Kulicke & Soffa cancels advanced display Project W

In a regulatory filing, Kulicke & Soffa stated: “Previously referred to as Project W, the Company has been engaged with one of its strategic customers to support the Customer with the development and future mass production of certain technologies relating to advanced display. In connection with the Customer’s strategic review of its business, the Customer has informed the Company that it has cancelled the Project. In connection with the foregoing, on March 11, 2024, the Company committed to a plan to cease operational activities and commence wind down activities concerning various aspects of the Project, as a result of which the Company expects to incur pre-tax charges, including impairments, in the range of $110 million and $130 million. The pre-tax cash expenditures include (i) between approximately $3 million and $5 million of one-time termination benefits, (ii) between approximately $8 million and $13 million of contract termination charges, and (iii) between approximately $6 million and $11 million of other associated costs. The Company also expects to incur pre-tax non-cash impairment charges of (i) between approximately $49 million and $53 million of inventory write-down charges, and (ii) between approximately $44 million and $48 million of impairment charges relating to long-lived assets. The Company plans to recognize the non-cash inventory write-down and impairment charges in the second fiscal quarter of 2024, with the remaining cash expenditures to be recognized over the course of fiscal year 2024. The Company expects to complete majority of its wind down activities by the end of fiscal year 2024.”