated that blue development revenues were $1.1 million in the quarter.

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CFO Brian Millard clarified that UDC's focus has been on achieving commercial specs, regardless of architecture, and that the LG announcement is a positive step. He explained that fluorescent blue is an established product with known stability. Millard also confirmed Q1 blue development revenue was approximately $1.1 million and reiterated that full-year 2025 OpEx is expected to be flat year-over-year.

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CFO Brian Millard declined to comment on the status of specific customer negotiations but noted that discussions on various topics are ongoing. He clarified that the 2025 guidance is driven more by the general demand environment rather than significant material pricing pressure, as no major customer agreements are up for renewal this year.

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CEO Matt Moschner confirmed there is evidence that investments in the sales channel are helping drive growth in the regionalized packaging market by reaching more mid-sized customers with easy-to-use products. Regarding the semi market, Moschner stated the full-year cautious view is unchanged and it's too early to call for 2026, but he remains excited about the long-term potential, aided by relationships strengthened through the Moritex acquisition.

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CEO Robert Willett attributed the SEMI strength to investments in high-bandwidth memory for data centers and cross-selling opportunities from the Moritex acquisition. For the medical market, he noted that after a period of customer overinvestment post-COVID, spending is returning to a more normal cadence, with Cognex's new AI and deep learning tools resonating well for complex inspection applications.

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CFO Cary Baker reiterated that the two main drivers for Q3 gross margin expansion are the increasing mix of M800 ICs and the benefit from selling lower-cost wafers. CEO Chris Diorio addressed the food opportunity, stating that item-level tagging is currently in large-scale pilots, with a focus on fresh categories like bakery and proteins where expiration dates are critical to ROI. He expressed strong optimism but noted it will take time to scale.

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CFO Cary Baker explained the sequential Q2 reader IC decline is due to timing, specifically higher-than-expected sales of the end-of-life 'Indy' product in Q1, while demand for the new 'E Family' remains strong. He projected the M800 could become the volume runner later in the year, which would provide a 300 basis point gross margin benefit once fully blended. CEO Chris Diorio added that the new loss analytics deployment is occurring in the second half of the current year.

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CEO Chris Diorio confirmed a strong enterprise pipeline, including two major food opportunities, but acknowledged a current "lull" with no new Fortune 100 ramps expected in the first half of 2025. He noted that any second-half ramps would likely be just starting. Regarding the second grocer, Chris Diorio declined to specify their geographic location for competitive reasons but emphasized it is a large opportunity that Impinj is working with directly.

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CFO Cary Baker confirmed a stronger-than-normal Q4 for systems, driven by seasonal capital deployments, a significant rollout spike from a visionary European retailer, and an elongated end-of-life process for Indy reader ICs. CEO Chris Diorio added that the food tagging opportunity is significant, with meaningful volumes expected in 2025 from quick-serve restaurants, supply chains, and grocers.

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President & CEO Thomas Edman explained that the Wisconsin facility acquisition was driven by future defense sourcing requirements and hyperscaler interest in supply chain resiliency, but a definitive timeline awaits customer commitments. Regarding the Malaysia (Penang) facility, Edman noted that while the revenue ramp is slower than anticipated due to qualification and training challenges affecting yields, it does not impact TTM's competitive position. He confirmed that ramping Penang remains a top priority for the company.

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CEO Thomas Edman stated that TTM is engaged with approximately 10 customers at Penang, including 4 anchor clients. He clarified that while the Medical, Industrial & Instrumentation (MII) segment has more customers in qualification, the Data Center and Networking segments represent the largest revenue contribution. On market visibility, Edman ranked markets by tariff sensitivity, noting Automotive and MII are most sensitive, but expressed confidence as the less-sensitive A&D and Data Center markets constitute over 70% of revenue.

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The Kimball ramp-up is on track, with the expected ~$10M network EBITDA benefit still holding. It's currently a slight margin drag but will contribute more as it scales. The M&A pipeline is full, but they remain disciplined, evaluating both acquisitions and high-return organic projects, with the capacity to pursue both.

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Co-CEO Mike Battles noted that valuations for quality assets remain high but Clean Harbors' strong balance sheet and synergy potential provide a competitive advantage. Co-CEO Eric Gerstenberg confirmed that discussions with multiple captive operators are ongoing but clarified that the company's growth and ramp-up plans for Kimball are not dependent on securing any captive closures, which would represent pure upside.

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Co-CEO Mike Battles noted that while M&A valuations remain high, Clean Harbors' strong balance sheet allows it to be selective and aggressive, adding that economic downturns can create opportunities. Co-CEO Eric Gerstenberg confirmed active discussions with captive owners but clarified that the company's growth and Kimball ramp-up plans do not depend on any captive closures, making them entirely upside potential.

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Co-CEO Eric Gerstenberg confirmed the IS weakness was concentrated in the refinery vertical due to reduced turnaround scope. The strategy is to diversify by cross-selling into other verticals like chemicals. Co-CEO Michael Battles added that they are also focused on pricing to offset wage inflation. Regarding PFAS, Gerstenberg stated the business is on an '$80 million to $90 million run rate' for the year, with Battles adding that exiting 2024 at a $100 million run rate is a fair estimate for the 2025 outlook.

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CEO Todd Gleason explained that the H2 bookings guidance reflects a normalized view and does not assume winning every potential large deal. Regarding inflation, he acknowledged that while major contracts are fixed, rising component costs from distribution are expected and have been factored into the guidance, along with costs for proactive hiring to support growth. He confirmed that the company's stance on tariffs remains unchanged from the previous quarter.

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Todd Gleason (executive) projected a significant step-up in adjusted EBITDA from Q1 to Q2, with a continued ramp throughout the year driven by higher volume, productivity gains, and cost actions. He specified that recent acquisitions contributed approximately $45 million to $50 million to the Q1 bookings, meaning the base business still delivered record orders of around $180 million.

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CEO Todd Gleason explained that project delays are due to a multitude of external factors (supply chain, interest rates, election uncertainty) and are causing projects to shift right, not cancel. He noted that recent acquisitions bring valuable talent to manage the growing pipeline. CFO Peter Johansson confirmed that Profire's historical growth has been organic, driven by market recovery and expansion into new markets.

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Executive Chairman Robert Mehrabian and CEO George Bobb confirmed the full-year margin target of ~60 bps improvement remains intact. Bobb detailed that marine instrumentation growth is driven by sustainable trends in offshore energy and defense subsea unmanned vehicles. Mehrabian affirmed that the KeyOptik acquisition is still expected to add about $0.15 to EPS for the year.

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Executive Chairman Robert Mehrabian and President & CEO George Bobb confirmed the full-year margin target remains. Bobb detailed that marine growth is driven by sustainable trends in offshore energy and subsea defense. Mehrabian affirmed that the KeyOptik acquisition is still expected to add about $0.15 to EPS for the year, calling it a 'really good acquisition' with strong synergies.

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Executive Chairman Robert Mehrabian and CEO George Bobb confirmed the ~60 bps margin target remains intact. Bobb detailed that marine instrumentation growth is driven by sustainable demand in offshore energy and defense subsea vehicles. Mehrabian affirmed they still expect KeyOptik to add about $0.15 to EPS for the year, calling it a 'really good acquisition' with improving margins.

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Executive Chairman Robert Mehrabian projected a full-year margin improvement of approximately 60 basis points, noting that while new acquisitions like Qioptiq are initially dilutive, their margins are expected to improve quarterly. He affirmed that Teledyne's strong balance sheet and cash flow position it well to pursue acquisitions during periods of economic stress, consistent with its historical strategy, while remaining disciplined on valuation.

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Executive Chairman Robert Mehrabian admitted he was surprised by the slow recovery in legacy digital imaging, attributing it to customer and distributor caution on inventory, the China effect, and Teledyne's refusal to accept low-margin orders. For potential upside, he pointed to the Instrumentation segment, especially test and measurement, and new product introductions in Digital Imaging as areas where the current outlook is prudent and could outperform.

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Executive Chairman Robert Mehrabian clarified that sales pull-ins were primarily from the Defense businesses, driven by large backlogs. He provided detailed book-to-bill figures, noting an overall ratio of 1.48, with strong performance in FLIR (1.17) and Engineered Systems (1.82). Regarding Test & Measurement, he stated that Q3 strength came from protocol analyzers and expressed hope for a typical year-end capital expenditure cycle to boost the oscilloscope business in Q4.

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CEO Todd Kelsey revised the fiscal 2025 semi-cap growth forecast to low-double-digits from mid-teens. EVP & CFO Patrick Jermain stated the new Malaysia facility's margin drag would be minimal and short-lived, with CEO Todd Kelsey adding its initial focus will be semi-cap and healthcare. EVP & COO Oliver Mihm attributed confidence in Healthcare's FY26 growth to new program ramps, new customer wins, and positive leading indicators from engineering services. He and VP Shawn Harrison also noted increased activity and strategic positioning for growth in European defense.

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President and CEO Todd Kelsey stated that tariff costs are passed to customers and Plexus is well-positioned to move production if needed, supported by an enhanced trade compliance team. He described semicap demand as stable and driven by share gains. EVP and COO Oliver Mihm and executive Shawn Harrison explained that major manufacturing wins can take 1.5 to 3 years to fully ramp after being announced. EVP and CFO Patrick Jermain attributed the stronger free cash flow forecast to excellent Q1 performance and sustained working capital efficiencies.

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CEO Scott Keeney confirmed strong visibility for A&D products, driven by the HELSI program and a growing sales funnel. CFO Joe Corso specified that the industrial fiber laser business is most directly affected by tariffs on input costs from China, with a potential impact of a few hundred basis points in Q3/Q4. Scott Keeney added that the indirect impact on the broader economy is a source of uncertainty, though the defense business is relatively insulated.

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CEO Scott Keeney confirmed strong visibility for A&D product revenue, citing the HELSI program and a growing funnel of opportunities as key drivers. CFO Joe Corso addressed tariffs, stating the primary impact is on input costs for the industrial fiber laser business, with no significant Q2 impact expected but a potential effect of a few hundred basis points in Q3 and Q4. Scott Keeney added that the indirect impact of tariffs on broader market demand is a larger, unforecastable concern.

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CFO Joe Corso confirmed management's confidence in achieving at least 25% year-over-year growth in the A&D market, noting that while quarterly timing can be difficult to predict, revenue is expected to increase as the year progresses. Corso explained that while the manufacturing transition will provide some gross margin lift, the most significant driver for margin expansion will be higher production volumes.

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CEO Scott Keeney confirmed strong visibility for continued A&D product growth, supported by a robust backlog for key directed energy and sensing programs. He stated that nLIGHT is a deeply engaged supplier for Israel's IRON BEAM project, involved with current products and future development. Keeney also clarified that the Q3 microfabrication revenue increase was driven by a single, long-term customer and should not be seen as a signal of a broader market recovery.

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CEO Scott Keeney confirmed strong visibility for continued A&D product revenue growth, supported by a robust backlog in both directed energy and sensing. He stated that nLIGHT is a supplier for the IRON BEAM project and is 'deeply engaged' with key players in Israel. Keeney clarified that the Q3 microfabrication revenue increase was driven by a single long-term customer and should not be seen as a broader market recovery signal.

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CEO John Lee attributed the Flex drilling pull-in to earlier customer demand rather than tariffs. He noted continued growth in low earth orbit (LEO) satellite applications for HDI drilling, which validates their tool's competitiveness. CFO Ram Mayampurath addressed gross margins, highlighting five consecutive quarters above 47% and reiterating a long-term commitment to a 47%-plus margin despite near-term tariff uncertainty.

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CEO John Lee highlighted 'green shoots' in the chemistry business for advanced packaging, which grew 12% organically year-over-year, and noted rising orders for chemistry equipment for AI-related applications. He explained that AI is now driving growth not just in IC substrates but also in MLB and HDI, which each constitute about a third of the PCB market.

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CFO Carol Hibbard stated that ASR revenue was a single-digit percentage of total revenue for the quarter. She also detailed that the typical total deployment timeline is about 24 months, with installation-to-acceptance being roughly half of that. In Q2, they saw a two-month improvement on that portion, reducing it from 12 months to 10 months for certain projects.

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CFO Carol Hibbard attributed the strong Q4 revenue to accelerated milestone completion and a record number of system starts and completions, noting the Q1 guide still reflects 40% year-over-year growth. CEO Richard Cohen described Veo Robotics as a strategic acquisition for its unique IP in robot safety and noted an increase in inbound M&A interest.

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CEO Richard Soloway and President/CFO Kevin Buchel attributed equipment weakness to temporary distributor destocking, not a lack of end-demand, and highlighted their manufacturing in the Dominican Republic as a key tariff advantage. Buchel explained that higher OpEx from legal fees and new hires represents a new baseline. He also confirmed that the school security market remains robust with available funding and that the PRIMA product is improving after a slow start.

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President and CFO Kevin Buchel provided the equipment revenue breakdown: $7.6 million for intrusion/access and $14.2 million for locking. He stressed that the shortfall was due to timing issues with two specific distributors—one of which made a corporate decision to reduce year-end inventory across all manufacturers—and was not related to a change in end-market demand. Buchel also confirmed the company is not adjusting its OpEx strategy, as the revenue issue is considered temporary, and it will continue investing in growth, particularly by hiring engineers.

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President, COO, and CFO Kevin Buchel reiterated his confidence in a swift locking recovery, citing assurances from the largest locking-specific distributor and strong sell-through data. He noted that radio sales growth was broad-based, not just from one new distributor. Regarding seasonality, Buchel explained that quarters typically strengthen as the fiscal year progresses, with Q4 being the strongest. He also addressed the Prima product line, acknowledging a slower-than-hoped ramp due to a lack of a full accessory set at launch, but stated that with the full line now available, he expects performance to significantly improve.

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Kevin Buchel, President, COO & CFO, stated the company aims for enhanced growth in the radio business through relationships with large national accounts, not just normalization. He confirmed continued strength in fire radios and noted one distributor still has excess inventory. Regarding Prima, he emphasized its importance for penetrating the residential market and adding incremental recurring revenue, expressing optimism about its future success following product enhancements and a dedicated sales focus.

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CFO Dan Schumacher stated the network margin was just over 31%. CEO Rob Bodor explained that their robust supply chain has mitigated significant raw material cost increases from tariffs. He attributed the 3D Printing decline to macro headwinds affecting prototyping, as customers are launching fewer new products. Bodor also noted their differentiated, automated offering is well-suited for the low-to-mid-volume production niche they are targeting.

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CEO Robert Bodor reported seeing traction with both new and established customers, highlighting the effectiveness of the new team-based sales model and citing strong engagement from the medical device sector. Bodor also noted that the aerospace and defense vertical has been particularly strong. CFO Dan Schumacher added that while the start to the year was 'more normal,' trends remain below the prior year, reflecting a prolonged manufacturing contraction.

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CFO Dan Schumacher characterized the market as "uneven," noting that August and September saw a better-than-seasonal pickup from a very low base in June and July. He clarified that October trends reflect a normal seasonal decline, which is factored into the Q4 guidance. Schumacher attributed the margin improvement to better sourcing algorithms in the Network and automation and cost management in the Factory. CEO Rob Bodor added that the organizational realignment is a long-term strategy to optimize operations and better serve customers globally.

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CEO Jeff Benck stated that the effects of customer pauses and pull-ins are currently balancing out, though the uncertainty is elongating new booking cycles. He noted that Industrial sector strength is balanced between new customers and existing ones in areas like HVAC, AGVs, and gaming. He clarified that the new Penang facility (Building 4) will be online next year, but existing capacity is available. Regarding M&A, he explained that Benchmark is evaluating tuck-in opportunities to enhance capabilities but remains focused on organic growth and will be disciplined.

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CEO Jeff Benck confirmed the growth is a combination of both strong share gains from the previous year and improved demand from some OEM customers, particularly in the front-end wafer fab space. CFO Bryan Schumaker explained that the Q1 guidance includes normal variable compensation resets and higher taxes. He affirmed that the company will continue to drive working capital efficiencies, aiming to improve inventory turns from the current 4x towards a historical 5-5.5x.

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CFO Farouq Tuweiq and CEO Dan Bernstein confirmed that the Enercon acquisition is performing better than expected, with a robust growth profile and strong team. They noted that while it's early for monetization, they are seeing synergy opportunities in the sales funnel, particularly in defense, which may be accelerated by the current global environment. Tuweiq also confirmed the fuse facility consolidation in China is complete and mentioned the ongoing process of shifting some at-risk revenue from China to their India operations, a move initiated in late 2024 to enhance nimbleness.

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Executive Farouq Tuweiq projected a positive multiyear outlook for Enercon, driven by global defense replenishment and rearmament trends. He quantified direct AI-related revenue at approximately $7 million in 2024, with strong growth expected in 2025. Executive Daniel Bernstein added that major distributors believe the destocking cycle bottomed in January, with early recovery signs visible in circuit protection orders.

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Executive Farouq Tuweiq stated the Boeing strike's Q3 impact was not overly material and that Q4 guidance accounts for its continuation. CEO Daniel Bernstein added they assume no sales to that customer for the rest of the year. Bernstein identified AI, Space, and EV as drivers of new demand, not just inventory replenishment. Executive Lynn Hutkin reported Q3 Commercial Space revenue was $2 million, bringing the year-to-date total to $6.3 million.

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Executive Daniel Bernstein described the pricing environment as 'shocking,' with surprisingly little price pressure due to customers' focus on inventory management. Executive Farouq Tuweiq added that cost controls should help preserve margins when volumes recover. On recovery timing, Bernstein expressed skepticism about the '6 months' forecast from distributors, calling it a standard non-answer. For OpEx, Tuweiq guided for R&D to remain around $6 million and SG&A to be 'range bound.' Executive Lynn Hutkin provided Q2 revenues of $15.4M for commercial air and $12M for military.

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Executives provided details on the new partnerships, confirming the Topcon deal is a comprehensive collaboration with significant revenue potential and the second OEM deal will launch in late 2025, providing global scale. They acknowledged that tariff uncertainty is causing some customer caution, particularly in Canada and Latin America, which was factored into guidance. They also stated that recent price increases have been well-received in the market and are in line with competitors.

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