Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) Q3 2020 Earnings Conference Call - Final Transcript
Jul 30, 2020 • 08:00 am ET
Hello, and welcome to the Kulicke & Soffa, Third Quarter Fiscal 2020 Financial Results Conference Call. [Operator Instructions]. A question-and-answer session will follow the formal presentation. [Operator Instructions]. It is now my pleasure to turn the call over to Joe Elgindy, Senior Director, Investor Relations and Strategic Initiatives. Joe, please go ahead.
Thank you. Welcome everyone to Kulicke & Soffa's third quarter fiscal 2020 conference call. Joining us on the call today are Fusen Chen, President and Chief Executive Officer and Lester Wong, Chief Financial Officer. For those of you who have not received a copy of today's results, the release as well as the latest investor presentation are both available in the Investor Relations section of our website at investor.kns.com.
In addition to historical statements, today's remarks will contain statements relating to future events and our future results. These statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Our actual results and financial condition may differ materially from what is indicated in those forward-looking statements.
For a complete discussion of the risks associated with Kulicke and Soffa that could affect our future results and financial condition, please refer to our recent SEC filings, specifically the 10-K for the year ended September 28th, 2019, and the 10-Q for the period ending, March 28th, 2020.
With that said, I would now like to turn the call over to Fusen Chen for the business overview. Please go ahead, Fusan.
Thank you, Joe. Considering the increasing dynamic environment we are operating in, we wanted to start this call by highlighting three specific points, that may help to clarify our position and the strategy.
First, our manufacturing facility are operating at a nearly full capacity, and the development progress are continuing to progress as planned. Last quarter, we specifically identified supply chain concerns associated with the regional shutdown in place and the movement control orders, which constrained capacity at several suppliers. These supply chain issues were resolved by early May, and that we no longer anticipate supply chain challenge in the near-term.
Secondly, although US reopening challenge made adversity effect near-term [Indecipherable] and the industry-related dynamic. We continue to anticipate a robust recovery in semiconductor unit growth is inevitable. With over 80% of global semiconductor package utilizing wire bonding process, our core market is clearly correlated with the semiconductor unit growth. Total semiconductor unit production in calendar year 2018 was estimated to be about 5% higher than unit expectations in calendar year 2020.
This decrease in production is unique historically, and has impacted demand for our core products. Currently, recent semiconductor forecasts from Gartner support our view that semiconductor unit count will grow by 10% to 11% annually for both calendar year 2021 and also 2022. Again, this anticipated return to unit growth is expected to directly and positively trigger capacity investments for our core products. Last, our visibility in the longer term roadmap within the fast growing next generation LED market has improved.
We are technically executing