Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 28, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __ to __

Commission File Number: 001-37961

_________________________________________________________________________________________________________________________

ICHOR HOLDINGS, LTD.

(Exact Name of Registrant as Specified in its Charter)

_________________________________________________________________________________________________________________________


Cayman Islands						Not Applicable
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)
3185 Laurelview Ct. Fremont, California						94538
(Address of principal executive offices)						(Zip Code)

Registrant’s telephone number, including area code: (510) 897-5200

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary Shares, par value $0.0001	ICHR	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non‑accelerated filer

Small reporting company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). Yes o No x

As of August 2, 2024, the registrant had 33,687,847 ordinary shares, $0.0001 par value per share, outstanding.

TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)	1
	Consolidated Balance Sheets	1
	Consolidated Statements of Operations	2
	Consolidated Statements of Shareholders' Equity	3
	Consolidated Statements of Cash Flows	5
	Notes to Consolidated Financial Statements	6
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	14
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	24
ITEM 4.	CONTROLS AND PROCEDURES	24

PART II - OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	25
ITEM 1A.	RISK FACTORS	25
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	25
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	25
ITEM 4.	MINE SAFETY DISCLOSURES	25
ITEM 5.	OTHER INFORMATION	25
ITEM 6.	EXHIBITS	26

	SIGNATURES	27

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

ICHOR HOLDINGS, LTD.

Consolidated Balance Sheets

(in thousands, except share and per share amounts)

(unaudited)


	June 28, 2024		December 29, 2023
Assets
Current assets:
Cash and cash equivalents	$	114,349	$	79,955
Accounts receivable, net	65,216		66,721
Inventories	231,475		245,885
Prepaid expenses and other current assets	7,596		8,804
Total current assets	418,636		401,365
Property and equipment, net	89,142		92,755
Operating lease right-of-use assets	34,623		36,611
Other noncurrent assets	13,727		11,912
Deferred tax assets, net	3,103		3,148
Intangible assets, net	53,056		57,288
Goodwill	335,402		335,402
Total assets	$	947,689	$	938,481
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	58,961	$	60,490
Accrued liabilities	15,122		14,871
Other current liabilities	6,812		6,638
Current portion of long-term debt	7,500		7,500
Current portion of lease liabilities	9,721		9,463
Total current liabilities	98,116		98,962
Long-term debt, less current portion, net	122,665		241,183
Lease liabilities, less current portion	26,025		28,187
Deferred tax liabilities, net	1,169		1,169
Other non-current liabilities	4,838		4,303
Total liabilities	252,813		373,804
Shareholders’ equity:
Preferred shares ($0.0001 par value; 20,000,000 shares authorized; 0 shares issued and outstanding)	—		—
Ordinary shares ($0.0001 par value; 200,000,000 shares authorized; 33,629,331 and 29,435,398 shares outstanding, respectively; 38,066,770 and 33,872,837 shares issued, respectively)	3		3
Additional paid in capital	595,881		451,581
Treasury shares at cost (4,437,439 shares)	(91,578)		(91,578)
Retained earnings	190,570		204,671
Total shareholders’ equity	694,876		564,677
Total liabilities and shareholders’ equity	$	947,689	$	938,481

The accompanying notes are an integral part of these consolidated financial statements.

ICHOR HOLDINGS, LTD.

Consolidated Statements of Operations

(in thousands, except share and per share amounts)

(unaudited)


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net sales	$	203,227	$	185,008	$	404,610	$	410,878
Cost of sales	177,670		159,266		356,059		351,896
Gross profit	25,557		25,742		48,551		58,982
Operating expenses:
Research and development	5,926		5,188		11,296		9,501
Selling, general, and administrative	19,807		19,500		39,026		39,667
Amortization of intangible assets	2,086		3,960		4,232		7,926
Total operating expenses	27,819		28,648		54,554		57,094
Operating income (loss)	(2,262)		(2,906)		(6,003)		1,888
Interest expense, net	1,858		5,030		5,954		9,580
Other expense, net	50		100		289		884
Loss before income taxes	(4,170)		(8,036)		(12,246)		(8,576)
Income tax expense	942		12,620		1,855		12,085
Net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)
Net loss per share
Basic	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Diluted	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Shares used to compute Net loss per share:
Basic	33,548,071		29,116,413		31,779,521		29,050,645
Diluted	33,548,071		29,116,413		31,779,521		29,050,645

The accompanying notes are an integral part of these consolidated financial statements.

ICHOR HOLDINGS, LTD.

Consolidated Statements of Shareholders’ Equity

(in thousands, except share amounts)

(unaudited)


For the three months ending June 28, 2024	Ordinary Shares			Additional Paid-In Capital		Treasury Shares			Retained Earnings		Total Shareholders' Equity
	Shares	Amount				Shares	Amount
Balance at March 29, 2024	33,467,846	$	3	$	593,125	4,437,439	$	(91,578)	$	195,682	$	697,232

Ordinary shares issued from exercise of stock options	31,381	—		747		—	—		—		747
Ordinary shares issued from vesting of restricted share units	130,104	—		(1,929)		—	—		—		(1,929)

Share-based compensation expense	—	—		3,938		—	—		—		3,938
Net loss	—	—		—		—	—		(5,112)		(5,112)
Balance at June 28, 2024	33,629,331	$	3	$	595,881	4,437,439	$	(91,578)	$	190,570	$	694,876


For the three months ending June 30, 2023	Ordinary Shares			Additional Paid-In Capital		Treasury Shares			Retained Earnings		Total Shareholders' Equity
	Shares	Amount				Shares	Amount
Balance at March 31, 2023	29,034,946	$	3	$	437,388	4,437,439	$	(91,578)	$	247,651	$	593,464
Ordinary shares issued from exercise of stock options	31,996	—		724		—	—		—		724
Ordinary shares issued from vesting of restricted share units	124,702	—		(1,637)		—	—		—		(1,637)
Ordinary shares issued from employee share purchase plan	49,917	—		1,131		—	—		—		1,131
Share-based compensation expense	—	—		4,277		—	—		—		4,277
Net loss	—	—		—		—	—		(20,656)		(20,656)
Balance at June 30, 2023	29,241,561	$	3	$	441,883	4,437,439	$	(91,578)	$	226,995	$	577,303

The accompanying notes are an integral part of these consolidated financial statements.

ICHOR HOLDINGS, LTD.

Consolidated Statements of Shareholders’ Equity

(in thousands, except share amounts)

(unaudited)


For the six months ending June 28, 2024	Ordinary Shares			Additional Paid-In Capital		Treasury Shares			Retained Earnings		Total Shareholders' Equity
	Shares	Amount				Shares	Amount
Balance at December 29, 2023	29,435,398	$	3	$	451,581	4,437,439	$	(91,578)	$	204,671	$	564,677
Ordinary shares issued, net of transaction costs	3,833,334	—		136,738		—	—		—		136,738
Ordinary shares issued from exercise of stock options	142,331	—		3,500		—	—		—		3,500
Ordinary shares issued from vesting of restricted share units	182,215	—		(3,272)		—	—		—		(3,272)
Ordinary shares issued from employee share purchase plan	36,053	—		1,021		—	—		—		1,021
Share-based compensation expense	—	—		6,313		—	—		—		6,313
Net loss	—	—		—		—	—		(14,101)		(14,101)
Balance at June 28, 2024	33,629,331	$	3	$	595,881	4,437,439	$	(91,578)	$	190,570	$	694,876


For the six months ending June 30, 2023	Ordinary Shares			Additional Paid-In Capital		Treasury Shares			Retained Earnings		Total Shareholders' Equity
	Shares	Amount				Shares	Amount
Balance at December 30, 2022	28,861,949	$	3	$	431,415	4,437,439	$	(91,578)	$	247,656	$	587,496
Ordinary shares issued from exercise of stock options	124,762	—		2,850		—	—		—		2,850
Ordinary shares issued from vesting of restricted share units	157,229	—		(2,329)		—	—		—		(2,329)
Ordinary shares issued from employee share purchase plan	97,621	—		2,033		—	—		—		2,033
Share-based compensation expense	—	—		7,914		—	—		—		7,914
Net loss	—	—		—		—	—		(20,661)		(20,661)
Balance at June 30, 2023	29,241,561	$	3	$	441,883	4,437,439	$	(91,578)	$	226,995	$	577,303

The accompanying notes are an integral part of these consolidated financial statements.

ICHOR HOLDINGS, LTD.

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	Six Months Ended
	June 28, 2024		June 30, 2023
Cash flows from operating activities:
Net loss	$	(14,101)	$	(20,661)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	15,679		17,145
Share-based compensation	6,313		7,914
Deferred income taxes	45		10,049
Amortization of debt issuance costs	232		233



Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net	1,505		40,561
Inventories	14,410		17,470
Prepaid expenses and other assets	1,878		5,986
Accounts payable	(144)		(45,047)
Accrued liabilities	53		(5,961)
Other liabilities	(3,574)		(11,619)
Net cash provided by operating activities	22,296		16,070
Cash flows from investing activities:
Capital expenditures	(7,337)		(10,834)




Net cash used in investing activities	(7,337)		(10,834)
Cash flows from financing activities:
Issuance of ordinary shares, net of fees	136,738		—
Issuance of ordinary shares under share-based compensation plans	4,719		3,981
Employees' taxes paid upon vesting of restricted share units	(3,272)		(2,329)


Repayments on revolving credit facility	(115,000)		(5,000)

Repayments on term loan	(3,750)		(3,750)
Net cash provided by (used in) financing activities	19,435		(7,098)
Net increase (decrease) in cash	34,394		(1,862)
Cash at beginning of period	79,955		86,470
Cash at end of period	$	114,349	$	84,608
Supplemental disclosures of cash flow information:
Cash paid during the period for interest	$	7,536	$	9,851
Cash paid during the period for taxes, net of refunds	$	1,452	$	3,340
Supplemental disclosures of non-cash activities:
Capital expenditures included in accounts payable	$	1,458	$	293
Right-of-use assets obtained in exchange for new operating lease liabilities	$	2,379	$	3,103

The accompanying notes are an integral part of these consolidated financial statements.

ICHOR HOLDINGS, LTD.

Notes to Consolidated Financial Statements

(dollar figures in tables in thousands, except per share amounts)

(unaudited)


Note 1 – Basis of Presentation and Selected Significant Accounting Policies

Basis of Presentation

These consolidated unaudited financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”). All intercompany balances and transactions have been eliminated upon consolidation. All dollar figures presented in tables in the notes to the consolidated financial statements are in thousands, except per share amounts. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted as permitted by the U.S. Securities and Exchange Commission's rules and regulations for interim reporting. These consolidated financial statements should be read in conjunction with our audited financial statements and notes thereto included in our Annual Report on Form 10‑K for the year ended December 29, 2023.

Year End

We use a 52- or 53-week fiscal year ending on the last Friday in December. Our fiscal years ending December 27, 2024 and December 29, 2023 are each 52 weeks. References to 2024 and 2023 relate to the fiscal years then ended, respectively. The three-month periods ended June 28, 2024 and June 30, 2023 are each 13 weeks. References to the second quarter of 2024 and 2023 relate to the three-month periods then ended.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods presented. We base our estimates and judgments on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results could differ from the estimates made by management. Significant estimates include inventory valuation, uncertain tax positions, valuation allowance on deferred tax assets, and impairment analysis for both definite‑lived intangible assets and goodwill.

Cash and Cash Equivalents

Cash and cash equivalents consist of deposits and financial instruments which are readily convertible into cash and have original maturities of 90 days or less at the time of acquisition.

Fair Value of Financial Instruments

The carrying values of our financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities, and long-term debt, net of unamortized debt issuance costs, approximate fair value.

Revenue Recognition

We recognize revenue when control of promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. This amount is recorded as net sales in our consolidated statements of operations.

Transaction price – In most of our contracts, prices are generally determined by a customer-issued purchase order and generally remain fixed over the duration of the contract. Certain contracts contain variable consideration, including early-payment discounts and rebates. When a contract includes variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include the variable consideration in the transaction price only to the extent that it is probable that a significant reversal will not occur. Variable consideration estimates are updated at each reporting date. Historically, we have not incurred significant costs to obtain a contract. All amounts billed to a customer relating to shipping and handling are classified as net sales, while all costs incurred by us for shipping and handling are classified as cost of sales.

Performance obligations – Substantially all of our performance obligations pertain to promised goods (“products”), which are primarily comprised of fluid delivery subsystems, weldments, and other components. Most of our contracts contain a single performance obligation and are generally completed within 12 months. Product sales are recognized at a point-in-time, upon "delivery," as such term is defined within the contract, which is generally at the time of shipment, as that is when control of the product has transferred. Products are covered by a standard assurance warranty, generally extended for a period of one to two years depending on the customer, which promises that delivered products conform to contract specifications. As such, we account for such warranties under Accounting Standards Codification ("ASC") Topic 460, Guarantees, and not as a separate performance obligation.

Contract balances – Accounts receivable represents our unconditional right to receive consideration from our customers. Accounts receivable are carried at invoice price less an estimate for doubtful accounts and estimated payment discounts. Payment terms vary by customer, but payment is generally due within 15 to 60 days of purchase. Historically, we have not experienced significant payment issues with our customers. We had no significant contract assets or liabilities on our consolidated balance sheets in any of the periods presented herein.

Public Offering of Shares

In March 2024, we completed an underwritten public offering of 3.8 million ordinary shares, which included the exercise in full of the underwriters' option to purchase additional ordinary shares. We received net proceeds from the offering of approximately $136.7 million, after deducting the underwriting discount of $1.59 per share and incremental offering expenses of $0.9 million.

Accounting Pronouncements Recently Issued

In November 2023, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker ("CODM"), a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted, and requires retrospective application to all prior periods presented in the financial statements. We are currently evaluating the effect that the adoption of this ASU may have on our consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). This ASU is intended to enhance the transparency, decision usefulness, and effectiveness of income tax disclosures. The ASU requires a public entity to disclose a tabular tax rate reconciliation, using both percentages and currency, with specific categories. The ASU also requires a public entity to provide a qualitative description of the state and local income tax category and the net amount of income taxes paid, disaggregated by federal, state, and foreign taxes as well as by individual jurisdictions. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024, and early adoption and retrospective application are permitted. We are currently evaluating the effect that the adoption of this ASU may have on our consolidated financial statements.


Note 2 – Inventories

Inventories consist of the following:


	June 28, 2024		December 29, 2023
Raw materials	$	179,796	$	190,027
Work in process	37,631		36,849
Finished goods	46,746		47,449
Excess and obsolete adjustment	(32,698)		(28,440)
Total inventories	$	231,475	$	245,885


Note 3 – Property and Equipment and Other Noncurrent Assets

Property and equipment consist of the following:


	June 28, 2024		December 29, 2023
Machinery	$	118,076	$	113,529
Leasehold improvements	47,647		46,129
Computer software, hardware, and equipment	9,085		10,316
Office furniture, fixtures, and equipment	1,315		1,320
Vehicles	395		396
Construction-in-process	3,941		4,216
	180,459		175,906
Less accumulated depreciation	(91,317)		(83,151)
Total property and equipment, net	$	89,142	$	92,755

Depreciation expense was $5.3 million and $4.4 million for the second quarter of 2024 and 2023, respectively. Depreciation expense was $10.4 million and $8.7 million for the six months ended June 28, 2024 and June 30, 2023, respectively.

Cloud Computing Implementation Costs

We capitalize implementation costs associated with hosting arrangements that are service contracts. These costs are recorded to prepaid expenses or other noncurrent assets. To date, these costs have been those incurred to implement a new company-wide enterprise resource planning system. The balance of capitalized cloud computing implementation costs, net of accumulated amortization, was $7.6 million and $8.1 million as of June 28, 2024 and December 29, 2023, respectively, and is included in other noncurrent assets on our consolidated balance sheets. The related amortization expense, which is included in selling, general, and administrative expense on our consolidated statements of operations, was $0.3 million and $0.2 million for the second quarter of 2024 and 2023, respectively, and $0.5 million and $0.5 million for the six months ended June 28, 2024 and June 30, 2023, respectively.


Note 4 – Intangible Assets

Definite‑lived intangible assets consist of the following:


	June 28, 2024
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	73,142	$	(24,974)	$	—	$	48,168	9.9 years
Developed technology	11,047		(6,159)		—		4,888		10.0 years
Total intangible assets	$	84,189	$	(31,133)	$	—	$	53,056


	December 29, 2023
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	105,542	$	(53,680)	$	—	$	51,862	8.7 years
Developed technology	11,047		(5,621)		—		5,426		10.0 years
Total intangible assets	$	116,589	$	(59,301)	$	—	$	57,288


Note 5 – Leases

Operating lease right-of-use (“ROU”) assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. For purposes of calculating operating lease ROU assets and liabilities, we use the non-cancelable lease term plus options to extend that we are reasonably certain to take. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. Our leases generally do not provide an implicit rate. As such, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments.

We lease facilities under non-cancelable operating leases that expire at various dates during the years 2024 through 2031. In addition to base rental payments, we are generally responsible for our proportionate share of operating expenses, including facility maintenance, insurance, and property taxes. As these amounts are variable, they are not included in lease liabilities.

The components of lease expense are as follows:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Operating lease cost	$	2,492	$	2,393	$	4,984	$	4,804

Supplemental cash flow information related to leases is as follows:


	Six Months Ended
	June 28, 2024		June 30, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,851	$	4,602

Supplemental balance sheet information related to leases is as follows:


	June 28, 2024	December 29, 2023
Weighted-average remaining lease term of operating leases	4.3 years	4.6 years
Weighted-average discount rate of operating leases	3.8%	3.4%

Future minimum lease payments under non-cancelable leases are as follows as of June 28, 2024:


2024, remaining	$	4,936
2025	9,498
2026	9,170
2027	8,407
2028	3,882
Thereafter	2,827
Total future minimum lease payments	38,720
Less imputed interest	(2,974)
Total lease liabilities	$	35,746


Note 6 – Income Taxes

Income tax information for the periods reported is as follows:


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
Income tax expense	$	942		$	12,620		$	1,855		$	12,085
Loss before income taxes	$	(4,170)		$	(8,036)		$	(12,246)		$	(8,576)
Effective income tax rate	(22.6)		%	(157.0)		%	(15.1)		%	(140.9)		%

Our effective tax rate for the three and six months ended June 28, 2024 differs from the statutory rate primarily due to taxes on foreign income that differs from the U.S. tax rate, including a tax holiday in Singapore from which we will benefit through 2026, and a valuation allowance against U.S. deferred tax assets.

Our effective tax rate for the three and six months ended June 30, 2023 differs from the statutory rate primarily due to a valuation allowance recorded against our U.S. federal and state deferred tax assets, as well as taxes on foreign income that differ from the U.S. tax rate, including a tax holiday in Singapore from which we will benefit through 2026. We recorded an $11.1 million valuation allowance in the second quarter of 2023 based on an assessment of available positive and negative evidence, including an estimate of being in a three-year cumulative loss position in the U.S. by the end of 2023, projections of future taxable income, and other quantitative and qualitative information. We intend to maintain a full valuation allowance on our U.S. federal and state net deferred tax assets until there is sufficient positive evidence to support the reversal of all or some portion of the valuation allowance.

The ending balance for the unrecognized tax benefits for uncertain tax positions was approximately $4.2 million as of June 28, 2024. The related interest and penalties were $0.5 million. The uncertain tax positions that are reasonably possible to decrease in the next twelve months are insignificant.

As of June 28, 2024, we were under examination by California tax authorities.


Note 7 – Employee Benefit Programs

401(k) Plan

We sponsor a 401(k) plan available to employees of our U.S.‑based subsidiaries. Participants may make salary deferral contributions not to exceed 50% of a participant’s annual compensation or the maximum amount otherwise allowed by law. Eligible employees receive a discretionary matching contribution equal to 50% of a participant’s deferral, up to an annual matching maximum of 4% of a participant’s annual compensation. Matching contributions were $0.6 million and $0.6 million for the second quarter of 2024 and 2023, respectively, and $1.4 million and $1.5 million for the six months ended June 28, 2024 and June 30, 2023, respectively.


Note 8 – Long-Term Debt

Long‑term debt consists of the following:


	June 28, 2024		December 29, 2023
Term loan	$	131,250	$	135,000
Revolving credit facility	—		115,000
Total principal amount of long-term debt	131,250		250,000
Less unamortized debt issuance costs	(1,085)		(1,317)
Total long-term debt, net	130,165		248,683
Less current portion	(7,500)		(7,500)
Total long-term debt, less current portion, net	$	122,665	$	241,183

On October 29, 2021, we entered into an amended and restated credit agreement, which includes a group of financial institutions as direct lenders under the agreement. The credit agreement includes a $150.0 million term loan facility and a $250.0 million revolving credit facility (together, “credit facilities”). Term loan principal payments of $1.9 million are due on a quarterly basis. The credit facilities mature, and amounts due thereunder become payable, on October 29, 2026.

Interest is charged at either the Base Rate or the Bloomberg Short-Term Bank Yield (“BSBY”) Rate (as such terms are defined in the credit agreement) at our option, plus an applicable margin. The Base Rate is equal to the higher of i) the Prime Rate, ii) the Federal Funds Rate plus 0.5%, or iii) the BSBY Rate plus 1.00%. The BSBY Rate is equal to BSBY for a particular tenor matching the respective interest period. The applicable margin on Base Rate and BSBY Rate loans is 0.375% to 1.375% and 1.375% to 2.375% per annum, respectively, depending on our leverage ratio, which is based on trailing 12-month Consolidated EBITDA, as defined in our credit agreement. We are also charged a commitment fee of 0.175% to 0.350%, depending on our leverage ratio, on the unused portion of our revolving credit facility. Base Rate interest payments and commitment fees are due quarterly. BSBY Rate interest payments are due on the last day of the applicable interest period, or quarterly for applicable interest periods longer than three months. As of June 28, 2024, our credit facilities bore interest under the BSBY rate option at 7.27%.


Note 9 – Share‑Based Compensation

The 2016 Omnibus Incentive Plan provides for grants of share‑based awards to employees, directors, and consultants. Awards may be in the form of stock options (“options”), tandem and non‑tandem stock appreciation rights, restricted share awards or restricted share units (“RSUs”), performance awards, and other share‑based awards. Forfeited or expired awards are returned to the incentive plan pool for future grants. Awards generally vest over four years, 25% on the first anniversary of the date of grant and quarterly thereafter over the remaining three years. Upon vesting of RSUs, shares are withheld to cover statutory minimum withholding taxes. Shares withheld are not reflected as an issuance of ordinary shares within our consolidated statements of shareholders’ equity, as the shares are never issued, and the associated tax payments are reflected as financing activities within our consolidated statements of cash flows.

Share‑based compensation expense across all plans for options, RSUs, and employee share purchase rights was $3.9 million and $4.3 million for the second quarter of 2024 and 2023, respectively, and $6.3 million and $7.9 million for the six months ended June 28, 2024 and June 30, 2023, respectively.

Stock Options

The following table summarizes option activity:


	Number of Stock Options
	Service condition	Weighted average exercise price per share		Weighted average remaining contractual term	Aggregate intrinsic value
Outstanding, December 29, 2023	582,163	$	24.36
Granted	—	$	—
Exercised	(142,331)	$	24.59
Forfeited or expired	(639)	$	21.76
Outstanding, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266
Exercisable, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266

Restricted Share Units

The following table summarizes RSU activity:


	Number of RSUs
	Service condition	Performance condition	Market condition	Weighted average grant-date fair value per share
Unvested, December 29, 2023	1,088,083	97,299	171,101	$	30.37
Granted	389,622	100,941	62,776	$	40.33
Vested	(251,711)	(6,609)	(8,617)	$	32.04
Forfeited	(74,110)	(13,021)	(23,419)	$	30.26
Unvested, June 28, 2024	1,151,884	178,610	201,841	$	33.61

Employee Share Purchase Plan

The 2017 Employee Stock Purchase Plan (the “2017 ESPP”) grants employees the ability to designate a portion of their base-pay to purchase ordinary shares at a price equal to 85% of the fair market value of our ordinary shares on the first or last day of each six-month purchase period. Purchase periods begin on January 1 or July 1 and end on June 30 or December 31 (or the next business day if such date is not a business day). Shares are purchased on the last day of the purchase period.

As of June 28, 2024, approximately 2.1 million ordinary shares remain available for purchase under the 2017 ESPP.


Note 10 – Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share and a reconciliation of the numerator and denominator used in the calculation:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)
Denominator:
Basic weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Dilutive effect of options	—		—		—		—
Dilutive effect of RSUs	—		—		—		—
Dilutive effect of ESPP	—		—		—		—
Diluted weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Securities excluded from the calculation of diluted weighted average ordinary shares outstanding (1)	2,193,000		2,311,000		2,492,000		2,469,000
Net loss per share:
Basic	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Diluted	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)

(1)Represents potentially dilutive options and RSUs excluded from the calculation of diluted weighted average ordinary shares outstanding, because including them would have been antidilutive under the treasury stock method.


Note 11 – Segment Information

Our CODM, the Chief Executive Officer, reviews our results of operations on a consolidated level, and executive staff is structured by function rather than by product category. Additionally, key resources, decisions, and assessment of performance are analyzed at a company‑wide level. Therefore, we operate in one operating segment.

Foreign operations are conducted primarily through our wholly owned subsidiaries in Singapore and Malaysia and, to a lesser degree, Scotland, Korea, and Mexico. Our principal markets include North America, Asia, and, to a lesser degree, Europe.

Sales by geographic area represents sales to unaffiliated customers based upon the location to which the products were shipped. The following table sets forth sales by geographic area:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
United States of America	$	69,259	$	61,623	$	133,653	$	150,675
Singapore	81,541		70,372		160,667		152,658
Europe	21,307		27,764		52,656		57,750
Other	31,120		25,249		57,634		49,795
Total net sales	$	203,227	$	185,008	$	404,610	$	410,878

Foreign long-lived assets, exclusive of deferred tax assets, were $46.2 million and $48.2 million as of June 28, 2024 and December 29, 2023, respectively.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


Cautionary Statement Concerning Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. You should not place undue reliance on these statements. All statements other than statements of historical fact included in this report are forward-looking statements. These statements relate to analyses and other information which are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies. These forward-looking statements are identified by the use of terms and phrases such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will” and similar terms and phrases, including references to assumptions. However, these words are not the exclusive means of identifying such statements. These statements are contained in many sections of this report, including in this Part I – Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that we will achieve those plans, intentions or expectations. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, include geopolitical, economic and market conditions, including high inflation, changes to fiscal and monetary policy, high interest rates, currency fluctuations, challenges in the supply chain and any disruptions in the global economy as a result of the conflicts in Ukraine and the Middle East; dependence on expenditures by manufacturers and cyclical downturns in the semiconductor capital equipment industry; reliance on a very small number of original equipment manufacturers ("OEMs") for a significant portion of sales; negotiating leverage held by our customers; competitiveness and rapid evolution of the industries in which we participate; keeping pace with developments in the industries we serve and with technological innovation generally; designing, developing and introducing new products that are accepted by OEMs in order to retain our existing customers and obtain new customers; managing our manufacturing and procurement process effectively; defects in our products that could damage our reputation, decrease market acceptance and result in potentially costly litigation; our dependence on a limited number of suppliers; and other factors set forth in this report, and those set forth in Part I – Item 1A. Risk Factors of our Annual Report on Form 10‑K for the fiscal year ended December 29, 2023 ("2023 Annual Report on Form 10-K") and our other filings with the Securities and Exchange Commission (“SEC”). All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements contained in Part I – Item 1A. Risk Factors to our 2023 Annual Report on Form 10-K, as well as other cautionary statements that are made from time to time in our other filings with the SEC and public communications. You should evaluate all forward-looking statements made in this report in the context of these risks and uncertainties.

We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated unaudited financial statements and related notes included elsewhere in this report.


Overview

We are a leader in the design, engineering, and manufacturing of critical fluid delivery subsystems and components for semiconductor capital equipment. Our product offerings include gas and chemical delivery systems and subsystems, collectively known as fluid delivery systems and subsystems, which are key elements of the process tools used in the manufacturing of semiconductor devices. Our gas delivery subsystems deliver, monitor, and control precise quantities of the specialized gases used in semiconductor manufacturing processes such as etch and deposition. Our chemical delivery systems and subsystems precisely blend and dispense the reactive liquid chemistries used in semiconductor manufacturing processes such as chemical-mechanical planarization, electroplating, and cleaning. We also provide precision-machined components, weldments, e‑beam and laser-welded components, precision vacuum and hydrogen brazing, surface treatment technologies, and other proprietary products. This vertically integrated portion of our business is primarily focused on metal and plastic parts that are used in gas and chemical systems, respectively.

Fluid delivery subsystems ensure accurate measurement and uniform delivery of specialty gases and chemicals at critical steps in the semiconductor manufacturing processes. Any malfunction or material degradation in fluid delivery reduces yields and increases the likelihood of manufacturing defects in these processes. Most OEMs outsource all or a portion of the design, engineering, and manufacturing of their gas delivery subsystems to a few specialized suppliers, including us. Additionally, many OEMs are outsourcing the design, engineering, and manufacturing of their chemical delivery subsystems due to the increased fluid expertise required to manufacture these subsystems. Outsourcing these subsystems has allowed OEMs to leverage suppliers’ highly specialized engineering, design, and production skills while focusing their internal resources on their own value-added processes.

We have a global footprint with production facilities in California, Minnesota, Oregon, Texas, Singapore, Malaysia, the United Kingdom, Korea, and Mexico.

The following table summarizes key financial information for the periods indicated. Amounts are presented in accordance with GAAP unless explicitly identified as being a non-GAAP metric. For a description of our non-GAAP metrics and reconciliations to the most comparable GAAP metrics, please refer below to the section entitled Non-GAAP Financial Results within this report.


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
	(dollars in thousands, except per share amounts)
Net sales	$	203,227		$	185,008		$	404,610		$	410,878
Gross margin	12.6		%	13.9		%	12.0		%	14.4		%
Non-GAAP gross margin	13.0		%	14.5		%	12.6		%	15.0		%
Operating margin	(1.1)		%	(1.6)		%	(1.5)		%	0.5		%
Non-GAAP operating margin	2.2		%	2.9		%	1.7		%	4.6		%
Net loss	$	(5,112)		$	(20,656)		$	(14,101)		$	(20,661)
Non-GAAP net income (loss)	$	1,819		$	707		$	(893)		$	11,835
Diluted EPS	$	(0.15)		$	(0.71)		$	(0.44)		$	(0.71)
Non-GAAP diluted EPS	$	0.05		$	0.02		$	(0.03)		$	0.40


Macroeconomic Conditions and Business Update

The semiconductor industry is cyclical in nature. The industry entered a cyclical downturn in the fourth quarter of 2022, leading to reductions in spending on semiconductor capital equipment, resulting in weakened customer demand. In particular, industry overcapacity and a number of macroeconomic factors may have contributed to this reduced spending environment, which combined with increased export controls for advanced semiconductor-related goods and services shipped to China and delayed business investment in electronic memory capacity had varying levels of unfavorable consequences to our business. Although the total market for semiconductor capital equipment has experienced year-over-year stability and growth, inventory digestion at our customers and the relative spending levels within our primary served markets, in particular lower spending levels for deposition and etch equipment, has resulted in demand from our customers persisting at lower levels over the past year relative to the total semiconductor capital equipment market. To help mitigate these impacts and to better align our resources and cost structure with current and expected future levels of business, we initiated labor and other cost reduction initiatives starting in the fourth quarter of 2022, continuing through the second quarter of 2024.

While challenging macroeconomic conditions have impacted and will continue to impact our business and customers in the near term, we believe demand for semiconductors, semiconductor capital equipment, and our products will return to growth, fueled by the long-term growing need for more semiconductor productive capacity and enhanced process technologies.


Results of Operations

The following table sets forth our unaudited results of operations for the periods presented. The period‑to‑period comparison of results is not necessarily indicative of results for future periods.


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
	(in thousands)
Net sales	$	203,227	$	185,008	$	404,610	$	410,878
Cost of sales	177,670		159,266		356,059		351,896
Gross profit	25,557		25,742		48,551		58,982
Operating expenses:
Research and development	5,926		5,188		11,296		9,501
Selling, general, and administrative	19,807		19,500		39,026		39,667
Amortization of intangible assets	2,086		3,960		4,232		7,926
Total operating expenses	27,819		28,648		54,554		57,094
Operating income (loss)	(2,262)		(2,906)		(6,003)		1,888
Interest expense, net	1,858		5,030		5,954		9,580
Other expense, net	50		100		289		884
Loss before income taxes	(4,170)		(8,036)		(12,246)		(8,576)
Income tax expense	942		12,620		1,855		12,085
Net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)

The following table sets forth our unaudited results of operations as a percentage of our total sales for the periods presented.


	Three Months Ended		Six Months Ended
	June 28, 2024	June 30, 2023	June 28, 2024	June 30, 2023

Net sales	100.0	100.0	100.0	100.0
Cost of sales	87.4	86.1	88.0	85.6
Gross profit	12.6	13.9	12.0	14.4
Operating expenses:
Research and development	2.9	2.8	2.8	2.3
Selling, general, and administrative	9.7	10.5	9.6	9.7
Amortization of intangible assets	1.0	2.1	1.0	1.9
Total operating expenses	13.7	15.5	13.5	13.9
Operating income (loss)	(1.1)	(1.6)	(1.5)	0.5
Interest expense, net	0.9	2.7	1.5	2.3
Other expense, net	0.0	0.1	0.1	0.2
Loss before income taxes	(2.1)	(4.3)	(3.0)	(2.1)
Income tax expense	0.5	6.8	0.5	2.9
Net loss	(2.5)	(11.2)	(3.5)	(5.0)


Comparison of the Three and Six Months Ended June 28, 2024 and June 30, 2023

Net sales


	Three Months Ended				Change				Six Months Ended				Change
	June 28, 2024		June 30, 2023		Amount		%		June 28, 2024		June 30, 2023		Amount		%
	(dollars in thousands)
Net sales	$	203,227	$	185,008	$	18,219	9.8	%	$	404,610	$	410,878	$	(6,268)	(1.5)	%

The increase in net sales from the three months ended June 30, 2023 to the three months ended June 28, 2024 was primarily due to increased customer demand as a result of a stronger semiconductor capital equipment spending environment. The second quarter of 2023 represented the low-point in our quarterly net sales since the start of the cyclical downturn in the fourth quarter of 2022. Although net sales were higher on a quarter-on-quarter basis, higher net sales in the first quarter of 2023 compared to the first quarter of 2024 translated into lower net sales for the first half of 2024 compared to the first half of 2023. Further detail is provided above under the section entitled Macroeconomic Conditions and Business Update.

Gross margin


	Three Months Ended						Change				Six Months Ended						Change
	June 28, 2024			June 30, 2023			Amount		%		June 28, 2024			June 30, 2023			Amount		%
	(dollars in thousands)
Cost of sales	$	177,670		$	159,266		$	18,404	11.6	%	$	356,059		$	351,896		$	4,163	1.2	%
Gross profit	$	25,557		$	25,742		$	(185)	(0.7)	%	$	48,551		$	58,982		$	(10,431)	(17.7)	%
Gross margin	12.6		%	13.9		%			-130	bps	12.0		%	14.4		%			-240	bps

The decrease in gross margin from the three and six months ended June 30, 2023 to the three and six months ended June 28, 2024 was primarily due to unfavorable sales mix, as well as increased fixed overhead and excess and obsolete inventory expenses. Increased fixed overhead, including depreciation and occupancy costs, unfavorably impacted gross margin by 50bps for the three and six months ended June 28, 2024, and increased excess and obsolete inventory expense unfavorably impacted gross margin by 40bps and 80bps for the three and six months ended June 28, 2024, respectively.

Research and development


	Three Months Ended				Change				Six Months Ended				Change
	June 28, 2024		June 30, 2023		Amount		%		June 28, 2024		June 30, 2023		Amount		%
	(dollars in thousands)
Research and development	$	5,926	$	5,188	$	738	14.2	%	$	11,296	$	9,501	$	1,795	18.9	%

The increase in research and development expenses from the second quarter of 2023 to the second quarter of 2024 was primarily due to increased material and service costs from our new product development programs.

The increase from the six months ended June 30, 2023 to the six months ended June 28, 2024 was primarily due to increased material and service costs from our new product development programs of $1.3 million and increased employee-related expenses of $0.5 million, inclusive of share-based compensation expense.

Selling, general, and administrative


	Three Months Ended				Change				Six Months Ended				Change
	June 28, 2024		June 30, 2023		Amount		%		June 28, 2024		June 30, 2023		Amount		%
	(dollars in thousands)
Selling, general, and administrative	$	19,807	$	19,500	$	307	1.6	%	$	39,026	$	39,667	$	(641)	(1.6)	%

The increase in selling, general, and administrative expense from the second quarter of 2023 to the second quarter of 2024 was primarily due to increased occupancy costs, the majority of which were the result of a facility exit and consolidation, partially offset by reduced services and professional consulting costs.

The decrease in selling, general, and administrative expense from the six months ended June 30, 2023 to the six months ended June 28, 2024 was primarily due to reduced employee-related expense, inclusive of share-based compensation expense, partially offset by increased services and professional consulting costs and increased occupancy costs, the majority of which were the result of a facility exit and consolidation.

Amortization of intangible assets


	Three Months Ended				Change				Six Months Ended				Change
	June 28, 2024		June 30, 2023		Amount		%		June 28, 2024		June 30, 2023		Amount		%
	(dollars in thousands)
Amortization of intangible assets	$	2,086	$	3,960	$	(1,874)	(47.3)	%	$	4,232	$	7,926	$	(3,694)	(46.6)	%

The decrease in amortization expense from the three and six months ended June 30, 2023 to the three and six months ended June 28, 2024 was due to certain intangible assets becoming fully amortized in the second half of 2023.

Interest expense, net


	Three Months Ended						Change				Six Months Ended						Change
	June 28, 2024			June 30, 2023			Amount		%		June 28, 2024			June 30, 2023			Amount		%
	(dollars in thousands)
Interest expense, net	$	1,858		$	5,030		$	(3,172)	(63.1)	%	$	5,954		$	9,580		$	(3,626)	(37.8)	%
Weighted average borrowings outstanding	$	133,104		$	300,549		$	(167,445)	(55.7)	%	$	188,520		$	301,514		$	(112,994)	(37.5)	%
Weighted average borrowing rate	7.45		%	6.63		%			+82 bps		7.53		%	6.36		%			+117 bps

The decrease in interest expense, net from the three and six months ended June 30, 2023 to the three and six months ended June 28, 2024 was primarily due to decreases in the weighted average amounts borrowed, partially offset by an increase in our weighted average borrowing rate.

Other expense, net


	Three Months Ended				Change				Six Months Ended				Change
	June 28, 2024		June 30, 2023		Amount		%		June 28, 2024		June 30, 2023		Amount		%
	(dollars in thousands)
Other expense, net	$	50	$	100	$	(50)	(50.0)	%	$	289	$	884	$	(595)	(67.3)	%

The change in other expense, net from the three and six months ended June 30, 2023 to the three and six months ended June 28, 2024 was primarily due to currency exchange rate fluctuations during the periods related to our local currency payables of our foreign operations.

Income tax expense


	Three Months Ended						Change			Six Months Ended						Change
	June 28, 2024			June 30, 2023			Amount		%	June 28, 2024			June 30, 2023			Amount		%
	(dollars in thousands)
Income tax expense	$	942		$	12,620		$	(11,678)	n/m	$	1,855		$	12,085		$	(10,230)	n/m
Loss before income taxes	$	(4,170)		$	(8,036)		$	3,866	n/m	$	(12,246)		$	(8,576)		$	(3,670)	n/m
Effective income tax rate	-22.6		%	-157.0		%			+13,440 bps	-15.1		%	-140.9		%			+12,580 bps

The decrease in income tax expense from the three and six months ended June 30, 2023 to the three and six months ended June 28, 2024 was primarily due to recording a valuation allowance against our U.S. federal and state deferred tax assets, resulting in an $11.1 million charge to income tax expense during the second quarter of 2023. Because we have a valuation allowance recorded against our U.S. state and federal deferred income taxes, we did not record tax benefits from our U.S. taxable losses in the six months ended June 28, 2024.


Non‑GAAP Financial Results

Management uses certain non-GAAP metrics to evaluate our operating and financial results. We believe the presentation of non-GAAP results is useful to investors for analyzing business trends and comparing performance to prior periods, along with enhancing investors’ ability to view our results from management’s perspective. All non-GAAP adjustments are presented on a gross basis. Non-GAAP gross profit, operating income, and net income (loss) are defined as: gross profit, operating income (loss), or net income (loss), respectively, excluding (1) amortization of intangible assets, share-based compensation expense, and discrete or infrequent charges and gains that are outside of normal business operations, including transaction-related costs, contract and legal settlement gains and losses, facility shutdown costs, and severance costs associated with reduction-in-force programs, to the extent they are present in gross profit, operating income (loss), and net income (loss), respectively; and (2) with respect to non-GAAP net income (loss), the tax impacts associated with these non-GAAP adjustments, as well as non-recurring discrete tax items, including deferred tax asset valuation allowance charges. All non-GAAP adjustments are presented on a gross basis; the related income tax effects, including current and deferred income tax expense, are included in the adjustment line under the heading "Tax adjustments related to non-GAAP adjustments". Non-GAAP diluted earnings per share ("EPS") is defined as non-GAAP net income divided by weighted average diluted ordinary shares outstanding during the period. Non-GAAP gross margin and non-GAAP operating margin are defined as non-GAAP gross profit and non-GAAP operating income, respectively, divided by net sales.

Non-GAAP results have limitations as an analytical tool, and you should not consider them in isolation or as a substitute for our results reported under GAAP. Other companies may calculate non-GAAP results differently or may use other measures to evaluate their performance, both of which could reduce the usefulness of our non-GAAP results as a tool for comparison.

Because of these limitations, you should consider non-GAAP results alongside other financial performance measures and results presented in accordance with GAAP. In addition, in evaluating non-GAAP results, you should be aware that in the future we will incur expenses such as those that are the subject of adjustments in deriving non-GAAP results and you should not infer from our presentation of non-GAAP results that our future results will not be affected by these expenses or other discrete or infrequent charges and gains that are outside of normal business operations.

The following table presents our unaudited non‑GAAP gross profit and non-GAAP gross margin and a reconciliation from GAAP gross profit, the most comparable GAAP measure, for the periods indicated:


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
	(dollars in thousands)
U.S. GAAP gross profit	$	25,557		$	25,742		$	48,551		$	58,982
Non-GAAP adjustments:
Share-based compensation	717			1,091			1,493			1,512

Other (1)	160			—			908			1,287
Non-GAAP gross profit	$	26,434		$	26,833		$	50,952		$	61,781
U.S. GAAP gross margin	12.6		%	13.9		%	12.0		%	14.4		%
Non-GAAP gross margin	13.0		%	14.5		%	12.6		%	15.0		%

(1)Represents severance costs associated with our global reduction-in-force programs.

The following table presents our unaudited non‑GAAP operating income and non-GAAP operating margin and a reconciliation from GAAP operating income (loss), the most comparable GAAP measure, for the periods indicated:


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
	(dollars in thousands, except per share amounts)
U.S. GAAP operating income (loss)	$	(2,262)		$	(2,906)		$	(6,003)		$	1,888
Non-GAAP adjustments:
Amortization of intangible assets	2,086			3,960			4,232			7,926
Share-based compensation	3,938			4,277			6,313			7,914


Transaction-related costs (1)	—			—			785			—
Other (2)	733			—			1,600			1,324
Non-GAAP operating income	$	4,495		$	5,331		$	6,927		$	19,052
U.S. GAAP operating margin	(1.1)		%	(1.6)		%	(1.5)		%	0.5		%
Non-GAAP operating margin	2.2		%	2.9		%	1.7		%	4.6		%

(1)Represents transaction-related costs incurred in connection with our acquisitions pipeline.

(2)Represents severance costs associated with our global reduction-in-force programs, and, for the three and six months ended June 28, 2024, $0.5 million of costs incurred in connection with exiting and consolidating one of our U.S.-based manufacturing facilities.

The following table presents our unaudited non‑GAAP net income (loss) and non-GAAP diluted EPS and a reconciliation from GAAP net loss, the most comparable GAAP measure, for the periods indicated. All non-GAAP adjustments are presented on a gross basis; the related income tax effects, including current and deferred income tax expense, are included in the adjustment line under the heading "Tax adjustments related to non-GAAP adjustments".


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
	(dollars in thousands, except per share amounts)
U.S. GAAP net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)
Non-GAAP adjustments:
Amortization of intangible assets	2,086		3,960		4,232		7,926
Share-based compensation	3,938		4,277		6,313		7,914


Transaction-related costs (1)	—		—		785		—
Other (2)	733		—		1,600		1,324
Tax adjustments related to non-GAAP adjustments (3)	174		2,032		278		4,238
Tax expense from valuation allowance (4)	—		11,094		—		11,094
Non-GAAP net income (loss)	$	1,819	$	707	$	(893)	$	11,835
U.S. GAAP diluted EPS	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Non-GAAP diluted EPS	$	0.05	$	0.02	$	(0.03)	$	0.40
Shares used to compute non-GAAP diluted EPS	34,043,870		29,492,966		31,779,521		29,454,500

(1)Represents transaction-related costs incurred in connection with our acquisitions pipeline.

(3)Adjusts GAAP income tax expense for the impact of our non-GAAP adjustments, which are presented on a gross basis. During the second quarter of 2023, we recorded a valuation allowance against our U.S. federal and state deferred tax assets on a GAAP basis. In the first quarter of 2024, we determined that the valuation allowance should be recognized against our U.S. federal and state deferred tax assets on a non-GAAP basis as we were not in a three-year cumulative U.S. income position on a non-GAAP basis. Accordingly, from the first quarter of 2024 and forward, tax expense on a GAAP and non-GAAP basis reflects a valuation allowance against our U.S. federal and state deferred tax assets.

(4)During the second quarter of 2023, we recorded a valuation allowance of $11.1 million against our U.S. federal and state deferred tax assets. The valuation allowance was recorded based on an assessment of available positive and negative evidence, including an estimate of being in a three-year cumulative loss position in the U.S. by the end of 2023, projections of future taxable income, and other quantitative and qualitative information.


Liquidity and Capital Resources

The following section discusses our liquidity and capital resources, including our primary sources of liquidity and our material cash requirements. Our cash and cash equivalents are maintained in highly liquid and accessible accounts with no significant restrictions.

Material Cash Requirements

Our primary liquidity requirements arise from: (i) working capital requirements, including procurement of raw materials inventory for use in our factories and employee-related costs, (ii) business acquisitions, (iii) interest and principal payments under our credit facilities, (iv) research and development investments, (v) capital expenditures, and (vi) payment of income taxes. We have no significant long-term purchase commitments related to procuring raw materials inventory. Our ability to fund these material cash requirements will depend, in part, on our future cash flows, which are determined by our future operating performance, and our continued access to the capital markets and are therefore subject to prevailing global macroeconomic conditions and financial, business, and other factors, some of which are beyond our control.

We believe that our cash and cash equivalents, the amounts available under our credit facilities, and our operating cash flow will be sufficient to fund our business and our current obligations for at least the next 12 months and beyond.

Sources and Conditions of Liquidity

Our ongoing sources of liquidity to fund our material cash requirements are primarily derived from: (i) sales to our customers and the related changes in our net operating assets and liabilities and (ii) proceeds from our credit facilities and equity offerings, when applicable. Our credit facilities are comprised of a $150.0 million term loan facility and a $250.0 million revolving credit facility, of which $250.0 million remained available to draw on as of June 28, 2024.

Summary of Cash Flows

We ended the second quarter of 2024 with cash and cash equivalents of $114.3 million, an increase of $34.4 million from the prior year ended December 29, 2023. The increase was primarily due to net proceeds of $136.7 million from our issuance of 3.8 million ordinary shares in March 2024 in connection with an underwritten public offering and net cash provided by operating activities of $22.3 million, partially offset by net payments on credit facilities of $118.8 million and capital expenditures of $7.3 million.

The following table sets forth a summary of operating, investing, and financing activities for the periods presented:


	Six Months Ended
	June 28, 2024		June 30, 2023
	(in thousands)
Cash provided by operating activities	$	22,296	$	16,070
Cash used in investing activities	(7,337)		(10,834)
Cash provided by (used in) financing activities	19,435		(7,098)
Net increase (decrease) in cash	$	34,394	$	(1,862)

Our cash provided by operating activities of $22.3 million for the six months ended June 28, 2024 consisted of net non-cash charges of $22.3 million, consisting primarily of depreciation and amortization of $15.7 million and share-based compensation expense of $6.3 million, and a decrease in our net operating assets and liabilities of $14.1 million, partially offset by net loss of $14.1 million.

The decrease in our net operating assets and liabilities of $14.1 million during the six months ended June 28, 2024 was primarily due to a decrease in inventories of $14.4 million, partially offset by a decrease in accrued and other liabilities of $3.5 million.

The increase in cash provided by operating activities from the six months ended June 30, 2023 to the six months ended June 28, 2024 was primarily due to favorable changes in the balances of our working capital accounts of $12.7 million, partially offset by a reduction in net income net of non-cash charges of $6.5 million.

Cash used in investing activities during the six months ended June 28, 2024 and June 30, 2023 consisted of capital expenditures. The reduction in capital expenditures from the six months ended June 30, 2023 to the six months ended June 28, 2024 was due to reduced factory capacity expansion projects.

Cash provided by financing activities during the six months ended June 28, 2024 consisted of net proceeds of $136.7 million from our issuance of 3.8 million ordinary shares in March 2024 in connection with an underwritten public offering and net proceeds from share-based compensation activity of $1.4 million, partially offset by net payment on our credit facilities of $118.8 million. Cash used in financing activities during the six months ended June 30, 2023 consisted of net payments on our credit facilities of $8.8 million, partially offset by net proceeds from share-based compensation activity of $1.7 million.


Critical Accounting Estimates

Our consolidated financial statements have been prepared in accordance with U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, sales, expenses, and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates. To the extent that there are material differences between these estimates and our actual results, our future financial statements will be affected.

The critical accounting policies requiring estimates, assumptions, and judgments that we believe have the most significant impact on our consolidated financial statements are identified and described in our annual consolidated financial statements and the notes included in our 2023 Annual Report on Form 10‑K.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


Foreign Currency Exchange Risk

Substantially all of our sales arrangement with customers, and the significant majority of our arrangements with third-party suppliers, provide for pricing and payment in U.S. dollars and, therefore, are not subject to material exchange rate fluctuations. As a result, we do not expect foreign currency exchange rate fluctuations to have a material effect on our results of operations. However, increases in the value of the U.S. dollar relative to other currencies would make our products more expensive relative to competing products priced in such other currencies, which could negatively impact our ability to compete. Conversely, decreases in the value of the U.S. dollar relative to other currencies could result in our foreign suppliers raising their prices in order to continue doing business with us.

We have certain operating expenses that are denominated in currencies of the countries in which our operations are located and may be subject to fluctuations due to foreign currency exchange rates, particularly the Singapore dollar, Malaysian ringgit, British pound, euro, Korean won, and Mexican peso. Fluctuations in foreign currency exchange rates may cause us to recognize transaction gains and losses in our statement of operations. To date, foreign currency transaction gains and losses have not been material to our financial statements, and we have not engaged in any foreign currency hedging transactions.


Interest Rate Risk

We had total indebtedness of $131.3 million as of June 28, 2024, exclusive of $1.1 million in debt issuance costs, of which $7.5 million was due within 12 months. We do not enter into investments for trading or speculative purposes and have not used derivative financial instruments to manage our interest rate risk exposure. We have not been, nor do we anticipate being exposed to, material risks due to changes in interest rates. As of June 28, 2024, the interest rate on our outstanding debt is based on BSBY, plus an applicable rate depending on our leverage ratio. A hypothetical 100 basis point change in the interest rate on our outstanding debt would have resulted in a $0.3 million change to interest expense during the quarter, or $1.3 million on an annualized basis.

ITEM 4. CONTROLS AND PROCEDURES


Evaluation of Disclosure Controls and Procedures

We carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer (the "certifying officers"), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a‑15(e) and 15d‑15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act”)) as of the end of the period covered by this report. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based on this evaluation, our certifying officers concluded that our disclosure controls and procedures were effective as of June 28, 2024.


Limitations on Effectiveness of Controls and Procedures

A company’s internal control over financial reporting is a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. If we cannot provide reliable financial information, our business, operating results, and share price could be negatively impacted.


Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are currently not a party to any material pending or threatened litigation.

ITEM 1A. RISK FACTORS

This quarterly report should be read in conjunction with the risk factors included in our 2023 Annual Report on Form 10‑K. These risk factors do not identify all risks that we face – our operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial to our operations. Due to risks and uncertainties, known and unknown, our past financial results may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION


Insider Trading Arrangements

During the second quarter of 2024, none of our directors or officers (as defined in Section 16 of the Exchange Act), adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (each as defined in Item 408 of Regulation S-K).

ITEM 6. EXHIBITS


Exhibit Number						Description

31.1*						Certification of Principal Executive Officer Pursuant to Rules 13a‑14(a) and 15d‑14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002.
31.2*						Certification of Principal Financial Officer Pursuant to Rules 13a‑14(a) and 15d‑14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002.
32.1**						Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002.
32.2**						Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002.
101.INS*						Inline XBRL Instance Document
101.SCH*						Inline XBRL Taxonomy Extension Schema Document
101.CAL*						Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*						Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*						Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101)

*Filed herewith.

**Furnished herewith and not filed.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	ICHOR HOLDINGS, LTD.

Date: August 7, 2024	By:	/s/ Jeffrey S. Andreson
		Jeffrey S. Andreson
		Chief Executive Officer (Principal Executive Officer)

Date: August 7, 2024	By:	/s/ Greg Swyt
		Greg Swyt
		Chief Financial Officer (Principal Accounting and Financial Officer)

Exhibit 31.1

CEO CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jeffrey S. Andreson, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Ichor Holdings, Ltd.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: August 7, 2024	By:	/s/ Jeffrey S. Andreson
		Jeffrey S. Andreson
		Chief Executive Officer

Exhibit 31.2

CFO CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Greg Swyt, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Ichor Holdings, Ltd.;

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: August 7, 2024	By:	/s/ Greg Swyt
		Greg Swyt
		Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Ichor Holdings, Ltd. (the “Company”) on Form 10-Q for the period ending June 28, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, to my knowledge, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes‑Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: August 7, 2024	By:	/s/ Jeffrey S. Andreson
		Jeffrey S. Andreson
		Chief Executive Officer

Exhibit 32.2

CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(1)The Report fully complies with the requirements of section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: August 7, 2024	By:	/s/ Greg Swyt
		Greg Swyt
		Chief Financial Officer

Cover - shares	6 Months Ended
Cover - shares	Jun. 28, 2024	Aug. 02, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 28, 2024
Document Transition Report	false
Entity File Number	001-37961
Entity Registrant Name	ICHOR HOLDINGS, LTD.
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	3185 Laurelview Ct.
Entity Address, City or Town	Fremont
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94538
City Area Code	510
Local Phone Number	897-5200
Title of 12(b) Security	Ordinary Shares, par value $0.0001
Trading Symbol	ICHR
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Ordinary Shares Outstanding		33,687,847
Entity Central Index Key	0001652535
Current Fiscal Year End Date	--12-27
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Tax Identification Number	00-0000000

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Current assets:
Cash and cash equivalents	$ 114,349	$ 79,955
Accounts receivable, net	65,216	66,721
Inventories	231,475	245,885
Prepaid expenses and other current assets	7,596	8,804
Total current assets	418,636	401,365
Property and equipment, net	89,142	92,755
Operating lease right-of-use assets	34,623	36,611
Other noncurrent assets	13,727	11,912
Deferred tax assets, net	3,103	3,148
Intangible assets, net	53,056	57,288
Goodwill	335,402	335,402
Total assets	947,689	938,481
Current liabilities:
Accounts payable	58,961	60,490
Accrued liabilities	15,122	14,871
Other current liabilities	6,812	6,638
Current portion of long-term debt	7,500	7,500
Current portion of lease liabilities	9,721	9,463
Total current liabilities	98,116	98,962
Long-term debt, less current portion, net	122,665	241,183
Lease liabilities, less current portion	26,025	28,187
Deferred tax liabilities, net	1,169	1,169
Other non-current liabilities	4,838	4,303
Total liabilities	252,813	373,804
Shareholders’ equity:
Preferred shares ($0.0001 par value; 20,000,000 shares authorized; 0 shares issued and outstanding)	0	0
Ordinary shares ($0.0001 par value; 200,000,000 shares authorized; 33,629,331 and 29,435,398 shares outstanding, respectively; 38,066,770 and 33,872,837 shares issued, respectively)	3	3
Additional paid in capital	595,881	451,581
Treasury shares at cost (4,437,439 shares)	(91,578)	(91,578)
Retained earnings	190,570	204,671
Total shareholders’ equity	694,876	564,677
Total liabilities and shareholders’ equity	$ 947,689	$ 938,481

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 28, 2024	Dec. 29, 2023
Statement of Financial Position [Abstract]
Preferred shares, par value (in usd per share)	$ 0.0001	$ 0.0001
Preferred shares, authorized (in shares)	20,000,000	20,000,000
Preferred shares, issued (in shares)	0	0
Preferred shares, outstanding (in shares)	0	0
Ordinary shares, par value (in usd per share)	$ 0.0001	$ 0.0001
Ordinary shares, authorized (in shares)	200,000,000	200,000,000
Ordinary shares, outstanding (in shares)	33,629,331	29,435,398
Ordinary shares, issued (in shares)	38,066,770	33,872,837
Treasury stock, shares (in shares)	4,437,439	4,437,439

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Income Statement [Abstract]
Net sales	$ 203,227	$ 185,008	$ 404,610	$ 410,878
Cost of sales	177,670	159,266	356,059	351,896
Gross profit	25,557	25,742	48,551	58,982
Operating expenses:
Research and development	5,926	5,188	11,296	9,501
Selling, general, and administrative	19,807	19,500	39,026	39,667
Amortization of intangible assets	2,086	3,960	4,232	7,926
Total operating expenses	27,819	28,648	54,554	57,094
Operating income (loss)	(2,262)	(2,906)	(6,003)	1,888
Interest expense, net	1,858	5,030	5,954	9,580
Other expense, net	50	100	289	884
Loss before income taxes	(4,170)	(8,036)	(12,246)	(8,576)
Income tax expense	942	12,620	1,855	12,085
Net loss	$ (5,112)	$ (20,656)	$ (14,101)	$ (20,661)
Net loss per share
Net income per share, basic (in usd per share)	$ (0.15)	$ (0.71)	$ (0.44)	$ (0.71)
Net income per share, diluted (in usd per share)	$ (0.15)	$ (0.71)	$ (0.44)	$ (0.71)
Shares used to compute Net loss per share:
Shares used to compute net income per share, basic (in shares)	33,548,071	29,116,413	31,779,521	29,050,645
Shares used to compute net income per share, diluted (in shares)	33,548,071	29,116,413	31,779,521	29,050,645

Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Total	Ordinary Shares	Additional Paid-In Capital	Treasury Shares	Retained Earnings
Beginning balance (in shares) at Dec. 30, 2022		28,861,949
Beginning balance at Dec. 30, 2022	$ 587,496	$ 3	$ 431,415	$ (91,578)	$ 247,656
Treasury stock, beginning balance (in shares) at Dec. 30, 2022				4,437,439
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Ordinary shares issued from exercise of stock options (in shares)		124,762
Ordinary shares issued from exercise of stock options	2,850		2,850
Ordinary shares issued from vesting of restricted share units (in shares)		157,229
Ordinary shares issued from vesting of restricted share units	(2,329)		(2,329)
Ordinary shares issued from employee share purchase plan (in shares)		97,621
Ordinary shares issued from employee share purchase plan	2,033		2,033
Share-based compensation expense	7,914		7,914
Net loss	(20,661)				(20,661)
Ending balance (in shares) at Jun. 30, 2023		29,241,561
Ending balance at Jun. 30, 2023	577,303	$ 3	441,883	$ (91,578)	226,995
Treasury stock, ending balance (in shares) at Jun. 30, 2023				4,437,439
Beginning balance (in shares) at Mar. 31, 2023		29,034,946
Beginning balance at Mar. 31, 2023	593,464	$ 3	437,388	$ (91,578)	247,651
Treasury stock, beginning balance (in shares) at Mar. 31, 2023				4,437,439
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Ordinary shares issued from exercise of stock options (in shares)		31,996
Ordinary shares issued from exercise of stock options	724		724
Ordinary shares issued from vesting of restricted share units (in shares)		124,702
Ordinary shares issued from vesting of restricted share units	(1,637)		(1,637)
Ordinary shares issued from employee share purchase plan (in shares)		49,917
Ordinary shares issued from employee share purchase plan	1,131		1,131
Share-based compensation expense	4,277		4,277
Net loss	(20,656)				(20,656)
Ending balance (in shares) at Jun. 30, 2023		29,241,561
Ending balance at Jun. 30, 2023	577,303	$ 3	441,883	$ (91,578)	226,995
Treasury stock, ending balance (in shares) at Jun. 30, 2023				4,437,439
Beginning balance (in shares) at Dec. 29, 2023		29,435,398
Beginning balance at Dec. 29, 2023	$ 564,677	$ 3	451,581	$ (91,578)	204,671
Treasury stock, beginning balance (in shares) at Dec. 29, 2023	4,437,439			4,437,439
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Ordinary shares issued from exercise of stock options (in shares)		142,331
Ordinary shares issued from exercise of stock options	$ 3,500		3,500
Ordinary shares issued from vesting of restricted share units (in shares)		182,215
Ordinary shares issued from vesting of restricted share units	(3,272)		(3,272)
Ordinary shares issued from employee share purchase plan (in shares)		36,053
Ordinary shares issued from employee share purchase plan	1,021		1,021
Share-based compensation expense	6,313		6,313
Ordinary shares issued, net of transaction costs (in shares)		3,833,334
Ordinary shares issued, net of transaction costs	136,738		136,738
Net loss	(14,101)				(14,101)
Ending balance (in shares) at Jun. 28, 2024		33,629,331
Ending balance at Jun. 28, 2024	$ 694,876	$ 3	595,881	$ (91,578)	190,570
Treasury stock, ending balance (in shares) at Jun. 28, 2024	4,437,439			4,437,439
Beginning balance (in shares) at Mar. 29, 2024		33,467,846
Beginning balance at Mar. 29, 2024	$ 697,232	$ 3	593,125	$ (91,578)	195,682
Treasury stock, beginning balance (in shares) at Mar. 29, 2024				4,437,439
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Ordinary shares issued from exercise of stock options (in shares)		31,381
Ordinary shares issued from exercise of stock options	747		747
Ordinary shares issued from vesting of restricted share units (in shares)		130,104
Ordinary shares issued from vesting of restricted share units	(1,929)		(1,929)
Share-based compensation expense	3,938		3,938
Net loss	(5,112)				(5,112)
Ending balance (in shares) at Jun. 28, 2024		33,629,331
Ending balance at Jun. 28, 2024	$ 694,876	$ 3	$ 595,881	$ (91,578)	$ 190,570
Treasury stock, ending balance (in shares) at Jun. 28, 2024	4,437,439			4,437,439

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (14,101)	$ (20,661)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	15,679	17,145
Share-based compensation	6,313	7,914
Deferred income taxes	45	10,049
Amortization of debt issuance costs	232	233
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net	1,505	40,561
Inventories	14,410	17,470
Prepaid expenses and other assets	1,878	5,986
Accounts payable	(144)	(45,047)
Accrued liabilities	53	(5,961)
Other liabilities	(3,574)	(11,619)
Net cash provided by operating activities	22,296	16,070
Cash flows from investing activities:
Capital expenditures	(7,337)	(10,834)
Net cash used in investing activities	(7,337)	(10,834)
Cash flows from financing activities:
Issuance of ordinary shares, net of fees	136,738	0
Issuance of ordinary shares under share-based compensation plans	4,719	3,981
Employees' taxes paid upon vesting of restricted share units	(3,272)	(2,329)
Repayments on revolving credit facility	(115,000)	(5,000)
Repayments on term loan	(3,750)	(3,750)
Net cash provided by (used in) financing activities	19,435	(7,098)
Net increase (decrease) in cash	34,394	(1,862)
Cash at beginning of period	79,955	86,470
Cash at end of period	114,349	84,608
Supplemental disclosures of cash flow information:
Cash paid during the period for interest	7,536	9,851
Cash paid during the period for taxes, net of refunds	1,452	3,340
Supplemental disclosures of non-cash activities:
Capital expenditures included in accounts payable	1,458	293
Right-of-use assets obtained in exchange for new operating lease liabilities	$ 2,379	$ 3,103

Basis of Presentation and Selected Significant Accounting Policies

6 Months Ended

Jun. 28, 2024

Accounting Policies [Abstract]

Basis of Presentation and Selected Significant Accounting Policies


Note 1 – Basis of Presentation and Selected Significant Accounting Policies

Basis of Presentation

Year End

Use of Estimates

Cash and Cash Equivalents

Cash and cash equivalents consist of deposits and financial instruments which are readily convertible into cash and have original maturities of 90 days or less at the time of acquisition.

Fair Value of Financial Instruments

Revenue Recognition

Public Offering of Shares

Accounting Pronouncements Recently Issued

Inventories

6 Months Ended

Jun. 28, 2024

Inventory Disclosure [Abstract]

Inventories


Note 2 – Inventories

Inventories consist of the following:


	June 28, 2024		December 29, 2023
Raw materials	$	179,796	$	190,027
Work in process	37,631		36,849
Finished goods	46,746		47,449
Excess and obsolete adjustment	(32,698)		(28,440)
Total inventories	$	231,475	$	245,885

Property and Equipment and Other Noncurrent Assets

6 Months Ended

Jun. 28, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment and Other Noncurrent Assets


Note 3 – Property and Equipment and Other Noncurrent Assets

Property and equipment consist of the following:


	June 28, 2024		December 29, 2023
Machinery	$	118,076	$	113,529
Leasehold improvements	47,647		46,129
Computer software, hardware, and equipment	9,085		10,316
Office furniture, fixtures, and equipment	1,315		1,320
Vehicles	395		396
Construction-in-process	3,941		4,216
	180,459		175,906
Less accumulated depreciation	(91,317)		(83,151)
Total property and equipment, net	$	89,142	$	92,755

Cloud Computing Implementation Costs

Intangible Assets

6 Months Ended

Jun. 28, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets


Note 4 – Intangible Assets

Definite‑lived intangible assets consist of the following:


	June 28, 2024
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	73,142	$	(24,974)	$	—	$	48,168	9.9 years
Developed technology	11,047		(6,159)		—		4,888		10.0 years
Total intangible assets	$	84,189	$	(31,133)	$	—	$	53,056


	December 29, 2023
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	105,542	$	(53,680)	$	—	$	51,862	8.7 years
Developed technology	11,047		(5,621)		—		5,426		10.0 years
Total intangible assets	$	116,589	$	(59,301)	$	—	$	57,288

Leases

6 Months Ended

Jun. 28, 2024

Leases [Abstract]

Leases


Note 5 – Leases

The components of lease expense are as follows:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Operating lease cost	$	2,492	$	2,393	$	4,984	$	4,804

Supplemental cash flow information related to leases is as follows:


	Six Months Ended
	June 28, 2024		June 30, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,851	$	4,602

Supplemental balance sheet information related to leases is as follows:


	June 28, 2024	December 29, 2023
Weighted-average remaining lease term of operating leases	4.3 years	4.6 years
Weighted-average discount rate of operating leases	3.8%	3.4%

Future minimum lease payments under non-cancelable leases are as follows as of June 28, 2024:


2024, remaining	$	4,936
2025	9,498
2026	9,170
2027	8,407
2028	3,882
Thereafter	2,827
Total future minimum lease payments	38,720
Less imputed interest	(2,974)
Total lease liabilities	$	35,746

Income Taxes

6 Months Ended

Jun. 28, 2024

Income Tax Disclosure [Abstract]

Income Taxes


Note 6 – Income Taxes

Income tax information for the periods reported is as follows:


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
Income tax expense	$	942		$	12,620		$	1,855		$	12,085
Loss before income taxes	$	(4,170)		$	(8,036)		$	(12,246)		$	(8,576)
Effective income tax rate	(22.6)		%	(157.0)		%	(15.1)		%	(140.9)		%

As of June 28, 2024, we were under examination by California tax authorities.

Employee Benefit Programs

6 Months Ended

Jun. 28, 2024

Retirement Benefits [Abstract]

Employee Benefit Programs


Note 7 – Employee Benefit Programs

401(k) Plan

Long-Term Debt

6 Months Ended

Jun. 28, 2024

Debt Disclosure [Abstract]

Long-Term Debt


Note 8 – Long-Term Debt

Long‑term debt consists of the following:


	June 28, 2024		December 29, 2023
Term loan	$	131,250	$	135,000
Revolving credit facility	—		115,000
Total principal amount of long-term debt	131,250		250,000
Less unamortized debt issuance costs	(1,085)		(1,317)
Total long-term debt, net	130,165		248,683
Less current portion	(7,500)		(7,500)
Total long-term debt, less current portion, net	$	122,665	$	241,183

Share-Based Compensation

6 Months Ended

Jun. 28, 2024

Share-Based Payment Arrangement [Abstract]

Share-Based Compensation


Note 9 – Share‑Based Compensation

Stock Options

The following table summarizes option activity:


	Number of Stock Options
	Service condition	Weighted average exercise price per share		Weighted average remaining contractual term	Aggregate intrinsic value
Outstanding, December 29, 2023	582,163	$	24.36
Granted	—	$	—
Exercised	(142,331)	$	24.59
Forfeited or expired	(639)	$	21.76
Outstanding, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266
Exercisable, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266

Restricted Share Units

The following table summarizes RSU activity:


	Number of RSUs
	Service condition	Performance condition	Market condition	Weighted average grant-date fair value per share
Unvested, December 29, 2023	1,088,083	97,299	171,101	$	30.37
Granted	389,622	100,941	62,776	$	40.33
Vested	(251,711)	(6,609)	(8,617)	$	32.04
Forfeited	(74,110)	(13,021)	(23,419)	$	30.26
Unvested, June 28, 2024	1,151,884	178,610	201,841	$	33.61

Employee Share Purchase Plan

As of June 28, 2024, approximately 2.1 million ordinary shares remain available for purchase under the 2017 ESPP.

Earnings per Share

6 Months Ended

Jun. 28, 2024

Earnings Per Share [Abstract]

Earnings per Share


Note 10 – Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share and a reconciliation of the numerator and denominator used in the calculation:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)
Denominator:
Basic weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Dilutive effect of options	—		—		—		—
Dilutive effect of RSUs	—		—		—		—
Dilutive effect of ESPP	—		—		—		—
Diluted weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Securities excluded from the calculation of diluted weighted average ordinary shares outstanding (1)	2,193,000		2,311,000		2,492,000		2,469,000
Net loss per share:
Basic	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Diluted	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)

Segment Information

6 Months Ended

Jun. 28, 2024

Segment Reporting [Abstract]

Segment Information


Note 11 – Segment Information

Sales by geographic area represents sales to unaffiliated customers based upon the location to which the products were shipped. The following table sets forth sales by geographic area:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
United States of America	$	69,259	$	61,623	$	133,653	$	150,675
Singapore	81,541		70,372		160,667		152,658
Europe	21,307		27,764		52,656		57,750
Other	31,120		25,249		57,634		49,795
Total net sales	$	203,227	$	185,008	$	404,610	$	410,878

Foreign long-lived assets, exclusive of deferred tax assets, were $46.2 million and $48.2 million as of June 28, 2024 and December 29, 2023, respectively.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net loss	$ (5,112)	$ (20,656)	$ (14,101)	$ (20,661)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 28, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Basis of Presentation and Selected Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 28, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation These consolidated unaudited financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”). All intercompany balances and transactions have been eliminated upon consolidation. All dollar figures presented in tables in the notes to the consolidated financial statements are in thousands, except per share amounts. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted as permitted by the U.S. Securities and Exchange Commission's rules and regulations for interim reporting. These consolidated financial statements should be read in conjunction with our audited financial statements and notes thereto included in our Annual Report on Form 10‑K for the year ended December 29, 2023.
Year End	Year End We use a 52- or 53-week fiscal year ending on the last Friday in December. Our fiscal years ending December 27, 2024 and December 29, 2023 are each 52 weeks. References to 2024 and 2023 relate to the fiscal years then ended, respectively. The three-month periods ended June 28, 2024 and June 30, 2023 are each 13 weeks. References to the second quarter of 2024 and 2023 relate to the three-month periods then ended.
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods presented. We base our estimates and judgments on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results could differ from the estimates made by management. Significant estimates include inventory valuation, uncertain tax positions, valuation allowance on deferred tax assets, and impairment analysis for both definite‑lived intangible assets and goodwill.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash and cash equivalents consist of deposits and financial instruments which are readily convertible into cash and have original maturities of 90 days or less at the time of acquisition.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying values of our financial instruments, including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued liabilities, and long-term debt, net of unamortized debt issuance costs, approximate fair value.
Revenue Recognition	Revenue Recognition We recognize revenue when control of promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. This amount is recorded as net sales in our consolidated statements of operations. Transaction price – In most of our contracts, prices are generally determined by a customer-issued purchase order and generally remain fixed over the duration of the contract. Certain contracts contain variable consideration, including early-payment discounts and rebates. When a contract includes variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include the variable consideration in the transaction price only to the extent that it is probable that a significant reversal will not occur. Variable consideration estimates are updated at each reporting date. Historically, we have not incurred significant costs to obtain a contract. All amounts billed to a customer relating to shipping and handling are classified as net sales, while all costs incurred by us for shipping and handling are classified as cost of sales. Performance obligations – Substantially all of our performance obligations pertain to promised goods (“products”), which are primarily comprised of fluid delivery subsystems, weldments, and other components. Most of our contracts contain a single performance obligation and are generally completed within 12 months. Product sales are recognized at a point-in-time, upon "delivery," as such term is defined within the contract, which is generally at the time of shipment, as that is when control of the product has transferred. Products are covered by a standard assurance warranty, generally extended for a period of one to two years depending on the customer, which promises that delivered products conform to contract specifications. As such, we account for such warranties under Accounting Standards Codification ("ASC") Topic 460, Guarantees, and not as a separate performance obligation. Contract balances – Accounts receivable represents our unconditional right to receive consideration from our customers. Accounts receivable are carried at invoice price less an estimate for doubtful accounts and estimated payment discounts. Payment terms vary by customer, but payment is generally due within 15 to 60 days of purchase. Historically, we have not experienced significant payment issues with our customers. We had no significant contract assets or liabilities on our consolidated balance sheets in any of the periods presented herein.
Accounting Pronouncements Recently Issued	Accounting Pronouncements Recently Issued In November 2023, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker ("CODM"), a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted, and requires retrospective application to all prior periods presented in the financial statements. We are currently evaluating the effect that the adoption of this ASU may have on our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). This ASU is intended to enhance the transparency, decision usefulness, and effectiveness of income tax disclosures. The ASU requires a public entity to disclose a tabular tax rate reconciliation, using both percentages and currency, with specific categories. The ASU also requires a public entity to provide a qualitative description of the state and local income tax category and the net amount of income taxes paid, disaggregated by federal, state, and foreign taxes as well as by individual jurisdictions. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024, and early adoption and retrospective application are permitted. We are currently evaluating the effect that the adoption of this ASU may have on our consolidated financial statements.

Inventories (Tables)

6 Months Ended

Jun. 28, 2024

Inventory Disclosure [Abstract]

Schedule of Inventories

Inventories consist of the following:


	June 28, 2024		December 29, 2023
Raw materials	$	179,796	$	190,027
Work in process	37,631		36,849
Finished goods	46,746		47,449
Excess and obsolete adjustment	(32,698)		(28,440)
Total inventories	$	231,475	$	245,885

Property and Equipment and Other Noncurrent Assets (Tables)

6 Months Ended

Jun. 28, 2024

Property, Plant and Equipment [Abstract]

Summary of Property and Equipment

Property and equipment consist of the following:


	June 28, 2024		December 29, 2023
Machinery	$	118,076	$	113,529
Leasehold improvements	47,647		46,129
Computer software, hardware, and equipment	9,085		10,316
Office furniture, fixtures, and equipment	1,315		1,320
Vehicles	395		396
Construction-in-process	3,941		4,216
	180,459		175,906
Less accumulated depreciation	(91,317)		(83,151)
Total property and equipment, net	$	89,142	$	92,755

Intangible Assets (Tables)

6 Months Ended

Jun. 28, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Definite-Lived Intangible Assets

Definite‑lived intangible assets consist of the following:


	June 28, 2024
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	73,142	$	(24,974)	$	—	$	48,168	9.9 years
Developed technology	11,047		(6,159)		—		4,888		10.0 years
Total intangible assets	$	84,189	$	(31,133)	$	—	$	53,056


	December 29, 2023
	Gross value		Accumulated amortization		Accumulated impairment charges		Carrying amount		Weighted average useful life
Customer relationships	$	105,542	$	(53,680)	$	—	$	51,862	8.7 years
Developed technology	11,047		(5,621)		—		5,426		10.0 years
Total intangible assets	$	116,589	$	(59,301)	$	—	$	57,288

Leases (Tables)

6 Months Ended

Jun. 28, 2024

Leases [Abstract]

Components of Lease Expense

The components of lease expense are as follows:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Operating lease cost	$	2,492	$	2,393	$	4,984	$	4,804

Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases is as follows:


	Six Months Ended
	June 28, 2024		June 30, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,851	$	4,602

Supplemental Balance Sheet Information Related to Leases

Supplemental balance sheet information related to leases is as follows:


	June 28, 2024	December 29, 2023
Weighted-average remaining lease term of operating leases	4.3 years	4.6 years
Weighted-average discount rate of operating leases	3.8%	3.4%

Future Minimum Lease Payments Under Non-Cancelable Leases

Future minimum lease payments under non-cancelable leases are as follows as of June 28, 2024:


2024, remaining	$	4,936
2025	9,498
2026	9,170
2027	8,407
2028	3,882
Thereafter	2,827
Total future minimum lease payments	38,720
Less imputed interest	(2,974)
Total lease liabilities	$	35,746

Income Taxes (Tables)

6 Months Ended

Jun. 28, 2024

Income Tax Disclosure [Abstract]

Schedule of Income Taxes

Income tax information for the periods reported is as follows:


	Three Months Ended						Six Months Ended
	June 28, 2024			June 30, 2023			June 28, 2024			June 30, 2023
Income tax expense	$	942		$	12,620		$	1,855		$	12,085
Loss before income taxes	$	(4,170)		$	(8,036)		$	(12,246)		$	(8,576)
Effective income tax rate	(22.6)		%	(157.0)		%	(15.1)		%	(140.9)		%

Long-Term Debt (Tables)

6 Months Ended

Jun. 28, 2024

Debt Disclosure [Abstract]

Schedule of Long-term Debt

Long‑term debt consists of the following:


	June 28, 2024		December 29, 2023
Term loan	$	131,250	$	135,000
Revolving credit facility	—		115,000
Total principal amount of long-term debt	131,250		250,000
Less unamortized debt issuance costs	(1,085)		(1,317)
Total long-term debt, net	130,165		248,683
Less current portion	(7,500)		(7,500)
Total long-term debt, less current portion, net	$	122,665	$	241,183

Share-Based Compensation (Tables)

6 Months Ended

Jun. 28, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Option Activity

The following table summarizes option activity:


	Number of Stock Options
	Service condition	Weighted average exercise price per share		Weighted average remaining contractual term	Aggregate intrinsic value
Outstanding, December 29, 2023	582,163	$	24.36
Granted	—	$	—
Exercised	(142,331)	$	24.59
Forfeited or expired	(639)	$	21.76
Outstanding, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266
Exercisable, June 28, 2024	439,193	$	24.28	1.4 years	$	6,266

Schedule of RSU Activity

The following table summarizes RSU activity:


	Number of RSUs
	Service condition	Performance condition	Market condition	Weighted average grant-date fair value per share
Unvested, December 29, 2023	1,088,083	97,299	171,101	$	30.37
Granted	389,622	100,941	62,776	$	40.33
Vested	(251,711)	(6,609)	(8,617)	$	32.04
Forfeited	(74,110)	(13,021)	(23,419)	$	30.26
Unvested, June 28, 2024	1,151,884	178,610	201,841	$	33.61

Earnings per Share (Tables)

6 Months Ended

Jun. 28, 2024

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share and a reconciliation of the numerator and denominator used in the calculation:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net loss	$	(5,112)	$	(20,656)	$	(14,101)	$	(20,661)
Denominator:
Basic weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Dilutive effect of options	—		—		—		—
Dilutive effect of RSUs	—		—		—		—
Dilutive effect of ESPP	—		—		—		—
Diluted weighted average ordinary shares outstanding	33,548,071		29,116,413		31,779,521		29,050,645
Securities excluded from the calculation of diluted weighted average ordinary shares outstanding (1)	2,193,000		2,311,000		2,492,000		2,469,000
Net loss per share:
Basic	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)
Diluted	$	(0.15)	$	(0.71)	$	(0.44)	$	(0.71)

Segment Information (Tables)

6 Months Ended

Jun. 28, 2024

Segment Reporting [Abstract]

Schedule of Sales By Geographic Area

The following table sets forth sales by geographic area:


	Three Months Ended				Six Months Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
United States of America	$	69,259	$	61,623	$	133,653	$	150,675
Singapore	81,541		70,372		160,667		152,658
Europe	21,307		27,764		52,656		57,750
Other	31,120		25,249		57,634		49,795
Total net sales	$	203,227	$	185,008	$	404,610	$	410,878

Basis of Presentation and Selected Significant Accounting Policies - Additional Information (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	1 Months Ended	6 Months Ended
	Mar. 29, 2024	Jun. 28, 2024
Basis Of Presentation [Line Items]
Original maturities acquisition period		90 days
Underwriting discount (in usd per share)	$ 1.59
Public Stock Offering
Basis Of Presentation [Line Items]
Public offering (in shares)	3.8
Proceeds from the offering	$ 136.7
Offering expenses	$ 0.9
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2025-06-29
Basis Of Presentation [Line Items]
Performance obligation satisfaction period		12 months
Minimum
Basis Of Presentation [Line Items]
Extended product warranty period		1 year
Payment terms, due period		15 days
Maximum
Basis Of Presentation [Line Items]
Extended product warranty period		2 years
Payment terms, due period		60 days

Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 179,796	$ 190,027
Work in process	37,631	36,849
Finished goods	46,746	47,449
Excess and obsolete adjustment	(32,698)	(28,440)
Total inventories	$ 231,475	$ 245,885

Property and Equipment and Other Noncurrent Assets - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	$ 180,459	$ 175,906
Less accumulated depreciation	(91,317)	(83,151)
Total property and equipment, net	89,142	92,755
Machinery
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	118,076	113,529
Leasehold improvements
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	47,647	46,129
Computer software, hardware, and equipment
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	9,085	10,316
Office furniture, fixtures, and equipment
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	1,315	1,320
Vehicles
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	395	396
Construction-in-process
Property Plant And Equipment [Line Items]
Property, plant and equipment, gross	$ 3,941	$ 4,216

Property and Equipment and Other Noncurrent Assets - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 5.3	$ 4.4	$ 10.4	$ 8.7

Property and Equipment and Other Noncurrent Assets - Summary of Capitalized Cloud Computing Implementation Cost (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023	Dec. 29, 2023
Property, Plant and Equipment [Abstract]
Capitalized cloud computing implementation cost	$ 7.6		$ 7.6		$ 8.1
Capitalized costs amortized during the period	$ 0.3	$ 0.2	$ 0.5	$ 0.5

Intangible Assets - Schedule of Definite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Finite Lived Intangible Assets [Line Items]
Gross value	$ 84,189	$ 116,589
Accumulated amortization	(31,133)	(59,301)
Carrying amount	53,056	57,288
Customer relationships
Finite Lived Intangible Assets [Line Items]
Gross value	73,142	105,542
Accumulated amortization	(24,974)	(53,680)
Carrying amount	$ 48,168	$ 51,862
Customer relationships \| Weighted Average
Finite Lived Intangible Assets [Line Items]
Weighted average useful life	9 years 10 months 24 days	8 years 8 months 12 days
Developed technology
Finite Lived Intangible Assets [Line Items]
Gross value	$ 11,047	$ 11,047
Accumulated amortization	(6,159)	(5,621)
Carrying amount	$ 4,888	$ 5,426
Developed technology \| Weighted Average
Finite Lived Intangible Assets [Line Items]
Weighted average useful life	10 years	10 years

Leases - Components of Lease Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Leases [Abstract]
Operating lease cost	$ 2,492	$ 2,393	$ 4,984	$ 4,804

Leases - Supplemental Cash Flow Information Related to Leases (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023
Leases [Abstract]
Operating cash flows from operating leases	$ 4,851	$ 4,602

Leases - Supplemental Balance Sheet Information Related to Leases (Detail)	Jun. 28, 2024	Dec. 29, 2023
Leases [Abstract]
Weighted-average remaining lease term of operating leases	4 years 3 months 18 days	4 years 7 months 6 days
Weighted-average discount rate of operating leases	3.80%	3.40%

Leases - Future Minimum Lease Payments Under Non-Cancelable Leases (Detail) $ in Thousands	Jun. 28, 2024 USD ($)
Leases [Abstract]
2024, remaining	$ 4,936
2025	9,498
2026	9,170
2027	8,407
2028	3,882
Thereafter	2,827
Total future minimum lease payments	38,720
Less imputed interest	(2,974)
Total lease liabilities	$ 35,746

Income Taxes - Schedule of Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract]
Income tax expense	$ 942	$ 12,620	$ 1,855	$ 12,085
Loss before income taxes	$ (4,170)	$ (8,036)	$ (12,246)	$ (8,576)
Effective income tax rate	(22.60%)	(157.00%)	(15.10%)	(140.90%)

Income Taxes - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 28, 2024
Income Tax Disclosure [Abstract]
Unrecognized tax benefits for uncertain tax positions		$ 4.2
Deferred tax assets, valuation allowance	$ 11.1
Cumulative loss position, term	3 years
Tax penalties and interest expense		$ 0.5

Employee Benefit Programs - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Defined Contribution Plan Disclosure [Line Items]
Percentage of maximum annual contributions per employee			50.00%
Percentage of eligible employee receive discretionary matching contribution			50.00%
Employee matching contributions	$ 0.6	$ 0.6	$ 1.4	$ 1.5
Maximum
Defined Contribution Plan Disclosure [Line Items]
Percentage of maximum annual contributions per employee			4.00%

Long-Term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Line Of Credit Facility [Line Items]
Total principal amount of long-term debt	$ 131,250	$ 250,000
Less unamortized debt issuance costs	(1,085)	(1,317)
Total long-term debt, net	130,165	248,683
Less current portion	(7,500)	(7,500)
Long-term debt, less current portion, net	122,665	241,183
Term loan
Line Of Credit Facility [Line Items]
Total principal amount of long-term debt	131,250	135,000
Revolving credit facility
Line Of Credit Facility [Line Items]
Total principal amount of long-term debt	$ 0	$ 115,000

Long-Term Debt - Additional Information (Details) - USD ($) $ in Thousands	Oct. 29, 2021	Jun. 28, 2024	Dec. 29, 2023
Line Of Credit Facility [Line Items]
Principal amount of long-term debt		$ 131,250	$ 250,000
Term loan
Line Of Credit Facility [Line Items]
Principal amount of long-term debt		131,250	135,000
Revolving credit facility
Line Of Credit Facility [Line Items]
Principal amount of long-term debt		$ 0	$ 115,000
Credit Agreement \| Federal Funds Effective Rate
Line Of Credit Facility [Line Items]
Basis spread on variable rate	0.50%
Credit Agreement \| BSBY Rate
Line Of Credit Facility [Line Items]
Basis spread on variable rate	1.00%
Credit Agreement \| Maximum \| BSBY Rate
Line Of Credit Facility [Line Items]
Additional basis spread on variable rate	2.375%
Credit Agreement \| Maximum \| Base Rate
Line Of Credit Facility [Line Items]
Additional basis spread on variable rate	1.375%
Credit Agreement \| Minimum \| BSBY Rate
Line Of Credit Facility [Line Items]
Additional basis spread on variable rate	1.375%
Credit Agreement \| Minimum \| Base Rate
Line Of Credit Facility [Line Items]
Additional basis spread on variable rate	0.375%
Credit Agreement \| Term loan
Line Of Credit Facility [Line Items]
Principal amount of long-term debt	$ 150,000
Credit facility, periodic principal payments	1,900
Credit Agreement \| Term loan \| BSBY Rate
Line Of Credit Facility [Line Items]
Interest rate		7.27%
Credit Agreement \| Revolving credit facility
Line Of Credit Facility [Line Items]
Principal amount of long-term debt	$ 250,000
Credit Agreement \| Revolving credit facility \| Maximum
Line Of Credit Facility [Line Items]
Percentage of commitment fee on unused portion of revolver	0.35%
Credit Agreement \| Revolving credit facility \| Minimum
Line Of Credit Facility [Line Items]
Percentage of commitment fee on unused portion of revolver	0.175%

Share-Based Compensation - Additional Information (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation expense for options, RSUs and employee share purchase rights across all plans	$ 3.9	$ 4.3	$ 6.3	$ 7.9
The 2016 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, expiration period			4 years
Awards vesting percentage			25.00%
Awards vesting period			3 years
2017 Employee Stock Purchase Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Purchase price equal to percentage of fair market value of ordinary shares			85.00%
2017 Employee Stock Purchase Plan \| Ordinary Shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Ordinary shares remain available for purchase			2.1

Share-Based Compensation - Schedule of Option Activity (Details) - Service condition - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 28, 2024
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
Number of stock options, outstanding, beginning balance (in shares)	582,163
Number of stock options, granted (in shares)	0
Number of stock options issued from exercise of stock options (in shares)	(142,331)
Number of stock options forfeited or expired (in shares)	(639)
Number of stock options, outstanding, ending balance (in shares)	439,193
Number of stock options, exercisable (in shares)	439,193
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Weighted average exercise price per share, outstanding, beginning balance (in usd per share)	$ 24.36
Weighted average exercise price per share, granted (in usd per share)	0
Weighted average exercise price per share, exercised (in usd per share)	24.59
Weighted average exercise price per share, forfeited or expired (in usd per share)	21.76
Weighted average exercise price per share, outstanding, ending balance (in usd per share)	24.28
Weighted average exercise price per share, exercisable (in usd per share)	$ 24.28
Weighted average remaining contractual term, outstanding	1 year 4 months 24 days
Weighted average remaining contractual term, exercisable	1 year 4 months 24 days
Aggregate intrinsic value, outstanding	$ 6,266
Aggregate intrinsic value, exercisable	$ 6,266

Share-Based Compensation - Schedule of RSU Activity (Details)	6 Months Ended
	Jun. 28, 2024 $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Weighted average grant date fair value per share, unvested, beginning balance (in usd per share) \| $ / shares	$ 30.37
Weighted average grant date fair value per share, granted (in usd per share) \| $ / shares	40.33
Weighted average grant date fair value per share, vested (in usd per share) \| $ / shares	32.04
Weighted average grant date fair value per share, forfeited (in usd per share) \| $ / shares	30.26
Weighted average grant date fair value per share, unvested, ending balance (in usd per share) \| $ / shares	$ 33.61
Restricted Stock Units Service Condition
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
Number of restricted share units, unvested, beginning balance (in shares)	1,088,083
Number of restricted share units, granted (in shares)	389,622
Number of restricted share units, vested (in shares)	(251,711)
Number of restricted share units, forfeited (in shares)	(74,110)
Number of restricted share units, unvested, ending balance (in shares)	1,151,884
Performance Condition
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
Number of restricted share units, unvested, beginning balance (in shares)	97,299
Number of restricted share units, granted (in shares)	100,941
Number of restricted share units, vested (in shares)	(6,609)
Number of restricted share units, forfeited (in shares)	(13,021)
Number of restricted share units, unvested, ending balance (in shares)	178,610
Market Condition
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward]
Number of restricted share units, unvested, beginning balance (in shares)	171,101
Number of restricted share units, granted (in shares)	62,776
Number of restricted share units, vested (in shares)	(8,617)
Number of restricted share units, forfeited (in shares)	(23,419)
Number of restricted share units, unvested, ending balance (in shares)	201,841

Earnings per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Numerator:
Net loss	$ (5,112)	$ (20,656)	$ (14,101)	$ (20,661)
Denominator:
Basic weighted average ordinary shares outstanding	33,548,071	29,116,413	31,779,521	29,050,645
Diluted weighted average ordinary shares outstanding	33,548,071	29,116,413	31,779,521	29,050,645
Securities excluded from the calculation of diluted weighted average ordinary shares outstanding	2,193,000	2,311,000	2,492,000	2,469,000
Net loss per share:
Basic (in usd per share)	$ (0.15)	$ (0.71)	$ (0.44)	$ (0.71)
Diluted (in usd per share)	$ (0.15)	$ (0.71)	$ (0.44)	$ (0.71)
ESPP
Denominator:
Dilutive effect of shares	0	0	0	0
Options
Denominator:
Dilutive effect of shares	0	0	0	0
RSUs
Denominator:
Dilutive effect of shares	0	0	0	0

Segment Information - Additional Information (Details) $ in Millions	6 Months Ended
	Jun. 28, 2024 USD ($) Segment	Dec. 29, 2023 USD ($)
Segment Reporting [Abstract]
Number of operating segment \| Segment	1
Foreign long-lived assets, exclusive of deferred tax assets \| $	$ 46.2	$ 48.2

Segment Information - Schedule of Sales By Geographic Area (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Segment Reporting Information [Line Items]
Total net sales	$ 203,227	$ 185,008	$ 404,610	$ 410,878
United States of America
Segment Reporting Information [Line Items]
Total net sales	69,259	61,623	133,653	150,675
Singapore
Segment Reporting Information [Line Items]
Total net sales	81,541	70,372	160,667	152,658
Europe
Segment Reporting Information [Line Items]
Total net sales	21,307	27,764	52,656	57,750
Other
Segment Reporting Information [Line Items]
Total net sales	$ 31,120	$ 25,249	$ 57,634	$ 49,795

Ichor (NASDAQ:ICHR)
Historical Stock Chart
From Oct 2024 to Nov 2024

Ichor (NASDAQ:ICHR)
Historical Stock Chart
From Nov 2023 to Nov 2024

Market Data

News

Trading Tools

Markets

Discover

Hot Features

Follow Feed

Options Flow

Monitor

ICHR Ichor Holdings

Ichor Holdings News

Your Recent History

Company

Business

Popular

Get The App

Trending Now

Toplists

Market Data

News

Trading Tools

Markets

Discover

Hot Features

Follow Feed

Options Flow

Monitor

ICHR Ichor Holdings

Ichor Holdings News

Your Recent History

Company

Business

Popular

Get The App