VECO
#Thanks.
It's hard to split because the customers can use the reactor in a variety of different ways.
So it's hard for us to have visibility of exactly where they're going to use it.
Clearly the lighting market is growing.
We said fine-pitch market is growing by 25%.
And then with the TV uptick, which a year ago, basically as the TV market fell off, then that was making reactors available to use for lighting.
But now it's actually requiring more.
So I can't really give you a breakdown of how it goes, but I think all three sections are needing more reactors.
So that's the good thing.
Nobody's freeing anything up.
Most of the orders that we've been getting have been for new capacity.
We did see some replacement orders over the last year.
There are about I think 2,300 reactors in the installed base.
A lot of those, probably two-thirds of those were shipped in the 2009, 2010 and 2011 really ramp-up.
They are getting old and they are less productive.
We're not seeing a large replacement market yet, but we believe that it will come in the coming years and it will be a significant opportunity for us.
Yes, 2018, 2019, hard to read exactly, but ---+ and different customers will probably approach it a little differently.
<UNK>, we may not be able to provide you a numerical figure like that.
But yes, I think we can say that the industry is consolidated, so the order pattern and the sales pattern would be concentrated among the top five, six customers, yes.
That we can say.
But it's hard to give you a figure around that.
It might be a little bigger than five.
I'd say five to eight or so.
But yes.
Go ahead.
I can't say.
They've had a history of recent years of making their own, but I think they've also had a history in recent years of buying their mid-power laser diodes from other sources.
So don't really know there.
Thanks, <UNK>.
They're actually not inspection systems.
They're Ion Beam Deposition systems to build the mass blanks which are then processed further.
We received an order for one of these.
These tend to be long lead times of nine months or more.
We're not counting on any more orders this year and it's really going to depend on the progress in the industry as far as EUV adoption.
But they're probably our longest lead-time product.
Yes.
So for the full year, we are committed to 40% or higher for gross margin at the Company level.
We did about 41% in 2016 and then feel very good about 40% plus in 2017.
In terms of temporary impact to gross margin, we have a little bit of duplicate expenses going on in Q4.
And also about 1% or so getting impacted in Q1.
So gross margin should begin to improve from Q2 once the consolidation initiative is behind us.
As you know, gross margins always can get impacted depending on product mix, regional mix or the shipment volume levels.
But at this point based on the visibility that we have, we feel pretty good about having 40% or higher for the entire year.
For a given quarter here or there it may rotate around that number, plus, minus 1% or so.
But overall for the full year we feel pretty good about starting it with a four [handle].
Thanks, <UNK>.
All right.
At this point we will conclude the call.
Thank you for joining us.
Thank you.
