A copy of our earnings release is available in the Investor Relations section of our website at ir.micron.com. This call is broadcast live over the web and can be accessed through our website. In addition, today's call is being recorded and will be available via replay on our website. We will be referring to a slide presentation during the call which we also posted at ir.vishay.com. You should be aware that in today's conference call, we will make forward-looking statements discussing future events and performance. These statements are subject to risks and uncertainties that could cause actual results to differ from the forward-looking statements. For a discussion of factors that could cause results to differ, please see today's press release and Vishay's Form 10-Ks and Form 10-Q filing with the Securities and Exchange Commission. We are including information on various GAAP and non-GAAP measures in our press release and on the conference call. We have included full GAAP and non-GAAP reconciliation in our press release and in the presentation posted on ir.vishay.com, which we believe you will find useful when comparing our GAAP and non-GAAP. We use non-GAAP measures because we believe they provide useful information about the operating performance of our businesses and should be considered by investors in conjunction with GAAP measures. Now, I turn the call over to President and Chief Executive Officer, Joel McCall.

Thank you, Peter. Good morning, everyone. Thank you for joining our fourth quarter 2024 conference call. I'll start my remarks with a review of our revenue for the fourth quarter by end markets, channel, and region. Then Dave will take you through a review of the fourth quarter financial results, and our guidance for the first quarter of 2025. After that, I'll give you a summary of our actions during 2024 to implement the three-point-o and the key initiatives we plan to focus on in 2025 as we continue to execute our five-year strategic plan, and then after, we'll be happy to answer any of your questions. Revenue for the fourth quarter was down slightly versus Q3 at $714.7 million for a full year revenue of $2.9 billion that was below 2023. As we've talked about all year, the industry has endured a prolonged period of inventory digestion by customers worldwide, compounded by weak macroeconomic conditions in Europe. But after nine straight quarters of inventory consumption, the longest inventory correction cycle we've seen, inventory levels at the end customers and in the distribution channel appear to be normalizing, particularly for semiconductors serving automotive and industrial end markets in Asia and the Americas. As a result, book to bill at quarter end was 1.01 compared to 0.88 in Q3, with most of the improvement coming from semiconductors which reported a book to bill of near one versus 0.79 in Q3 and a passive book to bill had moved into positive territory at 1.03 versus 0.97 last quarter. We're watching book to bill data closely in Q1, especially now coming out of the Chinese New Year holiday to see how this trend continues. Bookings continue to improve, particularly for products related to smart grid infrastructure projects, AI server power, and military defense. Even though revenue was more or less in a holding pattern most of the year, at Vishay Intertechnology, Inc., we have not been standing still. We have been pressing ahead and building momentum. The organization has the shared sense of purpose and commitment to make Vishay three-point-o a success. Preparing to take full advantage of the megatrends of e-mobility and sustainability. Setting the foundation to transform everyone's thinking to the business-minded is positioning us to accelerate revenue, improving profitability, and enhancing return. These are top priorities across Vishay Intertechnology, Inc. As employees across the globe have adopted a customer-first, and a business-minded approach in everything we do, a cultural shift has been taking hold within the company. There's a different vibe now as employees collaborate, exchange ideas, cooperate, and make decisions to improve profitability, and everyone is looking ahead to seeing the initiatives they are working on this year pay off in the next industry upturn. I want to express my gratitude to the Vishay Intertechnology, Inc. employees for their willingness to embrace continued change this year and for working together to achieve our five-year strategic plan and financial goals. Let's now take a closer look at the fourth quarter revenue relative to the third quarter, starting with the review of revenue by end markets on Slide three. Automotive revenue decreased six percent versus the third quarter. Most customers hold below their schedule agreements, which was also at lower rates than the third quarter. While in Europe, production volume decreased along with lower forecast later in the quarter. At year end, due to the holidays, some automotive plant shutdowns pushed their scheduled demand out into the first half of 2025. New programs, however, using AI chipsets for driver assist and autonomous driving programs were started with customers during the quarter. In the Americas, automotive customers held at normal rates through the first eleven weeks of the quarter on strong demand. In the last two weeks of the quarter, polls were very light. In China, automotive demand came from EV production and growing electronic content. Global and China automotive Tier one and assemble using Vishay Intertechnology, Inc. products for China automotive OEMs. Each product division works to design in and sell technology, differentiated products to China Automotive. We completed the contract negotiations with large OEMs during the quarter, which resulted in a typical ASP decline in the low to mid-single digits along with volume and share gain. Renewed schedule agreements show improving demand for the first half of 2025 but still limited visibility in the second half of the year. Design activity around EVs continue during the fourth quarter, even though there's an acceleration to design towards hybrid powertrain. Design activity is focused on high-performance computing safety, autonomous driving, infotainment, smart cockpit applications, and in-cabin monitoring. Revenue from industrial end markets decreased $5 million or two percent for the quarter. Order intake for smart grid infrastructure projects continues to be quite positive during the quarter. We won another China program during the quarter. And order intake was also strong for grid management products, power supplies, power tools, and industrial inverters. Customers in the Americas and Asia continue to consume semiconductor inventory throughout the quarter, improving the balance between inventories and lead times. Customers in Europe on the other hand continued to contend with weak business conditions impaired by seasonality and high component inventory which is planned for Q1 2025 consumption. New design activity in industrial was focused on automation, including connectivity, robots, agriculture, remote monitoring, and HVDC for smart grid Infosys. In aerospace defense, with order flow similar to prior quarters this year, revenue was slightly below the third quarter. Distributors continue to place orders at a booking rate above one to support U.S. Military demand. As we increased our backlog of orders also related to low earth orbit satellite programs. In Europe, revenue was flat for this segment on normal year-end seasonality, while commercial aerospace demand faces some supply chain challenges, with mechanical products. Our Vishay Intertechnology, Inc. products are in the queue. Once the mechanical supply chain issue is improved. We are a preferred supplier and continue designing work on new programs for all US Department of Defense OEMs. Some projects include munition replenishment, missile design programs, hypersonic ballistic tracking space sensors, next-generation interceptors, and commercial and military low earth orbit satellites. We have multiple products supporting this design in the defense and space program. As a reminder, Vishay Intertechnology, Inc.'s passives have the broadest military established reliability certification. We sell the medical end markets mostly in the with strong demand for some customers based on forecast in 2025. We did have softer orders from one large customer for inductors, however. Design activity for patient monitoring, surgical assist robots, and glucose monitoring continues to create new business opportunities for Vishay Intertechnology, Inc. to sell our entire portfolio of products. Implantable devices continue to offer us high dollar content opportunities. Revenue from the other market segments including computing, consumer, and telecom end markets, was up three percent quarter over quarter, with strong order intake related to heightened demand for AI servers, and server power projects. We are designing in and supplying a wide variety of products to AI which supports the unique position of Vishay Intertechnology, Inc. These products are MOSFETs polymer tantalum capacitors, resistors, voltage suppressors, diodes, and inductors. Also, for IC products, we're designing in e-fuses, driver moths, and power stage. This list further demonstrates the breadth of our portfolio, which populates a high percentage of components on a board in power application. AI at this point remains a quick turns business. We see unscheduled orders from CMs looking for quick delivery to support AI power management modules. Spot orders are running around sixty percent of total orders in Asia. Still low visibility. Design activity stayed focused on AI server power, power conversion of power management of the AI chipsets. Along with notebooks, and designs aimed at companies who integrate AI chipsets into their program. Turning to slide four. Which displays revenue mix by channel. You can see that the distribution revenue declined versus the Third quarter. While OEM and EMS revenue increased slightly. This is an encouraging sign around consumption. Revenue from OEM EMS customers grew for the first time since the fourth quarter of 2023. Automotive and industrial OEMs are normalizing inventory levels, and demand related to smart grid infrastructure projects was strong. EMS customers are citing buy to direct demand, although regional EMS in Europe are still holding high inventory, coupled with soft end customer demand. Most of the EMS in Europe did shut down in the last two weeks of the year. Sales to distribution declined seven percent on fewer shipment days during the quarter versus Q3 and the prolonged weak demand in Europe's industrial end markets, particularly for renewable. Asia and the Americas distributors managed their year-end inventories and manage their financial P&L. Worldwide POS decreased three percent once again pulled down by reducing POS in Europe. The holidays fell mid-week in late December, many distributors stopped accepting shipments after eleven weeks into the quarter. Our distribution inventory remained stable at twenty-seven weeks. Let's go to slide five. In terms of the geographical mix. Europe is the lagging region, softening revenues per share as a whole, and declining eight percent as macroeconomic conditions continue to weaken. Distributors are still working through inventory, and customers stopped accepting shipments after week eleven into the quarter. This weakness masked the growth in Europe related to smart grid infrastructure projects. Asia was a bright spot with revenue benefiting from shipments to smart grid infrastructure programs, and spot orders related to AI servers and some early signals for industrial. I'll now turn the call over to Dave, where he will review the financial results of Q4.

Let's start our review of the fourth quarter results with the highlights on slide six. Fourth quarter revenues were $715 million including $3 million attributable to the legacy Newport products, and within the range of our guidance. Revenues decreased 2.8% compared to the third quarter, reflecting a 1.6% reduction in volume, a 0.6% reduction in ASPs, and a 0.6% negative foreign currency impact related mostly to the euro. By reportable business segment, the $21 million decrease in revenues was mainly attributable to a $16 million decrease in opto, and a $7 million decrease in inductors. MOSFETs diodes, and resistors had more modest decreases. These declines were partially offset by an $11 million increase in our capacitor segment. Compared to the fourth quarter last year, revenues were down 9% reflecting a volume decrease net of Newport of 4.7% and a 4.6% reduction in ASPs. Book to bill for the quarter was 1.01 comprised of 0.99 for semis and 1.03 for passives, the first book to bill over one in nine quarters. Backlog was stable at 4.4 months with semis and passives both flat versus Q3 semis at 3.9, passives at 4.9. Moving on to the next slide, presenting the income statement highlights. Gross profit was $142 million, resulting in a gross margin of 19.9% and included a negative impact from Newport of approximately 190 basis points. Lower compared to the third quarter, gross margin was 60 basis primarily due to lower average selling prices, a slight increase in depreciation, and a higher negative impact from Newport. Depreciation expense was $52 million slightly under our guidance for the quarter? Up from $51 million in quarter three, and reflects the additional equipment that's come online. SG&A expenses totaled $132 million compared to $129 million for the third quarter, this is higher than our guidance for the quarter and reflects higher R&D expenses incurred in Newport, and some unanticipated legal and professional fees. During the quarter, we recorded a $66 million non-cash goodwill impairment charge to reflect the reduction in fair value of our MOSFETs reporting unit. The impairment charge does not affect our liquidity, cash flows from operating activities, or debt covenants.

We remain committed to our MOSFET expansion plans.

Inclusive of the impairment charge, GAAP operating margin was minus 7.9% compared to minus 2.5% in the third quarter and 9.9% in the fourth quarter of 2023. Adjusted operating margin decreased to 1.4% in line with the decrease in margins. In gross margin and reflecting the increase in G&A expenses. Adjusted EBITDA for the quarter was $66 million for an adjusted EBITDA margin of 9.3% down from 9.7% in the third quarter. Our GAAP effective tax rate for the full year is not meaningful at the low levels of pre-tax loss. Due to the GAAP net loss for the quarter, the effective tax rate for the quarter was approximately minus 12.3%. Our normalized effective tax rate for the full year was approximately 36% which yields a not meaningful quarterly effective tax rate. GAAP loss per share was $0.49 compared to a loss of $0.14 per share in quarter three and $0.37 per share in quarter four 2023. Adjusted EPS was breakeven per share compared to $0.08 per share in third quarter, and $0.37 per share in the fourth quarter of 2023. Proceeding to slide eight, three is of reference. The presentation includes a table illustrating the revenue, gross margin, and book to bill ratios for each of our reportable business segments. Of note, for the fourth quarter, the results of Newport continue to be reported substantially all in the MOSFETs business segment weighing on that segment's gross margin approximately 900 basis points. Turning to slide nine and our cash conversion cycle metrics. Our DSO was stable at 53 days, DPO was up 34 days from 32. Inventory was up slightly due to the Brooklebock acquisition, up to $689 million resulting in an inventory days outstanding of 109 days up from 106 days in the third quarter. Total cash conversion cycle for the fourth quarter is 128 days. Continuing to slide ten, you can see we generated $68 million in operating cash for the fourth quarter. Total CapEx for the quarter was $145 million including $103 million designated for capacity expansion projects, and $320 million for the year. Which fell below our guidance of between $360 and $390 million. As delivery of some equipment was delayed to quarter one. This brings the total CapEx for the period 2022-2024 to over $1 billion as we invest in Vishay Intertechnology, Inc. three-point-o.

On a trailing twelve-month basis, capital intensity was 10.9% compared to 9.7% for the same period last year. Due to the investments in capacity expansion projects, free cash flow for the quarter was a negative $76 million compared to negative $9 million in the third quarter. For the full year, free cash flow was a negative $143 million. Stockholder returns for the fourth quarter amounted to $26.2 million consisting of $13.6 million for our quarterly dividend, and $12.6 million for share repurchases. We repurchased 0.7 million shares during the quarter at an average price of $18.02 per share. For 2024, we returned $105 million to stockholders. Cash and short-term investments decreased $6 million at quarter end as we continue to deploy cash to fund our strategic plan. At the end of the quarter, we are in a net borrowing position in the U.S. With $136 million outstanding on our revolver. As previously noted, we are required to fund cash dividends, share repurchases, and principal and interest payments using our cash on hand in the US. And we're using our US-based liquidity to fund the Newport expansion as well as other strategic investments. We have $467 million on our revolver at the current EBITDA levels. We expect to continue to draw on our revolver to fund our US cash needs. Turning to slide eleven for our guidance. For the first quarter 2025, revenues are expected to be $710 million plus or minus $20 million, plus or minus 50 basis points. Gross margin is expected to be in the range of 19.0%. Newport is expected to continue to have an approximate drag of 175 to 200 basis points on the gross margin in the first quarter. Depreciation expense is expected to be approximately $53 million for the first quarter and $214 million for the full year 2025. SGA expenses are expected to be $137 million plus or minus $2 million for the quarter. The increase versus quarter four is primarily due to the accrual of assumed and incentive compensation for 2025 versus a very low level of incentive comp in 2024. SG&A expenses for the full year are expected to be between $530 million and $560 million. In addition to the incentive compensation accruals, we are assuming continued investment in R&D, increasing spending on enhancing technology tools and typical inflationary impacts.

For 2025, we expect a normalized effective tax rate to be between 30% and 32%. And finally, our stockholder return policy calls for us to return at least 70% of our free cash flow to stockholders in the form of dividends and stock repurchases. For 2025, we once again expect negative free cash flow due to our capacity expansion plans. Despite negative cash flow in 2024, we still returned over a hundred stockholders.

For 2025, we expect to maintain our dividend and opportunistically repurchase. I'll now turn the call back to Joel. Thank you, Dave. Turn to slide twelve. As a reminder, we are pulling eight growth levers to meet our commitment to scale capacity to our customers. To accelerate revenue growth, to position Vishay Intertechnology, Inc. to be a much more reliable supplier, to drive greater returns through expansion of our product portfolio, and to expand our participation in our addressable markets. During 2024, we continued our focus on expanding capacity, both internally and externally. And on innovation, I'll recap our activities from Q4, starting with semiconductor we completed on schedule First at Newport, the transfers of three silicon MOSFET structures in Q4. And are on track to complete another six by the end of the first quarter of 2025. We started production of commercial and automotive technologies in late Q4 our building inventory in anticipation of customer approvals, later this year after which we will start shipping. We expect to complete qualification of the automotive grade components during Q1 and Q2 while scheduling their site audits. Thereafter, customers During the fourth quarter, we continued to receive delivery of silicon carbide equipment at Newport, and remain on schedule to meet our plan of production in early 2026. At SK Key Foundry, our partner in Korea, we released one automotive MOSFET and have ramped up wafers to be delivered in Q1. We also plan to release another automotive MOSFET in the first quarter and an additional five technologies in the second quarter, one automotive, three commercial and one IC. Through this partnership, we will be able to increase annualized capacity for MOSFETs by 12% in 2025 compared to 2024, but more importantly, we will be able to increase annualized capacity by 25% for our advanced split gate MOSFET to support new automotive and commercial opportunities. In Taiwan in Q4, we started to ramp volume of commercial diodes. Automotive qualifications are still pending, for 2024, as expected, we increased capacity on constrained lines of high runners between 25% to 40%. For an annualized increase overall diode capacity of 4.7%. Approval from the government. In Turin, Italy, we have received environmental and now plan to ship commercially qualified diodes in Q2. We expect to complete qualification of the 1200 volt technology in Q2 and the 650 volt technology in Q3. Both to be released to production in the second half of the year. Now for passives. At La Laguna, Mexico during Q4, we worked directly with automotive customers on part number qualifications and stayed on track to qualify the facility for automotive inductors. We also began shipping Amatherm Sensor products during the quarter. As a reminder, the Amatherm line includes products that support inrush current limiting and temperature sensing. For the year, we increased annual capacity for the large size low volume inductors but decided to pull back on adding capacity on the small size high volume to align with end market demand in favor of using external capacity. At our facility in Juarez, Mexico, where we're shipping commercially qualified current sense resistors and other automotive products, we have increased annualized capacity by 18% in 2024 versus 2023. In addition to increasing our capacity of lower margin commodity products, and to expand our product portfolio to widen our market participation, we continue to qualify subcontractors. This year. During the fourth quarter, we completed qualifications for two new subcontractors for resistor technology. Across all subcontractors during the quarter, we added over 1400 part numbers to Vishay Intertechnology, Inc., bringing the total for the year to greater than 10,400 part numbers. We exceeded our external capacity goals set for the year. On our path to achieving our 2028 financial targets, specifically against our goal of more than four we generated 5%. We set a goal of utilizing outsourced wafer fabs for 33% of semiconductor production for the year, the rate of production for outsourced fabs on wafers was 34%. Finally, against our goal of utilizing outside assembly for the back end, the goal was 20% vice per semiconductor production. Our outsourced assembly represented 21% of revenue for 2024. As for innovation in our silicon carbide strategy, starting with our plans to commercialize the 1200 volt planner technology, we released two products during the fourth quarter. For a total of three products in 2024, and released another three products in January, and plan to release another three products yet in the first quarter. In addition, we are on schedule with our plan to commercialize the 700 volt planner MOSFETs in the second quarter of 2025 and the 650 volt planner MOSFETs in the third quarter of 2025. As a reminder, these silicon carbide MOSFET components and modules for onboard charging, which open more doors for us with automotive OEM. During the quarter, we completed the reliability testing of the Gen three trench technology and we are now working towards optimization. We currently have given samples to one automotive OEM and midyear we will expand sample availability selectively. With the full market release of this product in the second half of the year. For silicon carbide diodes, we released an industry first smallest package using our Gen three diode 650 volt and 1200 volt products. We are also on track to release the automotive version in Q1. We completed the reliability test of our Gen four 650 volt automotive power pack to be released in Q1. We also will release the Gen four 1200 volt automotive diode in Q2. Finally, at Electronica, 2024, we showcased nine reference designs across automotive, industrial, and telecom applications. Some of which demonstrated our silicon carbide capabilities, plus Vishay Intertechnology, Inc.'s ability to populate 80% of the components on a circuit board in power applications. Sample boards were available for customers to take for quick evaluation. We plan to release some of these reference designs into catalog distribution throughout 2025. We also displayed a multi-phase power board that incorporates smart stage which is another example of our solution selling strategy and our product portfolio, so we're ready to scale with our customers as demand returns. We bolstered our engagements with OEMs, so we're ready to support their product roadmaps. And with channel partners, so we're ready to gain share. Also, EV programs were pushed out during the quarter, which gives us more time to advance our silicon carbide strategy. We also expanded our product portfolio through the new technology acquisitions, Amatherm, and BurkelBox. And we also acquired Newport, which advances our silicon carbide strategy and our campus concept. Now as we enter into 2025, we see many promising indicators, including a positive book to bill for the first time in nine quarters, strong order intake for the smart grid infrastructure project, and initial shipments for AI. All of our strategic levers will be in play as we continue to execute our five-year plan to position Vishay Intertechnology, Inc. to take advantage of the megatrends of e-mobility and sustainability. We remain committed to our long-term plan of increasing Vishay Intertechnology, Inc.'s capacity between 2023 and 2028 as a reminder, to assure our customers of reliable volume as they scale. At our Investor Day in April 2024, we presented a plan of investing $2.6 billion in CapEx between 2023 and 2028. While we plan to continue to advance our capacity expansions, we have and will continue to modulate the spending in response to order flow and the timing of customer demand and qualifications. Also, the lead time of equipment and continued approval of subcontractor capacity are variables we include to throttle down our capacity spending. For 2025, we plan to spend between $300 million to $350 million at least 70% of which will be invested in capacity expansion projects for our high growth product lines, including our wafer fab expansions. Under Vishay Intertechnology, Inc. three-point-o, we are business-minded. We are connected to the customers, and we gather and utilize market intelligence. This allows us, among other things, to make informed business decisions to throttle CapEx up or down, if and when necessary. At the same time, we are taking a closer look at our global footprint. Keeping in mind our customers' regional supply needs. And also to optimize our global footprint to a lower cost base and to enhance our returns. For example, in 2024, we started shifting towards campus structures that serve multiple product lines, La Laguna, Mexico, and the Newport facility in South Wales, UK. Plus adding subcontractors to produce commodities. Because of our strong execution of our levers in 2024, we're well positioned in 2025 to support a market upturn. We have the capacity. And we have the print position. Since the beginning of 2023, we have landed an incremental 23% capacity to ensure we are a reliable supplier ready to scale, meet our customers' needs over time. We're ready to capture share gains as we continue to and our inventory is well positioned to quickly grow POS. We're ready to support prior year design wins as they turn into future start of production. By adding FAEs during 2024, we have engaged with more customers about their product and technology roadmaps. We also opened an eMobility lab in Italy which has strengthened our design position and reference design solution selling capability. We're creating design opportunities that increase our share of the and our capacity investments ensure we're ready to support their future demand. We are now better aligned with future growth segments like AI server power management, smart grid infrastructure projects, aerospace defense, industrial robotics, and hybrid for automotive and EV programs. We are doing the work to implement Vishay Intertechnology, Inc. three-point-o in the customers see a different Vishay Intertechnology, Inc. A business-minded organization. Feedback is that Vishay Intertechnology, Inc. is engaged early in the design pipeline partnering with customers and preparing to scale, in line with their roadmaps, we are actively in conversations with customers for more visibility to be able to support their market upturn in a timely way. I now turn the call back to the operator, to Wanda, Let's open the call to questions.

Thank you.

Ladies and gentlemen, as a reminder, you can ask a question and then wait for your name to be announced. To withdraw your question, our first question comes from the line of Peter Payne with JPMorgan. Your line is open.

Hey, guys. Good morning. Thanks for taking my question.

I just want to zoom in on the AI server power side, and maybe if you can just level set us on how you're thinking about AI related revenue this year and maybe how, I think, investors should think about your average content per system or per board. Maybe.

Thanks, Peter.

AI in the fourth quarter, we saw the initial volumes. It was very small in the fourth quarter. A number of CMs are lining up to participate with the NVIDIA chipset. The demand, we're working hard to try and understand the demand, the schedule, and as we talk to CMs, they say they're gonna have some volume. It's gonna be better than Q4. Delivery of the NVIDIA chipset. But they're not able to tell us the timing of the.

So we're preparing on our own. We're being proactive to make sure.

that the MOSFETs are in position to be able to support, plus the other components that I talked about, polymer tantalum and others. So our design position is good. To put content on it, we've seen content in the $30 to $40 range per tray. We try and gather how many trays are in a rack. We've heard in the order of $600. But again, it's what is our share gonna be? I'd like to provide you more. But we're working hard to get more visibility. I think as we get past Chinese New Year now, we'll be able to get more intelligence. But at this point, that's about the content we know.

Perfect.

And maybe I don't on a on a follow-up on that. I think outside of the you know, the GPU ecosystem, you know, the custom ASIC is also ramping up pretty aggressively. And our forecast is that sometimes over next you know, few years that it could be a fifty-fifty split between custom ASIC deployments versus, you know, more GPU. Maybe talk about your position on the non-NVIDIA Inside designs.

So we've positioned our FAEs to reach out, FAEs, whether they're Vishay Intertechnology, Inc. FAEs or our reps, they're at the design locations of computer companies, in a good position to design the technologies across. So we are Vishay Intertechnology, Inc. again, introducing them to be able to support eighty plus percent of the components on the board. So I would say at this point, our design activity, we're in a positive spot.

Okay.

One more, if I may, before I go back into the queue. Typically, your second quarter is a seasonally stronger period. I didn't hear you guys call a bottom, but would it be in first based on some of the positive book to bill? Also, pretty normalized inventory that you know, we should be tracking it's just more of a positive report just given some of the positive signal trends within in your dream quarter?

Okay. The book to bill in Q4 was positive. The book to bill in Q1 is also attractive. We're now looking at the Chinese New Year. Always watch Chinese New Year before and after. How will the bookings look once the people are back to work? So the next couple weeks, will be a signal if it's sustainable. Automotive, the schedule agreements I mentioned, they're showing us better volumes in the first half of the year. Quarter on quarter, so we're optimistic about that as well. The guide of $710 that we put in the quarter that Dave mentioned, there's the annual ASP reductions that have come from our contract negotiations. So that all lands in January. We do have volume growth. So we'll get past the first quarter, get those ASPs in place, and then work to grow volume. We like how the book to bill is setting up at this point.

Great. Thank you, guys.

Thank you.

I'm showing no further questions in the queue.

I would now like to turn the call one moment. We do have a question that came up. Our next question comes from the line of Ruplu Bhattacharya with Bank of America. Your line is open. Hi. Thank you for taking my questions.

Joel, to start, I want to ask you about your outreach to distributors. Does Vishay Intertechnology, Inc. now have the proper amount of inventory in the channel do you see any excess inventory at distribution? And with that, can you also comment on pricing in both passives and actives? Is there any scope for Vishay Intertechnology, Inc. to raise prices in either segment?

Okay. Hi, Rupel. Thanks for the question. Our work with distribution began right away with Vishay Intertechnology, Inc. three-point-o January of 2023, and we've been adding SKUs quarter on quarter. We’ve added nearly fifty thousand SKUs now after the period of two years. Those were part numbers that Vishay Intertechnology, Inc. did not have on the shelf. Our inventory distribution, I said, is relatively stable. We're at twenty-seven weeks. The inventory, I'll say, is fresh. Items that are nonmoving or idle would be very very small. Very small. So you see the inventory at twenty-seven weeks. If we look at Asia versus Europe, versus the Americas, Asia inventory in Q1 of 2024 was eighteen and a half weeks. America's inventory in Q1 of 2024 is forty-seven weeks. Europe's inventory, we talked about it. We've got to get through this inventory and tier one. But as far as the inventory itself, it's the right inventory. We've added inventory because of the SKUs we've added.

Pricing protection?

Regarding your question about pricing. We've made adjustments to our VPA, our published pricing, in 2024. So we did take price adjustments because we believe many of our products are competitive. So decisions can be made using the screen price. There will always be opportunities where a distributor brings in large volumes, million piece opportunities plus, where they'll ask us to be a little more aggressive and we'll take those into consideration. But overall, Rupel, I think what we've done in distribution is well positioning us. We'll continue to work with distributor by distributor to better position Vishay Intertechnology, Inc. to gain POS.

Okay. Thank you for the details there.

Can I ask you a question on CapEx? So you're guiding for $300 to $350 million of CapEx spend in 2025. You gave a lot of details, but I missed this. How much total new capacity is coming online in fiscal 2025? And I know you have Newport coming online and then maybe there are other sites. How has your total expectation for the three-year CapEx spend changed? Since the Analyst Day. So can you can you give us some details in terms of that three to three fifty where is that spend becoming online? How much of it like, total capacity coming online, and has your three-year expectation changed?

Okay. The $300 to $350 million, we first look at the van. We look at the Newport fab. Getting the silicon products up and running, we talked about the dates that we have there released in these structures as well as landing the silicon carbide equipment that's there putting the process in place. So continuing to get this fab turned on to Vishay Intertechnology, Inc. products is where CapEx will be. The other fab is in Itseo, Germany. That's the twelve-inch fab.

equipment.

We've got the building and now is part of that next step in the fab. So CapEx continues at a majority of that $300, $350. Is for the fabs. After that, we look into the individual product lines. We've done well to add capacity in 2024. I've mentioned we've increased capacity for the company by 23% since Vishay Intertechnology, Inc. three-point-o began. That's good. We're in a good position. Now we look at line by line, and modulate what is the delivery time of equipment? It's no longer two years. It's no longer a year and a half. It's less. In our plan, we had spending based on what we knew about the delivery of equipment. We've also increased our subcontractor qualification. This is great. Because we're able to take the Vishay Intertechnology, Inc. recipe and have a subcontractor build the products without our own CapEx investment. So this is why we say modulate.

Okay. I appreciate the details there. Can I ask one question to David? Can you update us on your capital allocation priorities? So And you mentioned free cash flow would be negative in fiscal 2025. Is it reasonable for investors to expect the same level of $100 million of return on capital that you had to shareholders in fiscal 2024 should we expect the same amount in fiscal 2025?

Hi, Rupel. It's a good question. So first and foremost, I think to reset the bar, our policy is to return 70% of free cash to shareholders. And even though in 2024, we had negative free cash, we chose to shoot higher, and we turned up at the end $105 million in 2024. In 2025, we're committed to the dividend as I and I noted in the remarks, and we're gonna make opportunistic share repurchases during the year. We're not going to commit to a specific number.

Okay. Got it. If I can sneak one more in, Joel, Europe is weak and Asia is strong. How do you see the regional mix changing in fiscal 1Q? And will your playbook be any different across these regions? Meaning, are you hiring more in Asia because it's stronger? So how do you plan to deal with the mix of Mac? Thank you for taking my question.

You bet. When we look at our FAA placement, and our sales, the commercial sales people, we're always moving these to the proper place too to be engaged with customers. So Asia is high concentration for sure. Of positioning the people in the right spot. We've got a great Asia team, they're well in tune with Vishay Intertechnology, Inc. three-point-o. And they get close to customers, and they bring back a lot of good intelligence. So Asia is still a main focus, and they're doing very well. Europe, we’ve adjusted the European sales team in some ways to be closer to the customers. This is happening in Q4 and Q1.

We've adjusted the European sales team in some ways to be closer to the customers.

We're excited about the team of people we have. The customers are trying to get an understanding of what's gonna happen with their governments. There's an election coming in Germany in February. This election is important because first and foremost, colleagues that I speak with hope to see some direction by the government people wanna feel that the economies can move, that government has a direction, and they're sponsoring programs to make the business move. We're gonna go through inventory digestion in Q1 in Europe. But I'll say the same thing about distributor position. We're going after better position, Our distributor team in Europe is working for that. We wanna gain share. So even if the economy is soft or flat, we want to gain share of business we may have lost, regain it, or gain share of what's there. So we continue to concentrate. We're focused on each region. There are different dynamics. But our intention is to grow in each. Asia seems to be out front at the moment.

Okay. Thank you for all the details.

Thank you, real quick.

Thank you. Please stand by for our next question. We have a follow-up question from the line of Peter Payne with JPMorgan. Your line is open.

Hey, guys. Thanks for the follow-up question. Question on the gross margins. Front. And so there's a few puts and takes. You know, so with the Newport, it should be I would imagine that there should be a tailwind as we kinda move through 2025. But then I think there's also also additional depreciation expense that we should account for. So just taking to those factors, how should we think about your gross margins that we as we kinda move through the year?

Alright. That's that's a great question. So and you hit it on some of the puts and takes upfront already. But obviously, what drives our margin is volume. Right? And based on Joel's comments and input from customers, you know, we're expecting volumes to improve.

Through there?

In terms of the Q1 guidance, we already have the ASP declines baked into that margin for the annual contract renewal with the OEMs. We're doing the usual cost downs, you know, cost reductions, efficiency gains, automation. You noted the higher depreciation. Newport, your comment's a good one. We hope to be margin neutral towards the end of the year. So when we enter 2026, we're profitable.

Okay?

Then that'll step down that drag as we go through the year. That's about, I think, all we can... But it, you know, the focus this year on the Newport is obviously the technology transfer and the qualifications and the customer not necessarily the profitability. So I think that's about all we can say on the margin. It's volume driven. Right? Volume is a swing.

Peter, as we release these structures quarter by quarter, if it's a commercial product, industrial, we send out a PCN to notify our distributor partners that this is a new location. There's a time frame that they get thirty to ninety days to sign up the PCN. Once we have that signed off, then we can start loading volume. So you're gonna see a stair-stepping of volume towards greater capacity utilization in Newport throughout the year. We qualify a structure. We get the PCNs approved. Commercially first. You'll see more utilization automotive, we gotta get the automotive customer in for audits. We wanna do this in parallel. To component qualification. We got good people at Newport. They understand the technology very well. They're doing a great job of turning this from one owner to another. And I think our pace is quite good. We're expecting the tailwind, as you said. In 2025 to help us out on that margin.

Got it. So the new port from being a hundred fifty to two hundred basis points of impact being margin neutral. So that would be, like, a almost a one seventy five is one step up through the year. Is that right?

What is the improvement quarter by quarter? Dave, target is.

But the end of year end, to be neutral. Certainly, the first quarter twenty-sixth, we were planning on profitability.

Perfect. So. Thank you guys.

You, Peter.

I would now like to turn the call back to Joel for closing remarks.

Alright. Thank you, Towanda. Thank you again, everyone, for attending our year-end 2024 earnings call. As you've heard today, we are moving forward implementing Vishay Intertechnology, Inc. three-point-o with speed and determination. We are ready to support our customers when the market turns up and we're quite positive on what we've achieved so far. Thank you again. We'll see you at our next earnings call in May. Have a good day.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.