BE Semiconductor Industries N.V. (Besi) announced it grew its second-quarter net income by 110.6 percent from 2019. The electronic component manufacturing equipment maker significantly improved its profit because of a surge in demand from is Chinese clients. The company also revealed its robust recent sales allowed it to beat its 2019 first-half earnings by over 89.1 percent.
Besi’s Impressive Q2 Financial Results
In Q2 2020, Besi took in €124.3 million ($146.68 million) in revenue, an increase of 34.1 percent from the same period last year. Thanks to an improved product mix and enhanced labor cost reductions, the brand bettered its gross margin by 6 percent. Together, those changes enabled the firm to earn €39.8 million ($46.93 million) in net income versus €18.9 million ($22.29 million) in Q2 2020.
In April, Besi offered a Q2 sales range of €95.865 ($107.62 million) to €114.15 million ($134.55 million). However, the firm’s better-than-expected revenue in the June period blew past the high point of its guidance by 8.91 percent.
CEO Richard W. Blickman said his company’s strong revenue growth came from healthier than anticipated mobile component equipment shipments. Even with the impact of the coronavirus pandemic, the firm’s Chinese handset and personal electronics customers ramped up their orders.
Besi Improves Half Year Sales by 32.5 Percent
Since Besi experienced such strong business growth in Q2 2020, it topped its 2019 first-half financial results. In the first six months of this year, the brand earned €53.7 million ($63.3 million) in net income against €215.6 million ($254.14) in revenue. That means the firm topped its 2019 first-half net income results by 89.1 percent and outpaced its sales 32.5 percent.
Unfortunately, Besi does not expect its success to carry over into Q3.
Blickman provided guidance that his firm’s sales would drop by 10 to 25 percent sequentially. That works out to an estimated revenue range of €93.225 million ($109.89 million) to €111.87 million ($131.87 million). The CEO explained his company predicts a negative sequential change because of coronavirus related uncertainty and a historic drop off in purchases during the summer.
That said, the manufacturer’s medium-term outlook is not all bad. Market research company Counterpoint reported the Chinese smartphone market contracted by 17 percent from 2019 in Q2. If brands like Apple and Huawei generate buzz for their late 2020 releases, local demand might pick up in Q3. Provided such a scenario unfolds, Besi might beat its guidance two quarters in a row.