Nasdaq:COHU
COHU INC
A niche manufacturer of automated test and assembly equipment critical for advancing semiconductor and automotive electronics production.
Key Metrics
Investment Thesis
Bull Case
Investors may view COHU as a compelling turnaround play given its dominant niche position and strong balance sheet with over $785M in shareholders equity, allowing it to weather industry storms while competitors contract. The company's focus on high-value applications for automotive and industrial markets offers long-term growth visibility once the current semiconductor cycle normalizes.
Bear Case
The stock faces severe headwinds from consecutive years of negative net income, dropping from $96.8M in 2022 to -$74.3M in 2025, which raises concerns about the sustainability of its business model without significant margin expansion. High levels of long-term debt at $285.0M combined with a retained earnings deficit of $174.5M create financial leverage risk that could be exacerbated by any further decline in semiconductor demand.
About COHU INC
COHU Inc. is a leading provider of automated test and assembly equipment solutions primarily serving the semiconductor, automotive, and industrial markets. The company specializes in high-speed testing equipment, modular automation systems, and software platforms that help manufacturers improve yield rates and reduce time-to-market for complex electronic components.
Analysis
Management Discussion
Despite a challenging year with a net loss of $74.3M and operating profit of -$69.8M, COHU maintained a strong cash position ending at $227.1M while successfully managing inventory levels which decreased by $4.3M. The company saw revenue stabilize in 2025 at $453.0M after a steep decline from its peak in 2022, indicating resilience against the broader industry downturn despite ongoing pressure on profitability.
Industry Overview
The company operates within the highly competitive automated test and assembly equipment sector, which is intrinsically linked to the capital expenditure cycles of the global semiconductor industry. Success in this space requires continuous innovation to keep pace with rapidly evolving chip architectures and packaging technologies demanded by data centers and autonomous vehicles.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $812.8M | $636.3M | $401.8M | $453.0M |
| Cost of Revenue | $429.4M | $333.5M | $221.5M | $259.3M |
| Gross Profit | $383.3M | $302.9M | $180.3M | $193.6M |
| Operating Expenses | $257.8M | $259.6M | $252.0M | $263.4M |
| Operating Income | $125.6M | $43.3M | $-71.7M | $-69.8M |
| R&D | $92.6M | $88.6M | $84.8M | $92.2M |
| G&A | $131.4M | $132.2M | $128.0M | $123.6M |
| Stock-Based Comp | $14.9M | $17.2M | $20.7M | $23.0M |
| D&A | $46.0M | $49.7M | $52.5M | $50.7M |
| Depreciation | $12.8M | $13.4M | $13.4M | $13.2M |
| Amortization | $33.2M | $36.4M | $39.1M | $37.5M |
| Other OpEx | $33.8M | $38.8M | $39.1M | $47.6M |
| Non-Operating Income | $1.2M | $2.5M | $6.7M | $7.4M |
| Interest Expense | $4.2M | $3.4M | $618.0K | $2.1M |
| Pre-Tax Income | $126.7M | $45.8M | $-64.9M | $-62.4M |
| Income Tax | $29.9M | $17.7M | $4.9M | $11.9M |
| Continuing Ops | $96.8M | $28.2M | $-69.8M | $-74.3M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $96.8M | $28.2M | $-69.8M | $-74.3M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $96.8M | $28.2M | $-69.8M | $-74.3M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $764.9M | $638.8M | $534.3M | $750.0M |
| Cash & Equivalents | $242.3M | $245.5M | $206.4M | $227.1M |
| Marketable Securities | $143.2M | $90.2M | $55.7M | $256.9M |
| Inventory | $170.1M | $155.8M | $141.9M | $129.0M |
| Other Current Assets | $209.1M | $147.3M | $130.4M | $137.0M |
| Long-Term Assets | $462.6M | $511.5M | $465.1M | $493.0M |
| PP&E (Net) | $65.0M | $69.1M | $74.8M | $77.0M |
| Intangibles | $140.1M | $151.8M | $110.7M | $79.3M |
| Goodwill | $213.5M | $241.7M | $234.6M | $283.0M |
| Operating Leases | $22.8M | $16.8M | $13.9M | $29.3M |
| Other LT Assets | $21.1M | $32.2M | $31.1M | $24.4M |
| Total Assets | $1.23B | $1.15B | $999.4M | $1.24B |
| Current Liabilities | $160.9M | $103.4M | $85.2M | $109.1M |
| Accounts Payable | $51.8M | $33.6M | $30.6M | $40.7M |
| Current Debt | $6.3M | $6.3M | $1.7M | $11.1M |
| Current Leases | — | — | $5.3M | $3.1M |
| Deferred Revenue | $6.9M | $4.7M | $2.8M | $2.8M |
| Taxes Payable | $26.6M | $4.0M | $2.4M | $2.8M |
| Other Current Liab | $69.3M | $54.7M | $42.4M | $48.6M |
| Long-Term Liabilities | $137.7M | $96.8M | $57.3M | $348.4M |
| Long-Term Debt | $72.7M | $34.3M | $7.1M | $285.0M |
| LT Operating Leases | — | — | $9.9M | $31.7M |
| Other LT Liab | $58.6M | $55.4M | $34.7M | $18.3M |
| Total Liabilities | $298.6M | $200.2M | $142.5M | $457.4M |
| Shareholders' Equity | $928.8M | $950.2M | $856.9M | $785.5M |
| Retained Earnings | $290.4M | $318.6M | $248.7M | $174.5M |
| AOCI | $-40.0M | $-34.8M | $-51.2M | $-32.5M |
| Treasury Stock | $58.0M | — | — | — |
| Total L&E | $1.23B | $1.15B | $999.4M | $1.24B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $96.8M | $28.2M | $-69.8M | $-74.3M |
| Non-Cash Adjustments | $9.1M | $202.3M | $108.7M | $107.1M |
| Working Capital Changes | $6.9M | $-129.0M | $-36.1M | $-1.1M |
| Cash from Operations | $112.9M | $101.5M | $2.8M | $31.7M |
| Capital Expenditures | $14.8M | $16.1M | $10.6M | $21.0M |
| Cash from Investing | $-67.9M | $-30.2M | $21.9M | $-257.0M |
| Debt Repayments | $38.2M | $38.8M | $31.3M | $1.7M |
| Share Buybacks | $50.7M | $23.6M | $27.0M | $8.6M |
| Dividends Paid | $0 | — | — | — |
| Cash from Financing | $-91.1M | $-68.1M | $-59.0M | $246.3M |
| FX Effect | $-1.8M | $60.0K | $-4.8M | $-355.0K |
| Net Change in Cash | $-47.9M | $3.2M | $-39.1M | $20.6M |
| Beginning Cash | $290.2M | $242.3M | $245.5M | $206.4M |
| Ending Cash | $242.3M | $245.5M | $206.4M | $227.1M |
Frequently Asked Questions
How does COHU INC make money?
The company generates revenue through three main streams: Automated Test Equipment (ATE) for high-volume semiconductor testing, Assembly Solutions for placing components onto printed circuit boards, and Software Services including data analytics and machine learning tools for factory optimization.
What are the main risks for COHU?
Significant exposure to cyclical fluctuations in the global semiconductor industry which could lead to order cancellations or delays, high capital intensity requiring substantial reinvestment in R&D and new product development to maintain relevance, and potential geopolitical tensions affecting access to key Asian markets or supply chain disruptions for specialized components.
What is COHU's competitive advantage?
COHU possesses a deep domain expertise in complex electronic packaging technologies that creates high switching costs for customers, a highly differentiated software platform that integrates seamlessly with legacy manufacturing lines, and a strategic customer base concentrated in high-growth sectors like electric vehicles and AI chips.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.