November 5, 2024 - 10-Q: Quarterly report pursuant to Section 13 or 15(d)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-Q

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

For the quarterly period ended September 30, 2024

☐ 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: 000-31285

TTM TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

    Delaware

    91-1033443

    (State or other jurisdiction of
incorporation or organization)

    (I.R.S. Employer
Identification No.)

200 East Sandpointe, Suite 400, Santa Ana, California 92707

(Address of principal executive offices)

(714) 327-3000

(Registrant’s telephone number, including area code)

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

    Title of each class

    Trading symbol(s)

    Name of each exchange on which registered

    Common Stock, $0.001 par value

    TTMI

    Nasdaq Global Select Market

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 ☑ No ☐

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 ☑ No ☐

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

    ☐  

    Smaller 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. ☐

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

As of November 1, 2024, there were outstanding 101,969,460 shares of the registrant’s Common Stock, $0.001 par value.

TTM TECHNOLOGIES, INC.

Form 10-Q

For the Quarter Ended September 30, 2024

TABLE OF CONTENTS


		Page
PART I: FINANCIAL INFORMATION		3
Item 1. Financial Statements (unaudited)		3
Consolidated Condensed Balance Sheets as of September 30, 2024 and January 1, 2024		3
Consolidated Condensed Statements of Operations for the quarter and three quarters ended September 30, 2024 and October 2, 2023		4
Consolidated Condensed Statements of Comprehensive Income (Loss) for the quarter and three quarters ended September 30, 2024 and October 2, 2023		5
Consolidated Condensed Statements of Stockholders' Equity for the three quarters ended September 30, 2024 and October 2, 2023		6
Consolidated Condensed Statements of Cash Flows for the three quarters ended September 30, 2024 and October 2, 2023		7
Notes to Consolidated Condensed Financial Statements		8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 3. Quantitative and Qualitative Disclosures About Market Risk		25
Item 4. Controls and Procedures		26
PART II: OTHER INFORMATION		27
Item 1. Legal Proceedings		27
Item 1A. Risk Factors		27
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		27
Item 3. Defaults Upon Senior Securities		27
Item 4. Mine Safety Disclosures		27
Item 5. Other Information		27
Item 6. Exhibits		29
SIGNATURES		30

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

TTM TECHNOLOGIES, INC.

Consolidated Condensed Balance Sheets

As of September 30, 2024 and January 1, 2024


	As of
	September 30, 2024			January 1, 2024
	(Unaudited)
	(In thousands, except par value)
ASSETS
Current assets:
Cash and cash equivalents	$	469,500		$	450,208
Accounts receivable, net		422,885			413,557
Contract assets		362,668			292,050
Inventories		227,913			213,075
Receivable from sale of Shanghai E-MS (SH E-MS) property		—			6,737
Prepaid expenses and other current assets		41,861			54,060
Total current assets		1,524,827			1,429,687
Property, plant, and equipment, net		859,247			807,667
Operating lease right-of-use assets		79,500			86,286
Goodwill		702,735			702,735
Definite-lived intangibles, net		201,069			236,711
Deposits and other non-current assets		51,440			60,577
Total assets	$	3,418,818		$	3,323,663

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt, including current portion of long-term debt	$	3,465		$	3,500
Accounts payable		387,071			334,609
Contract liabilities		138,368			126,508
Accrued salaries, wages, and benefits		112,616			98,561
Other current liabilities		121,730			140,806
Total current liabilities		763,250			703,984
Long-term debt, net of discount and issuance costs		912,809			914,336
Operating lease liabilities		84,291			80,786
Other long-term liabilities		111,359			113,518
Total long-term liabilities		1,108,459			1,108,640
Commitments and contingencies (Note 14)
Equity:
Common stock, $0.001 par value; 300,000 shares authorized; 113,132 and 111,282 shares issued as of September 30, 2024 and January 1, 2024, respectively; 101,968 and 102,108 shares outstanding as of September 30, 2024 and January 1, 2024, respectively		113			111
Treasury stock – common stock at cost; 11,164 and 9,174 shares as of September 30, 2024 and January 1, 2024, respectively		(157,570	)		(123,091	)
Additional paid-in capital		902,658			880,963
Retained earnings		833,252			782,123
Accumulated other comprehensive loss		(31,344	)		(29,067	)
Total stockholders’ equity		1,547,109			1,511,039
Total liabilities and stockholders' equity	$	3,418,818		$	3,323,663

See accompanying notes to consolidated condensed financial statements.

TTM TECHNOLOGIES, INC.

Consolidated Condensed Statements of Operations

For the Quarter and Three Quarters Ended September 30, 2024 and October 2, 2023


	Quarter Ended						Three Quarters Ended
	September 30, 2024			October 2, 2023			September 30, 2024			October 2, 2023
	(Unaudited)
	(In thousands, except per share data)
Net sales	$	616,538		$	572,582		$	1,791,788		$	1,663,528
Cost of goods sold		486,650			459,312			1,440,954			1,365,628
Gross profit		129,888			113,270			350,834			297,900
Operating expenses:
Selling and marketing		19,961			18,763			60,053			58,245
General and administrative		42,567			38,916			124,841			111,829
Research and development		8,054			6,173			23,922			19,682
Amortization of definite-lived intangibles		6,951			11,429			28,636			37,245
Impairment of goodwill		—			44,100			—			44,100
Restructuring charges		1,393			4,091			6,367			19,061
Total operating expenses		78,926			123,472			243,819			290,162
Operating income (loss)		50,962			(10,202	)		107,015			7,738
Other (expense) income:
Interest expense		(11,768	)		(10,101	)		(36,311	)		(34,751	)
Loss on extinguishment of debt		—			—			—			(1,154	)
Gain on sale of subsidiary		—			—			—			1,270
Other, net		(14,177	)		3,044			(1,086	)		9,310
Total other expense, net		(25,945	)		(7,057	)		(37,397	)		(25,325	)
Income (loss) before income taxes		25,017			(17,259	)		69,618			(17,587	)
Income tax provision		(10,706	)		(19,807	)		(18,489	)		(18,469	)
Net income (loss)	$	14,311		$	(37,066	)	$	51,129		$	(36,056	)

Earnings (loss) per share:
Basic earnings (loss) per share	$	0.14		$	(0.36	)	$	0.50		$	(0.35	)
Diluted earnings (loss) per share		0.14			(0.36	)		0.49			(0.35	)

See accompanying notes to consolidated condensed financial statements.

TTM TECHNOLOGIES, INC.

Consolidated Condensed Statements of Comprehensive Income (Loss)

For the Quarter and Three Quarters Ended September 30, 2024 and October 2, 2023


	Quarter Ended						Three Quarters Ended
	September 30, 2024			October 2, 2023			September 30, 2024			October 2, 2023
	(Unaudited)
	(In thousands)
Net income (loss)	$	14,311		$	(37,066	)	$	51,129		$	(36,056	)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments, net		325			(52	)		(533	)		(485	)
Derecognition of foreign currency translation adjustments due to sale of subsidiary		—			—			—			(6,627	)
Net unrealized (loss) gain on cash flow hedges:
Unrealized (loss) gain on effective cash flow hedges during the period, net		(3,905	)		3,010			835			8,150
Amounts realized in the statement of operations, net		(851	)		(837	)		(2,579	)		(1,558	)
Net		(4,756	)		2,173			(1,744	)		6,592
Other comprehensive (loss) income, net of tax		(4,431	)		2,121			(2,277	)		(520	)
Comprehensive income (loss), net of tax	$	9,880		$	(34,945	)	$	48,852		$	(36,576	)

See accompanying notes to consolidated condensed financial statements.

TTM TECHNOLOGIES, INC.

Consolidated Condensed Statements of Stockholders’ Equity

For the Three Quarters Ended September 30, 2024 and October 2, 2023


	Common Stock				Treasury Stock						Additional Paid-In			Retained		Accumulated Other Comprehensive			Total Stockholders'
	Shares		Amount		Shares			Amount			Capital			Earnings		Loss			Equity
	(Unaudited)
	(In thousands)
Balance, January 1, 2024		111,282	$	111		(9,174	)	$	(123,091	)	$	880,963		$	782,123	$	(29,067	)	$	1,511,039
Net income		—		—		—			—			—			10,466		—			10,466
Other comprehensive income		—		—		—			—			—			—		2,150			2,150
Issuance of common stock for performance-based restricted stock units		227		1		—			—			(1	)		—		—			—
Issuance of common stock for restricted stock units		41		—		—			—			—			—		—			—
Repurchases of common stock		—		—		(600	)		(9,334	)		—			—		—			(9,334	)
Stock-based compensation		—		—		—			—			6,787			—		—			6,787
Balance, April 1, 2024		111,550	$	112		(9,774	)	$	(132,425	)	$	887,749		$	792,589	$	(26,917	)	$	1,521,108
Net income		—		—		—			—			—			26,352		—			26,352
Other comprehensive income		—		—		—			—			—			—		4			4
Issuance of common stock for restricted stock units		1,559		1		—			—			(1	)		—		—			—
Repurchases of common stock		—		—		(1,390	)		(25,145	)		—			—		—			(25,145	)
Stock-based compensation		—		—		—			—			6,580			—		—			6,580
Balance, July 1, 2024		113,109	$	113		(11,164	)	$	(157,570	)	$	894,328		$	818,941	$	(26,913	)	$	1,528,899
Net income		—		—		—			—			—			14,311		—			14,311
Other comprehensive loss		—		—		—			—			—			—		(4,431	)		(4,431	)
Issuance of common stock for restricted stock units		23		—		—			—			—			—		—			—
Stock-based compensation		—		—		—			—			8,330			—		—			8,330
Balance, September 30, 2024		113,132	$	113		(11,164	)	$	(157,570	)	$	902,658		$	833,252	$	(31,344	)	$	1,547,109


	Common Stock				Treasury Stock						Additional Paid-In			Retained			Accumulated Other Comprehensive			Total Stockholders'
	Shares		Amount		Shares			Amount			Capital			Earnings			Loss			Equity
	(Unaudited)
	(In thousands)
Balance, January 2, 2023		109,598	$	110		(7,370	)	$	(98,659	)	$	858,077		$	800,841		$	(24,790	)	$	1,535,579
Net loss		—		—		—			—			—			(5,814	)		—			(5,814	)
Other comprehensive loss		—		—		—			—			—			—			(7,271	)		(7,271	)
Issuance of common stock for performance-based restricted stock units		337		—		—			—			—			—			—			—
Issuance of common stock for restricted stock units		21		—		—			—			—			—			—			—
Stock-based compensation		—		—		—			—			5,240			—			—			5,240
Balance, April 3, 2023		109,956	$	110		(7,370	)	$	(98,659	)	$	863,317		$	795,027		$	(32,061	)	$	1,527,734
Net income		—		—		—			—			—			6,824			—			6,824
Other comprehensive income		—		—		—			—			—			—			4,630			4,630
Issuance of common stock for restricted stock units		1,284		1		—			—			(1	)		—			—			—
Stock-based compensation		—		—		—			—			5,121			—			—			5,121
Balance, July 3, 2023		111,240	$	111		(7,370	)	$	(98,659	)	$	868,437		$	801,851		$	(27,431	)	$	1,544,309
Net loss		—		—		—			—			—			(37,066	)		—			(37,066	)
Other comprehensive income		—		—		—			—			—			—			2,121			2,121
Issuance of common stock for restricted stock units		10		—		—			—			—			—			—			—
Repurchases of common stock		—		—		(1,020	)		(14,617	)		—			—			—			(14,617	)
Stock-based compensation		—		—		—			—			6,367			—			—			6,367
Balance, October 2, 2023		111,250	$	111		(8,390	)	$	(113,276	)	$	874,804		$	764,785		$	(25,310	)	$	1,501,114

See accompanying notes to consolidated condensed financial statements.

TTM TECHNOLOGIES, INC.

Consolidated Condensed Statements of Cash Flows

For the Three Quarters Ended September 30, 2024 and October 2, 2023


	Three Quarters Ended
	September 30, 2024			October 2, 2023
	(Unaudited)
	(In thousands)
Cash flows from operating activities:
Net income (loss)	$	51,129		$	(36,056	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation of property, plant, and equipment		78,709			74,060
Amortization of definite-lived intangible assets		35,642			47,811
Amortization of debt discount and issuance costs		1,517			1,726
Loss on extinguishment of debt		—			1,154
Deferred income taxes		(1,180	)		1,177
Stock-based compensation		21,697			16,728
Gain on sale of subsidiary		—			(1,270	)
Impairment of goodwill		—			44,100
Other		2,194			(633	)
Changes in operating assets and liabilities:
Accounts receivable, net		(9,328	)		72,591
Contract assets		(70,618	)		30,360
Inventories		(14,838	)		(38,493	)
Prepaid expenses and other current assets		(2,236	)		81
Accounts payable		34,698			(26,788	)
Contract liabilities		11,860			(1,745	)
Accrued salaries, wages, and benefits		14,055			(20,955	)
Other current liabilities		(2,461	)		(24,034	)
Net cash provided by operating activities		150,840			139,814
Cash flows from investing activities:
Proceeds from sale of SH E-MS property		6,737			61,769
Purchase of property, plant, and equipment and other assets		(129,709	)		(114,167	)
Proceeds from sale of property, plant, and equipment and other assets		29,599			384
Proceeds from sale of subsidiary, net of cash disposed		—			6,039
Other		(76	)		(101	)
Net cash used in investing activities		(93,449	)		(46,076	)
Cash flows from financing activities:
Repurchases of common stock		(34,479	)		(14,617	)
Repayment of long-term debt		(8,730

Form: 10-Q

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TTM TECHNOLOGIES, INC.