Photronics, Inc. reported its financial results for the third quarter and nine months ended July 28, 2024, revealing a decline in revenue compared to the previous fiscal period. Revenue for the three months was $210.98 million, down 5.9% from $224.21 million in the same quarter of 2023. For the nine months, revenue totaled $644.32 million, a decrease from $664.60 million year-over-year. The decline in revenue was attributed to reduced demand in the semiconductor and flat panel display (FPD) markets, with integrated circuit (IC) revenue for the quarter at $155.88 million, down 4.4% from the prior year.

Gross profit for the third quarter was $75.14 million, compared to $86.80 million in the same quarter of 2023, reflecting a gross margin decrease of 310 basis points. Operating income also fell to $52.15 million from $65.26 million year-over-year. However, net income for the quarter remained relatively stable at $48.17 million, slightly down from $48.26 million in the prior year, while net income attributable to Photronics shareholders increased to $34.39 million from $26.96 million.

For the nine-month period, net income attributable to shareholders rose to $96.82 million from $80.87 million, with earnings per share increasing to $1.57 from $1.32. The effective tax rate for the third quarter was 22.7%, down from 25.0% in the same quarter of the previous year.

On the balance sheet, total assets increased to $1.65 billion as of July 28, 2024, up from $1.53 billion at the end of October 2023. Current assets also rose to $892.64 million, driven by an increase in cash and cash equivalents, which reached $537.33 million, up from $499.29 million. Short-term investments saw a significant rise to $69.05 million from $12.92 million.

Photronics continues to focus on strategic initiatives, including a joint venture established in 2018 with DNP for photomask production in China, which reported a decrease in net income for the quarter. The company has also authorized an increase in its share repurchase program from $31.7 million to $100 million as of August 2024, although no shares were repurchased during the reported periods.

Overall, while Photronics experienced revenue declines, it managed to improve net income attributable to shareholders and maintain a strong balance sheet, positioning itself for future growth amid industry volatility.