Ram Mayampurath
CFO at MKS Instruments
Free cash flow conversion of 11.4% improved 500 basis points over the prior year. We are pleased with our execution on the margins and the strength in the underlying cash generation in our business, despite a challenging demand environment in our end markets. Let me now turn to first quarter outlook. We expect revenue of $910,000,000 plus or minus $40,000,000 consistent with the guidance we provided last quarter and consistent with our view that the market is relatively stable, albeit at a slightly higher run rate than what we saw a year ago. By end market, our first quarter outlook is as follows: revenue from our semiconductor market is expected to be $400,000,000 plus or minus $15,000,000 revenue from our electronics and packaging market is expected to be $245,000,000 plus or minus $10,000,000 and revenue from our specialty industrial market is expected to be $265,000,000 plus or minus $15,000,000 Based on anticipated revenue levels and product mix, including lower chemistry sales in the light of the Lunar New Year, we estimate first quarter gross margins of 46.5% plus or minus 100 basis points. We expect first quarter operating expenses of $255,000,000 plus or minus $5,000,000 We expect our OpEx spending to remain at this range of $250,000,000 to $260,000,000 a quarter as we continue to invest in people and infrastructure. We estimate adjusted EBITDA of $217,000,000 plus or minus $23,000,000 We expect tax rate of approximately 22% in the first quarter. For the year, we expect our tax rate to be in the range of 19% to 21%. Based on these assumptions, we expect first quarter net earnings per diluted share of $1.4 plus or minus $0.27 Our execution has remained strong despite the cyclical challenges in our end markets.
