finance research letters call for papers

Measures weighted citations received by the journal. Citation weighting depends on the categories and prestige of the citing journal.

Measures actual citations received relative to citations expected for the journal's category.

34% from 2019

9% from 2019

• SJR of this journal has increased by 34% in last years.
• This journal’s SJR is in the top 10 percentile category.
• SNIP of this journal has increased by 9% in last years.
• This journal’s SNIP is in the top 10 percentile category.

Finance Research Letters

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Finance Research Letters invites submissions in all areas of finance, broadly defined. Finance Research Letters offers and ensures the rapid publication of important new results in these areas. We aim to provide a rapid response to papers, with all papers undergoing a desk review by one of the Editors in Chief before being sent for review. Read Less

Finance Research Letters invites submissions in all areas of finance, broadly defined. Finance Research Letters offers and ensures the rapid publication of important new results in these areas. We aim to provide a rapid response to papers, with all papers undergoing a desk rev...... Read More

Economics, Econometrics and Finance

Top papers written in this journal

SciSpace is a very innovative solution to the formatting problem and existing providers, such as Mendeley or Word did not really evolve in recent years.

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(Before submission check for plagiarism via Turnitin)

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Speed and accuracy over ms word.

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Time taken to format a paper and Compliance with guidelines

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Frequently asked questions

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Yes, the template is compliant with the Finance Research Letters guidelines. Our experts at SciSpace ensure that. If there are any changes to the journal's guidelines, we'll change our algorithm accordingly.

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Of course! We support all the top citation styles, such as APA style, MLA style, Vancouver style, Harvard style, and Chicago style. For example, when you write your paper and hit autoformat, our system will automatically update your article as per the Finance Research Letters citation style.

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Sign up for our free trial, and you'll be able to use all our features for seven days. You'll see how helpful they are and how inexpensive they are compared to other options, Especially for Finance Research Letters.

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Yes. You can choose the right template, copy-paste the contents from the word document, and click on auto-format. Once you're done, you'll have a publish-ready paper Finance Research Letters that you can download at the end.

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It only takes a matter of seconds to edit your manuscript. Besides that, our intuitive editor saves you from writing and formatting it in Finance Research Letters.

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It is possible to find the Word template for any journal on Google. However, why use a template when you can write your entire manuscript on SciSpace , auto format it as per Finance Research Letters's guidelines and download the same in Word, PDF and LaTeX formats? Give us a try!.

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SciSpace's Finance Research Letters is currently available as an online tool. We're developing a desktop version, too. You can request (or upvote) any features that you think would be helpful for you and other researchers in the "feature request" section of your account once you've signed up with us.

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Sure. You can request any template and we'll have it setup within a few days. You can find the request box in Journal Gallery on the right side bar under the heading, "Couldn't find the format you were looking for like Finance Research Letters?”

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After writing your paper autoformatting in Finance Research Letters, you can download it in multiple formats, viz., PDF, Docx, and LaTeX.

12. Is Finance Research Letters's impact factor high enough that I should try publishing my article there?

To be honest, the answer is no. The impact factor is one of the many elements that determine the quality of a journal. Few of these factors include review board, rejection rates, frequency of inclusion in indexes, and Eigenfactor. You need to assess all these factors before you make your final call.

13. What is Sherpa RoMEO Archiving Policy for Finance Research Letters?

• Pre-prints as being the version of the paper before peer review and
• Post-prints as being the version of the paper after peer-review, with revisions having been made.

14. What are the most common citation types In Finance Research Letters?

15. How do I submit my article to the Finance Research Letters?

16. can i download finance research letters in endnote format.

Yes, SciSpace provides this functionality. After signing up, you would need to import your existing references from Word or Bib file to SciSpace. Then SciSpace would allow you to download your references in Finance Research Letters Endnote style according to Elsevier guidelines.

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Finance Research Letters - Impact Score, Ranking, SJR, h-index, Citescore, Rating, Publisher, ISSN, and Other Important Details

Published By: Elsevier BV

Abbreviation: Finance Res. Lett.

Impact Score The impact Score or journal impact score (JIS) is equivalent to Impact Factor. The impact factor (IF) or journal impact factor (JIF) of an academic journal is a scientometric index calculated by Clarivate that reflects the yearly mean number of citations of articles published in the last two years in a given journal, as indexed by Clarivate's Web of Science. On the other hand, Impact Score is based on Scopus data.

Important details.

About Finance Research Letters

Finance Research Letters is a journal published by Elsevier BV . This journal covers the area[s] related to Finance, etc . The coverage history of this journal is as follows: 2004-2022. The rank of this journal is 1090 . This journal's impact score, h-index, and SJR are 11.03, 81, and 2.231, respectively. The ISSN of this journal is/are as follows: 15446131, 15446123 . The best quartile of Finance Research Letters is Q1 . This journal has received a total of 11028 citations during the last three years (Preceding 2022).

Finance Research Letters Impact Score 2022-2023

The impact score (IS), also denoted as the Journal impact score (JIS), of an academic journal is a measure of the yearly average number of citations to recent articles published in that journal. It is based on Scopus data.

Prediction of Finance Research Letters Impact Score 2023

Impact Score 2022 of Finance Research Letters is 11.03 . If a similar upward trend continues, IS may increase in 2023 as well.

Impact Score Graph

Check below the impact score trends of finance research letters. this is based on scopus data..

Finance Research Letters h-index

The h-index of Finance Research Letters is 81 . By definition of the h-index, this journal has at least 81 published articles with more than 81 citations.

What is h-index?

The h-index (also known as the Hirsch index or Hirsh index) is a scientometric parameter used to evaluate the scientific impact of the publications and journals. It is defined as the maximum value of h such that the given Journal has published at least h papers and each has at least h citations.

Finance Research Letters ISSN

The International Standard Serial Number (ISSN) of Finance Research Letters is/are as follows: 15446131, 15446123 .

The ISSN is a unique 8-digit identifier for a specific publication like Magazine or Journal. The ISSN is used in the postal system and in the publishing world to identify the articles that are published in journals, magazines, newsletters, etc. This is the number assigned to your article by the publisher, and it is the one you will use to reference your article within the library catalogues.

ISSN code (also called as "ISSN structure" or "ISSN syntax") can be expressed as follows: NNNN-NNNC Here, N is in the set {0,1,2,3...,9}, a digit character, and C is in {0,1,2,3,...,9,X}

Finance Research Letters Ranking and SCImago Journal Rank (SJR)

SCImago Journal Rank is an indicator, which measures the scientific influence of journals. It considers the number of citations received by a journal and the importance of the journals from where these citations come.

Finance Research Letters Publisher

The publisher of Finance Research Letters is Elsevier BV . The publishing house of this journal is located in the Netherlands . Its coverage history is as follows: 2004-2022 .

Call For Papers (CFPs)

Please check the official website of this journal to find out the complete details and Call For Papers (CFPs).

Abbreviation

The International Organization for Standardization 4 (ISO 4) abbreviation of Finance Research Letters is Finance Res. Lett. . ISO 4 is an international standard which defines a uniform and consistent system for the abbreviation of serial publication titles, which are published regularly. The primary use of ISO 4 is to abbreviate or shorten the names of scientific journals using the technique of List of Title Word Abbreviations (LTWA).

As ISO 4 is an international standard, the abbreviation ('Finance Res. Lett.') can be used for citing, indexing, abstraction, and referencing purposes.

How to publish in Finance Research Letters

If your area of research or discipline is related to Finance, etc. , please check the journal's official website to understand the complete publication process.

Acceptance Rate

• Interest/demand of researchers/scientists for publishing in a specific journal/conference.
• The complexity of the peer review process and timeline.
• Time taken from draft submission to final publication.
• Number of submissions received and acceptance slots
• And Many More.

The simplest way to find out the acceptance rate or rejection rate of a Journal/Conference is to check with the journal's/conference's editorial team through emails or through the official website.

Frequently Asked Questions (FAQ)

What is the impact score of finance research letters.

The latest impact score of Finance Research Letters is 11.03. It is computed in the year 2023.

What is the h-index of Finance Research Letters?

The latest h-index of Finance Research Letters is 81. It is evaluated in the year 2023.

What is the SCImago Journal Rank (SJR) of Finance Research Letters?

The latest SCImago Journal Rank (SJR) of Finance Research Letters is 2.231. It is calculated in the year 2023.

What is the ranking of Finance Research Letters?

The latest ranking of Finance Research Letters is 1090. This ranking is among 27955 Journals, Conferences, and Book Series. It is computed in the year 2023.

Who is the publisher of Finance Research Letters?

Finance Research Letters is published by Elsevier BV. The publication country of this journal is Netherlands.

What is the abbreviation of Finance Research Letters?

This standard abbreviation of Finance Research Letters is Finance Res. Lett..

Is "Finance Research Letters" a Journal, Conference or Book Series?

Finance Research Letters is a journal published by Elsevier BV.

What is the scope of Finance Research Letters?

For detailed scope of Finance Research Letters, check the official website of this journal.

What is the ISSN of Finance Research Letters?

The International Standard Serial Number (ISSN) of Finance Research Letters is/are as follows: 15446131, 15446123.

What is the best quartile for Finance Research Letters?

The best quartile for Finance Research Letters is Q1.

What is the coverage history of Finance Research Letters?

The coverage history of Finance Research Letters is as follows 2004-2022.

Credits and Sources

• Scimago Journal & Country Rank (SJR), https://www.scimagojr.com/
• Journal Impact Factor, https://clarivate.com/
• Issn.org, https://www.issn.org/
• Scopus, https://www.scopus.com/

Note: The impact score shown here is equivalent to the average number of times documents published in a journal/conference in the past two years have been cited in the current year (i.e., Cites / Doc. (2 years)). It is based on Scopus data and can be a little higher or different compared to the impact factor (IF) produced by Journal Citation Report. Please refer to the Web of Science data source to check the exact journal impact factor ™ (Thomson Reuters) metric.

Impact Score, SJR, h-Index, and Other Important metrics of These Journals, Conferences, and Book Series

Check complete list

Finance Research Letters Impact Score (IS) Trend

Top Journals/Conferences in Finance

Reference management. Clean and simple.

How to format your references using the Finance Research Letters citation style

This is a short guide how to format citations and the bibliography in a manuscript for Finance Research Letters . For a complete guide how to prepare your manuscript refer to the journal's instructions to authors.

• Using reference management software

Typically you don't format your citations and bibliography by hand. The easiest way is to use a reference manager:

• Journal articles

Those examples are references to articles in scholarly journals and how they are supposed to appear in your bibliography.

Not all journals organize their published articles in volumes and issues, so these fields are optional. Some electronic journals do not provide a page range, but instead list an article identifier. In a case like this it's safe to use the article identifier instead of the page range.

• Books and book chapters

Here are examples of references for authored and edited books as well as book chapters.

Sometimes references to web sites should appear directly in the text rather than in the bibliography. Refer to the Instructions to authors for Finance Research Letters.

This example shows the general structure used for government reports, technical reports, and scientific reports. If you can't locate the report number then it might be better to cite the report as a book. For reports it is usually not individual people that are credited as authors, but a governmental department or agency like "U. S. Food and Drug Administration" or "National Cancer Institute".

• Theses and dissertations

Theses including Ph.D. dissertations, Master's theses or Bachelor theses follow the basic format outlined below.

• News paper articles

Unlike scholarly journals, news papers do not usually have a volume and issue number. Instead, the full date and page number is required for a correct reference.

• In-text citations

References should be cited in the text by name and year in parentheses :

Here are examples of in-text citations with multiple authors:

• Two authors: (Kidner and Martienssen, 2004)
• Three or more authors: (Michel et al., 2011)
• About the journal

• Other styles
• Bioorganic Chemistry
• Veterinary Pathology

Finance Research Letters impact factor, indexing, ranking (2024)

Aim and Scope

The Finance Research Letters is a research journal that publishes research related to Economics, Econometrics and Finance . This journal is published by the Elsevier BV. The ISSN of this journal is 15446131, 15446123 . Based on the Scopus data, the SCImago Journal Rank (SJR) of finance research letters is 2.231 .

Finance Research Letters Ranking

The latest Impact Factor list (JCR) is released in June 2024.

The Impact Factor of Finance Research Letters is 7.4.

The impact factor (IF) is a measure of the frequency with which the average article in a journal has been cited in a particular year. It is used to measure the importance or rank of a journal by calculating the times its articles are cited.

The impact factor was devised by Eugene Garfield, the founder of the Institute for Scientific Information (ISI) in Philadelphia. Impact factors began to be calculated yearly starting from 1975 for journals listed in the Journal Citation Reports (JCR). ISI was acquired by Thomson Scientific & Healthcare in 1992, and became known as Thomson ISI. In 2018, Thomson-Reuters spun off and sold ISI to Onex Corporation and Baring Private Equity Asia. They founded a new corporation, Clarivate , which is now the publisher of the JCR.

Important Metrics

finance research letters Indexing

The finance research letters is indexed in:

• Web of Science (SSCI)

An indexed journal means that the journal has gone through and passed a review process of certain requirements done by a journal indexer.

The Web of Science Core Collection includes the Science Citation Index Expanded (SCIE), Social Sciences Citation Index (SSCI), Arts & Humanities Citation Index (AHCI), and Emerging Sources Citation Index (ESCI).

Finance Research Letters Impact Factor 2024

The latest impact factor of finance research letters is 7.4 which is recently updated in June, 2024.

The impact factor (IF) is a measure of the frequency with which the average article in a journal has been cited in a particular year. It is used to measure the importance or rank of a journal by calculating the times it's articles are cited.

Note: Every year, The Clarivate releases the Journal Citation Report (JCR). The JCR provides information about academic journals including impact factor. The latest JCR was released in June, 2023. The JCR 2024 will be released in the June 2024.

Finance Research Letters Quartile

The latest Quartile of finance research letters is Q1 .

Each subject category of journals is divided into four quartiles: Q1, Q2, Q3, Q4. Q1 is occupied by the top 25% of journals in the list; Q2 is occupied by journals in the 25 to 50% group; Q3 is occupied by journals in the 50 to 75% group and Q4 is occupied by journals in the 75 to 100% group.

Journal Publication Time

The publication time may vary depending on factors such as the complexity of the research and the current workload of the editorial team. Journals typically request reviewers to submit their reviews within 3-4 weeks. However, some journals lack mechanisms to enforce this deadline, making it difficult to predict the duration of the peer review process.

The review time also depends upon the quality of the research paper.

Call for Papers

Visit to the official website of the journal/ conference to check the details about call for papers.

How to publish in Finance Research Letters?

If your research is related to Economics, Econometrics and Finance, then visit the official website of finance research letters and send your manuscript.

Tips for publishing in Finance Research Letters:

• Selection of research problem.
• Presenting a solution.
• Designing the paper.
• Make your manuscript publication worthy.
• Write an effective results section.
• Mind your references.

Acceptance Rate

Final summary.

• The impact factor of finance research letters is 7.4.
• The finance research letters is a reputed research journal.
• It is published by Elsevier BV .
• The journal is indexed in UGC CARE, Scopus, SSCI .
• The (SJR) SCImago Journal Rank is 2.231 .

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Call for papers for a conference in Green Fintech and two special issues of “Finance Research Letters” and the “International Review of Economics and Finance”

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FinancialResearch.gov

Partnerships and catalyzed research.

The OFR works with public and private organizations to achieve its goals in monitoring, researching, and analyzing financial stability. Research partnerships and catalyzed research programs are an effective way to develop high-impact research and methods for analyzing emerging and existing risks. These efforts allow the OFR to leverage its resources to consider a wider range of issues than might otherwise be possible.

Views and opinions expressed are those of the authors and do not represent official positions or policy of the Department of the Treasury (Treasury) or the OFR. The written publications (including but not limited to research papers, briefs, articles and blogs) highlighted on this page are not authored by the OFR and are owned by a third party. The OFR does not guarantee that statements or data contained in the written publications are accurate and is not responsible for updating these products.

National Science Foundation grant to the National Bureau of Economic Research

OFR has partnered with the National Science Foundation (NSF) to fund grant awards in support of financial stability related research activities. NSF used funds provided by OFR to award a grant to the National Bureau of Economic Research (NBER), a nonprofit organization committed to disseminating unbiased economic research among public policymakers, business professionals, and the academic community. By partnering with NSF to fund a grant award to NBER, the OFR is seeking insight from a research community that is actively involved in cutting-edge research into major economic issues, including financial stability.

NBER Catalyzed Research Projects & Conferences

Financial Frictions and Systemic Risk Project

This project supports research on the interplay between financial market institutions, financial frictions, and systemic financial risk. Particular issues of interest include funding structures and capital market frictions; operational and financial linkages across markets; financial stability; and the determinants, detection, and remediation of systemic risk. The initiative encourages interaction among researchers, policymakers, and financial market practitioners, with the goal of identifying and addressing research questions that are particularly important for public policy.

Financial Market Frictions and Systemic Risks Conference (March 8, 2024)

This conference brought together researchers in various subfields of economics and financial economics to study funding structures, capital market frictions, operational and financial linkages across markets, financial stability, and systemic risk. The conference promoted knowledge about potential sources of data that might be used to address these topics and to advance interactions between researchers, policy-makers, practitioners, and regulators, with the goal of identifying and addressing research questions that bear on public policy.

Defense Advanced Research Projects Agency

Cybersecurity vulnerabilities in the financial system continue to be a serious and evolving threat to financial stability. To increase visibility in this area, the OFR partnered with the Defense Advanced Research Projects Agency (DARPA)—a research and development agency of the United States Department of Defense responsible for the development of emerging technologies for use by the U.S. and its allies—to develop research on risks to the U.S. financial system from a cyberattack.

DARPA’s Ensuring Consistency of Systemic Information (ECoSystemic) program aims to develop innovative techniques for the robust recovery of financial information systems. Federated information systems are large, complex, and distributed computer and data systems, exactly the systems on which today’s financial system relies. With improved backups and processes for recovering data in the event of disruption or corruption, information systems can promptly return to a functional and mutually consistent restored state. ECoSystemic has engaged teams, each exploring a different facet of the financial system, and developing distinct analytical approaches and tools. Each team produces an executive summary of its work and results. The techniques developed for maintaining resilient datasets have applications in the military and commercial arenas as well.

DARPA Partnership Products

OFR did not fund these DARPA-authored products, but OFR provided advice and feedback on their technical approaches.

Resilient Knowledge Graph Representations for Federated Financial Data

This paper presents a new data paradigm that can facilitate analyses of critical financial issues. Specifically, the paper examines how the widespread use of resilient data structures could enhance the efficiency and stability of financial markets by allowing regulators and market participants to understand and better identify systemic risks. The ability to obtain value from data depends on how easily the data can be accessed for their intended use. A knowledge graph organizes federated data that lends itself to understanding relationships among entities such as market participants, exchanges, or instruments. Compared to other data structures, such as flat files or relational databases, knowledge graphs are more extensible, have lower barriers to access, and are uniquely suited to identifying relations within networks for visualization and analysis. The research shows that knowledge graphs also can be made resilient to attacks by malicious actors and physical failures. The paper demonstrates through examples how knowledge graphs can be leveraged to derive resilient meta statistics that financial regulators can use to identify abnormal behaviors and unusual variations in financial database characteristics over time.

Improving the resilience of machine learning in financial systems through synthetic data

The stability of a financial system requires the ability to recognize and recover from catastrophic events quickly. It requires that data backups and their connected systems are consistent. This inference problem requires a model of why acceptable differences exist to detect when inconsistencies arise. Synthetic data that systematically generate acceptable and unacceptable inconsistencies can significantly improve the financial system’s resilience. This paper outlines an interpretable procedure using Bayesian probabilistic models to create synthetic data. The approach allows the development of machine learning tools to detect inconsistencies in federated backups. The paper shows how this synthetic-data approach can reveal the conditions under which a machine-learning tool may fail and how that information can be used to build a more robust tool for detecting potential operation outages or cybersecurity threats.

Protecting Distributed Financial Networks

Distributed financial networks are a feature of the international financial system of payments, but they are also increasingly vulnerable to disruption as new technologies create unexpected opportunities for surprises, threats, and shocks. These vulnerabilities arise due to current economic and technical trends, including the increasing velocity and digitalization of individual economic activity, as well as the growing interconnectedness of the global economy. This brief discusses these financial system challenges through the lens of a credit card payment system. It present a range of integrated tools and procedures tailored to meet the needs of the financial firm, network, and system as no single “silver bullet” solution exists. Instead, protecting networks requires multiple, integrated solutions that work together to reduce system fraud and errors.

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Lam Research (LRCX) Q2 2024 Earnings Call Transcript

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NASDAQ: LRCX

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LRCX earnings call for the period ending June 30, 2024.

Image source: The Motley Fool.

Lam Research ( LRCX -8.11% ) Q2 2024 Earnings Call Jul 31, 2024 , 5:00 p.m. ET

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Good evening, and welcome to the Lam Research June quarterly earnings call. All participants will be in a listen-only mode. [Operator instructions] After today's presentation, there will be an opportunity to ask questions. [Operator instructions] Please note this call is being recorded.

I would now like to turn the conference over to Mr. Ram Ganesh, VP, investor relations. Please go ahead.

Ram Ganesh -- Head, Investor Relations

Thank you, and good afternoon, everyone. Welcome to the Lam Research quarterly earnings conference call. With me today are Tim Archer, president and chief executive officer; and Doug Bettinger, executive vice president and chief financial officer. During today's call, we will share our overview on the business environment, and we'll review our financial results for the June 2024 quarter and our outlook for the September 2024 quarter.

The press release detailing our financial results was distributed a little after 1:00 p.m. Pacific Time. The release can also be found on the Investor Relations section of the company's website along with the presentation slides that accompany today's call. Today's presentation and Q&A include forward-looking statements that are subject to risks and uncertainties reflected in the risk factors disclosed in our SEC public filings.

Please see accompanying slides in the presentation for additional information. Today's discussion of our financial results will be presented on a non-GAAP financial basis unless otherwise specified. A detailed reconciliation between GAAP and non-GAAP results can be found in the accompanying slides in the presentation. This call is scheduled to last until 3:00 p.m.

Pacific Time. A replay of this call will be made available later this afternoon on our website. And with that, I'll hand the call over to Tim.

Timothy M. Archer -- President, Chief Executive Officer, and Director

Thanks, Rob, and good afternoon, everyone. In the June quarter, Lam delivered another set of solid results with revenues, profitability, and earnings per share, all coming in above the midpoint of our guidance. Our CSBG business posted strong growth with revenues up 22% sequentially, led by Reliant and spares. On the manufacturing side, we achieved a key milestone in the quarter with our Malaysia factory shipping its 5,000th chamber.

This is the fastest ramp of a new manufacturing facility in Lam's history, and we remain on track to achieve our long-term cost reduction goals through an expanded global manufacturing and supply chain footprint. As previously communicated, 2024 is a year of strategic investment for Lam, where we are prioritizing product development for key technology inflections, global R&D infrastructure close to our customers, and digital transformation for operational efficiency at scale. We believe these investments will put Lam in a position to outperform as the industry moves into a period of multi-year WFE spending expansion. Now, turning to WFE, we expect this year's spending to be in the mid $90 billion range.

Our customer investment profile is generally unchanged from our prior view, apart from slightly stronger domestic China spending and additional demand related to the ramp of high-bandwidth memory or HBM capacity. We see Foundry/Logic, DRAM, and NAND investments all up on a year-on-year basis. Global spending on mature node technologies is expected to be roughly flat year on year. Looking ahead to 2025, we see a positive environment for continued growth in WFE spending.

The power of AI is a transformative business tool is still yet to be fully realized. Today, the focus on AI model training is driving strong demand for GPUs and HBM. However, as AI use cases expand, we believe inferencing at the edge will spur content growth of low-power DRAM and NAND storage in enterprise PCs and smartphones. Investments for AI-enabled edge devices play particularly well to Lam's strengths.

We anticipate that memory customers looking to scale capacity and lower bid cost will bias WFE spending toward technology upgrades of the installed base. For NAND, the etch and deposition intensity of upgrades is significantly higher than in a greenfield investment. When you consider Lam's sizable installed base in memory, including roughly 7,500 high aspect ratio dielectric etch chambers for NAND alone, we are positioned to outgrow overall WFE when customers upgrade existing memory production lines to next-generation nodes. Longer term, etch and deposition are set to play an increasingly vital role in the industry's efforts to develop faster, more power-efficient, and lower-cost semiconductors to serve AI-related applications by delivering critical solutions for atomic-level device scaling, new materials innovation, and advanced packaging integration, we see tremendous opportunity for Lam to expand our served market and increase our share at each successive process technology node.

To this end, our R&D focus is yielding exciting new products, including this year, our first direct power coupled conductor etch tool with matchless power source and bias, known as Direct Drive. This new power source uses solid-state drivers to stabilize the plasma in the etch chamber 500 times faster than current industry standards. By combining direct power coupling with Lam's unique plasma pulsing capabilities, our latest conductor etch systems are delivering best-in-class performance for newly emerging 4F2 DRAM applications. In 4F2 devices, the nature of the bit line placement requires precise etching of ultra-small high aspect ratio of silicon structures to avoid device shorts or leakage.

With direct power coupling and plasma pulsing, Lam connects to vertically oriented 4F2 transistor architectures with unprecedented depth uniformity and profile controller. Similarly, conductor etch is becoming a critical enabler for EUV patterning for gate-all-around and DRAM due to the need to reduce etch placement error. For nodes below two nanometers, the requirement is for roughly 40% tighter control than at five nanometers. Our new conductor etch tool delivers a 30% reduction in feature roughness, which is one of the main contributors to etch placement error.

In addition, we can achieve one to two orders of magnitude improvement in defectivity for a given EUV dose, further helping customers reduce the overall cost and improve the capability of the EUV patterning process. Turning to NAND. AI applications are driving demand for faster, higher-capacity enterprise SSDs. NAND makers are pursuing both vertical and lateral scaling of NAND arrays as well as increasing bits stored per sell through implementation of QLC and PLC technologies.

In support of these efforts, Lam is developing new dielectric etch and deposition capabilities. Earlier today, we announced Lam Cryo 3.0, Lam's third generation of cryogenic etch technology. Building on our learning from nearly 1,000 cryogenic etch chambers, running in NAND fabs worldwide. This new patented cryogenic etch process delivers industry-leading control of the NAND memory channel hole profile.

When Lam Cryo 3.0 is deployed on our Vantex system, the etch are delivering the industry's highest available ion energy, we can create a 10-micron deep channel hole that has a top-to-bottom profile deviation of less than 10 nanometers or less than 0.1% relative to its depth. Such tight profile control allows customers to increase bit density by packing more cells per layer while also having the flexibility to add more layers per tier. Lam Cryo 3.0 also addresses our industry's need for more sustainable solutions, delivering a 40% reduction in energy consumption per wafer and a 90% reduction in greenhouse gas emissions per wafer compared to non-cryogenic etchers. Deposition technology is also advancing quickly to support increased bit density and lower cost through multi-tier stacking.

Polysilicon and tungsten gap-fill materials have typically been used to enable tier stacking in high-layer-count NAND. Integration of these materials, however, has resulted in poor control of critical dimensions and overlay, negatively impacting yield and performance. Ram's innovative PECVD-based pure carbon and gap-fill process provides an attractive alternative material. With the unique combination of high etch selectivity, superior mechanical properties, and simplified dry post-process removability, it also reduces the number of process steps required in some cases by approximately 50% compared to traditional approaches.

Overall, etch and deposition are becoming increasingly critical to addressing the complex semiconductor requirements of a growing AI environment. We are excited by the breadth of opportunities we see ahead for the company, especially those created by technology inflections to gate-all-around backside power delivery, advanced packaging, and dry EUV resist processing. All of these are etch and deposition intensive and each represents a $1 billion or higher growth opportunity for Lam. We look forward to sharing our progress on these fronts as well as our long-term financial model at our next Investor Day, which we are planning to hold in February 2025.

With that, I'll turn it over to Doug.

Douglas R. Bettinger -- Executive Vice President and Chief Financial Officer

Great. Thank you, Tim. Good afternoon, everyone, and thank you for joining our call today. We executed well in the June 2024 quarter.

Our June quarter results came in above the midpoint or exceeded our guidance ranges for all financial metrics. We were pleased with the company's strong execution. For fiscal year 2024, we achieved the highest gross margin percentage since the merging of Lam with Novellus in 2013, coming in at 48.2% and we generated quite strong free cash flow of approximately $4.3 billion or 29% of revenue. Let's look at the details of our June quarter results.

Revenue came in at $3.87 billion, which was an increase from the prior quarter and over the midpoint of guidance. Our deferred revenue balance at the end of the quarter was -- or excuse me, $1.55 billion, which is a decrease of $194 million in the March quarter related to revenue recognized that was tied to customer advanced payments. As we sit here today, I believe deferred revenue remains stable at these levels for the foreseeable future. Let's turn to the revenue segment details.

June quarter systems revenue in memory was 36%, which was a decrease from the prior quarter level of 44%. The decline in the memory segment was mainly attributable to DRAM. DRAM came in at 19% of systems revenue compared with 23% in the March quarter as investments in mature nodes declined in the June quarter. DRAM revenue reached a new record in fiscal year 2024 with spending focused on DDR5 and HBM enablement as well as on the 1Y node.

Nonvolatile memory came in at 17% of our systems revenue, which was down from the March quarter level of 21%. And just a reminder, we are characterizing one customer's investment in specialty DRAM as a nonvolatile investment since it has a nonvolatile component in the device. NAND revenue was at a low point for this year, and I expect NAND investment to gradually improve as utilization rates return to more normal levels and our customers slowly increased spending in conversions to 2xx and 3xx layer devices into the next year. The Foundry segment represented 43% of our systems revenue, which was roughly flat with the percentage concentration in the March quarter of 44%.

Growth in shipments for gate-all-around nodes was offset by a decline in mature node spending. The Logic and other segment were 21% of system revenue in the June quarter, up from the prior level of 12%. The increase was driven by strength in mature node spending in China. With respect to the regional composition of our total revenue, the China region came in at 39%, down slightly from the prior quarter level of 42% and a little bit higher than our expectations from the previous earnings call.

This was driven by domestic China spending. The next largest geographic concentration was Korea at 18% of revenue in the June quarter, versus 24% in the March quarter. Taiwan was 15% of revenue in the June quarter, which was an increase from 9% in the March quarter. The customer support business group revenue in the June quarter pulled approximately $1.7 billion, an increase of 22% from the prior quarter level and 14% higher than the June quarter and calendar 2023.

CSBG revenue represented 44% of our June quarter revenues and reached the highest point since the end of calendar 2022, driven primarily by an increase in Reliant Systems, followed by growth in spares. Our Reliant Systems revenue benefited from strength in domestic China spending for specialty and mature nodes. Spares revenue increased largely due to continued improvement in utilization at our memory customers as well as a little bit of inventory stocking. I do not think CSBG will grow modestly in calendar year 2024.

Let's look at profitability. Our June quarter gross margin came in at 48.5% at the top end of our guided range and slightly down from 48.7% in the March quarter. June quarter gross margin benefited from continued improvement in factory efficiencies, which largely offset the headwind we saw in customer mix that we talked about on the last earnings call. Operating expenses for the June quarter were $689 million, down marginally from the prior-quarter amount of $698 million.

As Tim mentioned, we continue to prioritize spending in research and development to extend our technology differentiation as well as expand our product portfolio. I'd just point out that more than 70% of our total operating expenses were concentrated in research and development. The June quarter operating margin was 30.7%, above the guidance range mainly because of that strong gross margin performance. Our non-GAAP tax rate for the quarter was 11.5%.

We estimate the tax rate for the remainder of the calendar year 2024 to be in the low to mid-teens level, and this rate will fluctuate from quarter to quarter. Other income and expense for the June quarter was approximately $19 million in income compared with $10 million in income in the March quarter. The increase in OI&E was primarily the result of fluctuations in the fair value of our venture investments. And as we've talked about in the past, you will see variability in OI&E quarter to quarter.

Let's look at the capital return. We allocated approximately $382 million to share repurchases, and we paid $261 million in dividends in the June quarter. During the quarter, we announced that our board of directors approved a $10 billion share repurchase authorization. We have $10.8 billion remaining in the plan at the end of the June quarter.

For fiscal year 2024, we returned $3.7 billion or 88% of free cash flow, which was in line with our long-term capital plans of returning 75% to 100% of free cash flow. June quarter diluted earnings per share were $8.14, close to the high end of our guidance range. The diluted share count was 131 million shares on track with our expectations and down from the March quarter. Let's look at the balance sheet.

Cash and cash equivalents totaled $5.9 billion at the end of the June quarter, up a little bit from $5.7 billion at the end of the March quarter. Days sales outstanding were 59 days in the June quarter, a slight increase from 57 days in the March quarter. June quarter inventory turns of 1.9x compared with 1.8x in the prior quarter. We are making progress in bringing inventory levels down, and we'll continue to work on this throughout the rest of calendar year 2024.

Our noncash expenses for the June quarter included approximately $79 million for equity compensation, $74 million in depreciation, and $14 million in amortization. Capital expenditures were $101 million, flat with the March quarter level was spending mainly centered on lab investments in the United States and Asia as well as manufacturing facilities in Asia, supporting our global strategy to be close to our customers' development and manufacturing locations. We ended the June quarter with approximately 17,200 regular full-time employees, which was flat with the prior quarter. Let's turn to our non-GAAP guidance for the September 2024 quarter.

We're expecting revenue of $4.05 billion, plus or minus $300 million. Gross margin of 47%, plus or minus one percentage point. This gross margin decline is reflective primarily of an unfavorable quarter-to-quarter change in customer mix. I expect this change to continue to be a slight incremental headwind in the December quarter.

Operating margins of 29.5%, plus or minus one percentage point. Gross margin and operating margin included impact from ongoing transformation costs related to projects to improve our systems and operations. As we communicated at the beginning of the year, we're focused on reengineering our business processes and systems to drive operational efficiencies and to implement AI at greater scale. And finally, we're forecasting earnings per share of $8 plus or minus $0.75 based on a share count of approximately 131 million shares.

Let me wrap up. As we finish the first half of calendar year 2024, I was pleased that we were able to execute to the objectives we shared at the beginning of the year. We prioritize investment to extend our technology differentiation while driving operational improvements. We're encouraged that the spares business recovery is beginning, and upgrade activity should improve as we exit the calendar year.

Longer term, Lam is well-positioned to capitalize the increase in etch and deposition intensity by delivering new capabilities and multiple new manufacturing inflections that we see ahead. We look forward to talking to you in February at our planned Investor Day about the long-term opportunities for Lam to continue our outperformance in the semiconductor industry. Operator, that concludes our prepared remarks. Tim and I would now like to open up the call for questions.

Questions & Answers:

Thank you. We will now begin the question-and-answer session. [Operator instructions] Your first question comes from Tim Arcuri with UBS. Please go ahead.

Timothy Arcuri -- Analyst

Thanks a lot. Doug, I wanted to ask about the service system mix in the guidance. So, you said that the service -- I thought you said but you now think it's going to grow modestly this year. But if I flatline service in September and December, it's up 8% year over year.

So, can you just clarify what you're thinking for service in the guidance? Thanks.

Yes, Tim, we don't decompose the individual components of the guide. I was clarifying, we now expect CSBG to be up a little bit for the year. It was particularly strong in the June quarter, whether it is up, down, or sideways from that as we go forward. I'm not going to give you individual components of the forecast.

But I do think for the year, it's going to grow a little bit.

OK. Great, Doug. Thanks. And then can you talk a little bit about -- just in DRAM, I think there's generally more excitement, Tim, about DRAM WFE than NAND, WFE among most investors out there about where it could go during this next peak.

Obviously, you do very well in NAND. But in DRAM, you did talk about a lot of the investments that you're making. Can you just talk about -- I know your leverage to the advanced packaging part of the HBM dollars being spent but that's still a pretty small piece of it. So, can you just maybe give a chance to kind of distill some of the view that you're not very levered to DRAM and give us a sense of maybe where you're investing and where you think you can gain share in DRAM?

Sure. Thanks, Tim. And as you said, we do very well in NAND and we still think NAND Day is coming, as I said. We've seen some of that -- those commentaries around the enterprise SSDs, etc.

But on the DRAM side, the reason we highlighted, the progress we're making, especially in this conductor etch I mean, one, it's a new tool we've introduced. It's new capabilities that are very exciting for the industry and really targeted toward the types of ultra-small structures that are going to exist in future DRAM nodes going forward. Lam is the global leader in conductor etch. And so, we're applying all of that expertise and learning we have toward future DRAM challenges.

And I think there's tremendous opportunity for us on those applications, as I pointed out. The other side of it, a lot of the excitement around DRAM is related to HBM. And there, as you commented, we play extremely well with our strong position in both TSV, etching as well as the TSV electroplating. And I think that we don't see any change in that strong position going forward.

So, we get the benefit both from the scaling and architectural changes that are occurring in DRAM going forward and from the advanced packaging and HBM-related expansion. And all of these -- on both of those sides are multiplied by the fact that you get fewer bits per wafer. And so, everybody recognizes you're going to need a lot more DRAM wafers processed going forward. And ultimately, that translates into more equipment from Lam.

Thank you, Tim.

Thanks, Tim.

Next question comes from Krish Sankar with Cowen and Company. Please go ahead.

Krish Sankar -- Analyst

Hi. Thanks for taking question. My first one is for Doug. I think, Doug, you gave some color on China.

Kind of curious how to think about China into the back half of this calendar year and into calendar '25. And along the same path, you kind of mentioned that December quarter, there could be a slight more gross margin headwind. Is there a way to quantify how much that -- how many basis points of headwind would be in December compared to the 47% in September? And then I have a follow-up for Tim.

Yes, sure, Krish. I'll just remind you what we said last quarter. It hasn't really changed in this quarter and what that statement was that for the year, '23-'24, China is up. However, it is a somewhat first-half-weighted year this year as opposed to last year, it was somewhat second-half-weighted.

I'm not communicating, hey, it's going away. It's not going away. It's just the spending because sometimes these customers are a little bit bigger than a bread box, it can be a little bit lumpy and that's very much what we're seeing in China. I'm not ready to tell you exactly what next year looks like from the China region.

But I do think it's going to be a pretty solid year, right? Again, it's not going away. It's too soon for us to quantify things for next year, but '25 should be a pretty decent year in China, Krish.

And then, Doug, any color on the December quarter gross margin?

I'm not going to give you a number, Krish, but I've been signaling for a while that because of customer mix, margin will have a little bit of some headwind going into the second half of the year. I just guided you to 47% in September and suggested that there might be a little bit of incremental headwind into December because of customer mix is what I said in the script.

Got it. Got it. Thank you for that, Doug. And then, Tim, just a quick follow-up.

When I look at all the upcoming tech inflections, like day dollar on, backside power delivery, maybe down the road 3D DRAM. You spoke within that, the transition to 4F2 DRAM from 6F2. I'm kind of curious, is this really that material? And if so, is there a way to size the opportunity for Lam at 4F2, you spoke a little bit about 100 -- just kind of wondering if you can give some more color around how to quantify that number for the 4F2 architecture transition. Thank you.

Sure. Well, I don't think we're prepared to quantify it for you today. But I think that my comment was, though, we see each of these inflections. And 6F2 to 4F2 is a technology inflection that brings with it some important changes.

I mean, one, the architectural layout of the device itself puts additional requirements on etch, which I think we're very well suited to serve. And that's why we've been developing new conductor etch capabilities to target those new requirements. So, there is some incremental opportunity there. Clearly, the jump to 3D NAND is a much bigger step-up in etch depth intensity, but our goal is to increase our SAM and grow our share at every technology node.

So, we look at whatever is the new requirement and how we can best address that. You also look -- as you look at DRAM going forward, another thing that's happening, whether it's 6F2 or maybe 4F2 is the implementation of more EUV layers and how Lam plays in EUV. Again, anything where effectively pattern transfer etches. The feature sizes are getting smaller.

Precision is required. These are the kinds of high-tech etches that Lam excels at. And so, we look at participating in those. And then on the deposition side, of course, we've talked about things like our dry EUV resist process and how that plays into EUV as DRAM and Foundry/Logic transition from EUV to high-end EUV.

And so, we're just looking at every technology node as an opportunity for us to gain.

Thanks, Krish.

Your next question comes from Srinivas Pajjuri with Raymond James. Please go ahead.

Srini Pajjuri -- Analyst

Thank you. Tim, I have a question on DRAM. Obviously, the recovery has been ongoing and HBM is a secular driver that you talked about, and you do have a very strong position in that market as well. Then I look at your revenue, I think it peaked around December of '23, and it's been kind of declining on a sequential basis.

I'm guessing some of that is maybe mature node DRAM. Just wondering if you're kind of at the bottom and then given all the talk about HBM spending, I would think that it's going to kind of -- it should, at some point, come back strongly. So, I just want to hear your thoughts on why it's been declining. And how should we think about, in particular, in DRAM revenue?

Yes. I think you generally have it pretty correct. We had talked about the fact that some mature DRAM spending was a little bit heavily concentrated in the second half of last year through early part of this year even. And as that came off, there was some of a reset in what we would call kind of traditional or the conventional DRAM.

That is being picked up at some rate by the growth in HBM, but HBM is still in its ramping phase. And I think that as we look into 2025 becomes an even bigger driver of wafers in DRAM. And so, I think that explains probably the profile. And I think that as we look forward to the secular driver of HBM, the impact on wafer effectively, how many wafers require us to produce that number of bits due to the dice size and due to the complexity of stacking these DRAMs means that we see DRAM demand for DRAM equipment continuing to grow through 2025 and probably well beyond that.

OK. Got it. Thank you. And then on the CSBG business being up 20% sequentially, 22% I know you don't want to give us guidance going forward, at least for the next quarter.

I'm just curious about the sustainability of some of the trends that you're seeing, Tim. And then what does that mean for the overall WFE? Is this a prelude to something? And is this just the utilization improving? And then does this usually follow in terms of WFE increasing and in terms of new tech migrations or capacity additions? So, any color on that would be helpful.

Sure. It's a good question. And I guess, again, reminding people that the CSBG business includes our Reliant business, which sells into mature nodes, it includes spares, it includes upgrades, and services. And so, each of those components move somewhat differently.

And we talked about this quarter, particularly being strong as a result of Reliant and spares. We are starting to see a pickup in utilization in the memory fabs as we've talked about -- and I've talked a little bit about the fact that as we look forward, we think that upgrades will begin to become a much more prominent part of our customers' WFE spending as they look to upgrade memory fabs that they really haven't been upgraded in quite some time because of the severe downturn that we've seen in that -- in those markets over the last few years. And so, I do think, going forward, you see a little bit more of a balance between those different segments. Upgrades coming up stronger and spares continuing to grow simply because our installed base itself continues to get bigger.

Traditionally, we would have always said that we would expect the CSBG business to grow every single year, and that's simply effective every year, we ship more tools, and those tools then require services and spares and basically present new opportunities for Lam to capture revenue from those systems. So, I think long-term CSBG will be returning back to that growth and next year, probably much more biased toward the upgrades business as customers start to do memory fab upgrades.

Your next question comes from C.J. Muse with Cantor Fitzgerald. Please go ahead.

C.J. Muse -- Analyst

Yes. Good afternoon. Thank you for taking the question. I guess first question I was hoping to focus on gross margins.

A couple of quarters ago, Doug, you talked about kind of looking back to the June kind of '23 quarter has normalized. But given the guide today, it sounds like that was conservative and it's a higher number. So, just as you think about calendar '25, as you get to kind of a normalized China mix and you normalize to Reliant, what would be kind of the base level we should be thinking about for gross margins? And then can you talk to what kind of accretion we should be thinking about related to Malaysia and/or some of these higher-margin upgrade drivers?

Yes, C.J. I mean, you've alluded to some of the things that move gross margin on, obviously. Yes, I had previously anchored you and other respect to that June quarter before the China mix improved or strengthened, I guess, maybe not improved. As the baseline -- I guided it down a little bit in September, described customer mix softening a little bit relative to moving that.

And I'm not suggesting, hey, a little bit more in December potentially. It's all about customer mix. Too soon for me to guide you for next year, but the things you should be thinking about is what does that customer mix look like next year? I'm not sure yet, and I'm not ready to point you to numbers, but what will begin to show up in a more significant fashion is the accretion for -- from those Asia factories as we ramp output, that will be a benefit to gross margins. So, those are the moving pieces to be thinking about.

The customer mix, I'm not entirely sure but as we see a likely WFE environment next year, that's somewhat stronger, increasingly, the incremental volume will be supported from those Asia factories, which should be beneficial to gross margins, C.J.

Very helpful. And then I guess as my follow-up, in your prepared remarks, you spoke to the 7,500 high aspect ratio etch chambers installed in the NAND industry. And just curious, as you see upgrades there, what kind of growth could that add to overall NAND WFE specifically to you guys? Is there a kind of percentage we should think about? Any help there would be great.

We haven't quantified that, but the reason I included it was simply to point out the installed base itself becomes a powerful driver of revenue during those upgrade cycles. And we do think that the next phase, we've seen higher memory fab utilization, particularly when we talked about NAND beginning to improve last quarter, and that seems to be continuing as we move through the remainder of this year. We get to next year and the upgrades start in earnest, to those tools represent opportunities for Lam to help our customers achieve both a technology upgrade and a bit cost reduction as they move forward and accrues quite a lot of revenue for Lam relative to the amount of WFE spend. I'll remind people the WFE Lam's capture rate of spending in an upgrade is significantly higher because etch and deposition represents so much of the upgrade.

So, that was the reason we point out the size of our installed base.

Thanks so much.

Thanks, C.J.

The next question comes from Stacy Rasgon with Bernstein Research. Please go ahead.

Stacy Rasgon -- Analyst

Hi, guys. Thanks for taking my question. First, I wanted to ask like if the NAND business next year is primarily driven by upgrades, what does that imply for growth? Like would it be conceivable that NAND WFE could double year over year in calendar '25 that was purely upgrade-driven? Or would you need capacity additions to get there? And are you seeing any signs at all of capacity additions right now? It doesn't sound like it.

Well, Stacy, what I would say is that, obviously, we're not going to guide what NAND WFE is next year. Frankly, I think it's still a developing story. But what we're trying to say is that as customers move to upgrades, whatever WFE is spent, Lam will be the primary beneficiary of that WFE spend. And so, that's a year in which my comment was we would be confident that we would outgrow WFE in the NAND space if it was primarily upgrade spend.

And upgrades represent a tremendous efficient way for customers to essentially advance their technology and lower their costs. And so, we do think that will be the next phase of NAND investment based on our thoughts.

Got it. Got it. I mean, maybe to follow up on that just a little bit, I mean, if you look at your current like NAND outlook for this year, would you say that that outlook has gotten better or worse or stayed the same versus like 90 days ago?

It probably hasn't changed much, Stacy. This is Doug. Maybe a little bit better. We certainly see a little bit of an uptick in utilization.

But I don't think it's meaningfully different, Stacy.

Got it. So, it's kind of a noise.

Yes, kind of a noise.

Got it. OK. That's helpful. Thank you, guys.

Appreciate it.

Next question comes from Harlan Sur with JPMorgan. Please go ahead.

Harlan Sur -- Analyst

Yes. Good afternoon. Thanks for taking my question. Given the strength in CSBG, it looks like utilization by your customer base continues to rise.

Did that also broaden out to start to include not just leading-edge logic, foundry, DRAM, and NAND, but maybe also start to include mature and specialty fabs as well? Or are at a minimum, mature and specialty utilization at least stabilizing in line with some of the cyclical improvements that we're seeing in the semi industry?

Harlan, mature node stuff is still pretty soft, frankly. And I think you understand what's going on. I think just listen to everybody else's earnings calls in the analog, industrial, automotive space. And there's still a lot of inventory out there, it's still relatively soft.

The statements we're making on utilization have more to do with what we're seeing in the memory fabs, quite frankly.

I appreciate that. And then on HBM and advanced packaging, I mean, last night, we heard AMD talk about supply dynamics being tight on their AI GPU supply next year, colos, and HBM on the custom ASIC front, we hear companies like Broadcom keep getting upside orders from their AI customers like Google. Last quarter, you talked about doing $1 billion in advanced packaging and HBM revenues this year. Has that number moved higher and is the team capacity constrained on advanced packaging systems and are your lead times here for those tools starting to stretch out?

Well, it has moved higher, and we're not going to requantify it just yet, but it is -- we're seeing very strong demand in those areas. I talked about the expansion of our global manufacturing supply chain footprint. And obviously, that's giving us more flexibility than we had during the last ramp. Our goal through all those investments was to be able to respond in these next few years of expansion better than we did in the expansion that we saw right around the time of COVID.

And so, I think that that will position us. Sure, you're always a little bit short and customers always drop in tools within your lead time, which keeps you busy. But I think that we're doing quite a nice job responding to the urgent request from our customers. We actually like this.

I would say that generally from running the business, we like this environment where all parts of our business are a little bit supply constraint. I mean, you hear a lot of our customers talking about being cautious about adding capacity. Other customers talking about having a little trouble getting tools. I think that's a good place for us to be because it means that I think we're setting up for more manageable long-term ramp of demand than sort of a short spike followed by, again, periods of digestion that always creates a little bit of chaos in the industry.

Thank you, Tim. Thanks, Doug.

Thanks, Harlan.

Your next question comes from Atif Malik with Citi. Please go ahead.

Atif Malik -- Analyst

Hi. Thank you for taking my question. Doug, if I look at the 2023 year-over-year China sales growth among the big five equipment makers. All of them are up quite well.

ASML is up like 250% and the U.S. peers are up in teens or 20%, but you guys were down 11% total China sales in 2023. And this year, you're expecting China sales to be up. So, I'm just trying to understand the dynamics last year.

Were this just a function of maybe NAND spending and the NAND project not being active or are there competitive elements in China that are working against you?

Atif, I'll remind you that perhaps our largest customer got restricted when the regulations came out, our NAND customer in China. That customer was pretty strong in '22, went away in '23. So, the year-over-year comparisons you're making, you've got to factor that in. And then the strength we're seeing '23 to '24 is a different mix entirely, really not any NAND in China to speak of, at least not domestic China.

I don't know if that helps you, but make sure you're thinking about that.

Yes, it all makes sense. That's helpful. And then on the cryo improvement, Tim, that you mentioned, are those improvements or process tool of record is going to solidify your market share next year or the year after?

That's -- well, I think that all of these things when you introduce something new, I mean, I think what people kind of lose sight of this. Generally, we're working several years ahead with our customers on R&D. I talked about the investments we're making where we make -- we're building labs close to our customers in different geographies. That's because, in many cases, we're engaging those customers a good five years ahead of production implementation.

That's not to say Lam Cryo 3.0 take five years to get into production. But it's not technology that's ramping, say, this year, but it really is looking out at the needs of our customers wanted to generations out and really solving their difficult etch challenges. So, sometimes when the benefits are so good, and I talked about the fact that we get about 2.5 times etch rate, tremendous profile control customers will often pull that in sooner. But really, this is designed for kind of the 400-plus layer may ultimately end up being pulled in earlier than that, but that's where you really start to see the needs for this kind of capability.

That's exactly I was asking about. It is 400 layers or 200 layers, but it sounds like 400 layers.

Yes. And I think that what we -- you'll see in our press release today, we talked a little bit about we're trying to chart the path across not only etch but also our deposition films toward where the industry needs to go to get to 1,000 layers because we truly see over the next decade, that that's where you want to get in terms of satisfying bit density and cost as NAND demand continues to expand with AI.

Great. Thank you.

Next question comes from Toshiya Hari with Goldman Sachs. Please go ahead.

Toshiya Hari -- Analyst

Hi, guys. Thank you so much for taking the questions. I joined late, so I do apologize if these questions have been addressed. Just on the third-generation cryo tool, Tim, that you spoke about.

How is this technology or tool fundamentally different or better than your nearest competitor? I know you just spoke to some of the characteristics, but if you can clarify that for us to the extent you're comfortable, that would be really, really helpful. And then my second question, again, on the CSBG side, probably one for Doug. And again, you may have address this. For the full year, calendar year, I think you previously said flattish, plus or minus.

Is that still the view? Or given the strength you saw in June, is that -- should we be thinking about a higher growth rate for the full year? Thank you.

Maybe I'll take that one first, and then I'll let Tim comment on the 3.0 stuff. Yes. You might have missed my scripted statements. As we sit here today, we now expect that for 2024 CSBG, the word I used was modestly grow this year versus last year.

And part of that is we saw particularly strength -- that particular strength in the June quarter in Reliant, a little bit of an improvement in spares. And as we think about the utilization trends that are likely occurring with our memory customers, I think spares continues to be decent and we're optimistic that we'll start to see some of the upgrade spend that we've been talking about for a while. And I'll hand it over to Tim on the 3.0 stuff.

Sure, Doug. Yes. I think, obviously, what I would just start with is the biggest difference between what we're delivering with Lam Cryo 3.0 and what our competitors do is in the results on the wafer, which we talked about pretty amazing 10-micron deep holes with less than a 10-nanometer taper from the top to bottom. At etch rates that are 2.5 times conventional etching.

So, it's the results that are pretty amazing. We talked about the fact that the -- this is based on some new surface chemistries that are enabled in our tool and there's a whole combination of hardware issue -- hardware configuration and capabilities in our tool that I think allow us to achieve that result. And I can't go into all of those details today, but it is I did allude to one of them, which is on our Vantex System. The chamber design allows us to deliver a significantly higher ion energy than what is available from any other system available in the semiconductor industry.

And that does play some role in etching these very, very deep near with -- holes with near-perfect verticality. So, that's about all I can say today.

Thank you. Appreciate that.

Your next question comes from Joe Moore with Morgan Stanley. Please go ahead.

Joe Moore -- Analyst

Great. Thank you. I wanted to ask you -- I mean, there's been a number of press concerns about export controls with talking about the foreign direct product rule which doesn't seem like it would affect you, but also talking about entity list. And I'm just wondering, obviously, we don't know what would happen with any of that.

But are you seeing any different behavior from your China customers? Are you seeing them push things in or pull things -- push things out because of any of those anxieties?

Yes. Joe, I think that, obviously, we don't know exactly what's going to happen either just as you said, and so we can't really speculate on that. I have mentioned in the last couple of calls that there are ongoing discussions all the time with the U.S. government and regulatory agencies were part of those discussions and we'll continue to be.

I think in terms of change in behavior by any of our customers, I don't think it's something that's noticeable nor would it be something that we would be able to easily react to. We've talked about how we deal with some of these new customers that emerge with down payments and other things to make sure that we understand the -- those customers as viable customers. But beyond that, we service them like others at this point as long as we can ship to them. And I would say lead times and responsiveness from our perspective is same as we treat any customers of those size.

Very helpful. Thank you.

Thanks, Joe.

Next question comes from Blayne Curtis with Jefferies. Please go ahead.

Blayne Curtis -- Analyst

Hey. Thanks for letting me ask a question. I actually -- I know you got a couple on this, Doug, on the China business. I'm just kind of curious.

I think you qualified as a solid year next year, and I just didn't know what that meant. So, I know you've been hesitant to kind of call of China, I think you called it like flat, plus or minus, maybe up or down last time. Do you feel better about it, I guess, outside of this June that's the other kind of part of the question. Just if you can qualify a little bit.

I mean, you should have some idea of what you're going to ship that pay ahead. So, it was June kind of a cleanup, and it might be a little bit lumpy, and/or is China actually trending a bit better for you?

I don't know, Blayne, that I'm trying to communicate anything any different than we said on the last call, to be honest with you. We described this year as somewhat first-half-weighted, really no change to that. The June quarter was maybe a little tiny bit stronger in China, but only a little tiny bit. It's too soon for me to -- for us to quantify 2025.

But what I would tell you is I expect next year to be a solid year in terms of spending in China. I'm not going to give you a number yet because I'm not completely sure. But what I wouldn't want anybody to think is it's going away because it's not.

Gotcha. And then I'm just kind of curious, the broad strokes was growth for next year. I know you don't want to give a forecast. But in terms of the moving pieces there, I mean, it's pretty clear leading edge is strong, DRAM has been strong.

I'm just kind of curious as you look into that forecast, if you're willing to venture kind of a view on the NAND business.

Yes. I think NAND spending next year has to be greater than it is this year, right? We're off two years of quite low spending in NAND. I don't know what magnitude. I expect next year, we expect next year, you're going to see a lot of upgrades in NAND.

But too soon for us to give you a number, but I would be shocked if it's not stronger than it is this year. It has to be.

Thanks, Doug.

Yes. Thanks, Blayne.

The next question comes from Joe Quatrochi with Wells Fargo. Please go ahead.

Joe Quatrochi -- Wells Fargo Securities -- Analyst

Yes. Thanks for taking the questions. I wanted to try on the NAND side again. If we just think about your prior peak NAND revenue, ex customers that are obviously now restricted, can capacity upgrade to just higher layer counts support your return to those levels, just given your higher share of higher etch and depth intensity for the transitions?

Joe, if it's just an upgrade your spending will be lower than when capacity gets added, obviously, our share of wallet will be greater. The fact that we lost a pretty large NAND customer in the China region, hard to replace that. I'm not ready to tell you what kind of next year is relative to previous peaks. But I know next year is going to be a stronger year than it is this year for sure.

Yes. And Joe, I think that, obviously, we're talking next year, it's very specific to the demand environment and the upgrade business in 2025. Longer term, I mean, we've laid out, in our view, is that NAND spending rises. And so, it's just a matter of the time frame you're looking at.

And from the standpoint of Lam's business, the etch and depth components and the complexity of tier stacking the precision that's required for implementation of QLC and PLC technologies, all of these skewed toward Lam's technical strengths and also SAM expansion opportunities. I talked about the PECVD, pure carbon gap fill process, which is a new addition to the portfolio for NAND scaling technology going forward. And so, if I go back and I look at where we were in the portfolio, we had to sell, when people used to think of NAND is a very, very strong business for Lam, we've expanded that portfolio quite substantially with the gap fill, the backside stress management, the ALD oxide gap fill process plus the etch and stack debt that we've always had as well as our metallization. So, it's one of growth in NAND demand, but also growth in Lam's portfolio and served market as well opportunities ahead.

So, I think that bodes well for us once the NAND business itself starts to recover.

That's helpful color. And just as a quick follow-up, you talked about global mature node spending being roughly flat this year. Can you just help us understand just kind of how does that break down? I mean, I think clearly, the non-China piece is pretty weak. But just any kind of color there you could help us parse that out.

Yes. You answered your own question, Joe. China is decent right now. Outside of China, it's pretty soft.

And I think you understand what's going on. There's inventory that's built up, four days inventories still need to come down in the mature node, analog, industrial automotive space, and investment won't meaningfully occur until that gets adjusted. So, that's kind of what's going on. You sort of answered your own question.

Fair enough. Thanks.

Next question is a follow-up question from Krish Sankar. Please go ahead.

Hi. Thanks for taking my follow-up. Doug, I just had a quick follow-up. It's a question on inventory.

You spoke about bringing inventory turns down. What kind of -- curious like how to think about inventory next year, especially you're planning for a strong WFE year in 2025. Or do you think most of this inventory would be in a bin, how to think about inventory next year? Thank you.

Yes. Listen, if you think back to when business declined for us last year, a big part of what fell off pretty rapidly was our NAND business. And so, a lot of the inventory that we still have sitting on the balance sheet will support NAND. So, when assuming NAND is stronger next year, and it will be, we will consume that NAND inventory that's been sitting on the balance sheet for a while.

What will offset that to a certain extent is growth elsewhere, where we'll need to procure new inventory. So, I'm not ready to give you an inventory forecast quite yet, but we're continuing to work as we go through the remainder of this year to kind of bring it down, and then what we do with next year will depend largely on the timing of business, the mix of business, the geographic distribution of business, but we'd like to get turns back to where they historically have been and they're not there yet. So, that's how you should be thinking about it, Krish.

Thank you. Very helpful. Thanks, Doug.

Next question is from Melissa Weathers with Deutsche Bank. Please go ahead.

Melissa Weathers -- Deutsche Bank -- Analyst

Hi there. Thank you for taking my questions. I wanted to ask on the leading edge and specifically gate-all-around nodes. I don't think I heard an update to your $1 billion gate-all-around revenues in 2024 target.

So, is that still the case? And then as we think about those nodes ramping through next year, like what's the trajectory of that ramp that we should be thinking about as you move from pilot lines into high-volume manufacturing?

Yes. Thanks, Melissa. I mean, we always make choices about what we do and don't include it in the prepared remarks and gate-all-around fell out this time, just no intended message. In fact, if I look at what happened in the quarter, Lam, again, as we've talked on previous calls, is really positioned quite nicely with our forward-looking etch and depth portfolios.

We really targeted those kind of markets with new tools in selected etch, which is a market we hadn't been in before. And in fact, in the quarter, we had additional selected etch wins for gate-all-around at multiple customers. We targeted investment in ALD films that are specifically needed for things like spacers and gate-all-around, and we had additional wins in the quarter for those films. Often with gate-all-around, we think of those -- they are obviously different technologies, but kind of occurring at the same node, the backside power delivery.

That's an area that is really right in our sweet spot in terms of deposition and etch. And in the quarter, we had wins in backside power in ALD oxide. And so, I would say net-net, I mean, given those wins and what you're hearing from the end markets about the need for high-power computing demand for AI, I think the $1 billion forecast we gave you, certainly, as we move through next year would be going higher. And so, again, that's a combination of rising demand, but also a product portfolio that's both expanding and one in which we're winning share.

And so, there was no message about leaving it off, but thank you for asking the question so we could get that in right at the end.

OK. Thank you. That's all my questions there.

Awesome. Operator, I think that concludes our call. I want to thank everybody for joining us today. We look forward to seeing you at a variety of conferences and interactions as we go through the remainder of the quarter.

[Operator signoff]

Duration: 0 minutes

Call participants:

Doug Bettinger -- Executive Vice President and Chief Financial Officer

Tim Arcuri -- Analyst

Tim Archer -- President, Chief Executive Officer, and Director

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• Transcripts

Research Frontiers, Inc. (REFR) Q2 2024 Earnings Call Transcript

Research Frontiers, Inc. ( NASDAQ: REFR ) Q2 2024 Earnings Conference Call August 1, 2024 4:30 PM ET

Company Participants

Joe Harary - President & CEO

Conference Call Participants

Neal Goldman - Goldman Capital Management Michael Kay - Kay Associates Leonard Lietzow - Private Investor Jeff Harvey - Private Investor Allen Ginsberg - Private Investor

Good afternoon ladies and gentlemen. Welcome to the Research Frontiers Investor Conference Call to discuss the Second Quarter of 2024 results of operations and recent developments. During today's presentation all parties will be in a listen-only mode. [Operator Instructions] This conference is being recorded today.

A replay of this conference call will be available starting later today in the Investors Section of Research Frontiers website at www.smartglass.com and will be available for replay for the next 90 days. Please note that some of the comments made today may contain forward looking information.

The words expect, anticipate, plans, forecast, and similar expressions are intended to identify forward-looking statements. Statements that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions that are part of the Securities Litigation Reform Act of 1995.

These statements reflect the company's current beliefs and a number of important factors could cause actual results for future periods to differ materially from those expressed. Significant factors that could cause results to differ from those anticipated are described in our filings with the SEC.

Research Frontiers undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were emailed to it prior to this conference call either in their presentation or as part of the Q&A session at the end.

In some cases, the company has responded directly to email questions prior to this call or will do so afterwards in order to answer more questions of general interest to shareholders on this call. If you find that your question has been substantially answered as a courtesy and to allow time for other shareholders to ask their questions, please remove yourself from the queue by pressing star two. Also, we ask that you keep your question brief in the interest of time.

I would now like to turn the conference over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead, sir.

Thank you, Paul, and hello everyone and welcome to our investor conference call to discuss the second quarter of 2024. On our last conference call, we anticipated higher royalty income for the second quarter based on leading indicators.

Indeed, compared to the same quarter last year, our royalty income increased by 165%. The first quarter of 2024 was dynamic and the second quarter saw royalty income rise by over 56% from those elevated levels. For the first half of this year, royalty income surged by over 85% compared to the same period last year driven by substantial growth in our two largest markets, automotive and aircraft.

This impressive revenue growth builds on the strong performance from 2023 where fee income increased by 69% over 2022 and overall revenue was up by 109% from the prior year. The second quarter of 2024 marked our sixth consecutive quarter of revenue growth compared to the prior year.

Looking ahead to the second half of this year, we expect Q3 and Q4 royalty income to surpass last year's levels, further solidifying our growth trajectory. We expect our growth this year will come from growth in our existing markets and from new product introductions.

Expenses this quarter were about $105,000 lower, bringing our net loss for the second quarter to just $94,000 or $0.0 per share. Our average cash burn rate has been steadily decreasing. Based on projected revenue growth, I do not anticipate the need to raise additional capital in the foreseeable future unless a strategic reason arises.

We continue to be free of debt and are in strong financial shape. And as of June 30th, 2024, the company had over $1.9 million in cash and cash equivalents and our working capital was $2.8 million. We currently expect to have sufficient working capital for more than the next five years of operations.

Now let's together look underneath these numbers so we can all better understand where we are and what we can expect. Sales of cars using our SPD-SmartGlass technology at Ferrari and McLaren remain quite strong.

Ferrari has stated that in order to maintain the exclusivity of the Purosangue, which uses our SPD-SmartGlass, they will voluntarily limit production to 20% of their total unit production for all Ferrari cars.

Based on these numbers, an extremely high percentage of Ferrari customers are opting for the SPD-SmartGlass roof option. Ferrari just reported an excellent second quarter in terms of sales. Additionally, third quarter production at Ferrari is typically their highest.So if these trends continue with the Purosangue, we can expect higher royalties from it next quarter as well.

Remarkably, even though we're only halfway through the current 2024 year, these roofs have almost equaled the total number of roofs from all of last year. The popularity and high take rates of the McLaren models using SPD-SmartGlass are also evident. Even though we're only halfway through 2024, the total number of routes on just one model of McLaren puts us on track to triple the number of SPD roofs this year as compared to last year.

I also want to take this opportunity to congratulate our licensee Isoclima on the introduction of SPD-SmartGlass on the panoramic roof of the Gemera by Koenigsegg Automotive, the beautiful car made even more beautiful and comfortable by SPD-SmartGlass. Isoclima announced this new program in June.

In our last conference call, we noted with anticipation the IPO of our licensee, Gauzy, and the introduction of a retrofit application by our licensee, LTI, at the AIA show in Washington, D.C. Both took place in early June.

We also highlighted the successful development of an SPD-SmartGlass sunroof for a flagship, relatively lower-priced, midsize model from an Asian auto manufacturer. This program is still on track for introduction, and we, along with Gauzy, are eagerly awaiting the OEM's launch announcement to share more details. There is a meeting about the launch of this car scheduled for later this month.

What's particularly exciting is that the manufacturing cost of products using our technology has decreased significantly, making it feasible for use for the first time in moderately priced vehicles like the one I just mentioned. This creates opportunities for higher volumes of SPD-Smarttechnology in middle-market cars worldwide.

Moving to our second-largest royalty-generating market, aircraft, we also once again had higher revenues there in the second quarter. There's been a fundamental improvement in that market for us as well. This stems from the way that decisions are made.

For general aviation aircraft, private jets mostly, we are on the HondaJet and the King Air and a number of other models. In those and other cases, the OEM made the decision about putting our high-performing SPD technology on their aircraft.

The significant shift is that in larger aircraft made by Boeing and Airbus, now it's the customer that decides. This has been tremendously enabling for our licensees selling SPD electronically dimmable windows or EDWs because the performance in terms of switching speed, being instantaneous, and the wide change in tint also being uniform has made it an easier choice by the customer to pick SPD.

And apart from the obvious benefits of improving the passenger experience by giving them more control over their environment and reducing noise in the aircraft cabin, there are temperature benefits as well.

Half of heat comes from infrared and the other half from solar heat gain from visible light. IR has always been relatively easy to block. It is the visible light where the other half of heat comes from that historically has been challenging. We block 99.5% of that visible light.

Heat inside the cabin has always been a known issue and until takeoff, aircraft had to hook up expensive terminal or auxiliary power of the electricity or run their engines and waste fuel to generate power while on the tarmac.

I'll give you one example of what's been observed. Our licensee and spec tech had done a SPD EDW installation on a LearJet. One day there were two Lears parked next to each other on the ramp, so they were in the same environmental conditions. Both Lears were being worked on that day for maintenance.

One of them had in spec tech's SPD EDW and the other didn't. The maintenance crew said the cabin in the Lear with SPD was 26 degrees Fahrenheit cooler than the one right next to it. Now remember in cars Mercedes tests show that there's an 18 degree Fahrenheit reduction in temperature.

Once we had a NASA scientist at our office at the research frontiers and I asked him why it would be higher in an aircraft and he went to the whiteboard and seven different equations and three diagrams of the fuselage and later he stopped talking and said and that's why and I told him that I simply was glad it worked well.

The first line of defense against heat right now while aircraft is sitting on the ground is trying to prevent the cabin from becoming excessively hot to begin with according to Charles Horning who's a professor of Aviation Maintenance Science at Embry-Riddle Aeronautical University.

He says many of us have been on flights where the flight attendants have all asked passengers to close the sliding windows before they get off the aircraft. That's probably the best thing that could be done to try to keep the cabin from heating up. But here's the problem with that approach.

It's been historically difficult to get passengers to close shades and the flight attendant unions have balked at directing their passengers to do that and rather than simply closing the shades SPD EDWs have proven to be more effective at blocking light than closed shades are.

And I think it's noteworthy that other technologies such as electrochromic technology can actually create unwanted heat. They can actually generate heat and this sometimes has been shown in videos to cause the window to crack in mid-flight because they operate a lot like your cell phone battery.

So electrochromic EDWs automatically switch to their maximum heat transmitting state when a plane is at the gate and notably SPD EDWs automatically switch to their maximum heat blocking state when at the gate. So it's a much more preferable environment and effect.

And it was recently reported about cabins being so hot sitting on the tarmac that passengers were taken off the plane and some passengers were hospitalized. This has caused some to call for more stringent government and FAA regulations about heating the cabin and we are in an excellent solution there.

And the customers themselves are now picking SPD for the larger aircraft. Comlux and Airbus just delivered another ACJ-220 in late June and have another one expected to be delivered later this year and next year they're targeting four to six of these large aircraft with SPD EDWs. Even bigger is the international airline referred to in Gauzy's IPO registration statement. In this case it's for part of their Boeing fleet, so we have Boeing and Airbus.

Now let's discuss the architectural glass market. In our last conference call we highlighted the cost and logistical benefits of an architectural retrofit application for SPD-SmartGlass. AIT, the parent of our licensee LTI SmartGlass, launched this publicly at the American Institute of Architects or AIA show in Washington D.C. that was in early June.

The General Services Administration of the U.S. government or the GSA is the world's largest customer for energy efficient glass and has new mandates and programs to upgrade government buildings for energy efficiency and security. These initiatives are positive drivers for our business and since the AIA show we've identified and are working to scope out some initial government projects for SPD-SmartGlass.

Additionally, the Dynamic Glass Act offers substantial tax credits of between 30% and 50% for adopting SmartGlass and putting it into service, encouraging its adoption in all types of buildings and homes. This legislation will help the private sector adopt SPD-SmartGlass. We have also begun work on private projects utilizing SPD-SmartGlass as well.

Now in the interest of time and to cover as much ground as possible, I've taken a number of the questions that we have received by email and incorporated them in my presentation today. I'd now like to open up the conference to additional questions. And first I'll read and answer some of the questions we received by email and I encourage people to email their questions before the conference call so we can tell our presentation to cover the most ground for the benefit of all shareholders and cover all of the topics of interest.

So here are some of the additional questions that were emailed to us and in some cases I'm combining several related questions into one. Can you please talk about some of the developments with your competitors in the SmartGlass industry?

Well as many of you know, View recently filed for bankruptcy and Crown ElectroKinetics dodged another delisting bullet on NASDAQ by effectuating a second reverse stock split. This time it's 150 to 1 reverse stock split. So if anyone's keeping track they've done a cumulative of 9,000 for one reverse stock split during the past year or so and pre the reverse split Crown would be trading at three one hundredths of a penny as of yesterday's close. So that's why they did the split.

And they've yet to produce their long-promised smart window inserts after many years of it being just around the corner. And I actually welcome the day if it ever comes when they finally do that, because I think their product in a side-by-side comparison may actually be our best salesperson.

Another company, Halio, which used to be known as Kinestral and has received substantial glass company investments is in the process of liquidation. We and our licensees actually have been approached to see if we want to buy any of their equipment or hire some of their senior executives. And the severe negatives in the SmartGlass world fortunately are all or fortunately for our shareholders not for the other companies are all related to other technologies.

SPD is doing quite fine in comparison and on a positive note for our industry and squarely in the SPD-SmartGlass column our licensee Gauzy had a successful and traditional IPO rather than trying to go public using the SPAC route and raised their targeted $75 million. They'll be using this money to expand production lines, further R&D and increase their sales and marketing. All of this helps Research Frontiers and the SPD-SmartGlass industry.

And if you remember my comments on our last conference call together I noted that to do the SmartGlass industry correctly, if you're a manufacturer or a marketer and Gauzy is both, you need production capacity, factories, people and a diverse geographic footprint to cover the world and the industries that SPD-SmartGlass serves and now with their IPO Gauzy has expanded resources to do all of that.

I would also pay attention to their actual quarterly financial filings and investor calls. They'll be a good source of information not only about Gauzy but about Research Frontiers as well. And as I noted last time our shareholders now have the benefit of two leading players in the SPD industry Research Frontiers and Gauzy as public companies releasing information and announcing developments. And while we're on this subject I wanted to address another shareholder question we received.

As we noted many times Gauzy film sales is the leading indicator of sales of SPD Smart products, end products. Gauzy sells their SPD film to our end product licensees such as the glass laminators who then fabricate them and sell the finished product to the customers such as the automakers, the airlines and the aircraft manufacturers.

One of our shareholders Sam Finta emailed us his questions. Did you see the Ferrari Purosangue showing up all over the place with a very high percentage having the SPD-SmartGlass? Sam if you knew how high it was you'd be amazed. The Cadillac CELESTIQ has also been spotted on the road in addition to the McLaren that has offered SPD for years.

All three of these are very high-end vehicles ranging from $400,000 to $700,000. Can we assume that the royalty on these vehicles are much higher versus a $50,000 to $100,000 vehicle such as the Mercedes where it was a $2,500 option? The Ferrari SmartGlass roof is a $20,000 option. It would seem that we collect a far bigger royalty than we used to on a $2,500 option.

Well, thanks Sam for that question. And as many of you know we get our royalty based on the selling price from the glass laminator or the end product licensee to the car manufacturer. So it's the selling price of the glass to the car manufacturer. And we can only collect the royalty once. So we currently collect it on the highest practical value area of the supply chain which is on the end product sale rather than on the SPD film sales.

And as you would expect this royalty could be higher on more expensive cars because the bells and whistles that go along with the SPD-SmartGlass roof are often part of that selling price by the laminator to the customer.

As a practical matter the higher priced cars can put more of those bells and whistles and additional functionality into their roofs because of the price point that they sell at. So the higher the price of the SmartGlass roof the higher our royalty and the higher the price of the car, the more features that can be put into the roof systems.

Oh that's clear. So it's still only on the selling price from the laminator to the car manufacturer, but usually that's a much higher end piece of glass that they're selling, so it's selling for a higher price and the royalty should be higher per car.

Now for high volume cars such as the upcoming Asian auto manufacturer in the mid-price range that we talked about, as you could expect the economies of scale and also just higher sales volumes and purchasing power would result in a lower selling price for the SPD roof from the licensee to that automaker. And there we'll get a lower royalty per car but presumably much higher overall royalties based upon the higher expected volumes.

So getting back to Gauzy's SPD film sales are a leading indicator for activity for researcher interiors and for sales buyer and product licensees where we generate our royalties. Gauzy gave guidance about their second quarter revenues about two weeks ago. And their second quarter 2024 revenues are expected to be in the range of $24 million to $24.5 million, which is up 22% compared to the prior year quarter.

First half 2024 revenues are expected to be in the range of $48.7 million to $49.2 million, which is up 31% compared to the prior year. This basically puts Gauzy on a target to generate almost $100 million in revenues this year and I'm going to read a quote from Eyal Peso who is the Gauzy co-founder and CEO and he's also one of our newest and esteemed directors.

He noted -- our exceptional start to 2024 extended into the second quarter with revenue that is expected to exceed expectations. As expected the robust pace of revenue growth in the first half is driven by a number of key customers that accelerated a portion of their full year purchasing commitments to earlier in the year to meet robust demand.

We believe we are poised to produce strong double-digit revenue expansion in the second quarter and then even more notably Mr. Peso continued in this press release. Since our IPO we continue to be laser focused on executing against our goals.

We are seeing OEMs expand utilization of our SmartGlass technologies, major cities replacing mirrors on their bus fleets with their ADAS and CMS systems and our products being incorporated into iconic new commercial and hospitality projects. We are highly excited for the future and the progress we are making to fully deliver against our plan for 2024 and beyond.

Okay. So here's some more questions that were emailed to us, from Steve Azer. Also can you update on Hyundai and did they pull out of their investment in REFR Gauzy? Well, as many of you know Hyundai was a strategic investor in Gauzy. And I saw a confusing report on one of the websites that talked about a Hyundai exit from their investment in Gauzy. But I think that's because they consider an IPO an exit event. But I asked and I found out Hyundai did not sell its Gauzy stock before or during the IPO and is still a strategic investor in Gauzy, so they didn't sell anything.

Also next question from Steve Azer. Also Gauzy had higher revenue forecast, will this be tied to future REFR sales? Yes as I noted earlier in my presentation Steve, SPD film sales are a very good leading indicator of our royalties. And if you start tracking things you'll probably see a correlation.

Finally as another question from Steve, finally my concern is still the lack of any new positive news releases over the last few years as it seems there is less business coming in. We had more press releases years ago but it seems now less news. Thank you.

I wouldn't say there's less business coming in if you look at the revenues there's actually a lot more business coming in and Steve you've been a long-term and loyal shareholder and never just a cheerleader, so I really appreciate all that. But I think the fact that we've moved from being a technology company in the development stage to one where products are used by many different large companies like Ferrari and General Motors and Mercedes, McLaren and Boeing and Airbus and Bobcat and others has maybe paradoxically reduced our ability to make announcements.

In the past we can announce the entry of a new license agreements and this type of announcement was in our control. But now that we basically have the who's who of the major companies in the glass industry and their customers as licensees and customers we have less new licensees that need to be signed on board. And with the major companies as customers industry practiced by us and by our licensees such as Gauzy is that we must wait for the customer to announce. And that may change somewhat in the architectural industry because less keeping things close to the vest by the customers there.

But until then we must wait for the customers in the automotive and aircraft industries to speak first. And those are our two biggest industries right now, so it's the world we live in. And as I noted, that might change as we move to architectural. But in the meantime the numbers will do the talking. And I think this quarter and last quarter they've spoken loudly both we and Gauzy have had high growth especially in the first and second quarters of this year as we all gain more and more traction.

We've discussed a lot of exciting topics so far today. And now I'll ask our Operator Paul to please open up the conference to any additional questions people participating today might have that we have not already covered. And some of our largest shareholders have suggested trying to keep these conference calls much shorter.

So I'm going to ask your assistance with this. If your question was substantially answered but you need more details feel free to email us. And as you've done in the past we've had very productive conversations as a result. And today you know please try to keep your questions short and focused.

So Paul, if you wouldn't mind opening up the queue for questions.

Question-and-Answer Session

My pleasure. [Operator Instructions] And our first question comes from Neal Goldman of Goldman Capital Management. Your line is open. Mr. Goldman, please go ahead.

Neal, you may be on mute.

Neal Goldman

Okay. Is that good?

Oh, there we go. Hi.

Now we can. How are you doing?

Good. I'm doing great. First question is Gauzy was up 22%. We were up 56% in royalties. Who are the other key distributors for us?

Well, they're supplying the film and then it depends on the markup. So Ferrari is a substantial portion, McLaren, Cadillac is a small contribution by one of the same licensees that's doing the Ferrari. And then you have the aircraft markets, which is vision systems and inspect that primarily. So, those are the things where you have. The film price is basically the same for all the industries. The end product price can change dramatically, depending on who the customer is, in the bells and whistles, like I talked about before, can contribute also. And it's all good.

Before Gauzy does major expansion with the incremental funds they got from the IPO. If they were operating at capacity today, if demand was there, what kind of incremental revenues would be receiving from Gauzy?

Well, that's a hard question to answer. So if they were at capacity, it would probably be about a million square meters and figure the average Ferrari sunroof is, 1.267 square meters, roughly 1.3 square meters. A typical sunroof may be one meter. And then if you have the front and back panoramic, it could be a meter and a half to 1.8 meters. So that'll give you kind of an idea of the number of sunroofs. But if they're at a million square meters capacity, I imagine that the royalty per car because of the volumes will be lower for us. So, it could be 25, 50, 75, 100, 150 or even $200 per car, depending on the dynamics. If that same film is going to aircraft, a million square meters could produce a couple hundred million dollars in revenue.

And what would be our share?

Say that number?

So it really depends on the market it goes to, like the same 1.2 square meter, square foot window, for example, would sell for a lot less if it was put into a sunroof than if it was put into an aircraft window, just because the selling price to the -

And what did you say the price would be if they were all aircraft, the incremental volume to us?

Probably about $100 million. I'm not predicting that because, there's wide planes. But that'd be the high end of the market.

Okay. But that would be –

Yes, that would be probably the highest price per square foot we were getting.

Yes. $3 a share just from that.

Okay. Right. Thank you, Joe

Thanks, Neal. Bye.

And our next question comes from Michael Kay of Kay Associates. Your line is open.

Michael Kay

Hello, Joe.

Hey, Michael. How are you?

Okay. Let me just. Okay. Just a dissenting voice about something. One of the reasons I'm still in Research Frontiers, never sold a share for the last 25, 50 years is because your conference calls are so detailed, you entertain questions, and you don't put any time limits compared to some other companies where I'm a shareholder, where I can't even get on the line. Of course, they have very strict timeframes. And so, I think that's a tremendous plus. I don't even care.

Thank you. And it's a self-serving plus, because sometimes the only way to really get information when you see the noise of a stock price that fluctuates is to actually listen to what's going on. And when you have a company that happens to be in industries where you can't always talk about everything, sometimes these conference calls are the best venue for doing it. So it's our pleasure to do that. Thank you.

Yes. And I really appreciate the fact that you don't put time limits, take email questions, and give everyone a chance regardless of how many shares they own to answer questions. I think now, we have now a consistent earnings the last few quarters, uptrend, things with Gauzy. The fact that any technology, given the climate change, which now I think even the most ignorant individuals who thought it was a Chinese hoax must agree just by reading the newspapers or listening to the news, that any technology that could show to decrease interior temperatures certainly is a major plus.

And I'm wondering, what is the company doing to inform institutions, money managers? There are mutual funds, micro-cap funds about the existence of research frontiers, because even if they buy a car with SPD, they may not realize that that has been developed by Research Frontiers. So will you be initiating any systemic program to inform money managers about the existence and prospects of the company?

Okay. Excellent question, Michael. So first of all, let me say that regardless of whether climate change exists or doesn't, it's always good to be energy efficient and increase comfort and security and all of the things that SPD does. Back in 1965, I'm not really sure that the world was thinking so much about those things and now they are, fortunately, but it's always a good thing. So we would be doing it whether there was climate change or not, because conserving resources is always a good thing. In terms of making this known, I'll tell you what we won't do and what we will do if I could do that.

Yes, there's been a number of companies that what the SEC refers to as ESG washing where they basically just tout ESG and they've gotten into big trouble because there's nothing underlying that. We're probably the opposite. We've been a green company since day one before the term green was even coined and that's fine. What are we going to do to bring this to the attention of money managers? Well, the message is very, very consistent, okay? And now it's being amplified by another licensee that is even dealing with larger money managers and that's Gauzy is you talk about the benefits of the technology and what you're doing. Electric vehicles, we're increasing the range of the driving range. Cars were increasing fuel economy.

Buildings, we're increasing energy efficiency. Planes, we're doing, we talked a lot about the energy efficiency aspects and the comfort aspects and there's the security aspects as well. So you talk about the messages consistently. And we were talking about CO2 reduction in vehicles before it became fashionable to do that, because it's the right thing to do. So we'll continue to do that. But now we have kind of a partner with a megaphone next to us doing the same thing. And what you're having also is a lot of the noise that used to be in the market dropping away. What do I mean by that? Well, you had a public company view that is now no longer public.

You have a company, Crown that was promising a smart window technology and hasn't yet delivered it. You had companies like Halio, which were getting a lot of very favorable publicity, probably right up until the day they liquidated. So there's a lot of these players that have tried and failed, tried and failed, tried and failed. And you're going to see more of them. We've tried and succeeded. And we've done it in a way where it allowed us to remain in the game as the markets developed around our technology, it allowed us to remain in the game to have the resources to help our licensees and allowed us to remain in the game so that these licensees can build their businesses like Gauzy did and some of our other licensees around our technology.

So, you have more and more players out there that are highly credible, highly, well resourced and focused on this, carrying that same message as we are. And, if you look at the post Gauzy IPO, Research Frontiers did well just based on the attention they got. Because you don't have to be a genius to look at a company like Gauzy, look at the reliance they put in SPD-SmartGlass as a key technology and come to us. So all of these things are very positive and we'll continue to build on them.

Thank you. One more brief question. Is Gauzy basically the only company or the major one that does the production of the film? Or is it like, is it Hitachi or some other company, is it Isoclima?

Well remember, they bought Hitachi's SPD business from them. So yes, that was in their registration statements. That's a very positive development, because now they've expanded capacity through acquisition and they've also expanded expertise through that process because, Hitachi was a very smart company, I could tell you. And they developed a lot of good know-how around SPD technology, which now is residing with Gauzy and allows them to really accelerate what they're doing even further.

Does Isoclima make a film?

They don't make a film. They buy it. They buy it from Gauzy.

Thank you and continued success to you and the company, Joe.

Thanks, Michael. Hope to see you soon.

[Operator Instructions] And our next question comes from Jeff Harvey of Private Investor. Your line is open.

Jeff Harvey

Hey, Jeff. How are you?

A couple of things. First of all, I have to say, I think the Gauzy IPO was one of the worst IPOs I've ever seen in my 35 years in business. I don't know what happened there, but the underwriters are supposed to support the market after the initial offering and they certainly didn't do that very well.

No, judging from the stock price, they didn't. But Gauzy did get its target price and the $75 million they were looking for. So they have the resources they expected. But it would be nice if you would see price appreciation. And look, they had a very good first quarter compared to last year and they had an excellent second quarter. And we'll see what the market does when the actual numbers are released.

I think I missed what you talked about the middle level car that's going to be introduced from Asia. When do you expect that to happen now?

As I said, there's a meeting at the end of this month about the launch. So we'll know more about it probably than us and Gauzy.

Okay, great. Thank you very much.

And our next question comes from Allen Ginsberg of Private Investor. Your line is open.

Allen Ginsberg

Yes. Hi, Joe. How are you?

Hey, Allen. How are you?

Okay. Is there going to be a breakdown at some point between what Gauzy does with PDLC as opposed to SPD, because that would be helpful to see what Gauzy is doing with both technologies?

I doubt it because the SEC rules kind of require companies to lump things into what they call business units. So, Gauzy, if you look at their business units, they have ADAS and they have other things like that and they have smart film. So I think this would be probably combined with smart film.

Okay. Because that would be helpful, if that would be possible, but --

Sure. But remember, they also have a much higher margins on the SPD business. So they and we have a vested interest in more of their business being that if their interest is revenue growth and profitability, and I read you the quote from the OpEx [ph], so I think you can see the same thing.

Just as a follow-up to a question that was just asked about getting the word out to various stock people. Wouldn't it be a good idea to hire a financial public relations firm at this point since you have so much going on and not just Gauzy?

We've been interviewing, yes.

Okay. Good. I hope you do. Thank you.

Thanks. Thank you.

And we have a question from Leonard Lietzow of Private Investor. Your line is open, sir.

Leonard Lietzow

Joe, since they raised their $75 million and since in their notes in their S1 where they had contracts on all of the SPD film for this year that they could make. I would assume that they're expanding their line. I think they could put a second line right next to the one they got right now.

That's exactly right. They've laid out the second line if they wanted it to be in Germany right next to the first one in the Stuttgart area. Or they may decide they're going to do it in Asia near the other customer or the U.S. depending on where the need is logistically, but film is pretty easy to ship wherever it needs to be in the world. So if it was all done in Germany and shipped worldwide, there's plenty of companies that successfully do that with even harder things to ship and film is relatively light and easy to ship. So it could be anywhere, but they have the ability to do that.

With architects and that coming on and with autos and airplanes using everything that they can make right now, I would think that they have to get something up and running pretty good if they're going to be sell, that's a big number?

We saw this --we've seen this now twice, where large capable companies develop SPD production lines, first Hitachi and now Gauzy. And once you know what to build, and that's part of the know-how, and how to configure it, which is another part of it, because there's a whole system of rollers and other things and tension that you put on the film and things like that that becomes very important in keeping yields up. Once you know how to do all that stuff, it's not hard to replicate it. And assuming you had the building permits or the factory line or the warehouse was already there, it doesn't take more than I would say six to eight months to get another line up.

Okay. Because that's the only way we can continue to grow revenue is to be able to sell more film.

Right. And as long as Gauzy is making money on that film, they have every incentive to keep making more and more factories.

Okay. Thank you.

Yes. Thanks.

Okay. I am seeing no further questions in the queue. I'll turn the call back over to our host.

Okay. Well, look, as a reminder, if we haven't fully answered any questions, or either email to us or in our presentation today or in the live Q&A, please feel free to call or email us. And now I'm just going to make a few closing remarks.

The outlook for the SmartGlass industry remains extremely promising, bolstered by growing revenues in automotive and aircraft and increasing regulatory support like the Dynamic Glass Act providing substantial tax credits for adoption that should bring other markets like the architectural market more mainstream for us as well.

Research Frontiers is a recognized leader with an innovative, high-performing and reliable solution. And we and our licensees are seeing increasing demand from respected, iconic brands worldwide and from their customers.

And in some industries where the customer can choose, they are selecting SPD as shown by the new Airbus and Boeing programs. And our close strategic partnership with Gauzy continues to create opportunities in multiple sectors as we continuously work together on business development and product innovation. As a matter of fact, we have a meeting on Monday coming up together.

Gauzy's recent IPO also has brought greater transparency and resources to the industry and their expanded production and marketing will further reduce cost of using SPD-SmartGlass and highlight the immense potential of SPD technology to an ever-widening audience of customers and investors.

And in our last conference call, we predicted higher royalty income for the second quarter based on the leading indicators that we saw at that time, and we were right. We achieved this and saw a 165% increase compared to the same quarter last year, and we had a great first quarter this year, and our second quarter royalty income rose over 56% from those elevated levels from the first quarter.

And if you go to the first half of the year, our royalty income increased by over 85% driven by significant growth in our automotive and aircraft markets. And looking ahead, we expect Q3 and Q4 royalty income to surpass last year's levels.

And this growth, just to put it in context, builds on a very strong 2023 where pre-income increased by 69% over 2022, and overall revenue was up 109%. And in the second quarter of 2024, it marked our sixth consecutive quarter of revenue growth compared to the prior year. So you got this now sustained revenue growth.

And I think I mentioned in prior calls that as we get further and further along, revenues are going to look less choppy. You're not going to have a lot of up and down quarters. They're mostly going to be in one direction, and we all hope and work towards it being up and we got it.

And looking ahead, we expect automotive and aircraft revenues to continue rising in the coming quarters. And that's driven by new product introductions, the introduction of new automakers, offering SPD-SmartGlass on the new car models, and increasing penetration at existing customers. And of course, the retrofit market for buildings also represents a significant new growth catalyst as we work to enable smarter, more sustainable infrastructure worldwide.

So as we conclude today's call, I want to thank our shareholders for their steadfast support. It's really helped us all. The momentum we've built over the past six quarters evidenced by our consistent revenue growth and successful strategic initiatives positions us strongly for current success and future opportunities.

Our SPD-SmartGlass technology is increasingly recognized as a standard of excellence in the smart glass world, further validating our leadership in the industry. And our industry itself has become stronger, at least the SPD part of it, with our licensees gaining more resources to expand and our technology being adopted across diverse industries and for new uses.

So we're constantly gaining more traction, leveraging our innovative energy efficient light control technology and our strong partnerships to drive further advancements in value creation for our shareholders and for our industry. And I want to thank you all for being part of our efforts and we look forward to sharing more milestones with you in the near future. Thank you all very much.

This concludes today's conference call. Thank you for attending.

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