Financial Data and Key Metrics Changes - CVD Equipment's revenue for Q2 2022 was 4 million in Q2 2021 [11] - The net loss for Q2 2022 was 0.12 per diluted share, compared to a net income of 0.22 per diluted share in Q2 2021, which included a 10.5 million, a 41.4% increase from 16.7 million, up 60.5% from 12.6 million, compared to $5.8 million in Q1 of the prior year, marking a 72% year-on-year increase in orders [7] - The orders primarily consisted of 21 FirstNano CVD systems, with 14 for the PVT-150 system, 2 for superconducting tape applications, and others for battery nanomaterials [7] - The SDC product line also saw an increase in order rates in Q2 2022, although supply chain issues negatively impacted revenue and profitability across all segments [9] Market Data and Key Metrics Changes - The aerospace market is beginning to recover, but full recovery is not expected until at least 2023 [8] - Supply chain issues due to the pandemic and geopolitical instability have caused increases in commodity and product material costs, affecting all companies [9][15] Company Strategy and Development Direction - The company is focusing on markets that support the electrification of everything, including electric vehicle battery technology and high-power electronics [6] - CVD Equipment is driving towards operational self-reliance by installing additional machine centers to mitigate supply chain issues [10] - The company aims to leverage its investments in capital equipment to improve machining capabilities and operational efficiencies [26] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the second half of 2022, emphasizing the importance of customer focus and market engagement [21] - The return to profitability is dependent on the completion and delivery of existing orders, ongoing receipt of new orders, and managing supply chain issues [18] - The company believes its cash and cash equivalents will be sufficient to meet working capital and capital expenditure requirements for the next 12 to 18 months [19] Other Important Information - The company has been impacted by increased costs on manufacturing material components and delays in supply chain deliveries since Q3 2021 [15] - CVD Equipment is utilizing flexible in-house manufacturing to mitigate potential delivery delays and material cost increases [15] Q&A Session Summary Question: Employee headcount changes and hiring plans - The company has added approximately 15 to 18 personnel this year to support increased manufacturing capacity [22] Question: Ability to find skilled labor at the right cost - The company has been able to attract talent in engineering and operations, with positive results in hiring [24] Question: Future of in-house manufacturing if supply chain issues improve - The company plans to continue in-house manufacturing as it improves margins and supports competitiveness [26] Question: Explanation of different battery technology devices - The company manufactures the Carbon 300, Powder Coat 1100, and PVT-150, each serving different applications in battery technology and high-power electronics [27][29] Question: Competitors and market share growth - The growth has been attributed to both market share gains and overall industry growth [33] Question: National security concerns and preference for U.S. manufacturing - There is a preference for U.S. manufacturing in battery technology and electrification, which could benefit the company [36] Question: Scarcity of resources holding back potential - The primary issue is supply chain problems affecting all equipment companies [37] Question: Capital allocation thoughts for future profitability - The company is focusing on organic growth and has not prioritized share repurchase discussions at this time [46]
CVD(CVV) - 2022 Q2 - Earnings Call Transcript